Pennsylvania Online Gaming Bill Introduced in Senate

John Mehaffey June 17, 2014 1112 Reads

A new Pennsylvania online gaming bill has been introduced in the state senate. The bill’s prime sponsor is Senator Edwin Erickson.

The bill has a major change that is different than previous versions.  A line from the definition of “authorized game” has been removed from the previous draft. This missing line stated, “The board only may approve poker games pursuant to this chapter”.  It now simply reads, “Any interactive game approved by the board pursuant to this chapter”, which was a part of the original language.  This may mean that casino games could be allowed under the proposal.

The remaining bill looks similar to the previous version.  Most of the language is word for word.

Interstate Compacts

The bill would allow for interstate compacts with states or territories. It specifically mentions these and not any international possibilities. It is thought that international networking of liquidity by U.S. states is impossible due to the probability that there must be federal approval.

Bad Actors

The bad actor clause remained intact. It would forbid “any trademark, trade name, service mark or similar intellectual property that is used to identify any aspect of the Internet website or the operator offering the wagers or interactive games to its customers” from companies that accepted Pennsylvania players after December 31, 2006.  Player databases, software or derivatives of, or any hardware used in violation of the UIGEA would be excluded from Pennsylvania’s potential online gaming industry.

Taxes

The tax rate would be 14 percent.  Promotions could be deducted. Funds seized from fraudulent players would be counted as taxable income.

A license for operators would be $5 million. The licensing fee for significant vendors was intentionally left blank. Affiliates would require licensing in Pennsylvania.

Unlicensed Operators

Unlicensed operators would still need to pay taxes. This does not immune them from prosecution for offering illegal gambling, only for tax evasion. The first conviction of illegal online gambling is a first degree misdemeanor. Subsequent violations are second degree felonies.  The minimum fine would be $75,000.

Other Terms

Other items that are found in the bill include the requirement that all deposits be segregated from operating funds. Players must be at least 21 years of age. Internet cafes would be banned unless offered by a site operator. Bot play is strictly forbidden. Gaming sites would be required to prominently display problem gambling information.

The full language of the bill may be found here.

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