Online poker shared liquidity has progressed a step closer to reality, after the online gambling regulators of France, Italy, Portugal, Spain, and the United Kingdom have reached an accord in relation to certain technical standardization matters.
During an informal meeting held on November 29, representatives for the above-mentioned countries’ gambling regulatory bodies discussed ways of how to meet European technical standards when and if liquidity sharing agreements are reached. Issues related to data reporting were of particular interest to the participants.
The participating gambling regulators reaffirmed in Wednesday statements their intention to sign online poker liquidity agreements by mid-2017. However, according to industry experts, the deadline mentioned may be far too ambitious to be reached.
UK’s presence at the Tuesday meeting is a fact that requires special mention. It is not that the local gambling regulator has not been interested in online poker liquidity sharing. Quite the contrary, the country has actually entered talks with the US state of New Jersey for a potential Transatlantic shared liquidity agreement; an idea the development of which will be interesting to be followed, although it will be a bit hard to materialize.
The fact that UK is among the countries interested in European liquidity sharing is notable because the local market is the sole unsegregated one among the above-listed. In other words, UK-based poker players can participate in international pools as long as the website they are playing on holds a license by the UK Gambling Commission. On the other hand, French, Italian, Spanish, and Portuguese players can only play on .fr, .it, .es, and .pt websites, respectively.
France was the country to initiate talks on the matter after the country’s government allowed the local gambling regulator to negotiate shared liquidity agreements with other ring-fenced European markets. Although discussions seem to be moving forward and regulatory bodies have agreed on certain terms, there are still huge differences in the countries gambling laws to be overcome before any liquidity sharing is in place.
Taxation systems in the five involved jurisdictions will probably turn out to be the biggest stumbling block. Local markets tax online poker cash games and tournaments in a different manner and with different rates. What is more, rakes paid on cash games vary from one territory to another.
For instance, French cash game players are required to pay a 2% rake on every pot. In Italy, cash game rake stands at 5.5% and pots are raked in a different manner. Spain features a completely different rake level. This means that regulators will have to think and talk hard to reach an agreement on that particular issue without hurting players’ winnings and regulated operators’ revenues.
Online poker in Spain, Italy, and France has declined seriously over the past several years and the downward trend has generally been attributed to stiff regulations and high tax and rake levels. Although local players have been provided with the chance to play on regulated websites intended specifically for their domestic markets, they have mostly opted for unregulated ones.
Portugal regulated its market a little more than a year ago and it is yet to launch its first .pt online poker website after PokerStars obtained a local license. The market is ring-fenced but the country’s participation in the Tuesday meeting shows that it has left the door open to take due measures if it sees that the segregated market model is not a satisfactory option.
