Lawmakers and gambling industry members have raised concerns over a government plan to lower entry barriers for foreign investors into the local casino business.

The Ministry of Knowledge Economy on July 23 announced a revision to a law on business within the nation’s free trade zones, which aims to boost the inflow of overseas capital into the local gambling industry.

Thus far, foreign investors who want to operate a casino here have been required to invest $300 million and undergo evaluation for final approval.

Under the revision, however, the Ministry of Culture, Sports and Tourism will carry out pre-qualifications screening for those who make an initial investment of $50 million.

With the screening taking 60 days, only the selected investors can apply for the final approval after extra procedures such as an additional investment of $250 million.

As other existing regulations are expected to remain the same, investors are required to invest more than $500 million in the next two years after opening a casino. When they fail to carry out requirements, their business license is expired.

However, experts and lawmakers are resisting the new revision, saying the pre-qualifications screening could offer preferential treatment to foreign investors.

“If they pass through the preliminary screening, it would become a lot easier for those who have not enough money to host the remaining investment,” Rep. Lee Jong-kul of Democratic United Party said in a party speech last week.

Another industry source said that foreign investors could sell off the operations after seeking short-term profit, which is often seen in the stock market such as in the Lone Star fiasco.

“The Culture Ministry will require diverse factors through the whole screening process. When they attempt to sell off the business, they should get the approval from the ministry,” said a Knowledge Economy Ministry official.

By Lee Ji-yoon (jylee@heraldcorp.com)