A tight deadline
Imperial Pacific International (IPI) could lose its casino license after July 10 if it does not comply with three orders issued by the Commonwealth of the Northern Mariana Islands (CNMI) gaming regulator.
The Commonwealth Casino Commission (CCC) made the three orders effective on June 25. The first requires the casino operator to appoint a new CEO within 15 days, which puts the deadline at July 10. The second mandates IPI to honor its financial obligations to the CNMI government and private vendors. The third, due within 30 days, requires IPI to have enough money set aside to cover three months’ worth of payroll.?
I’m sorry to say, we have to revoke the license and the game is over.”
The chairman of the CCC, Edward C. Deleon Guerrero, said on Monday that the failure of the casino operator to meet any of these orders will not be tolerated. If any of the orders are not followed, Guerrero emphasized: “I’m sorry to say, we have to revoke the license and the game is over.”
Point of contention
Imperial Pacific takes particular umbrage with the order regarding the payroll funds. The CCC stated on Monday that the money set aside to cover payroll needs to be placed in an account in Imperial Pacific International’s name with a US or CNMI bank. For the required three-month period, this reserve cache will be $1.4m.?
Imperial Pacific argued against this stipulation as it has concerns that the money could be seized or frozen in order to pay a former contractor, Pacific Rim. Company bank accounts have already been frozen after a US federal court ordered Imperial Pacific to pay $5.6m to Pacific Rim for a promissory note breach.
it is up to Imperial Pacific to resolve the issue with Pacific Rim
The CCC does not plan to get involved in this dispute and said that it can do nothing to help Imperial Pacific bypass a court order. Guerrero said that it is up to Imperial Pacific to resolve the issue with Pacific Rim to ensure that the payroll reserves are protected.
Uncertainty abounds
The development of Imperial Pacific’s Saipan casino resort has been delayed multiple times over the years. It was originally supposed to be finished by August 2017, yet three years later, it is still not complete. The latest planned completion date is now August 2022.
Most recently, Imperial Pacific recorded a $503m loss in 2019. With the coronavirus pandemic closing IPI’s “temporary” casino on the resort site and heavy restrictions on travel in the Asia-Pacific region causing low numbers of high-roller visitors, 2020 is also looking to be a tough year for the company.?