There is perhaps no other country on earth whereby gambling is as universally accessible and widely practiced on a daily basis. At the same time the gaming market is not comparable to any other. Whilst there is a general prohibition on gambling, including casinos under the Penal code, the pachinko industry has grown to be an integral industry to japans economy, culture and lifestyle. This report will explain to the reader, in light of the prohibition on gambling, the legal basis for this growth.

Despite the sheer size of the industry the pachinko market has been in decline in terms of popularity and revenue. New regulations were brought into effect in 2004 which has sent shockwaves through the industry. Gambling compliance analyses these new regulations and their effect on the industry in the future.

In addition to the comprehensive legal analysis of the pachinko and pachislot industry, the report covers other aspects of gambling in Japan including officially managed races, lottery and casino.

This report is an absolute essential for the executive who wishes to have an up to date legal analysis of the gaming market in Japan. It is also an important research tool for lawyers, analysts and other professionals who wish to be kept abreast of gaming developments from a legal perspective.

Table of Contents    

1. Background

2. Regulatory Environment

2.1 The General Prohibition on Gambling
2.2 Pachinko and Pachislot
2.2.1 The Historical Development of Pachinko
2.2.2 A Manufacturers Definition of a Pachinko Machine
2.2.2.3 The three Types of Pachinko Machine
2.2.3 Definition of Pachislot from a Manufacturers Perspective
2.2.4 Regulation of the Pachinko and Pachislot Industry
2.2.4.1 The Approval Process for Pachinko and Pachislot Machines
2.2.5 The Applicable laws – Pachinko A Non Gambling Business
2.2.6 The Tri-Party System - A Tenuous Legal Status?
2.2.7 The July 2004 Regulation Changes – A Significant Adjustment for the Industry
2.2.8 Smoking in Pachinko Parlors
2.3 Japans Officially Managed Races
2.3.1 Horse Race Betting
2.3.2 Bicycle Racing
2.3.3 Motorboat Racing
2.4 Mahjong
2.5 Lottery
2.6 Casinos
2.6.1 Proposed Casino Structure
2.6.1.1 Legal framework proposed
2.6.1.2 Casinos to be Integrated resorts
2.6.1.3 Limit on number of casinos
2.6.1.4 The proposed regulatory structure:  A two phase selection process for casinos
2.7 The Legal Status Online Gambling

3 Taxation

3.1 Taxation of Pachinko
3.2 Taxation in relation to Racing

4. Problem Gambling

5. Legislation

6. Money Laundering

6.1 Pachinko Money Laundering Funding Pyongyang?

7. Future and Recent Developments

8. Regulator Details

9. Predominant Manufacturers and Operators

10. Further resources

11. Endnotes