Massachusetts Special Commission Set to Recommend iGaming for 2018 Passage

Massachusetts Special Commission Set to Recommend iGaming for 2018 Passage

Just over nine months after its creation, Massachusetts’ Special Commission on Online Gaming, Fantasy Sports Gaming, and Daily Fantasy Sports is reportedly on the verge of recommending full iGaming legalization to the state’s legislature.

Per a report published by State House News Service on June 6, the Special Commission “has been studying the ever-changing world of online gaming and gambling (and) may be poised to recommend an all-inclusive approach to regulating the multifaceted industry.”

With a July 31 deadline to deliver its official findings looming, the nine-member panel of legislators, regulators, and industry experts appears to have formed a consensus on the once contentious issue of regulated online gambling.

Representative Joseph Wagner (D-Chicopee) – who serves as chairman of the Joint Committee on Economic Development and Emerging Technologies and co-chair of the Special Commission – told State House News Service that the debate now boils down to choosing the best method for eventual iGaming implementation:

“There are three options I think that we will look at.

There’s the gaming option, a type of structure where we have a separate law that would govern this; the omnibus approach, which is where we would give some authority some authority to oversee all of this; or to just simply let it play out for some time or more going forward.”

The Massachusetts Legislature embarked on an ambitious overhaul of the state’s gambling industry beginning in 2011, with the passage of the Expanded Gambling Act calling for the construction of three resort-style casinos.

By 2015 the state’s Attorney General instituted new policies to regulate the daily fantasy sports (DFS) industry, prompting further legislative discussion on the matter of full iGaming legalization. Those discussions eventually led the Massachusetts Gaming Commission (MGC) to form a Special Commission tasked with studying the industry’s viability.

Along with Wagner, the Special Commission is co-chaired by state senator Eileen Donoghue (D-Lowell). Other members include MGC chairman Stephen Crosby, state senator Jennifer Flanagan (D-Worcester and Middlesex), representative Mark Cusack (D-Norfolk), representative James Kelcourse (R-Essex), assistant attorney general Dan Krockmalnic, senatorial legal counsel Hirak Shah, and chairman of the Fantasy Sports Trade Association (FSTA) Peter Schoenke.

As a proponent of the omnibus approach, which would regulate all forms of iGaming under the same umbrella, Crosby commented on the need for centralized third-party oversight – either through the MGC or another body:

“Our view is that the Legislature’s job is to determine whether or not we want gambling online to be legal, and if the answer to that is yes – which it sort of presumptively appears to be – then come up with a regulatory environment that can deal with all of these things as they come down the pike and not have to try to be in a reactive mode.

And it could be the Gaming Commission, that makes a lot of sense. Though if it goes to somebody else it’s totally fine with us, we’re not invested in it one way or another.

Then give that agency really clear parameters of protection, what needs to be attended to for all these new gambling processes online, give them the ability to regulate and with the nimbleness and speed that is required.”

Bills which would’ve legalized online casinos, poker rooms, DFS contests, and lottery sales were introduced during the 2017 legislative session, but progress stalled in the Senate. The issue was essentially punted to next year, pending the Special Commission’s final recommendation report on July 31.

Chief among the reasons for this year’s delay is the integration of Massachusetts’ new land-based casino industry.

The state’s first brick and mortar gambling venue, Plainridge Park Casino, opened its doors in June of 2015, while the MGM Springfield and Wynn Boston Harbor casino resorts are scheduled to open in 2018 and 2019, respectively.

Crosby commented on the importance of working with the state’s newest gambling industry stakeholders, especially given the success of New Jersey’s use of land-based casinos as license holders and operators:

“If there is going to be a major change in the gaming world … the bricks and mortar people have to be attended to. Wynn is putting down $ 2.4 billion, MGM is putting in $ 1 billion and their economic interests, just to be fair, should be seriously considered.

Probably, we would think that online casino gaming – and we’ve got a definitional problem here – online casino gaming probably should be anchored in the bricks and mortar casinos.”

Special Commission members must deliver written opinions to co-chairs Wagner and Donoghue by June 16, while a final public meeting will be held at some point between now and July 31.

Continue Reading

Pennsylvania House Passes iGaming Bill to Set Stage for Final Negotiations with Senate

Pennsylvania House Passes iGaming Bill to Set Stage for Final Negotiations with Senate

Exactly two weeks after the Pennsylvania Senate voted to pass a comprehensive gambling bill, one which would regulate online casino games, slots, poker, and daily fantasy sports (DFS), the state’s House has done the same.

In a vote held on June 7, the full House voted 102-89 in favor of passing H-271 – an omnibus legislation package which expands Pennsylvania’s land-based casino industry, while creating a new regulatory framework for legal online gambling.

The next stage in the legislative process sends the bill back to the Senate, which passed its own version of H-271 by a 38-12 margin on May 24. But despite an apparent agreeance between the two bodies on the issue of iGaming regulation, the version of H-271 passed by the House differs in several major ways from the Senate’s previous attempt.

The Senate’s preferred model would see annual revenue generated by online slots and table games taxed at a rate of 54 percent, with the tax dropping to 16 percent for online poker.

Under the Senate’s plan, Pennsylvania would also charge online casino operators a licensing fee of $ 5 million, while online poker operators would pay a secondary licensing fee of $ 5 million – bringing the total cost to $ 10 million for most major iGaming companies which connect both platforms.

The text of H-271 as passed by the House modifies this taxation scheme – which is much higher than the 17.5 percent rate successfully implemented by neighboring New Jersey – to institute a flat 16 percent tax on all online gambling revenue. The dual licensing fee plan has also been modified, with the House seeking a one-time payment of $ 8 million to cover online casino and/or poker operators.

The partisan breakdown for the House vote saw 24 Democrats break ranks to join 78 Republicans voting for H-271, while 38 GOP lawmakers added their names to the list of 53 Democrats standing in opposition.

As reported by PennLive, Representative Dave Reed (R-Indiana County) – who serves as the House Majority Leader – discussed the higher revenue projections attached to the adjusted H-271:

“This is building upon the Senate proposal and will actually enhance revenue a little further.”

Initial revenue projections tabbed the potential increase from H-271’s passage at between $ 109 million and $ 147 million, under the Senate’s higher tax rate. But with many major iGaming operators already balking at the 54 percent tax, going on record to say they’ll simply sit out rather than join Pennsylvania’s new market, Reed’s prediction of “enhanced revenue” is based on attracting the industry’s most established operators to the state.

According to the House’s own revenue projections, the new version of H-271 would generate between $ 250 million and $ 300 million in new revenue for the state.

That increase of more than double takes into account the most controversial aspect of the House’s amended bill, which allows for casino gaming via video gaming terminals (VGTs) to be installed within non-gaming locations like airports and cafés.

Even so, Reed told PennLive that the House is actively seeking to avoid the sort of inflated revenue forecasts that have plagued states like Massachusetts and New York during similar iGaming legislation discussions:

“We want the most conservative estimate possible. We don’t want to overestimate revenues and I know that was a request of the administration and the governor’s office as well.”

Rep. Gene DiGirolamo (R-Bucks County) told PennLive that the inclusion of VGTs could be a potential deal-breaker for lawmakers who already had reservations about gambling expansion:

“This has the potential to be a disaster for our children, our families and our communities.”

Following the House vote, the Senate will now reevaluate the text of H-271 – with tax rates and the VGT issue chief among the negotiating hurdles. Should the two bodies reach a compromise, the final text of H-271 would then be sent to Governor Tom Wolf to be signed into law.

For his part, Gov. Wolf has remained on the proverbial sidelines during the extended debate, offering no public statements for or against H-271.

That trend continued after the House vote, as a spokesperson for Gov. Wolf offered only a noncommittal comment on the matter:

“(The Governor) is committed to continuing to work with all four caucuses to reach consensus on a gaming proposal.”

If and when Pennsylvania pushes its iGaming legislation through into codified law, the Keystone State will become the fourth in America to legalize and regulate online gambling – joining Nevada, New Jersey, and Delaware.

Continue Reading

Australia’s iGaming Onslaught Still is Poker Provider Penalized AUD$10,000

Australia’s iGaming Onslaught Still is Poker Provider Penalized AUD$10,000

During the 16 years which have passed since Australia enacted its Interactive Gambling Act (IGA) of 2001, the country has never prosecuted an online poker operator – until now.

As reported by The Australian, professional poker player Luke Gregory Brabin was fined AUD$ 10,000 by the Southport Magistrates Court, having been found guilty under the IGA of running an illegal gambling operation.

The 37-year old Brabin acquired the online poker platform in 2015, under the auspices of his company EV Plus Pty Ltd. He assumed ownership and operation of the Australian-facing site at that time, but Australian authorities have confined his criminal actions to the period between April and August of last year.

On August 10 of last year, a statement posted to the website and Facebook page maintained by Poker Asia Pacific announced the sudden closure of the site:

“Unfortunately, Poker Asia Pacific must suspend its services until pending legal action regarding the Interactive Gambling Act is resolved.

During this time, Poker Asia Pacific will be lobbying strongly to exclude online poker from the Interactive Gambling Act and ­resume its services without any legal implications.”

In November of last year, Australia’s federal government sought to strengthen existing laws covering the iGaming industry, including the IGA of 2001.

In crafting a new set of restrictions known as the Interactive Gambling Amendment Bill (IGAB) of 2016, Communications Minister Mitch Fifield followed up on the agenda of Senator Nick Xenophon. The anti-gambling political figure, who leads the Nick Xenophon Team (NXT) party, assumed the role of parliamentary “kingmaker” following last year’s elections, after NXT secured enough seats on the crossbench to influence major policymaking actions.

The initial objective of the IGAB was to tighten restrictions on “in-play” betting, or wagers placed as live sporting events are in progress. The original IGA of 2001 outlawed this practice, but unclear language in the law allowed for loopholes to be exploited, and up until the IGAB of 2016 was introduced operators of offshore online sportsbooks openly flouted the ban.

Unfortunately for Brabin, and millions of online poker players living in Australia, the IGAB of 2016 was written with open-ended legislative language, leaving only pre-game sports betting and casino games as exempted activities.
The Senate passed the IGAB in March of this year, but the law has yet to receive final assent, leaving Australia’s previously thriving online poker industry in a state of limbo ever since.

By December of last year, Poker Asia Pacific was posting regularly about the company’s lobbying efforts, in hopes of adding an online poker exemption to the IGAB before final passage.

But in an ominously worded post issued to the company’s Facebook feed on December 23 of last year, Poker Asia Pacific predicted that the entire industry would be rendered illegal upon the IGAB’s passage:

“If our efforts are not successful (then) online poker is likely to be banned in 2017 under the new bill (IGAB).
Which would mean Poker Asia Pacific would not be able to reopen and all of the other online poker sites would be banned as well.”

Even though the IGAB hasn’t become the law of the land just yet, it does call for the Australian Communications and Media Authority (ACMA) to dispense civil judgments against illegal operators. When the IGAB is fully assented, individual operators will be subject to fines of up to AUD$ 1.35 million per day, while companies may be fined up to AUD$ 6.75 million per day.

Not coincidentally, The Australian reports that the agency in question was indeed responsible for referring Brabin and his Asia Poker Pacific site to federal investigators.

Brabin declined to comment when asked by The Australian.

As a player, Brabin pocketed AUD$ 131,365 by winning an $ 1,100 Accumulator event at the 2014 World Series of Poker (WSOP) Asia Pacific event.

Continue Reading

Pennsylvania Senate Passes State’s First iGaming Bill; Massachusetts Senator Slows Momentum

Pennsylvania Senate Passes State’s First iGaming Bill; Massachusetts Senator Slows Momentum

When legislative sessions commenced across the country to begin the year, Pennsylvania and Massachusetts were considered likely candidates to legalize and regulate online gambling.

But after a whirlwind week of legislative action in both states, only Pennsylvania appears to be pushing forward on the iGaming front, with Massachusetts punting on the issue until next year.

On May 23, the Pennsylvania Senate Community, Economic & Recreational Development Committee passed H-271 via an 11-3 vote. That same day, the Senate Appropriations Committee also moved the bill – which calls for the regulation of online slots, casino games, poker, and daily fantasy sports (DFS) – forward by a 24-2 margin.

One day later, the full Senate voted 38-12 in favor of passing Pennsylvania’s first online gambling bill.

Senate Minority Leader Jay Costa (D-Allegheny) – who sponsored his own iGaming legislation this year and has been a vocal supporter of the issue – spoke from the Senate floor on the importance of retaining iGaming enthusiasts and the revenue streams they create:

“To not have those folks, we lose business along those lines, but more importantly, we lose an opportunity, an opportunity to have people who would be playing in that space.”

The Senate estimates that online gambling license fees and yearly taxation will generate between $ 110 million and $ 147 million next year, badly needed funds that have already been earmarked by Governor Tom Wolf to help resolve the state’s budget deficit.

Those projections are largely based on licensing fees, which H-271 sets at $ 5 million apiece for online poker and casino platforms – and $ 10 million for operators choosing to offer both. With up to 12 iGaming licenses slated to be issued, one for each of the state’s current land-based gambling licensees, garnering an eight-figure sum should be an attainable goal.

However, by passing H-271 and not one of three other iGaming bills introduced this year, Pennsylvania opted for the highest proposed tax rate of 54 percent on slot/casino revenue (poker will be taxed at 16 percent). And as Steve Ruddock of Online Poker Report has pointed out, that enormous tax burden may be enough to force smaller sites to sit on the sidelines, as the current 17.5 percent tax on iGaming revenue in New Jersey allows operators to retain just 5 cents on every dollar earned.

The House of Representatives will review H-271 in June and add its own amendments, before voting to send the iGaming issue to Governor Wolf’s desk.

Unfortunately, players in Massachusetts will be forced to wait another year for iGaming to launch, after Senate President Stan Rosenberg (D-Amherst) halted all momentum on the issue:

In a recent interview with Boston Herald Radio, Rosenberg outlined the Senate’s strategic approach to handling the current push to regulate both online lottery sales alongside slots, casino games, and poker:

“Online lottery and online gaming are both issues that are being reviewed now to try to figure out how we manage the situation so we don’t hurt the Lottery.

And in the case of online gaming that we don’t hurt the casino industry we’re building in Massachusetts.
We could potentially act next year… potentially.”

The Massachusetts Senate passed an online lottery measure last year, but it eventually stalled within the House amidst concerns that internet sales would inordinately effect the state’s traditional lottery system.

The state did manage to sign a DFS bill into law last year, which triggered the creation of the Massachusetts Special Commission on Online Gaming, Fantasy Sports Gaming and Daily Fantasy Sports. The panel was tasked with studying the latest online lottery and iGaming bills introduced to begin 2017, and their recommendations are scheduled to be published on July 31.

Rosenberg has decided that the best course of action is to wait for the results of that report, before crafting new legislative language for introduction in 2018.

Continue Reading

Nevada Governor Brian Sandoval Tells AG Jeff Sessions to Back Off Federal iGaming Ban

Nevada Governor Brian Sandoval Tells AG Jeff Sessions to Back Off Federal iGaming Ban

During a meeting with U.S. Attorney General Jeff Sessions on April 26, Governor Brian Sandoval of Nevada argued against federal efforts to ban online gambling.

According to transcripts from Sandoval’s press briefing on April 28, during which he provided local press an account of his discussion with Sessions, the executive running one of just three states with regulated iGaming defended the industry.

Michelle Rindels of the Nevada Independent published her take on Sandoval’s time with Sessions, which took place in Washington D.C. during the Nevada governor’s series of talks with Cabinet-level officials within the Trump administration.

In his recounting of events, Sandoval told reporters that he and Sessions – a longtime opponent of online gambling during his time as a senator from Alabama – sparred over the latter’s critiques of the iGaming industry.

During the Senate confirmation hearings held ahead of his elevation to Attorney General, Sessions was asked about his views on a 2011 opinion issued by the Department of Justice (DOJ) – which he would soon take command of – revising the federal government’s stance on the Wire Act of 1961.

That opinion held that the Wire Act – a federal law banning gambling activity over the telephone which was previously used to outlaw all online wagering – only applied to sports betting. By releasing the revised opinion, the DOJ effectively allowed individual states to legalize and regulate their own iGaming industries – a privilege that Nevada, New Jersey, and Delaware have since exercised.

Sessions responded that he was initially “shocked” at the DOJ’s decision, before stating that he was opposed to the current Wire Act interpretation.

As such, locales where iGaming has been regulated – along with states like New York, Pennsylvania, Massachusetts, and others currently considering similar legislation – have a renewed interest in the incoming DOJ chief’s policies on internet-based gambling.

Sandoval attempted to exclude Nevada from such actions, perhaps floating the possibility of a so-called “grandfather” clause which would exempt the three states that have successfully implanted iGaming regulations:

“If there is any action that is taken, that does not include Nevada, that we do a very good job. We’ve been better than anybody in the country if not the world when it comes to the regulation of gaming.”

In defending the right of states to regulate their own online gambling commerce, Sandoval joins a long list of advocacy groups which have expressed their opposition to Sessions’ rumored reversal of the 2011 DOJ opinion.

Among the organizations to publicly oppose a federal iGaming ban are The National Governors Association (NGA), the Democratic Governors Association (DGA), the Fraternal Order of Police (FOP), the National Conference of State Legislators (NCSL), and the North American Association of State & Provincial Lotteries (NASPL).

As reported by Online Poker Report and other outlets, the talks between Sandoval and Sessions come amidst increasing focus on the Trump administration’s connection to anti-iGaming interests. President Trump accepted $ 5 million in campaign contributions from Sheldon Adelson, the Las Vegas Sands land-based casino mogul and multibillionaire conservative patron.

Adelson previously championed the Restoration of America’s Wire Act (RAWA) initiative, providing millions of dollars in funding through a lobbying group known as the Coalition to Stop Internet Gambling.

Continue Reading

Fiscal Analysis of Michigan’s iGaming Legislation Creates Constitutionality Debate

Fiscal Analysis of Michigan’s iGaming Legislation Creates Constitutionality Debate

Even as Michigan lawmakers continue to coalesce around recently introduced online gambling legislation, a recent bill analysis conducted by the state’s Senate Fiscal Agency has cast doubts over the proposal’s constitutionality.

In a bill analysis document completed on April 5, legislative analyst Drew Krogulecki provided legislators with a comprehensive examination of Senate Bill 203, focusing on its potential consequences for municipal and state government.

Using a format in which opposing arguments against the bill are presented, followed by responses addressing those concerns, Krogulecki concluded his analysis by stating that the “Lawful Internet Gaming Act” would result in negligible financial impact:

“(The) bill would have an indeterminate negative impact on the City of Detroit, result in additional expenses to the Michigan Gaming Control Board, generate additional revenue to the First Responder Presumed Coverage Fund, and have an indeterminate impact on the General Fund and School Aid Fund.”

On their own, those insignificant economic benefits would be enough to call SB-203’s viability into question, but within the 16-page document, Krogulecki also highlighted a more pressing concern.

In the first opposing argument entry, the analyst outlines a legal argument which holds that SB-203 violates Michigan’s state constitution:

“Senate Bill 203 could be considered unconstitutional from several different perspectives.

Under Article 4, Section 41 of the Michigan Constitution, any law enacted after January 1, 2004, that authorizes any form of gambling must be approved by a majority of voters in a statewide election and a majority of electors voting in the township or city where the gambling would take place.

Without requiring a statewide vote, the bill would violate this provision.”

As observed by Krogulecki, the Michigan state constitution requires any law authorizing gambling related activities to be approved by voters, rather than the legislature.

However, Krogulecki then goes on to present a response that supports SB-203’s constitutionality.

According to this position, the fact that Detroit’s three land-based casinos, along with Michigan’s assortment of tribal gaming enterprises, would be iGaming licensees makes the bill constitutional due to a special exemption:

“Article 4, Section 41 of the Michigan Constitution specifically exempts the Detroit casinos (MotorCity, MGM Grand Detroit, and Greektown) and Indian tribal gaming from that section, and it is these casinos and the Indian tribes that would be potential licenses under the proposed Act.”

As currently written, SB-203 would only allow players physically located within one of the state’s brick and mortar casinos to participate in real money online gambling.

Should the bill be declared unconstitutional, the issue of iGaming in Michigan would not be dead. Rather, the proposal would be presented to voters via statewide referendum to comply with constitutional obligations.

Krogulecki’s report also called another potential obstacle into question, as his analysis suggests that SB-203 would create conflicts with the state’s tribal gaming authorities:

“The bills would erode tribal sovereignty. Specifically, Senate Bill 203 would require Michigan Indian tribes to waive their sovereign immunity if they wished to participate in online gaming.

While this would not be illegal, it could be unacceptable to the tribes. Furthermore, subjecting tribes to Michigan Gaming Control Board licensure and regulatory structures could be challenged as a violation of the Indian Gaming Regulatory Act.”

This particular opposing argument did not receive an accompanying response, which is not a surprise considering how California’s decade-long iGaming legislation debate has been hindered by tribal opposition.

Michigan is just one of several states currently mulling iGaming bills, along with New York, Pennsylvania, Massachusetts, West Virginia, and New Hampshire.

If approved, SB-203 would make Michigan the fourth U.S. state to regulate online gambling, joining Nevada, New Jersey, and Delaware.

Continue Reading

Government Gambling Commission in Sweden Calls for Full iGaming by 2019

Government Gambling Commission in Sweden Calls for Full iGaming by 2019

A panel commissioned by the Swedish government is calling for comprehensive reforms to expand the country’s current online gambling market, per a March 29 report by Reuters.

Over the last year and a half Sweden’s “Gambling License Enquiry” has studied the iGaming industry in hopes of improving the existing state-owned monopoly model. Known as Svenska Spel, that government-owned gambling enterprise currently controls the licensed online casino marketplace within Sweden.

Håkan Hallstedt, who serves as lead investigator for the Gambling License Enquiry and director general of the Lotteriinspektionen, or Swedish Gambling Authority, officially introduced the government’s proposal on March 31.

That plan would see Svenska Spel’s monopoly over online gambling ended, with Sweden shifting instead to the open-licensing scheme put in place by most major European nations.

Speaking to Sverige Radio, or Radio Sweden, Hallstedt offered a broad overview of his iGaming proposal, telling interviewers that “there will be one law to regulate everything.”

Asked about the potential for foreign-owned companies to apply for licenses, Hallstedt seemed receptive to the idea, saying “I think there are very good possibilities for that.”

According to statistics released by the Swedish Gambling Authority, the county’s iGaming marketplace sees only 77 percent of revenue directed to licensed and taxed platforms. Those include, a recently launched online casino owned by Malta-based Kindred Group (formerly known as Unibet).

Despite maintaining an ostensible monopoly over iGaming, the Swedish government is acutely aware that offshore operators can serve Swedish customers with impunity.

To that end, minister for public administration Ardalan Shekarabi spoke to the government’s desire to shield Swedish iGaming spending from unlicensed operators, during a press conference to officially announce the commission’s findings:

“The government’s starting point in this work has concerned the state regaining control of the gambling market. This has been one of the most difficult inquiries of this mandate period.”

By instituting an annual tax of 18 percent on gross gaming revenues, the open licensing plan would invite offshore operators like 888 Holdings, Amaya, and others to apply for licensure.

Meanwhile, companies like Betsson and Kindred Group – both of which were founded in Sweden before relocating to Malta for tax purposes – would be given priority within the restructured marketplace.

Speaking with industry news outlet iGaming Business, a Kindred Group spokesperson outlined the company’s approach to the expected shakeup:

“After the proposal has been put forward the political process picks up. The strategy and default action by Kindred is to obtain local licenses in re-regulated markets.

The final decision however can’t be made until we know what set of regulations the Parliament will actually adopt in 2018. So far though it seems to be a reasonable regime being proposed.

Peter Alling, who serves as head of Nordic public affairs for Kindred Group, was far more bullish on the regulation agenda:

“We welcome the political consensus on the need for a modern gambling legislation, and the commitment that a new law will be in place before the next general election.

For re-regulation to be successful there is no room for major changes in the investigator’s proposal. Delays will endanger the whole reform.

We know that any attempt to regulate prices, limit the choice of games, or charge high taxes will have a negative effect on channelization.”

Hallstedt and the Swedish Gambling Authority have stated their objective to raise the “channelization” rate – or the percentage of players doing business with licensed platforms only – from 77 percent to between 90 and 95 percent.

Continue Reading

Michigan Joins the iGaming Fray by Introducing Four New Bills; First Clears Committee Vote

Michigan Joins the iGaming Fray by Introducing Four New Bills; First Clears Committee Vote

With the introduction of four separate bills on March 1, Michigan officially joined the race to become America’s fourth state to regulate online gambling.

At this early juncture in the legislative process, three of the four bills (Senate Bills 202, 204, and 205) are simply penal code supplements to S-203, known unofficially as the “Lawful Internet Gaming Act.”

That bill would create the regulatory framework for a legalized iGaming industry, under which anyone physically located within the state’s borders would be permitted to play online poker and casino games for real money.

Sponsored by state senator Mike Kowall, and co-sponsored by four other lawmakers, S-203 is an extension of similarly constructed iGaming legislation introduced by Kowall last year. The 2016 effort, known as S-889, was put forth in April and passed through the Senate Regulatory Reform Committee by an 8-1 margin, before stalling on the full Senate floor.

On March 8 of this year, the same Senate committee – of which Kowall is a member – voted to move his new S-203 forward in a 7-1 vote.

During the hearing, executive director of the Poker Players Alliance (PPA) John Pappas praised Kowall’s construction of S-203:

“For more than a decade the PPA has been at the forefront of advocating for sensible public policy that authorizes and regulates internet gaming. We know a good bill when we see it, and that is why I would like to thank Senator Mike Kowall for his leadership on this issue.

Moving a poker game from the kitchen table to the computer table is just another part of the way the internet has transformed our lives – extending oversight into internet gaming is simply a reflection of our modern-day society.

Michigan can choose to ignore the internet, or it can embrace it for the benefit of its citizens and its economy.”

Along with Kowall, each of the bill’s five co-sponsors – state senators Curtis Hertel, Bert Johnson, Rick Jones, Marty Knollenberg, and Rebekah Warren – serve on the committee.

And while this passage was widely expected based on last year’s vote, the expedited nature of the committee vote provides lawmakers with additional time to debate the finer points and find compromise.

Those finer points give state regulators one year from the time S-203 is signed into law to create regulatory frameworks to govern a statewide iGaming industry. From there, only brick and mortar casinos already operating within Michigan’s borders would be eligible to apply for an iGaming operator’s license.

In a departure from the model established by Nevada, New Jersey, and Delaware, the number of such licenses to be awarded would not be capped.

Users would need to prove that they are 21 years or older in order to play, and geolocation would be used to ensure that all players are physically located within the state’s jurisdictional boundaries.

Crucially, the law allows Michigan to enter into interstate player sharing agreements with fellow iGaming-legal states. In the estimation of iGaming experts, this provision is considered essential in ensuring continued player pool liquidity growth.

In addition to a 10 percent tax applied to annual gross gaming revenue, iGaming operators would pay a $ 200,000 fee for the first year of a five-year licensure period, followed by $ 100,000 each year thereafter.

The five-year platform provider licenses which would be awarded to companies like PokerStars and 888 Casino would follow a $ 100,000 / $ 50,000 payment scheme.

Finally, an annual appropriation of $ 5 million from combined online gaming revenue would be collected and distributed to the state’s First Responder Presumed Coverage Fund.

Continue Reading

Area iGaming Profession Groups New Every month Cashflow Release in The first of the year

Area iGaming Profession Groups New Every month Cashflow Release in The first of the year

Per the latest monthly revenue report issued by the New Jersey Division of Gaming Enforcement (NJDGE), the state’s online gambling industry began 2017 with a record-setting January.

All told, the five brick and mortar casino entities licensed to operate online gambling ventures generated $ 18.8 million in revenue last month. That figure represents a 28 percent rate of growth over January of 2016, when New Jersey’s iGaming industry recorded $ 13.3 million in revenue.

And while the state’s streak of nine consecutive months tallying year-on-year revenue growth of 30 percent or higher came to an end, that near miss still qualifies as a rousing success.

In terms of month-on-month growth, the entire industry experienced a 2.4 percent uptick from its revenue count in December of 2016.

Breaking the numbers down by game type, the online casino segment – which includes virtual slot machines and table games like blackjack and roulette – accounted for $ 16.5 million. That was good for a 32 percent rate of growth over the same period last year, while online casino revenue expanded by 1.2 percent over December’s mark.

The online poker segment contributed $ 2.34 million in revenue during January, or 8.7 percent more than the same period last year. But when comparing December of 2016 to January, online poker revenue spiked by 11 percent.

As far as the various licensed operators and their collection of online gambling products were concerned, the Golden Nugget’s licenses (Golden Nugget Casino, Betfair Casino, and Play SugarHouse) topped their competitors with $ 4,776,218 in combined revenue. That figure nearly matched the group’s record-setting performance in December – despite the Golden Nugget iGaming operation being limited to casino games only.

The group of Caesars Interactive Entertainment licenses (Caesars Casino, Harrah’s Casino,, and were second-best with $ 4,032,263 in total monthly revenue. Of that amount, $ 3,318,899 was generated by casino play, while poker produced $ 713,364 more.

New Jersey also has Caesars licensees to thank for its strong online casino performance month-to-month, as its 10.80 percent rate of growth over December represented the only one over 0.51 percent within the industry.

Judging by market share, the Golden Nugget’s trio of licensees have made the greatest gains, while the Borgata’s four licensees (Borgata Casino, Borgata Poker, PartyPoker NJ, and Pala Casino) have slumped badly.

Back in May of 2016, the Golden Nugget group sat in fourth place in a five-horse race, holding only 19 percent of New Jersey’s iGaming industry market share. At that time, Borgata owned 24 percent market share and enjoyed a dominant position within the emerging industry.

When January’s numbers were in the books, however, Golden Nugget had jumped in front with 22 percent market share – while Borgata slipped into second place at 21 percent.

Industry experts point to Golden Nugget’s early adoption of Live Dealer online gaming – wherein players access live streamed footage of human dealers operating genuine casino equipment – as a key driver in the company’s recent iGaming surge.

Conversely, Borgata hitched its proverbial wagon to the poker sector, which has since been cornered by the arrival of PokerStars, the world’s leading online poker room.

Having contributed $ 2.8 million in tax revenue over January, the regulated iGaming industry which launched back in late 2013 has now contributed $ 75 million in taxes to New Jersey’s state coffers.

Continue Reading

Russia Introduces Bill to Ban International iGaming Transactions

Russia Introduces Bill to Ban International iGaming Transactions

As the ongoing cyberwar waged by Russia on various Western democracies rages on in the shadows, the country’s government has made the iGaming industry an explicit target.

Per reporting published by the Russian news service and industry outlet last week, the country’s Ministry of Finance has introduced a bill which would ban financial transactions made between Russian citizens and international online gambling operators.

Officially known as Bill 1113576-6, this anti-iGaming legislation was first submitted to the State Duma – a legislative body loosely akin to the U.K. parliament or U.S. Congress – back in 2015. That initial draft proved to be contentious, however, with several government ministries and Russian financial institutions objecting to its strict limitations.

Even so, the original version of the bill did receive support from Russia’s autocratic ruler, as President Vladimir Putin expressed his approval for tighter iGaming regulations.

After several rounds of revision and amendment, the bill has returned – largely intact on the fundamental level – to the forefront of the Duma’s legislative agenda.

Having recently been passed through a second reading, the consensus among Russian political experts is that the bill’s passage is a foregone conclusion.

If and when that passage occurs, the Federal Task Force would begin compiling a so-called “blacklist” of internationally licensed online gambling operators which currently serve Russian customers. From there, any attempt to deposit money to one of these banned sites would be blocked by the facilitating bank, credit card company, or online payment processor.

Alexander Zakondyrin, a politician and lawyer based in Moscow, described the financial impetus for such a blacklist to Business Insider in January of 2016:

“Russians play poker, but their money goes abroad. In the crisis situation, low oil prices and sanctions against Russia, which excludes the use of foreign debt markets, Russia’s budget needs additional income.”

As Russia continues its attempts to enter the modern world of regulated online gaming – and reap the tax benefits therein – the country’s conservative government has made incremental progress. Online sports betting is now offered on a legal basis by licensed domestic operators, although online poker and casino games remain illegal.

Accordingly, one of the blacklisted operators that would be targeted by this bill’s passage would be PokerStars. Currently, the global leader in online poker reports more than 8 percent of its worldwide player base accessing the site from Russian IP addresses.

Online poker in Russia isn’t limited to PokerStars either, as a 2016 article published by PokerNews quoted academic researcher Roberto Carmona-Borjas’ estimate that 16 percent – or 20 million Russians – currently play on one platform or another.

In light of that and similar reporting, and taking the lucrative nature of online poker among iGaming enterprises, certain insiders believe that the Russian government’s new bill is designed to effect regulation rather than prohibition.

Kirsan Ilyumzhinov, president of the World Chess Federation, offered the following appraisal of the online poker debate last year:

“It should be legalized; too many people are involved and are playing online. There are no reasons that it should be hidden and illegal.

I am working together with the government in order to allow online poker to become an intellectual sport in Russia.”

Zakondryin went one step further, expressing his belief that legal online poker would soon follow sports betting:

“In my opinion, conceptually the decision to legalize online poker has been already made by the Russian government. As early as June 2014, Shuvalov instructed the Ministry of Economic Development and the Ministry of Justice to prepare a report on such a project’s prospects.”

Continue Reading