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U.S. States Eager for Foreign Online Compacts

U.S. casino operators are looking to play on the world stage when it comes to online gaming.

States that are pursuing legalization of internet gambling are looking to join forces with foreign countries to create a global market of regulated jurisdictions, according to report by the Financial Times. These international compacts would greatly increase player pool liquidity, benefiting operators on both sides of the Atlantic.

Currently, only three states in the U.S. have approved online gaming legislation—Nevada, Delaware and New Jersey. All are moving forward with plans to implement a working internet gaming system by year’s end, and all three have stipulations in their laws that allow for interstate and international compacts.

New Jersey, the largest jurisdiction in terms of population, passed an online gaming bill in February that includes a provision allowing for “compacts with foreign countries.” Nevada was the first state to pass online poker legislation, and recently expanded that measure to include compacts with other U.S. states. Nevada has also recently published a provision allowing for “international compacts” to be added to the law in the current legislative session.

Other U.S. states, including Pennsylvania, California, Iowa and Illinois, are also exploring online gaming legislation. A provision in the Illinois bill allows the state “to enter into agreements with other gaming entities, including foreign entities.”

Europe remains a lucrative market for online gaming. Compacts between the U.S. and the U.K., which has a regulated online gaming market, would increase the player pool dramatically. The U.K. has 68 million residents, and linking with states in the U.S. would be a significant step to establishing a global online network.

Many European companies are eager to re-enter the American market after being locked out by the passage of the Unlawful Internet Gambling Enforcement Act of 2006. The bill put a ban on electronic gambling transactions that effectively prevented foreign-based operators from attracting American players. Additional crackdowns on poker sites last year by the Department of Justice eliminated almost every overseas company from the U.S. online market.

Since then, Congress has been unable to ratify online poker legislation on the federal level. The states have taken up the challenge, and are moving rapidly to establish an online presence.

 

Robert Rossiello is a contributing editor for Global Gaming Business magazine and the Art Director for Casino Connection Atlantic City. He updates and manages this site and designs and produces the supplemental magazines to Global Gaming Business: Casino Design, G2E Preview, RD&E and Tribal Government Gaming. He also is a photographer for these magazines and this website.