By Sudeshna Sarkar, IANS
Kathmandu : A nearly year-long battle for the ownership of Nepal’s casino industry, worth millions of rupees, has finally reached an end with the government recognising the claims of an Indian investor.
Rakesh Wadhwa, a chartered accountant from New Delhi, now holds sway over Nepal’s eight casinos, a major tourist attraction and a golden goose for the government, paying annually Nepali Rs.120 million (about $2 million) as royalty alone.
The Registrar of Companies Tuesday finally issued a letter recognising Wadhwa as the main foreign investor in the casino industry and the board led by him as the rightful board.
The arbitration comes after 10 months of tussle between Wadhwa and his American partner Richard Doyle Tuttle over the ownership of Nepal’s gaming industry.
In 1992, the government of Nepal granted a licence to a foreign-investment company, Nepal Recreation Center (NRC), to operate casinos in Nepal.
As per Nepal’s laws, any five-star hotel can open a casino on its premises and would hold the licence for it, with the management being given to NRC.
NRC was originally owned by Hong Kong-based company Cannosa Investment Ltd. in which Tuttle held 80 percent of the shares. However, Wadhwa says he bought out the shares and now is the majority owner of NRC.
While Tuttle is fighting the claim in Hong Kong’s courts, Nepal’s Department of Industries earlier this year recognised Wadhwa’s claim. Now the Registrar of Companies has affirmed it.
However, it remains to be seen if the American will accept the defeat. He could choose to challenge the decision in court.
In the past, the tussle had several times erupted in violence at the casinos when the police had to intervene.
T.R. Bhatt, one of the directors of NRC, said the Registrar of Companies’ decision would prevail over Hong Kong’s courts where a legal battle is still going on and might take years to reach a verdict.
“The casinos are in Nepal, not in Hong Kong,” Bhatt told IANS. “They are governed by Nepal’s laws.”
An interesting development could be an end to the monopoly in Nepal’s casino industry.
Tuttle is building a new casino in Kathmandu and could now choose to ask the government for permission to run it on behalf of a new company.
With the restoration of democracy after the fall of King Gyanendra’s government, monopolies are coming to an end and the government might decide to issue casino management licences to other organisations as well.
Perhaps that would be a better solution for the casino industry that employs over 7,000 people than an unrelenting fight between partners that has been dragging the industry into controversies.