Proposed Changes to Nevada Online Gaming Bill

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On Wednesday the Nevada Legislature introduced two new Bills that would amend the state’s current law that legalizes and regulates intrastate online poker.

Assembly Bill 114 and Senate Bill 9 jointly propose several important changes to the current law, some of which have sparked some controversy.

Some of the key changes to Nevada’s Online Gaming Bill include:

–         A provision that would allow Nevada to move forward with online gaming licenses and interstate compacts, so that Nevada gaming operators would have access to a larger customer base.

–         A doubling of online gaming license fees from $500,000 to $1,000,000 and the renewal fees from $250,000 to $500,000 annually.

–         A “bad actor” clause that would prohibit companies that illegally operated online gambling establishments in the United States prior to 2006 from obtaining a Nevada license for 10 years.

As for justifying the $1 million price tag for a license, Bill 114 presenter Assemblyman William C. Horne said “We don’t want some average American Joe Six-Pack with a server in his garage starting an online gaming operation, we want to have serious entrepreneurs entering this arena.”

“We would still be competitive,” Horne said. “We are constantly espousing ourselves to the world as the gold standard in gaming. But I also believe we are selling ourselves cheap. We have this Lexus product and we’re putting this Saturn price tag on it.”

The new “bad actor” clause that makes gambling businesses and assets that accepted US customers after December 31, 2006 ineligible to receive a license for 10 years would explicitly block companies or brands such as PokerStars or Full Tilt from receiving an online gambling license in the State of Nevada. They are not alone there, other online operators and software companies would be exposed.

Such a bad actor clause was originally part of New Jersey’s online gaming bill but was later removed, opening the door for PokerStars to make a move into the state.

With the support of the Nevada gaming community largely made up of the world’s largest land based casino resort who can afford to shell out the hefty license fee which they would more than make up ten-fold from their increased share prices and who would stand to benefit from the “bad actor” clause as it serves to weed out potential rival PokerStars, it is likely that such provisions will not see resistance from them.

However, a spokesperson for Nevada Governor Sandoval’s indicated that the governor will oppose the fee hike which would require a two thirds majority vote to pass.

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A veteran of the poker industry, James has been a member of the Canada Poker team since the beginning. He is always working quietly in the background to make sure that no big story gets left unpublished.

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