Black jack tables at the Venetian Macao. Photo: Benny Marty / Shutterstock

The China National Tourism Administration (CNTA) has banned tour groups from including stops at locations that are tied to gambling, the sex industry, or illegal drugs. Tour operators that include such stops will face fines up to 20,000 yuan ($3,022).

Gambling is banned in mainland China, but destinations along the mainland’s periphery have been able to pull in substantial revenue from setting up gaming industries catering to Chinese tourists. Macau is perhaps the most dramatic example, and because of Chinese tourism, Macau is the world’s largest gambling city in terms of revenue.

However, Vietnam, the Philippines, and Russia all have gambling industries that are dependent on Chinese tourists. In fact, Vietnamese citizens will not be able to legally gamble at Vietnamese casinos until December.

Although Macau surpasses it in gaming revenue, firms in Las Vegas have also attempted to cash in on Chinese tourism with venues like the Lucky Dragon Hotel and Casino.

How the CNTA will enforce these new rules is unclear, it’s also unknown how much revenue casinos pull in from Chinese tour groups. Given the sometimes-abusive nature of tour groups, the move is may be an effort by the Chinese government to nip this kind of problem in the bud before tour groups start fleecing tourists for revenue through unscrupulous relationships with gaming centers, bars, or operators in the sex industry.

Chinese tour groups often sell packages at or below cost. Profits from these “zero-dollar tours” come from mandatory stops at souvenir shops and outlets that tour groups receive kickbacks from. Thailand has been particularly zealous in the past few years in reducing this kind of tourism.

Under the new CNTA rules, tour operators can also be fined for changing itineraries or forcing tourists to make purchases at arranged stops.

It seems unlikely these new regulations would hurt the bottom of line casinos, especially the bigger players in Macau or Las Vegas. The chances are that if you are a Chinese tourist gambling at the Venetian Macao or the Bellagio, you won’t be on a zero-dollar tour.

However, the new rules do prevent potentially exploitative agreements between smaller gambling houses and tour groups where travelers are outright cheated out of vast sums of money. All-in-all, Beijing curbing the practice of zero-dollar tours is good for both destinations and consumers. Shops and restaurants will need to pay fees to prearrange the arrival of Chinese customers and Chinese travelers will have more control over controlling their travel budget without tour operators coercing them into buying overpriced souvenirs and food.