Nepal orders closure of two casinos for failing to pay royalties

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Licenses of two casinos have been revoked by Nepal’s Ministry of Culture, Tourism, and Civil Aviation after they failed to pay royalties. In the first week of February, the government had warned of action against non-payment of royalties by the casino operators. The casino sector in Nepal is believed to be employing around 15,000 people.

Earlier last month, Mike Bolsover, the CEO of Nepal casino operator SHL Management Pvt Ltd was barred from boarding a scheduled flight out of the Himalayan country due to the company failing to pay its taxes on casino operations at its two Nepal casinos – Tiger Palace Resort Bhairahawa and The Millionaire’s Club & Casino in Kathmandu.

According to the local news portal myRepublica, the casinos at the Yak & Yeti Hotel in Kathmandu and the Dreamland Hotel in Nepalgunj have been ordered to close after failing to pay their royalty dues despite repeated government requests. The five-star classification of the Yak & Yeti Hotel, which has run a casino since 1992, has also been revoked, with the ministry writing to the Prime Minister’s Office, the Council of Ministers, and the Ministry of Home Affairs to aid in the implementation of its decision.

In the records… the corporation has still to pay arrears up to fiscal year 2020/21, renewal fees for FY2021/22 and royalty fees for Rs 420 million (US$3.5 million),” said Prem Bahadur Ale, Minister for Culture, Tourism and Civil Aviation. “According to the law, the casino operation licence and hotel level classification certificate have been revoked.

Dreamland Hotel’s licence was cancelled because it failed to pay royalties of Rs 3.8 million (US$31,500) and ignored multiple written requests. Casinos in Nepal reopened in September-October last year after an 18-month closure due to COVID-19. The Nepal government had waived an annual royalty fee for all casinos that had been paying their yearly fee on schedule up until the commencement of the pandemic for the fiscal year ending 30 June 2021. Only eight or nine casinos, according to a report, were eligible for such a waiver.

Like Goa and Sikkim in India, the curbs on the casino industry in Nepal due to Covid19 have led to economic devastation in the tourism industry. “The casino operators are resuming their operations, in line with the decision of the District Administration Office of Kathmandu on September 1 to allow economic, social, and business activities by following health safety protocols,” the Nepal Casino Association (NCA) said in a statement in September 2021.