Imperial Pacific Blames COVID-19 for Failures, Seeks Casino License
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Posted on: June 16, 2021, 11:08h.
Last updated on: June 16, 2021, 03:05h.
Imperial Pacific International (IPI) is seeking help from the Saipan Superior Court in having its casino privileges restored. The company’s gaming license for its Imperial Palace Casino on the US Pacific island was suspended indefinitely in April.
In Saipan Superior Court, IPI has filed an administrative request for a judicial review regarding it being forced to halt gaming operations at its $3.9 billion integrated resort.
The Imperial Palace Casino suspended gaming operations in March of 2020 because of the COVID-19 pandemic. The casino has not been allowed to reopen because of the Northern Mariana Islands’ Commonwealth Casino Commission (CCC) revoking Imperial Palace’s casino permit earlier this year.
In its rescinding of the casino permit in April, the CCC said Imperial Pacific failed to pay its 2021 $15.5 million licensing fee and $3.1 million yearly regulatory fee. The gaming regulator additionally revealed that IPI failed to make good on its $20 million required contribution to the island’s Community Benefit Fund in both 2018 and 2019.
“We are suspending the license indefinitely until IPI complies,” declared CCC Chairman Edward DeLeon Guerrero.
Pandemic Problems
In court filings, Imperial Pacific says COVID-19 is responsible for its financial shortcomings, and that the global pandemic should qualify as a natural disaster.
Pursuant to the force majeure clause under the Casino License Agreement, the Licensee is not required to pay the Annual License Fee in the event of natural disasters,” IPI attorneys argued. “However, the Commonwealth Casino Commission raised disputes and alleged that the pandemic does not constitute a natural disaster or force majeure.
“As a result, the Licensee has filed a review with Superior Court in Saipan to determine whether the pandemic constitutes a natural disaster or force majeure. If it is determined that the pandemic constitutes a natural disaster or force majeure, the Licensee will not be required to pay the Annual License Fee,” the judicial review plea contends.
Trading Suspended
Imperial Pacific International is publicly traded on the Hong Kong Stock Exchange. But its trading was suspended in March after shares essentially became worthless. Each IPI share at the time was trading at HK$0.01 (US$0.0013).
IPI reported a HK$2.85 billion (US$370 million) loss for 2020. Revenue totaled just $3.4 million. But that didn’t curb enthusiasm from the company’s leadership.
“Despite the current impact from the COVID-19, we believe visitation to the Island of Saipan still has great potential in the long run benefiting from the island’s favorable weather, stunning attractions, location, and flexible visa policies, with more hotels to be built and opened,” an IPI statement in April announced.
But earlier this month, Cui Lijie, executive director and chairwoman of the IPI board of directors, resigned. IPI’s largest shareholder, Cui became a billionaire by founding a VIP junket business in Macau in 2009.
Cui remains the largest IPI shareholder. She controls a nearly 61 percent stake in IPI through her investment firm Inventive Star Ltd. She’s been accused in lawsuits from workers as having a “pattern of obstructionist and disobedient behavior.”
Last month, a judge in the US District Court for the Northern Mariana Islands ruled that IPI must pay seven former workers $5.43 million for injuries they incurred during the construction of the resort.
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