Greece’s casinos have been hard hit by the corona lockdown and have requested financial support from the government. Sales fell by 75 percent, but losses were also recorded before the Corona crisis. The reason is an anti-smoking law introduced in 2019. Can the Greek gaming industry survive the downturn?
The ten casino companies of Greece will reopen between July and September 2020 but are on the verge of bankruptcy economically. The sales of the already ailing operators have plummeted by around 75 percent under Corona. For this reason, the industry has now sent a cover letter to the tax authorities and asked for financial support.
The letter is addressed to Finance Minister Christos Staikouras and his deputy Apostolis Vesyropoulos. In addition, the president of the Greek gaming authority HGC (Hellenic Gaming Commission), Evaggelos Karagrigoriou, is addressed. In order to support the industry on its way out of the Covid 19 crisis, among other things, a reduction in tax payments is required.
As the operators explained, the step was necessary to secure the liquidity of the industry during the opening phase. Eight out of ten companies are severely affected by the effects of the pandemic – a tax cut could therefore help to save over 5,000 jobs. To save the day, a discount of 25 percent on the current tax of 57 percent or 20 percent is proposed.
The current situation of the casinos is coming to a head with an anti-smoking law introduced in 2019. According to the operators, the implementation led to a loss of 25 percent in sales last year, although the year actually promised good business due to increasing tourism. Now the casinos fear that the regulation will also have a negative impact on operations as a result of the reopening.
Consideration of new licensees
A new licensing system has been in effect in Greece since October 2019, with significantly more favorable taxation of 20 percent. The problem is that most operators have already applied for the new licenses but have not yet received them. With this in mind, the Greek casinos ask the tax authorities to take the exceptional situation into account.
Due to the Corona crisis, some operators may no longer be able to meet the Greek license conditions. Financial reserves between 200,000 and 500,000 euros and credit insurance are required here, for example. It is also argued that it is currently not possible for some operators to send all the necessary data to the gambling regulator.
According to reports in local media, the operators are now asking for the deadline for submitting license applications to be extended to the end of the year. The period is necessary to reposition and compensate for losses. Furthermore, there is a demand that the industry should continue to be taxed on the basis of the new gaming law, so that competitiveness is maintained.
Last year, Greece attracted attention with the Hellinikon casino project, and Mohegan received the license at the end of January. The US casino giant recently announced that it wanted to start building the resort on schedule despite the corona crisis. However, the project is currently on hold due to a lawsuit filed by Hard Rock International. The two had previously fought head-to-head.
The final start of the project now depends not only on the Covid-19 situation, but also on the court decision regarding the licensing. At the beginning of January, Hard Rock’s application was rejected, among other things, the group was accused of lacking experience in casino construction. Hard Rock recently announced that it would ultimately receive the Hellinikon licenses after all. It remains to be seen whether this will happen.
Largest urban construction project in Europe
It has been clear since March 2019 that the old Athens airport should become a casino. The 8 billion euro project is currently the largest urban construction project in Europe. The Hellinikon site covers over 620 hectares, making it three times the size of Monaco. So far, however, the ruin is still in a neglected condition
The resort’s casino area is said to be over 15,000 square meters and feature 120 gaming tables and 1,200 machines. In addition, a five-star hotel with at least 2,000 beds is planned. Various leisure establishments such as a shopping park, a theater complex, several fine restaurants, a museum, 8,000 apartments as well
a separate port will be built in the area.
The Greek real estate company Lamda Development is responsible for the project, and various international companies are also involved in the project, including the London architectural offices Foster + Partners and Charles Anderson. The real estate company Al Maarbar from Abu Dhabi is also involved. The mammoth project requires a total of over 70,000 workers. Commissioning is unlikely before 2025.