Reid Bill to License U.S. Online Poker (failed to pass in late 2010)

[Do it Right]

I'm somewhat concerned about the negative publicity Reid is getting for just considering this. Frist was able to sidestep this problem since he was retiring or running for president. Reid has 6 years left in office.

On the other hand I suppose the memory of the media is short. Almost none are pointing out the irony in that those decrying this are the same ones who helped push the UIGEA into play in the exact same fashion.

I really hope 'leaking' this bill really was just that and not an attempt at testing the waters since this water is pretty damn cold.

[droveski]

canada might get royally screwed here...no regulatory framework like the UK/FR/IT and possibly shut out of a US network?

[banonlinepoker]

LOL at the players yelling that their income is threatened. Go play live if your so good.

As it stands this bill has no chance, it is just another way for Reid to make his supporters think he is doing something for them like giving illegals amnesty and now paying the casinos back. BTW I don't think Steve Wynn or Sheldon Adelson voted or him and pretty much hate him but this is just another vote that the GOP will oppose (like the said they will until all the Bush tax cuts are extended at least two years) so Reid and Pelosi can call them their favorite soundbyte on the Rachel Maddow show. No way this can pass the senate in any form until the Dems pull back and get in the middle like Clinton did. Until Pelosi has lost her power nothing is going to get done except a last minute deal to extend unemployment and Bush tax cuts is struck. Which will happen probably next week.

As for Opt out I think it's bad but has to happen unfortunately or even the Dems in CA won't vote for it. Let's cut through the propaganda shall we?

[prodonkey]

Originally Posted by Lego05

Some of those comments on the yahoo page are just infuriating to read.

I lost like 35 minutes making comments and replying to other ones.

Ya I just read them for awhile.. about 95% of them could be replied to with you're a muppet! Everyone is like zomg the poor people, so addictive.. bleh blah. All the online is rigged ones and **** harry reid got a lot of thumbs up too.

I've never seen so many closed minded people commenting on something. I guess there is really only a small segment of people with literally nothing better to do than post comments there though.

[loK2thabrain]

Originally Posted by prodonkey

Ya I just read them for awhile.. about 95% of them could be replied to with you're a muppet! Everyone is like zomg the poor people, so addictive.. bleh blah. All the online is rigged ones and **** harry reid got a lot of thumbs up too.

I've never seen so many closed minded people commenting on something. I guess there is really only a small segment of people with literally nothing better to do than post comments there though.

I cannot bring myself to click that link and read those comments. Its just too damn soulcrushing

[Uglyowl]

Originally Posted by Butcho22

I cannot bring myself to click that link and read those comments. Its just too damn soulcrushing

Typical Yahoo! These morons ruined the stock message boards too which could have been a huge money maker for Yahoo, but the message boards have went to complete garbage (with apologies to garbage)

[LeapFrog]

Originally Posted by LeapFrog

Kevmath posted a link to 'the bill' in NVG, I don't know if it is the final bill or what. *loud noises about uncertainty* see the section below

http://media.lvrj.com/documents/Inte...ct_of_2010.pdf

ok, this is apparently still a draft.

Originally Posted by Kevmath

There, I've deleted my own post about a draft version of the bill. The issue earlier was about partial information about the bill being posted (then removed) without showing the entire bill in context.

[prodonkey]

I spent awhile clicking on names seeing how old people are.. avg age seems to be about 60.

[oldbookguy]

Originally Posted by Karak

Not that they care in the long run, but they are stepping very lightly around the WTO cases atm.

There is a bill section the addresses the WTO case and directs settlement while admitting the case was won also stating the agreement was in error and for the U S to finish withdrawing from that portion of the WTO agreement.

obg

[Tampax]

did they couple this bill with another one? They are voting on Bush Era tax cuts right now on C-SPAN2

[sluggger5x]

Are the votes today big for us?

http://www.cnn.com/video/flashLive/l...stream2&hpt=T2

[Berge20]

Votes currently going on in the Senate do not include the discussed poker item, nor were they expected to.

The two votes this morning in the Senate will not succeed, so the tax issue remains open for negotiation.

[PokerXanadu]

NOTE: BELOW I RESPOND TO VARIOUS POINTS OF CONCERN IN THE BILL, BUT MY RESPONSES ARE BASED ON THIS EARLY DRAFT BILL. MY UNDERSTANDING IS THAT THERE HAVE ALREADY BEEN VARIOUS CHANGES TO THE BILL TO ADDRESS SOME OF THESE POINT, IMPROVING IT FOR PLAYERS. FOR THIS REASON, I MAINLY LOOK AT THE LONG TERM POSITIVE OUTCOME OF THIS BILL (OPEN COMPETITIVE REGULATED IPOKER IN FIVE YEARS), AND TAKE THE NEGATIVES OF THE INTERIM IMPLEMENTATIONAL PERIOD WITH A GRAIN OF SALT AT LEAST UNTIL WE SEE THE FINAL DRAFT.

Originally Posted by repulse

Player withdrawals will not be taxable events -- nothing changes under this bill with respect to the amount of income tax an online poker player owes -- but the draft allows for the IRS to require tax withholding from withdrawals, which just makes you pay the tax you owe earlier.

The bill does not require withholding from players except for those who don't provide a Taxpayer ID Number. You have to follow the references in the bill to current tax code to detect this. As long as the player gives the site a standard W-9 Form, the site does not have to do any withholding.

Originally Posted by Jay Cohen

I don't know what makes you think that provision mitigates any WTO issues. This bill as described here is a complete slap in the face of the WTO. It may as well be called the American Gaming Protection Act. Even without the 2 year moratorium on new licensees it is still not WTO compliant. Whether or not US sites accept foreign players has nothing to do with it.

(I know many of you may argue that the WTO doesn't matter. That's a different discussion. But there is no way this bill as described here is compliant with the GATS and the WTO decision.)

The bill expressly addresses the WTO issue. It reiterates the official govt response to the WTO that gambling was never meant to be one of its fair trade commitments, and requires the govt to complete the process of withdrawing this WTO commitment.

Originally Posted by LeapFrog

huh?
http://pokerati.com/2010/12/03/reid-...nse-must-obey/

one of these things is not like the other. Can you clarify? Are you looking at a different draft?

The bill does grant the authority to the Commerce Secretary to decide if foreign site owners can be granted licenses once the two-year period is up. But the pokerati view on this is a "glass half empty" view of it. The decision will be based on whether or not the licensing requirements - things like site probity, protections against underage and problem gaming, safeguards against financial crimes, etc. - will be satisfied. Making this decision will be a public process, through public hearings and comments, not just an arbitrary ruling.

In addition, it is not just in regards to foreign site owners. For two years, only US casinos, race tracks & slot machine makers that have operated for five years (and have at least 500 slot machines running, in the case of casinos & race tracks) can get a license. The determination will also consider licensing other US casinos, other US corporations (google, facebook, aol, etc.) and such.

Also keep in mind that whomever gets licensed has to locate their US-facing operations inside the U.S. It is not a matter of granting licenses to foreign sites. All licensed sites will be U.S. sites. It is just a matter of which business entities will be eligible to be licensed.

I'm certain licensing will be expanded after the two-year initial period.

Originally Posted by wufwugy

All sounds great except it brushes the unlucky residents of bad states aside. I'd like to wait until we can get wording that makes sure that every state is automatically opted in, receives tax revenue, then provided an opportunity to opt-out at a later date via legislation or something else that they will never do

This stuff about it being states rights is garbage. It's all just a matter of interpretation, and interpretation is a matter of greasing the right pockets. The SCOTUS recently overturned a hundred years of precedent simply because of different interpreters. If we fight hard enough, then we don't have to screw many of the players in order to get where we want

Opt outs are an unfortunate reality of a federal bill. Whether it's automatic opt in or opt out, we will have battles in the states. An automatic opt in system would make it somewhat easier. Hopefully this is one of the changes that have been effected to the draft bill.

Originally Posted by Krax

Im gonna ask again, since noone replied:

is it known whether Euros will be able to play on US sites if this bill is implemented?

No, they cannot. At least not at first. After three years, the Commerce Secretary can make a determination allowing foreign players from jurisdictions where it is legal. This is at the whim of the Secretary, but no doubt the sites will be lobbying to allow it, which should go a long way towards getting it done.

Originally Posted by abroncosfan

Dont know if this has been asked yet but couldnt Phil Ivey and whoever owns PS simply apply for and open fulltilt2 and Pokerstars2 simply just transfer users to the new site and not wait 2 years. Also Im sure fulltilt and PS have cash to buy a land based casino through some shell company a get a clean license that way.

Anyone who has owned or operated a US-facing site will have to cease operations immediately and will be ineligible for a license, or to provide their services to a licensed site, for a certain number of years. The draft bill doesn't state how many years - just says "XX years" for the time being. After that, they can buy a US casino and get licensed.

Originally Posted by flight2q

(subject to changes in text) I think you're misreading this. There's no logical way to track what play resulted from deposited funds and what from bonus monies. But certainly if there is a deposit fee, then that is part of "other fees or charges" and will get taxed. It is written vaguely enough so that it seems that one could argue that the site should get to calculate the aggregate taxable amount as a net, subtracting out bonuses and such, but I'd like that to be clearer.

I haven't misread this. It is pretty clear that deposits to a players account from promotions (bonuses, incentives, etc.) are not counted, and any site revenues generated from them are not taxed. It may be difficult to implement if these funds are commingled in the player's account, but I'm sure sites can figure out a way.

Originally Posted by blutarski

Some things to wonder about pointlessly, atm:

2. Will they let us download HH's so we can use HEM, pt3, etc?
3. Will they try to make it difficult for HUD's to work?

The bill criminalizes the use of any such software if it is against the TOS of the site. If the site allows it, it's fine. Bots are forbidden.

[fnord_too]

Originally Posted by PokerXanadu

+1.

But even the bill as it is in this draft is overall, imo, a net positive over the previous Congressional bills. Look at it this way: under this bill, in about five years we shall have just about everything we want that is achievable from a federal licensing program:

Licensing open to all sites, domestic and foreign.
International player pools.
No state which passes an intrastate iPoker bill is allowed to opt out of the federal bill.
Solid regulations and consumer protections against fraud, cheating, bots, etc.
Reasonable taxation.

The bill does have deficiencies in the way the licensing progam is implemented, i.e. for the first five years. Hopefully these issues are being addressed and changed in the bill at least to some extent. Regardless, I would support this bill as a reasonable path to a legal, open, competitive iPoker market in the US. It is certainly far better than what we are facing without a bill: states passing either complete bans on iPoker or intrastate iPoker bills that overtax, criminalize unlicensed play and fragment the player pool.

Some notes on the draft bill provisions:

Although foreign sites are not allowed to get licensed for the first two years, there is nothing that prevents them from providing their software platforms on a B2B basis to the licensed US casinos. The casinos aren't going to write their own software, but rather will sign supplier agreements with the foreign networks/sites.

The 20% revenue tax is, I estimate, about equal to a 10% deposit tax, but without the problems of uncapped taxes on high stakes deposits. Note that the bill specifies that only revenues generated from player deposit amounts are taxed. Rake generated from other player funds, such as bonus monies, won't be taxed.

The "UIGEA strengthening" boils down to two main points: the UIGEA and Wire Act provisions are clarified to exempt Horse Racing and iPoker; and financial institutions are no longer burdened with determining what transactions are prohibited, as the federal government will have to provide them with a list of illegal gambling sites. The financial service providers will only be liable for blocking transactions to the specified sites, rather than forced into overblocking.

Except for the two year thing, everything in this post is great news, and the two years thing is not that horrible imo.

re: bots/cheaters/etc. I would suspect that regulation would make signing up for a site as arduous as getting your first cashout, maybe more so. But that is also great imo. It will hurt underage players (which sucks for the winning teenagers/20 yo's in the US) but it also will cut the legs out from underage gambling arguments, tax evasion arguments, money laundering arguments (since you can bet your sweet bippy that sites will give any transactional data that the government asks for if they are licensed), and just make the proposition much more palatable to a lot of people who don't have a fervent moral opposition to it. I think that if everything goes through, a good percentage of initial opt out states will swing around to opt in.

Will it be better or worse for (winning) players in the long run or short run? Who knows. I think it is a strong favorite to make things better in the long run, but sure, it could go the other way. How long will the status quo last if this doesn't go through? Again, who knows, but in my estimation, I think things deteriorate over the next 2-3 years to the point that live poker is a better option for people who live in states with live poker (because I think most of them will have some state law by then; really, once one state gets an even halfway working model, the others will fall.)


But here are some thoughts if it fails...
What is to stop a site that pulled out of the US market (ones still in it have a much harder battle) from making direct business proposals and pushing supportive laws? I mean, say Party goes to somewhere like VA (which has been on the fence about things like poker rooms and riverboat gambling, but does not have any big casino players in it) and proposes to offer an on line poker venue. They work with the legislature to craft state law that:
1. Provides reasonable revenue to the state (like a deposit tax, or rake tax based on state residence MGR)
2. Allows for residence to play against international pool and
3. Has provisions that they can also play against other states' residence who allow party to operate.

I'm just noodling here, but it seems like a viable state plan should be aggressively pursued if this fails. (Probably, it should have been pursued as a parallel effort all along, but limited resources and all that). I believe Party may be doing this in CA, but I think someplace without established casinos is a better target. Pitch a solution to the states who don't have a horse in the ipoker race, and try to build up a cadre and hope it proves to be viable enough to break into states that are trying to protect their internal casinos. (That is, if say 8 states get on board, and they are making more revenue than a protectionist state like say NJ if they get protectionist legislature passed, then maybe they could be wooed to revisit the issue).

/ramble, one time and all that. (Actually, I'll go with "Please baby, please baby, please baby, baby baby please!")

[banonlinepoker]

Guys today is simple theatre. Everyone knows how each vote was going to go. Reid is doing his usual do nothing, grandstanding nonsense when he knows he has to cave but has two weeks to give CNN and MSNBC talking points. It's disgusting. Why he doesn't just cut the deal like he should have months ago is just more Dem BS.