The markup, per http://financialservices.house.gov/H...px?NewsID=1340:


H.R. 2267, Internet Gambling Regulation, Consumer Protection, and Enforcement Act--Ordered reported to the House, as amended, with a favorable recommendation by a record vote of 41 yeas and 22 nays, 1 present.

• Amendment by Mr. Frank, no. 1, was OFFERED and WITHDRAWN.
  
• Amendment by Mr. Sherman,no. 2, was AGREED TO, by voice vote.
  
  Adds to the license applicant requirements a certification by the applicant and all related business entities that they have never violated Federal or State gambling laws and have done due diligence to prevent any US person from placing an internet bet that violated Federal or State gambling laws.
  ---
• Amendment by Mr. King and Mr. Meeks, no. 3, was AGREED TO, by voice vote.
  
  Adds a provision that licensees cannot accept any bets or wagers on sporting events, except for pari-mutuel racing as permitted by law.
  ---
• Amendment by Ms. Kilroy, no. 4, was AGREED TO, by voice vote.
  
  Gives the Treasury the authority to prohibit inappropriate advertising activites by licensees, such as spamming or Internet advertising campaigns directed at vulnerable populations (children, problem gamblers).
  ---
• Amendment by Mr. Bachus and Mrs. Bachmann, no. 5, was OFFERED and WITHDRAWN.
  
• Amendment by Mr. Baca, no. 6, was RULED NON-GERMANE.
  
• Amendment by Mr. Baca, no. 7, was NOT AGREED TO, by a record vote of 22 yeas and 37 nays.
  
• Amendment by Mr. Campbell, no. 8, was AGREED TO, as modified, by voice vote.
  
  Clarifications of some provision wordings to make sure the Treasury can delegate licensing and regulation to state or tribal authorities.
  
  Adds a requirement that the licensee facilities for US players are located within the US.
  
  Adds a requirement that anyone involved in the operations of the sites, including the software developers, meet the same suitability requirements as the licensee.
  
  Adds stricter provisions for consumer safeguards, including excluding players under 21 years of age; excluding any play per state opt outs; making information available for problem gamblers; making opt out options available for each player (loss limits, play time limits, deposit limits, etc.); requiring all players to set their limit options (at the player's discretion); privacy and security for players; protections against fraud; dispute resolution procedures for players; protections against money laundering; specific requirements for integrity and fairness of the games (including RNG protocols).
  
  Gives the Treasury the authority to update the safeguards above according to evolving technologies.
  
  Instructs the Director of the Financial Crimes Enforcement Network to maintain a list of Unlawful Internet Gambling sites, which will be made publicly and privately available by the Treasury for use by anyone mandated with compliance with the UIGEA. This eliminates the ambiguity of the UIGEA, and will probably eliminate overblocking. Includes an appeals and court process for anyone appearing on the list, to contest.
  ---
• Amendment by Mr. Sherman, no. 9, was AGREED TO, voice vote.
  
  Changes the initial state opt out period from 90 days to the end of one full state legislative session following enactment of the law. A very good amendment for us! This essentially implies that the states need to resolve the opt outs by state legislative action. It also means that the licensed sites can operate in all states until a state legislature takes action otherwise.
  
  Interestingly, there is no grace period following the end of the first state legislative session. So, if a state legislature passes an opt out or other limitation and the legislation isn't signed into law by the governor until after the end of the session (or the notice the governor gives the Treasury takes place after the end of the session), then the opt out/limitation doesn't go into effect on the sites until at least the first January 1 that comes at least 60 days after the first notice to the Treasury. And any change in opt outs/limitations by a state after the initial period has that same waiting time.
  
  Bottom line: opt outs/limitations aren't going to be easy and fast for the states.
  ---
• Amendment by Mrs. Bachmann, no. 10, was AGREED TO, by voice vote.
  
  A licensee can lose their license if they target advertising at persons underage according to State laws.
  ---
• Amendment by Ms. Bean and Ms. Kilroy, no. 11, was AGREED TO, by voice vote.
  
  Gives the Treasury the authority to ensure each licensee's software and systems to prevent minors from wagering are effective, and to levy penalties or license revocation if not.
  ---
• Amendment by Mr. Frank, no. 12, was AGREED TO, by voice vote.
  
  Gives the Treasury the authority to consult with the Indian tribes on development of regulations.
  
  Adds to the problem gamblers self-exclusion list provisions a statement that the licensees can't accept wagers from anyone who put themselves on this list (which this provision should have said in the first place). This list is maintained by the Treasury, and putting yourself on the list will get you excluded from all licensed sites.
  
  Specifies that this law doesn't affect existing Indian tribal gaming operations or compacts, and that tribes can get a license under this law without affecting their land-based gambling operations.
  
  Clarifies the safe harbor provision for financial transaction providers so that they are not liable for processing transactions under this law as long as they didn't have specific knowledge that the transactions were conducted in violation of the law. This goes hand in hand with the list by the Financial Crimes Enforcement Network mentioned above. If a site appears on the list, an FSP doesn't have safe harbor, but does have it for any other transaction for Internet gambling. Better than the original wording of this provision, which would have laid the responsibility for determining if transactions were compliant with this law on the FSP instead.
  
  Prohibits the use of credit cards for Internet gambling.
  ---
• Second Degree Amendment by Mr. Frank to Bachmann Amendment, no. 13a, was AGREED TO, as amended, by voice vote.
  
  If a federal or state court, or an appropriate state agency notifies the Treasury that someone is delinquent in child support payments, the person is automatically added to the self-exclusion list (and sites can't accept wagers from them) until the Treasury is notified that they are no longer delinquent.
  ---
• Amendment by Mrs. Bachmann, no. 13, was AGREED TO, as amended, by voice vote.
  
  Sites have to verify for each of their players that they are not delinquent on child support payments. This one would have been a mine field except the amendment above clarified how to implement it.
  ---
• Amendment by Mr. Peters and Mr. Hodes, no. 14, was AGREED TO, by voice vote.
  
  This one amazes me, and I think it is the most significant amendment in terms of changes to US law. It states that state and tribal lotteries don't have to get a license under this law to operate Internet gambling that is legal under the UIGEA (i.e., any intrastate or intratribal gambling other than sports betting) and makes such expressly legal. And it clarifies the Federal Wire Act to specify that it doesn't apply to such Internet gambling run by state or tribal lotteries. Bottom line - state lotteries will be able to offer any intrastate internet gambling they want, legally and without federal licensing and regulation.
  ---
• Amendment by Mr. Bachus and Mrs. Bachmann, no. 15, was AGREED TO, by voice vote.
  
  This one disqualifies sites from getting a license if they offered or facilitated illegal Internet gambling after passage of the UIGEA. I'm not going to delve into this one here, but will post about it in this thread later on.
  ---
• Amendment by Mr. Sherman, no. 16, was AGREED TO, by voice vote.
  
  Requires sites to locate their operations for US players in the US, including:
  
  Establish a US corporation or other US business entity, with majority US officers and majority US board members.
  
  The facilities for US operations located in the US and open to regulatory inspection.
  
  The majority of employees, and employees of affiliated business entities, are US residents or citizens.
  ---
• Amendment by Ms. Kilroy, no. 17, was AGREED TO, by voice vote.
  
  The sites have to make anonymized player data available to the Treasury, and the Treasury has to publish it on their web site, including gaming frequency, gaming duration, the amount wagered, the number of bets placed, and net losses.
  ---
• Amendment by Mr. Bachus, no. 18, was NOT AGREED TO, by a record vote of 22 yeas and 43, nays.

Great summary PX, Thanks

I have a question

What, if anything does this mean for international player pools? Will sites be able to offer gaming to overseas sites (from the US to elsewhere)? What about combined player pools.

If sites are licensed by the US,become US corporations and are subject to US law, then how would they offer services to players in other countries? Would the US just allow their licensed sites to offer games to other countries without some kind of agreement between both countries.

Would this also effect the current sites (ft/ps if they get a license) from operating in some places they currently do, if the law of those countries don't currently regulate online poker or if they have specific laws banning it. I just wonder if sites licensed in the US would be able to allow players in other countries to play (in one international pool) and if they can, will it be all of the same contries they serve now. Might suck for some plyers if certain sites have to drop players from some nations because they got a US license, Just wondering If this might happen?

EDIT: I guess overall I like the amended bill and support it, now we need to get to work on HR 4976 and make sure they don't mess that one up

Nothing in the bill or amendments prohibits combined international player pools. In fact, the amendments implicitly allow for them by not stating that they are forbidden, and by not stating that non-US owned sites are excluded. The amendment just specifies that for US player operations, the majority of employees, corporate officers and corporate board members have to be US persons. It does not exclude such sites from being owned by non-US persons. The amendments also say that the operations for US players have to be located in the US, but allow for other operations of the same sites to be located outside the US.

It depends. If international players can sneak in over the Mexican border, they will be afforded welfare payments, childcare, an education, healthcare, and free internet. If however, they attempt to enter a USA poker site from overseas through the internet, they will be hunted down by robot drones and evaporated.

The new USA poker sites, which will be run by Harrahs, Walmart, and Al Gore (Green Poker), will grow exponentially over the first two years before dying slowly under the weight of politically correct regulations and paperwork.

I'm almost sure this is a dumb question, but say the big sites don't get licenses and all that. Is there any risk that my roll on Pokerstars will just be frozen at some point, or I won't be able to get it off? Or would I be able to get my money off and just no play there, or would it just continue to be the same regardless of whether or not they're licensed?

Thanks

I really hope that pokerstars can find some workaround to keep the Stars name and still get a license. Private industry is always a million miles ahead of the stupid piece of **** that gov is so I hope they can.

Let's delve into the Bachus/Bachmann amendment, which on the face excludes any site that violated the UIGEA.

This amendment declares anyone unsuitable for licensing who:

1. Knowingly participated in any illegal Internet gambling activity since passage of the UIGEA including:

• the taking of an illegal Internet wager.
  
• the payment of winnings on an illegal Internet wager.
  
• advertising of any illegal Internet website or service.
  
• collection of payments to any illegal Internet gambling website.

2. Knowingly been owned, operated, managed or employed by any person participating in any of the above four points.

3. Received financial or other assistance from anyone who has knowingly accepted bets or wagers from a person located in the US in violation of Federal or State law.

4. Provided financial or other assistance to anyone who has knowingly accepted bets or wagers from a person located in the US in violation of federal or state law.

5. Has purchased or obtained from any other entity who has accepted bets or wagers in violation of US law:

• the entity itself.
  
• the customer mailing list of the entity.
  
• some of the equipment or services of the entity.

Personally, I don't see anything here that excludes sites like PokerStars or Full Tilt Poker. We already know the many valid legal arguments about these sites not violating any US federal laws, which covers #1, #2 and #5.

The only points where State laws come into play are in regards to receiving or giving assistance to persons accepting bets that violated state or federal gambling laws, #3 and #4. These provisions do not address accepting wagers, facilitating wagers or such. They only address giving assistance, financial or otherwise, to someone who illegally took such bets. That's a whole other matter, and not applicable to the poker sites. These two provisions covering state laws are anti-money laundering provisions, not anti-Internet gambling site provisions.

Sites that participated in sports betting won't be eligible for licensing under this amendment. Poker-only sites are not affected, imo.

PX, I doubt they will allow sites like PS/FT to obtain a license, but I could be wrong. It might take to much time and money fighting in the system for them to receive a license and they may not want to bother, they might know they're a long shot.

IMO PS/FT have options they can easily merge with another major player or buy out another smaller site that hasn't accepted US players in the past. Keep their software and player base, maybe just change their name and/or ownership and management to the site they merge with or buy. Something like this would be faster then spending time fighting in court for a license while other site who received a license are operating.

Yes, they have many options. Not the least of which is simply applying for a license. I really don't see anything in the amendments to stop them from doing so or disqualifying them. I don't think it will take litigation for them to get a license, either. There is also a strong chance that this will be made more explicit by further amendment to the bill later on (in the Senate) before passage, imo. Plus, there will even be opportunity for them to state their case during development of the regulations, before licensing applications begin.

The doors are certainly not shut on these sites. And I think they are still wide open.

This is a continued step towards country specific sites IMO.

If you believe that European states especially are going to allow the US to sweep up control of the online poker market without fighting back then you are dreaming.

European countries are going to continue the move to country only sites and then down the line will pool their players to form a Europeanwide site.

The end result wil be 2 blocks, one based in the US and one in Europe, with players from outside those areas facing a distinct possibility of being excluded from both.

lol. Anonymized PTR.

What was the stated rational for this amendment? Chairman Frank blitzed through this one pretty quick and wasn't exactly clear with his description. Would the data be used to monitor for collusion, ensure proper randomization, or to simply keep track of wagers for licensing (tax & fee) purposes?

I suspect it has mostly to do with public data about problem gaming, addiction and such. But that's just my guess.

Stars and Full Tilt might have problems because they accepted bets from residents of Washington state etc. where there are explicit laws against online poker.

Although I know this is a huge step forward for the regulation of online poker in the US. But I know very little about the process of a bill. How long do we have before it goes to the house and senate. And how long, assuming everything goes right, will we see any of this come into effect?

PX, is amendment no. 12 limited to but not excluding, visa check cards (issued by banks), prepaid visa/master cards, and/or visa/master gift cards? Will Visa and Mastercard allow for players to open accounts to use for internet gambling? Also, will this allow for Paypal to allow the same thing?

Curious about this as well.

Nicely done, and thanks, PX. I want to be just like you when I grow up.

As far as FT and PStars go, I don't think there is much reason to worry about them. I wasn't surprised to see language trying to ban the sites that didn't fall into step with the intent of the UIGEA. I have to think that all American facing sites knew this was a possibility. They supported us anyway and continue to support this bill. They understand how many American dollars are at stake. I have no doubt that they have plans to continue making dumptruck loads of money even if their specific sites are banned. I have no clue what they have in store, but they wouldn't have supported this legislation if they thought it would hurt their business in a significant way. It may involve something like partnering with Harrah's.com for their online poker room, or shutting down and reappearing under different names. I personally like PokerStairs. I hope that both PStars and FTP get licenses, though.

I think people are also worried about losing the big two. Didn't FTP and PStars become the big two because they accepted US players after the UIGEA? Once this legislation becomes law we may not see FTP and PStars in their current form being the biggest sites, but there will always be a big two (or three, or four) that dwarf all the rest of the sites.

Just my 2cents. (I can't believe my computer doesn't have the symbol for cents!)

PS: I have been involved in politics since I was 16. That's almost 25 years now. This is the most interesting, exciting thing I have been involved in politically.

How I Rate Today's Markup

I consider the markup, and committee passage, an unmitigated success. Here is my wish list for the legislation, which I posted in another thread a couple days ago:

Here is how today's markup stacks up against my wish list:

1. The amendment changing the initial state opt out from 90 days to the end of each state's first subsequent full legislative session shows a clear intent by Congress that the opt outs are meant to be determined by state legislatures. The regulations for implementation of a new law are always based on the mandate by the provisions of the law and the intent of Congress. I now expect any regulations regarding state opt outs to require or assume state legislative action.

2. Implicitly addressed by #1. This state opt out amendment, once again, shows the intent that state legislatures are expected to pass new laws if they want to opt out.

3. Clearing covered by the Campbell amendment. Some work will need to be done during the regulation development phase to solidify these consumer safeguards, but the framework is clearly stated and covers everything I would want.

4. Not addressed in this markup as it is part of the taxation bill, not this one.

5. Not addressed in this markup as it is part of the taxation bill, not this one.

6. Not addressed.

7. Not explicitly addressed, but the amendments regarding locating operations in the US for US players clearly leaves the door open for sites to have a combined player pool with their non-US operations.

8. Not addressed in this markup as it is part of the taxation bill, not this one.

So, I see positive results on most of the items in my wish list that fall under today's bill. And, I like many of the additional provisions added by amendment today.

The best though is the general success of getting the bill passed by the committee. The legislators are obviously serious about this bill, and many of the amendments corrected deficiencies in the bill which would have made it unpassable in the general assembly. There is clear intent to get this bill passed, something I was unsure of until today.

This may not explicitly prohibit international player pools, but what if every country had similar laws? There can only be one country from which a poker site has the majority of its employees, so if a site complies with this amendment and had the majority of its employees in the US, then if other countries pass similar laws, their citizens would not be allowed to play on the US sites.

Maybe the US can actually be the giant gorilla and dominate the international poker market, but if every county passed similar laws it would result in Balkanization as bad as the situation in France.

I understand that it is politically undesirable to have a site that has 99.99% of its operations outside the US, but IMO the percentage of employees, officers and board members should be related to some percentage of the US/Non-US player ratio. Otherwise requiring that the majority of operations are US based is an unfair barrier to international competition.

A "markup" is the process of a Congressional committee hearing and voting on amendments to a proposed bill that is before that committee. The markup is usually concluded by a vote of the committee on the amended bill. If passed, the bill is moved forward to either another committee (that will also need to pass it, possibly amending it as well) or to the full floor for debate and vote.

The bill that emerges after committee markup is a pretty good indication of the general final form of the bill, but amendments can still be made in other committee markups (if any) and during the full floor debate.

If the bill gets passed by a vote of the full floor of one chamber of the Congress (the House of Representatives in the case of this bill), it then gets sent to the other chamber (the Senate). The bill, or a companion bill, then goes through the same process in the other chamber including committee markup & vote (although this step could be skipped), full floor debate and vote.

If the bill that emerges (with a passing vote) from the Senate differs from the bill that was sent to them from the House, then the changed bill either goes back to the House for another full floor vote for passage, or goes to a reconciliation committee consisting of members from both houses to develop a compromise bill, which then needs another full floor vote in both chambers for passage.

Once the bill receives a final passage from both chambers, it goes to the President for signing to become law.

After becoming law, in the case of this bill there will be a period for development of the regulations by the Treasury. This will take some months to complete, possibly even running over to a year or more depending on the complexities and requirements of the bill. Once the final regulations have been set, it will take some time for implementation before the sites get licensed - submitting applications, background checks, etc.

Currently, there is nothing in the bill which specifically forbids sites from operating in the US during the period between the bill becoming law and an applicant site receiving a license. The Menendez bill in the Senate does specifically grant permission for any site that submits an application to operate until the application is either approved or denied.

The deadline for passage of the current Barney Frank bill (and the Menendez bill) is the end of this year. If the bill is not passed into law by then, the process will have to be started over with introduction of a new bill in the new session of Congress, which starts in January.

Here is the legal definition of credit card under US law, which applies to this amendment as well:

Since visa check cards, prepaid cards and gift cards don't operate on credit, they aren't forbidden by this amendment. PayPal will be able to be used as well, as long as funds come from the user's PayPal balance of a checking account, rather than charged to a credit card.

Thank you very much. Given your expertise. What is your take on the chances of this bill being passed by the end of the year(%)???

And are you suggesting that after becoming a law. Sites might have to wait a year before applying for a license. Or will they be allowed, or so far not denied the right to operate during this time.

These majority requirements would apply only to their US operations. It looks like this:

Site wants to run a US licensed site. They have to set up a US branch, incorporated in the US, located in the US, with majority US persons of officers, board members and employees, for this US entity only. Their non-US operations aren't subject to any of these requirements.