At a Westminster Hall debate last Wednesday, thrown some interesting numbers around in the process during the discussion of British politicians about online gambling to legalize in Britain.
Don Foster, an opinionated critic gambling and the spokesman of Liberal Democrat Culture mentioned that the industry has revenues of GBP12.5 billion a year, but apparently only a thousand sites among of the 6,000 that claimed online were regulated. UK Gambling Commission had done no “mystery shopping” on white-listed remote gaming websites. On the other hand, Belfair was saluted for its effort of passing the suspect betting patterns from the authorities.
Tobias Ellwood from Conservative Party MP was concerned on what was called the “uneven playing field”, which differentiates between the UK’s open and regulated remote gaming market from the monopolistic and exclusionary regimes in several other European Union member nations. He pointed out that the present EU system as a “very much flawed” and doesn’t offer an equitable and open market to gambling companies in EU nations. The development of widely recognized kite mark should be developed Ellwood suggested. This is to easily identify which online betting is safe and regulated.
Conservative MP Bob Neill also told the commons that there has already been an “enormous growth” of the Internet which resulted to most of the seven thousand online gambling sites is not effectively regulated.
Sports minister Gerry Sutcliffe responded to the debate, that there is already Gambling Act implemented to take “remote gambling” into account. He also pointed out that figures supplied by politicians are somewhat exaggerated. Growth in the numbers of gambling in UK has overwhelmingly increases in National Lottery gambling rather than other forms of gambling.
He also added that it is important and should be emphasized that the government should support the funding of research and education of problem gamblers. It has been revealed that GBP 15million will soon be spent on gambling addiction.
Archive for April, 2009
BRIT POLITICIANS DISCUSS ONLINE GAMBLING
PARTYGAMING REMOVES U.S. THREAT OF ONLINE GAMBLING PROSECUTION
$105 million the price for relief from retroactive prosecution
Shares in the London-listed online gambling group PartyGaming are expected to soar following the group’s announcement Tuesday that it has reached a settlement with the US Department of Justice, removing the threat of prosecution for pre-UIGEA activities.
The cost of removing the cloud of possible action by the Americans is $105 million, payable as follows:
* 10 April 2009 - $5m
* 30 September 2009 - $10m
* 31 March 2010 - $15m
* 30 September 2010 - $15m
* 31 March 2011 - $15m
* 30 September 2011 - $15m
* 31 March 2012 - $15m
* 30 September 2012 - $15m
It is considerable cheaper than the $300 million paid independently by one of the founders, Anurag Dikshit, in his personal capacity earlier this year (see previous InfoPowa report.)
In a statement, PartyGaming said that a non-prosecution agreement had been concluded with the US Attorney’s Office for the Southern District of New York (the ‘USAO’) following protracted negotiations.
Under the terms of the Non-Prosecution Agreement, the USAO will not prosecute PartyGaming plc or any of its subsidiaries for providing Internet gambling services to customers in the US prior to the enactment of the Unlawful Internet Gambling Enforcement Act on 13 October 2006.
As part of the agreement, the company has accepted a Statement of Facts regarding its business activities prior to the enactment of the UIGEA and has agreed to pay $105 million, payable in semi-annual instalments over a period ending on 30 September 2012. Such payments will be made from the Group’s existing financial resources.
Key elements of the Statement of Facts are:
* From 1997 until 13 October 2006, PartyGaming offered Internet gaming to players located in the US, including real-money poker and casino gaming. On 13 October, 2006, the day the UIGEA was enacted, the Group voluntarily exited the US market.
* Prior to 13 October 2006, certain of the US customer transactions intended for PartyGaming that were processed by third parties, and other gaming and payment-related activity, were contrary to certain US laws.
* PartyGaming has agreed to maintain, with respect to its operations, a restriction preventing Internet gambling services from being provided to customers in the US in violation of the prevailing law of the US or any jurisdiction within the US.
* If requested by PartyGaming, the USAO will bring the co-operation and remedial actions of PartyGaming to the attention of other licensing and regulatory authorities.
Commenting on today’s announcement, Jim Ryan, Chief Executive Officer said:
“The resolution of our position with the US authorities marks an important day for PartyGaming. It has been a long and complex process but we have reached an amicable solution with the USAO that makes commercial sense for our business and is in the best interests of shareholders. We are now well-placed to seize organic as well as strategic opportunities that previously were beyond our reach.”
The impact of the announcement on the company’s share price was almost immediate, with PartyGaming stock surging - at one stage by 15.3 percent to 253 pence on the London exchange.
Rival online gambling groups also known to be negotiating with the DoJ also benefitted, with 888 Holdings up 8 percent to 97.25 pence and Sportingbet rising 10 percent to 45.75 pence.
ONLINE TECHNOLOGY PROVIDER APPLIES FOR LAND SLOT ROUTE
Cantor Gaming may have eschewed online operating, but it is seeking permission for a small land operation in Nevada
Cantor Gaming, a mainly technology company that announced last year that it had ceased operating online casinos although it would continue to licence software, has applied for a slot route in Nevada, reports the Las Vegas Review-Journal.
Cantor is an offshoot of a major New York-based financial services provider and has a number of irons in the gambling industry fire. The company is operating the race and sports book at the month-old M Resort, using its “in-running” technology. It has also been successful in obtaining permission to offer land casinos its remote gambling device for use on-premises, branded eDeck, and last year acquired a Nevada holding company owned by Mickey Wichinsky (see previous InfoPowa report) that included several gambling-related businesses and an impressive library of slot machine games and technology.
Part of the latter acquisition was a small slot machine route operation, and it is this enterprise for which Cantor sought land operating permission last week. The operation is small by any standards - two dozen slot machines in five Southern Nevada locations, including a laundry and the Moose Lodge.
“The deal wasn’t so much to get the slot route as it was to purchase 50 years of intellectual property,” Phil Flaherty, a consultant to Cantor Gaming, told LVRJ, explaining that the main benefit to Cantor from the acquisition was Wichinsky’s casino games so the titles could be integrated into Cantor’s existing products.
However, the Wichinsky transaction brought with it a small slot machine route business, where the company manages the devices and shares in the revenues with the locations where the slots are situated.
“The route operation wasn’t that large, maybe about 100 devices on the route,” Flaherty said. “It was part of the entire transaction.”
Last week Cantor asked the Nevada Gaming Control Board for approval to operate five slot machines at the Pecos Laundry in Las Vegas, five machines at the Loyal Order of Moose Lodge No. 1763 in Las Vegas, three slot machines at the North Las Vegas Elks No. 2353, seven slot machines at the SuperMercado Rincon Latino in Las Vegas and two games at Mr. Deli in Las Vegas, according to the LVRJ report.
Restricted slot machine locations allow for up to 15 machines per location.
If permission is given Cantor will hardly constitute a serious competitive threat to the market leader. Herbst Gaming is Nevada’s largest slot machine route operator with a total of some 6 800 slot machines in roughly 600 locations statewide.
The sector has suffered in a tough economic environment in recent months, with Herbst reporting 10 to 20 percent quarterly declines in business.
