eGaming Review reported Thursday that PartyGaming, owner of PartyPoker.com, remains optimistic about not only the chances of the United States legalizing and regulating online gambling, but also the chances of European gaming companies gaining access to the U.S. market when that does happen. Regarding the latter, PartyGaming is running contrary to its competitors.
Other European companies remain skeptical that they will be allowed to serve U.S. customers if and when online gambling becomes legal in the States. Senator Robert Menendez’s (D – NJ) recent bill, the Internet Poker and Games of Skill Regulation, Consumer Protection, and Enforcement Act, made them even more anxious because of a clause describing one way that an applicant for an online gambling license could be deemed unsuitable:
“…is delinquent in filing any applicable Federal or State tax return or in the payment of any applicable tax, penalty, addition to tax, or interest owed to a jurisdiction in which the applicant or other person operates or does business.”
The worry stems from the interpretation of this clause. Some think it is a way to exclude overseas operators from the licensing process, as they obviously never paid any United States taxes when they did accept American customers. This is just an interpretation, however, and not necessarily the correct intention of that clause.
PartyGaming is not fretting over this, though. PartyPoker’s parent company is continuing to press on, lobbying at the federal level of the United States government to try to get online gambling legalized and regulated in the country that it once dominated. The company is not yet ready to lobby at the state level, however, despite one lobbyist’s warnings. Jim Tabilio, founder of the Poker Voters of America lobby (which he recently left) believes that because states only have 90 days to opt-out of the law that Menendez’s bill would become (Rep. Barney Frank’s bill has the same 90 day opt-out), some of the largest would opt-out because they would not feel that would be sufficient time to evaluate the law. Some of these states may then look to create intrastate online gambling networks, something that would hurt the potential of the U.S. market. Legal intrastate internet gambling is already under consideration in California.
Gigi Levy, Chief Executive Officer of 888.com, which owns Pacific Poker, also believes that the U.S. will keep overseas companies out once online gambling is legalized. This belief stems from the United States’ attitude, rather than any specific piece of legislation (Levy made his statement a month ago). Levy simply points to the United States’ withdrawal from its GATS commitments as evidence that the country will do what it wants, regardless of whether or not it goes against World Trade Organization rules.
PartyGaming already began the process of getting in the good graces of the U.S. government in April, when it agreed to pay $105 million for offering online poker and casino games to U.S. customers pre-UIGEA. In exchange, neither PartyGaming nor any of its subsidiaries will be prosecuted for actions taken before the UIGEA was passed.
In December 2008, PartyGaming founder Anurag Dikshit settled with the U.S. Department of Justice, agreeing to pay $300 million for his role in his company’s serving U.S. customers. He also faces possible jail time.

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