Dearth of Pennsylvania operators seeking online licensing

News on 16 Jun 2018

The tough taxes and regulations imposed by Pennsylvanian lawmakers and regulators on the state’s nascent online gambling sector appears to have discouraged state land casino operators from applying for the new licenses, which cover online slots, table games and poker and cost $10 million each.

Just legalising online gambling in the state took an agonisingly long time (see previous reports) but that has been followed by uncertainty and some at times mystifying policies and conditions drafted by the regulator which can hardly have been conducive for operators to come forward.

And they haven’t…a Pennsylvania Gaming Control Board spokesman has confirmed that so far not a single application has been received.

The state’s existing land casino licensees have 90 days starting April 16 to take advantage of their first bite of the cherry offer to take up licensing.

If the licenses are not taken up the plan is to split up the licensing into three categories – slots, table games, and poker – and offer these at $4 million each. And if after 120 days there are licenses still available these will be offered to entities other than the state-licensed casinos.

Some observers have postulated that the dearth of applications so far may be because operators prefer to licence specific categories and are waiting for the 90 day window to pass and the separation of slots, table games and poker to take place, enabling them to pick and choose at possibly lower cost.

That should soon be evident as the initial 90 day period draws to a close.

Others attribute the lack of interest to overly high taxation, especially on slots, uncertainty surrounding regulatory policy regarding partnerships with online providers, and the tethering of skin websites to the main licensee.

Overall, the approach by the Pennsylvanian authorities has created the perception among many that the regulatory environment is complicated, lacks certainty and is perhaps less than friendly in application.

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