Huge iGaming Licenser Malta Platform Charge tends Streamline and Unite Handle Insurance coverages

Huge iGaming Licenser Malta Platform Charge tends Streamline and Unite Handle Insurance coverages

The government of Malta, one of the world’s leading online gambling licensing agencies, recently tabled a bill which would transform the country’s approach to iGaming regulation.

If approved by the Malta Gaming Authority (MGA), the Malta Gaming Act would repeal all existing legislation with an updated set of regulatory policies.

In a press release issued on March 13, the MGA outlined several components of the new Malta Gaming Act, including a provision which would replace the current multi-license system with two primary iGaming certifications: Business-to-Consumer (B2C) and Business-to-Business (B2B). Other proposed improvements would expand the MGA’s jurisdiction to include additional compliance and enforcement, and formalizing the authority granted to the MGA’s Player Support Unit.

The release included comments from Parliamentary Secretary for Financial Services, Digital Economy & Innovation Silvio Schembri, who praised the MGA for embracing productive reforms:

“This Bill marks a major step in streamlining and encompassing the governance of all gaming services offered in and from Malta and across all channels under the competence of the MGA.

The Government wants to ensure that the gaming industry continues to be run responsibly, fairly and free from criminal activity, so that the Maltese jurisdiction provides a safe and well regulated environment where the industry can also develop and innovate.”

We hope to remove any red tape by increasing efficiency and flexibility for the Regulator, whilst improving the robustness of the current framework and focusing regulation on outcomes.”

According to Joseph Cuschieri – who serves as Executive Chairman of the MGA – the updated gaming codes are necessary if Malta is to keep pace with iGaming’s ongoing evolution:

“This is an important milestone and we welcome this major step forward by the Maltese Government.

This Bill contains draft proposals which aim to bridge the regulatory gap between various gaming verticals and channels, including new technologies serving as a platform to future proof gaming regulation, whilst ensuring that consumers enjoy a consistent level of protection.”

The MGA counts hundreds of iGaming operators among its worldwide network of licensees, with Betsson, Casumo, Greentube, and Paddy Power among the most well-known.

The new legislation was introduced following an extensive governmental review of gaming policy, which was launched in July of 2017 and included testimony from 53 stakeholders.

Per the MGA press release, the Malta Gaming Act was designed to remove regulatory red tape currently hindering its ability to protect consumers and hold operators accountable:

“The proposed regulatory framework will strengthen the MGA’s compliance and enforcement functions to better achieve its regulatory objectives, in line with concurrent developments on anti-money laundering and funding of terrorism obligations.

It also empowers the MGA to be more agile in its decision-making, decreasing unnecessary regulatory burdens whilst strengthening supervision and focusing the regulator’s efforts on the areas which present a higher risk profile.”

Schembri echoed those sentiments while providing his own justificiation for the Act, which he says will produce 4 percent growth across Malta’s iGaming industry:

“We hope to remove any red tape by increasing efficiency and flexibility for the Regulator, whilst improving the robustness of the current framework and focusing regulation on outcomes.”

The Maltese Parliament is currently studying the Act, but it is widely expected to pass before Cuschieri leaves the MGA to become chief executive officer of the Malta Financial Services Authority.

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Foxwoods Exec Offers Strong Support for Regulated iGaming in Connecticut During Public Testimony

Foxwoods Exec Offers Strong Support for Regulated iGaming in Connecticut During Public Testimony

Following the introduction of two gambling expansion bills within the Connecticut General Assembly, the state’s largest land-based casino operator has offered conclusive support for iGaming regulation.

As part of an open hearing on gaming issues held by the Public Safety and Security committee, Foxwoods Resort Casino deployed its executive director of online gaming to lobby for legalization. Seth Young provided written testimony to the committee’s three co-chairs – state senator Tim Larson (D-03) and Anthony Guglielmo (R-35), and state representative Joe Verrengia (D-20) – on behalf the Mashantucket Pequot Tribal Nation, owner and operator of Foxwoods.

Pursuant with House Bill 5306, introduced on February 28, the committee is currently pursuing a “Comprehensive Study of Gambling in Connecticut” – one which includes the possibility of iGaming regulation following the model successfully implemented by regional neighbor New Jersey.

Legislators in Connecticut are also considering House Bill 5307, which would legalize sports betting upon any repeal of the current federal ban.

Young told lawmakers that, while Foxwoods supports both sports betting and iGaming on principle, bringing casino games and poker online would provide greater economic benefit:

“iGaming … is a more lucrative opportunity for the state than sports gambling. As we see it, the strongest opportunity for the state is in legalizing statewide iGaming, another activity that is currently operating for Connecticut residents in the black market today.

We project the revenue opportunity for iGaming in Connecticut to be greater than the revenue opportunity for sports gambling.”

Young provided evidence from New Jersey’s thriving iGaming industry, which he told lawmakers had generated $ 126 million in tax revenue for the Garden State since launching in late 2013. Per Young’s testimony, Foxwoods estimates that Connecticut would generate $ 87 million in tax revenue through the first five years of legal iGaming.

He also pointed out that Connecticut has already opened its gambling industry to the internet, both by bringing off-track betting (OTB) operations online, and through the passage of a daily fantasy sports (DFS) law.

As a representative of Foxwoods – the second-largest land-based casino resort in the United States at 340,000 square feet – Young also tackled the “cannibalization” argument typically used by brick and mortar operators opposed to online adoption. According to Young, casinos like Foxwoods actually derive tangible benefits in the form of new patronage when their branding is made available to wider audiences online:

“There are strong ancillary benefits of a legalized, statewide online gaming program for land-based casinos, and by proxy the state of Connecticut.

iGaming has shown to be incremental – not cannibalistic – to land-based gaming revenue, with data showing that iGaming encourages increased visitation to land-based properties.”

Young once again used New Jersey as an example to prove his point, mentioning that Atlantic City’s land-based gambling industry reversed a decade of decline by growing 2.2 percent between 2016 and 2017:

“iGaming has contributed to Atlantic City’s stabilization and turnaround in a market with new casinos right over the border in Philadelphia and other neighboring states, in a similar destination-style market as we have here in Connecticut.

With this in mind, we submit that iGaming is a valuable asset that can be leveraged, with the potential ancillary benefit of increasing slot revenue to the state.”

New Jersey law requires iGaming providers, including out of state and European operators, to partner with a brick and mortar casino in order to secure the necessary licensing. Foxwoods’ primary competitor in the Connecticut market, Mohegan Sun Casino Resort, linked up with Resorts AC to launch a New Jersey-facing online platform in 2015.

Another argument used by Young concerned iGaming’s connection to job creation. Citing a study by the iDevelopment and Economic Association (IDEA), Young informed lawmakers that New Jersey’s legalization of iGaming had added an estimated 3,374 full-time jobs since 2013.

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Nevada Congresswoman Defends iGaming Legality in Letter to Department of Justice

Nevada Congresswoman Defends iGaming Legality in Letter to Department of Justice

Continuing an ongoing dialogue between lawmakers and the Department of Justice (DOJ) regarding online gambling’s legality, Representative Diane Titus (D-1) of Nevada defended the Silver State’s iGaming industry in an open letter.

Writing to Deputy Attorney General Rod Rosenstein, Titus argued against reversing a 2011 memorandum issued by the DOJ’s Office of Legal Counsel limiting the federal Wire Act’s iGaming ban to sports betting.

Prior to the memo’s release, the Wire Act of 1961 – which prohibited sports wagering via telephonic means – had been interpreted to form the basis of a full ban on internet gambling operations of any form, known as the Unlawful Internet Gambling Enforcement Act (UIGEA) of 2006.

When the DOJ shifted their stance, individual states were effectively free to pass legislation to legalize and regulate online poker and casino games.

Nevada became the second state to successfully pass an iGaming bill in February of 2013, joining Delaware, and within two months, the Ultimate Poker platform became the first legal iGaming site to go live within the U.S. New Jersey also legalized online poker that year, along with casino games, and Pennsylvania passed a comprehensive iGaming package in late 2017.

As a result, conservative donor and billionaire casino owner Sheldon Adelson has allied with conservative lawmakers on Capitol Hill to back a series of bills purporting to “Restore America’s Wire Act” (RAWA). While those efforts have proved to be toothless thus far, Adelson continues to fund the Coalition to Stop Internet Gambling (CSIG) and the arrival of ardent anti-gambling voice Jeff Sessions as Attorney General has revived the RAWA debate.

Sessions was forced to recuse himself from iGaming-related policymaking after he stated that he was “shocked” by the 2011 memo during his Senate confirmation hearings.

Titus opened her letter to Rosenstein by reminding the DOJ’s second in command of that memo’s clearly delineated directives:

“This opinion clarified that the Wire Act only applies to sports betting and does not prohibit other forms of online gaming.”

She then pointed to Nevada’s successful track record regulating online poker for the last five years as proof that iGaming legal states are thriving under the new laws:

“Much of the legal gaming in the U.S. occurs in my congressional district. Accordingly, Nevada has set the gold standard when it comes to gaming regulation and consumer protections.

In Las Vegas we have seen that a regulated market is always better than an illegal one.

Internet gaming will not go away with a reversal of the Wire Act guidance; it will merely push more consumers into black markets. A reversal will only hurt business.”

Titus also refuted claims made by Senators Lindsey Graham (R-SC) – sponsor of the original RAWA bill in 2014 – and Dianne Feinstein (D-CA), who jointly authored their own letter to Rosenstein requesting the 2011 memo be reexamined:

“The Graham-Feinstein letter uses fear tactics and hyperbolic language to emphasize their distaste for online gaming.

While they claim online gaming ‘preys on children,” in Nevada there are effective technological safeguards in place to verify age and location. In contrast, unregulated internet gaming sites provide no assurances that minors will be prevented from gambling.”

In closing, Titus observed that regulated iGaming industries force unregulated sites out of the marketplace altogether, significantly improving consumer protections:

“There is copious evidence that businesses involved in illegal online gaming have left the regulated online gaming markets in Nevada, Delaware and New Jersey.

I encourage you to carefully study this issue and consult with industry leaders, regulators and consumers before reversing Wire Act guidance in a way that could eliminate jobs in the online gaming industry, infringe on states’ rights, and exacerbate growth of the illegal online gaming market.”

In January, a bipartisan group of Congressional delegates from New Jersey – where iGaming revenue reached $ 245 million last year – also responded to the Graham-Feinstein letter by writing directly to Rosenstein.

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NJ iGaming Profession History $245 Million in Takings Over 2017 for 24.9% Uptick

NJ iGaming Profession History $245 Million in Takings Over 2017 for 24.9% Uptick

New Jersey’s online gambling industry ended 2017 in style, as state-licensed iGaming sites posted monthly revenue of $ 20.75 million for a 12.9 percent increase year-on-year.

December marked the third straight month of revenue growth, capping off a record-breaking year that saw New Jersey iGaming generate $ 245.6 million in annual revenue. The figure easily surpassed last year’s annual revenue of $ 196.7 million, good for a year-on-year gain of 24.9 percent.

When net gaming wins were divided by game type, the casino segment – comprised of table games and slots – was the clear market leader. Casino games accounted for $ 221.3 million, or more than 90 percent, of the annual revenue haul. With more than $ 50.1 million in annual revenue added, the casino segment grew by 30.1 percent year-on-year.

On the other side of the coin, poker revenue dropped slightly from $ 26.5 million in 2016 to $ 24.2 million last year, down 8.5 percent on the year.

The Golden Nugget licensing group – which includes GoldenNuggetCasino.com, BetfairCasino.com, and PlaySugarHouse.com – was the overwhelming leader in December. Golden Nugget licensees posted $ 6.08 million in combined monthly revenue, well ahead of the Borgata licensing group (BorgataCasino, BorgataPoker, and PartyPoker among others) at $ 4.3 million.

The Golden Nugget has dominated New Jersey iGaming since August of 2016, all without an affiliated poker product. Instead, the group rolled out the state’s first Live Dealer table games, which connect players via live stream to human dealers operating genuine casino equipment from within a dedicated onsite studio.

Golden Nugget licensees combined for $ 68.6 million in annual revenue across 2017 – up an astounding 62.3 percent over 2016 – handily beating out Borgata at $ 48.5 million (3.2 percent increase year-on-year).

In early 2011, lawmakers in the Garden State voted to authorize regulated iGaming, but Governor Chris Christie rejected the plan as unfeasible under federal law. At the time, the Department of Justice (DOJ) interpreted the Wire Act of 1961 – a federal ban on sports betting via the telephone – loosely enough to apply the law to all forms of online gambling.

That changed in December of 2011, when the DOJ released a memorandum limiting the Wire Act to sports betting only. As a result, individual states were free to legislate iGaming on their own terms, and by 2013 a newly passed bill was signed into law.

By 2014, the industry generated $ 122.9 million in annual revenue, a figure which has grown by at least 20 percent in every year since. The market’s monthly revenue peaked at $ 21.7 million in March of 2017.

Given Attorney General Jeff Session’s previously stated opposition to online gambling legalization, and recent attempts to revive the “Restore America’s Wire Act” effort to ban iGaming on the federal level, New Jersey’s political establishment has rallied in bipartisan fashion to save the state’s cash cow.

In a letter sent to Deputy Attorney General Rod Rosenstein of the DOJ, New Jersey’s senior U.S. Senator Bob Menendez (D-NJ) and nine colleagues representing both sides of the aisle directly referenced the record-setting run of revenue growth:

“Since 2011, New Jersey has enjoyed robust revenues from online gambling.

In fact, 2017 has already shattered records with $ 200 million in revenue in the first ten months.

This has coincided with a rebirth of Atlantic City. This growth in revenue is in large part due to significant capital investments by the state in online gaming facilities, equipment, and technology that makes online gaming safe and secure.”

With gross gaming revenue taxed at a 15 percent rate, December’s totals sent $ 3.3 million straight into the state’s coffers. Since the launch of regulated iGaming in 2013, New Jersey has generated $ 126.6 million in tax revenue.

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U.K. Regulator Investigating 17 iGaming Operators Over Money Laundering & Problem Gambling

U.K. Regulator Investigating 17 iGaming Operators Over Money Laundering & Problem Gambling

The United Kingdom Gambling Commission (UKGC) has warned each of the 195 iGaming operators within its jurisdiction, directing them to review policies on money laundering and problem gambling prevention.

In a form letter dated January 4, operators were updated on the findings of a recent UKGC compliance assessment.

The regulator focused on each company’s adherence to crucial regulations – including the Proceeds of Crime Act of 2002 (POCA) and the Money Laundering, Terrorist Financing, and Transfer of Funds Regulations of 2017 – designed to prevent criminal elements from laundering funds through online gambling.

Additionally, the UKGC examined how operators have implemented Breach of Social responsibility (SR) code provision 3.4.1.1(e) which states “licensees must put into effect policies and procedures for customer interactions where they have concerns that a customer’s behaviour may indicate problem gambling.”

According to the letter, the UKGC has already opened active investigations into 17 operators concerning their compliance with either, or both, of the regulations. Furthermore, the agency revealed that five operators will have their licenses subject to review under section 116 of the Gambling Act of 2005.

The operators in question were not mentioned by company name or license number.

In an accompanying statement, UKGC chief executive Sarah Harrison explained the letter’s intent:

“It is vital that the gambling industry takes its duty to protect consumers and keep crime out of gambling seriously.

The Gambling Commission’s new strategy sets out our vision for a fairer and safer gambling market.

The action we are taking to examine online casino operators’ compliance with money laundering and customer interaction requirements is just one example of how we will be relentless in turning that vision into reality.”

The letter identified several widespread deficiencies within the industry.

When employees who have been designated as Money Laundering Reporting Officers (MLRO) were tested on their knowledge, the UKGC found that some “were unable to provide suitable explanations as to what constitutes money laundering and had no understanding of the main principles under POCA.”

The agency also determined that Suspicious Activity Reports (SROs) were routinely submitted to the National Crime Agency (NCA) and Financial Intelligence Unit (FIU), operators largely ignored recommendations provided in return.

Operators in the U.K. are also required to screen data pertaining to player activity – including deposits and wagers – to identify users exhibiting symptoms consistent with problem gambling. When players exhibiting addictive tendencies were spotted, operators regularly failed to initiate the required “customer interactions,” such as informing players about their ability to impose betting limits, or making self-exclusion readily available.

In the letter, the UKGC made it clear that these customer interactions were made infrequently, even when operators had evidence that problem gambling may be occurring:

“We reviewed a large number of customer accounts during the assessments and identified potential signs of problem gambling based on consumers’ gambling pattern and spend. In many cases, however, this behaviour did not trigger a customer interaction.

Customer account records did not show any evidence of customer interactions taking place and operators were of the view that these customers did not raise any concerns.”

While the letter was limited to current regulations, Harrison made it clear that the UKGC is continually updating and adjusting its policies to reflect the iGaming industry’s ongoing evolution:

“As the online sector continues to grow, and now accounts for a third of the British gambling market, it is right that we maintain a sharp focus on online gambling.

That is why in addition to our work on compliance among online casino operators, we have also been conducting a wider ranging review of online gambling looking at how the market has evolved and to identify where further action can be taken to make gambling fairer and safer for consumers.”

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Golden Nugget NJ Becomes First iGaming Platform in U.S. to Offer Live Dealer Casino Hold’em

Golden Nugget NJ Becomes First iGaming Platform in U.S. to Offer Live Dealer Casino Hold’em

Online gaming enthusiasts in New Jersey received another gift from GoldenNuggetCasino.com in the days before Christmas, when the site launched the first live dealer Casino Hold’em tables in the country.

Since rolling out live dealer Casino Hold’em on December 23, the primary iGaming platform operated by Golden Nugget Atlantic City has run the game on a daily basis between 3 p.m. and 3 a.m. local time.

Live dealer games connect online casino players directly to a dedicated studio built within the Golden Nugget casino. From there, professional dealers operate genuine cards and other casino equipment while running real table games, including blackjack, baccarat, and roulette. Players at home are able to place bets and sweat the action in real time, without worrying about the integrity of unseen random number generators and other risk factors associated with traditional online gambling.

Casino Hold’em is a variant on classic Texas Hold’em, designed in 2000 by Stephen Au-Yeung to be played as a house-banked table game. Players begin by placing an ante bet in exchange for a two-card starting hand, while the dealer takes their own two-card holding. After three community cards, called the “flop,” have been dealt, the player may opt to fold and forfeit their ante bet, or place an additional bet of equal size to call.

Upon calling, two more community cards are dealt (the “turn” and “river”), at which point the player and the dealer expose their starting cards. Using any combination of those two cards and the community cards, players make their best possible five-card poker hand in hopes of beating the dealer for an even money payout. Additionally, players can win progressively larger prizes using the Ante-Win pay table by forming high hands (four of a kind, straight flush, etc).

Golden Nugget became the first legal and regulated iGaming operator in America to offer Casino Hold’em as a live dealer game.

In a public statement, Golden Nugget’s senior vice president and general manager of online gaming Thomas Winter celebrated the historic product launch:

“Being the first to offer a Live Dealer version of the world’s most popular poker game in America, Casino Hold’em, shows our commitment to delivering on an innovative and world-class product to our patrons.

Our patrons have asked, and we are happy to deliver, on this request using our unique live-dealer digital platform.”

The new Casino Hold’em tables are operated in conjunction with Ezugi, a company specializing in furnishing live dealer studios and products. In August of 2016, Ezugi partnered with the Golden Nugget Atlantic City to construct the first live dealer facility serving the regulated American iGaming market.

Kfir Kugler, who serves as chief executive officer for Ezugi New Jersey, offered his own statement on the addition of Casino Hold’em:

“We are again honored to partner with GoldenNuggetCasino.com and Golden Nugget Atlantic City to bring the first ever online live dealer Casino Hold’em to America and New Jersey.

America is in love with poker, and by using the Live Dealer platform, the game retains its strong connection between the player and the dealer in a live environment.”

In July of 2016, the month before becoming the online live dealer provider in New Jersey, GoldenNuggetCasino.com generated just over $ 3.7 million in monthly casino revenue – just ahead of larger and more well-established competitors like Borgata ($ 3.3 million) and Tropicana ($ 3.2 million).

By December of that year, with live dealer games proving especially popular with players, the site jumped to $ 4.7 million in monthly revenue while Borgata and Tropicana both dipped to $ 3 million.

At the time, Winter attributed the site’s dominant market share directly to the introduction of live dealer games.

Today, the Golden Nugget remains the lone provider of live dealer products in the state, both through GoldenNuggetCasino.com and fellow licensee Betfair.

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Pennsylvania Adds Possibility iGaming Sportsman as Boyd Casual gaming Gains Valley Form Internet casino

Pennsylvania Adds Possibility iGaming Sportsman as Boyd Casual gaming Gains Valley Form Internet casino

As part of a series of acquisitions completed to close out 2017, Boyd Gaming Corporation has added Pennsylvania’s Valley Forge Casino Resort to the company’s burgeoning portfolio.

Per a press release issued on December 20, the Las Vegas-based Boyd Gaming acquired the casino from Valley Forge Convention Center Partners for a purchase price of $ 280.5 million. As a result, Boyd Gaming makes its first entrance into the lucrative Pennsylvania market – which has been built into the second-largest statewide commercial gambling industry in the United States, trailing only Nevada.

Valley Forge Casino Resort is located in King of Prussia, Pennsylvania, a small township 20 miles northwest of the Philadelphia metropolitan area. Despite its status as one of the state’s smaller casinos, Valley Forge is home to 600 slot machines and 50 table games spread throughout 35,000 square feet of gaming space.

With the addition, Boyd Gaming will operate 29 casino properties throughout 10 states. Of those, the majority are located in Las Vegas (Gold Coast, Orleans, Sam’s Town), with others in Illinois, Indiana, Iowa, Kansas, Louisiana, Mississippi, Missouri, and Ohio.

Boyd Gaming announced the terms of its Valley Forge deal just two days after another major acquisition moved forward. On December 18, the company agreed to pay $ 575 million to purchase four casino properties – Ameristar St. Charles (Missouri), Ameristar Kansas City (Missouri), Belterra Casino Resort (Indiana); and Belterra Park (Ohio) – from Penn National Gaming, which had only recently acquired them from Pinnacle Entertainment.

In a statement, Keith Smith – who serves as president and chief executive officer for Boyd Gaming – commented on the company’s casino shopping spree:

“With the successful completion of our acquisitions of Valley Forge and the Pinnacle assets, Boyd Gaming will gain direct access to four of the nation’s largest gaming markets – Philadelphia, St. Louis, Kansas City and Cincinnati – with a combined population of nearly 10 million adults.

We believe this expansion will help drive additional growth throughout our nationwide portfolio, as we market our destination properties to these new customers in the Midwest and Northeast.”

And while the Valley Forge deal is expected to close in the third quarter of 2018, Boyd Gaming is already being mentioned as a potential player in Pennsylvania’s newly legalized online gambling industry.

In late October of last year, Governor Tom Wolf signed a comprehensive gambling expansion bill into law – regulating online casinos, poker rooms, slot parlors, daily fantasy sports (DFS) platforms, and lottery ticket sales in the process. As a result, Pennsylvania became the fourth state to legalize online gambling, joining Nevada, New Jersey, and Delaware.

The new law stipulates that any of Pennsylvania’s 12 brick and mortar casinos, Valley Forge included, can apply for an online gaming license.

As the former part-owner of the Borgata casino in Atlantic City – the license-holder behind several successful online casinos and poker rooms in New Jersey – Boyd Gaming has prior experience in the iGaming industry. The company sold off its share of the Borgata in 2016, but as Smith alluded to in his public comments on the Valley Forge deal, Pennsylvania’s recently passed legislation provides another entry point to an online presence:

“The acquisition of Valley Forge Casino Resort is another excellent opportunity to further grow and diversify our nationwide portfolio.

And thanks to Pennsylvania’s recent passage of gaming expansion legislation, there are new opportunities to drive incremental growth at Valley Forge through the expansion of the property’s slot capacity and the introduction of new forms of gaming.”

And back in 2014, while praising the Borgata’s newly launched iGaming properties, Smith set Boyd Gaming apart from fellow brick and mortar casino operators by refuting the “cannibalization” argument routinely used against iGaming expansion:

“Online gaming is growing our database creating a long-term opportunity to market Borgata to an entirely new group of customers.”

The Pennsylvania Gaming Control Board is currently crafting a regulatory framework for iGaming in the state, and the industry is expected to launch in the second half of 2018.

 

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New Jersey Legislator Introduces Bill to Allow International iGaming Player Pool Sharing

New Jersey Legislator Introduces Bill to Allow International iGaming Player Pool Sharing

New Jersey operates the most successful statewide online gambling industry in America, but lawmakers in the Garden State are gearing up for international integration.

On November 30, state senator Ray Lesniak (D-20) introduced Senate Bill 3536, which would revise current regulations by allowing computer servers and other equipment used in New Jersey’s iGaming industry to be operated outside of Atlantic City.

If passed, SB-3536 – which is bears the title “An Act Allowing Location of Internet Gaming Equipment Outside of Atlantic City Under Certain Circumstances” – would pave the way for New Jersey to share its online casino and poker player pools with international operators in Europe and elsewhere.

In a concluding statement attached to SB-3536, Lesniak summarized the bill’s intent:

“Under current law, Internet gaming equipment is required to be located within the territorial boundaries of Atlantic City.

This bill allows the division to permit Internet gaming equipment to be located outside of Atlantic City if the division deems it necessary to facilitate the conduct of international Internet wagering.”

Existing regulations were put in place by the New Jersey Division of Gaming Enforcement (NJDGE) in 2013, when New Jersey legalized online gambling through licenses issued to Atlantic City casinos. Under the New Jersey State Constitution, gambling activity in New Jersey is confined to Atlantic City only, and requiring essential equipment involved in the iGaming industry to be physically located there preserves the iGaming law’s constitutionality.

But as Lesniak noted in his bill’s text, NJDGE regulations also permit player sharing agreements with other jurisdictions – including foreign nations – provided such agreements remain consistent with federal law.

In October of this year, New Jersey forged such an agreement with Nevada and Delaware, the two other states which had legalized iGaming at the time (Pennsylvania has since passed legislation to become the fourth).

And in August, a preliminary agreement to share online poker player liquidity with the United Kingdom fell through, in large part due to the current locational law.

At the time, NJDGE director David Rebuck explained how an emphasis on Atlantic City served to scuttle the U.K. deal:

“Our law is very restricted in that the gaming servers, the actual gaming servers that allow for the outcome of the game to be determined, have to be in Atlantic City, and that’s just not a business model that they were willing to adopt.

If those states will not allow their gaming servers for online gaming to be here, we really are kind of stuck, unless there is a legislative change. We’re not in a very strong position to effectuate liquidity with those restrictions.”

By removing the current restrictions and allowing similar agreements to be enacted, Lesniak’s bill would let international players access New Jersey’s online casinos and poker rooms.

So-called common operators – or iGaming companies like PartyPoker, PokerStars, and Betfair currently serving customers in New Jersey and abroad – would benefit through increased player liquidity. Per data compiled by player volume tracking site PokerScout, the New Jersey-based PokerStars platform maintains a seven-day average of just 110 active players at any one time. If connected to the international site through player sharing, that number would grow by 11,000 players.

Lesniak has spent much of his four decades in the New Jersey statehouse advocating for gambling expansion, and he issued a statement explaining where SB-3536 fits into his legacy:

“I’ve changed my mission from making New Jersey the Silicon Valley of internet gaming to the Mecca of internet gaming.

Online gaming has helped Atlantic City revive its casino sector with a success that we can expand in ways that will generate more revenue, create jobs and fuel technological innovation in gaming.”

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Special iGaming Commission in Massachusetts Recommends Game of Chance Classification for DFS

Special iGaming Commission in Massachusetts Recommends Game of Chance Classification for DFS

Days after issuing a draft document which recommended the state classify daily fantasy sports (DFS) as “online gaming,” a special panel appointed to study iGaming legislation in Massachusetts has voted to finalize their report.

The Massachusetts Special Commission on Online Gaming, Fantasy Sports Gaming and Daily Fantasy Sports – which was created last September after the state passed DFS legislation – released its draft report on July 25. The Commission had been tasked with studying all forms of online gambling, including poker, casino games, and DFS, before reporting their findings and recommendations to the state legislature.

The panel, which includes Massachusetts Gaming Commission (MGC) Chairman Stephen Crosby, then held a formal vote on July 31 – the stated deadline for its report to be delivered. By a 5-3 margin, the Commissioners elected to approve that report and send it on to lawmakers for review.

In their final findings, the Commission recommended that DFS remain fully legalized in Massachusetts – but that it should be regulated as online gaming rather than a game of skill:

“At this time, the Special Commission recommends legalizing DFS as a subset of online gaming and enacting legislation that would put into law the proposed regulatory, governance, and taxation system described above,” the report says.

“However, the Special Commission recommends not legalizing more expansive online gaming at present, particularly in consideration of the fact that two resort casinos are not yet open, but urges re-evaluation in the near future and legislative oversight to continue to evaluate online gaming and activity at state and federal levels.”

The decision has drawn the ire of DraftKings and FanDuel, the two major operators within the DFS space, as both companies have argued consistently for the game of skill designation.

James Chisholm, who serves as director of public affairs for DraftKings, issued a statement addressing the Commission’s findings:

“While this commission report is merely a recommendation, it runs directly counter to the economic development law that overwhelmingly passed last year designed to promote the state’s Innovation Economy. The commission’s actions today, as we and our partners in the fantasy sports industry pointed out time and time again, could restrain our company’s ability to thrive and create jobs here in Massachusetts.

These recommendations if ever adopted would put us behind every other state in the country on this issue, and send a troubling message to other startups. We urge Governor Baker, Speaker DeLeo, Senate President Rosenberg, and rest of the Legislature to reaffirm their commitment to Massachusetts startups and reject these ill-advised recommendations in whatever legislation is finalized.”

FanDuel declined to offer comment on the matter, but considering that the two companies have recently issued joint statements on other subjects, the second-leading DFS operator is ostensibly opposed to the panel’s findings as well.

In October of last year, shortly after joining the Commission, Crosby outlined his stance on DFS’ ongoing debate over the role of skill versus chance in an interview with Global Gaming Business Magazine:

“There have been millions of dollars spent litigating whether DFS is a game of skill or a game of chance, and if it’s some skill is it enough skill to make it avoid the regulations of games of chance. That just makes no sense to me.

“What difference does it make as a matter of public policy whether you gamble on the throw of dice or the throw of a dart? Does it make any difference that one is skillful and one is pure chance? Should they be regulated any different? I just don’t get that.”

The current legislation deeming DFS to be legal in Massachusetts includes a sunset provision, which allows the law to expire in August of 2018.

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iGaming Industry Continues to Grow on Global Level

iGaming Industry Continues to Grow on Global Level

A trio of stories making headlines in the iGaming world shows that while online gambling may be controversial in the United States, international locales are increasingly interested in getting in the action.

Russian Sports Betting Should Double by 2022

A recent report by the online sportsbook review site Bookmaker Ratings predicts that the Russian market will grow at a rate of more than double between now and 2022.

Per the study, Russia’s existing market for regulated sports betting currently hauls in an approximate annual handle of 677 billion rubles (USD$ 10.1 billion) – but that number is expected to jump to 1.4 trillion rubles (USD$ 22.4 billion) during the next five years.

The government of Vladimir Putin authorized legal sports betting in 2014, replacing an entrenched system of illicit underground bookies and offshore sites – a fact which Bookmaker Ratings viewed as a potential hurdle to those lofty growth goals:

“The main obstacles to the transition of players to the Russian legal bookmakers, are the complexity of identity verification and desire of players to avoid playing personal income tax.”

Factors driving the predicted boost in annual handle include the entrance of established European sites via an expanded licensing process, and the commencement of the 2018 World Cup.

At the moment, Russia licenses 29 operators to accept real money wagers on sporting events, 11 of which maintain online platforms.

Jamaica Set for Legalization and Regulation

A report published on June 18 by the Trinidad and Tobago Guardian detailed measures taken by prominent government officials who are actively pursuing iGaming regulation.

Audley Shaw, who serves as Minister of Finance and Public Service, recently delivered an address to the 7th Caribbean Gaming Show and Summit. With the Jamaican government considering an iGaming bill since 2014, Shaw revealed that international online gambling operators have been invited to apply for licensing:

“Since last year, the Casino Commission has met with two large international investors, which are now advanced in the preparation of their applications for Integrated Resource Development status.

With these developments, there is a lot of optimism for the growth potential of the gaming sector.”

In 2014, Member of Parliament Horace Dalley spoke to the Jamaica Observer and outlined the case for iGaming regulation:

“Internet gaming is happening right now in Jamaica. Therefore, it is time that we make that progression to this methodology of gaming, as Jamaicans are already well-equipped with the devices to facilitate this.”

Shaw provided his own justification, observing that the country’s gaming sector recorded revenues of JD$ 111.25 billion (USD$ 863 million) in the 2016/2017 fiscal year – up from JD$ 91.9 billion (USD$ 713 million) year-on-year.

Kenya Implements 35 Percent Tax on Operators

Responding to the rapid rise of online sports betting and lottery sales in Kenya, legislators recently enacted a heavy tax burden on operators which is designed to curb the industry’s growth.

After initially proposing a 50 percent tax on revenue for iGaming companies – which was rejected by the country’s president Uhuru Kenyatta – lawmakers in Kenya compromised with a 35 percent tax hike.

That tax obligation adds to the 30 percent corporation duty imposed by the Kenyan government.

The legislature reached its agreement on the final day of the current session, amending the Betting, Lotteries, and Gaming Act’s current 15 percent tax on iGaming revenue by more than double.

With a federal election on August 8 looming, president Kenyatta issued a stern statement which positioned the tax hike as a tool to increase fees charged by operators, and thus reduce the demand for online betting products:

“The purpose of the amendment of section 59B of cap 469 was to discourage Kenyans and especially the youth in directing their focus on betting, lottery and gaming activities instead of productive economic engagements, a vice that is likely to degenerate into a social disaster.”

In recent years the Kenyan media has highlighted the country’s online sports betting craze, typically covering stories of young and impoverished bettors who fail to find their fortune online.

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