How New Legislation is Affecting UK Poker Players
A couple of years ago the UK introduced significant changes targeting online gambling. After many years of being one of the most open gambling markets in the world, the UK Gaming Commission (UKGC) brought in new legislation to regulate and tax the industry for the UK government. So you can get a full understanding of how this has affected online poker in the UK, here you can find out about the changes that have been brought in, which are the main poker sites affected and what is the impact be on you, the player.
UK Licensed Poker Sites - The New Regulations
Prior to November 2014 the UK government was only able to tax sites which were based in the UK. While many poker sites, casinos and betting companies kept their main offices in the UK, their 'official' operations are based in offshore tax havens like the Isle of Man and Gibraltar, meaning they were exempt from paying UK taxes.
In order to address this there were several ideas discussed including the possibility of insisting sites serving UK customers should be located within British borders. While sound in theory many other counties around the world have tried unsuccessfully to enforce this, only to fall foul of European and international free trade agreements leading to a state of uncertainty of the sites' legality and non-enforcement of domestic law.
Instead the UKGC opted for a 'point of consumption tax' meaning that sites would have to pay 15% taxes on their gross profit made from UK players. Companies also have to hold a UK Gaming Commission License in order to provide games and advertise to the British public. The cost of each license depends on the size of the operations and range of services provided, although the largest poker sites are expected to pay over £150,000 in application and annual fees.
UK Licensed Poker Sites - Which Sites are Affected
Essentially all online gambling companies which provide games to the UK should abide by these rules. For a start the majority of them wish to behave legally and responsibly to keep customers trust. Also with many leading poker rooms now part of limited companies there is no option, as they have a duty to their shareholders to act correctly. Notably unlike other countries, it legislation which the UK is taking seriously and after the laws first came into effect sports teams accepting sponsorship from non-licensed gambling companies were threatened with action.
Some of the biggest sports betting names on the UK High Street where the first to gain licenses. Companies such as Ladbrokes and William Hill and Titan Poker have a very high UK customer base throughout all their products, so gained licenses to cover all their activities including their poker sites which are part of the iPoker Network. In addition to these purely online companies such as 888.com and Bwin.Party with strong customer bases in the UK and FTSE listings, had to comply if they wished to stay in the strong UK market.
The biggest poker room of all, PokerStars and its sister site Full Tilt Poker, were originally permitted to operate under provisional licenses. There were some small concerns that these Amaya owned sites may not gain their licenses, having previously previously operated in several grey markets including the US. These were soon put to rest and due to their solid reputation of PokerStars and their existing Isle of Man licenses, and everything was quickly approved once the legislation came into effect.
UK Licensed Poker Sites - What is the Impact on UK Players?
In the build up to November 2014 there was plenty of communication from many sites explaining what UK players had to do. In many cases this was just a case of agreeing to new terms and conditions with some sites insisting on players downloading a new client. Apart from this very little has changed.
A big positive is that UK players are still allowed to play in the international player pools with no extra rake paid in regular games. The 15% 'Point of Consumption' tax will, for the most part, be absorbed by the poker sites, although it is expected that UK players loyalty rewards may be reduced in the future to cover some of the cost.
These costs have also affected players abilities to use French facing sites, such as Winamax and PokerStars.fr. UK players have been barred by these sites in order to avoid paying fees and taxes to Britain as well as France.
For a period of time there was a question over players ability to automatically reload under these laws. It was felt that under the legislation the ability to thoughtlessly put money onto the table would be seen to encourage problem gambling. This resulted in PokerStars saying that function would not be available to the UK.
This decision was reversed before November, due in part to pressure from the players highlighting its effects and unfairness. In an unrelated release PokerStars later announced they would rake tournament rebuys and add-ons in certain regulated markets, including the UK.
UK Licensed Poker Sites - Summing It Up
Despite some opposition, overall the new legislation in the UK has been welcomed by both sites and players. While providing regulation, the costs have been viewed as reasonable and the effects on players have been minor. You can still play on all the top poker sites without really noticing much of a difference, although some players may notice a dip in the value of the loyalty rewards they receive.
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