Federal Group, the oldest casino business in Australia finds itself fighting against change as the government moves to end its exclusive licence in Tasmania. Although this change is intended to happen within the next two years, the operator claims it cannot go forward as it has received no such communication from the government.
Federal Group is responsible for opening Australia’s first legal casino in 1973. Over the past 50 years, it alone has held a license for Tasmania’s electronic gaming machines (EGM).
The 2003 Deed between the Crown and Federal Group specifies a Rolling Term that “ensures the company is provided with at least four years’ notice of any changes to the arrangements.” The agreement further stipulates that the earliest date any new gaming provisions can be applied is 1 July 2026; however, Tasmania’s Liberal government is seeking to end the group’s monopoly by 1 July 2023.
A Federal Group representative commented, saying,
“We would urge the Tasmanian Government to remove the proposed amendment and to end the 2003 Deed of Agreement at the conclusion of the rolling term period, therefore honouring the terms of the 2003 deed.”
The company added that in addition to annulling the deed, the proposed changes would “remove the capacity for any compensation to be payable to a party.” A new report projects that the group is predicted to lose close to $25m per year, nearly a quarter of its 2018-19 takings of $108m.
Making its case, The Tasmanian Government said,
“The legislation, which will be introduced into the Parliament later this year, implements the government’s policy which was clear that the new arrangements would start in 2023 and Federal Group supported this policy at the 2018 election.”