PokerStars Earns Czech Republic Gaming License

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PokerStars announced on Tuesday that it has received a license to operate its online casino and poker room in the Czech Republic, the first site to do so under the country’s new gaming laws. The license was granted January 28th and should be ready to go within the next few days.

“We are very proud to be the first online casino and poker operator to be awarded a license and support the newly regulated Czech market,” said Guy Templer, Chief Operating Officer, in a press release. “This underscores our commitment to supporting local regulations and obtaining local licenses wherever possible.”

PokerStars said that it “will offer Czech players a wide range of poker games and tournament formats across its shared global liquidity,” so it appears that there will be no ring-fencing; Czech players will be able to play with people on other PokerStars sites.

The new gaming laws to which PokerStars referred were signed by Czech President Miloš Zeman in July 2016 and took effect January 1, 2017. Online gambling operators are now required to hold a Czech gaming license in order to offer their services to residents of the country. While some sites might choose to risk operating without a license, PokerStars did not.

PokerStars also might be one of just a few who decide to apply for a license. Under the new law, operators must pay a tax of 35 percent of gross gaming revenue from any game that uses a random number generator (RNG). As online poker uses an RNG, PokerStars will be hit with this tax (as well as on its casino games). On top of that, there is still the 19 percent income tax rate.

This was all be design, too. Andrej Babiš, the Czech Finance Minister who introduced the online gambling proposals in 2014, is actually very much against online gambling. But rather than trying to ban it and run into pushback or other problems that could result from a prohibition, he decided to legalize it, but tax operators up the wazoo. That way, operators might just self-ban. He actually wanted the gaming tax to be 40 percent, but backed off ever so slightly.

Babiš once told Business Week, “The indirect costs for the state stemming from such gambling are several times higher than the revenue it collects. That should be made even.”

At the end of December, UK gaming giant William Hill told its Czech customers that “following recent regulatory developments” it was going to stop serving Czech players and all current Czech accounts would be closed. Players were still able to withdraw their funds. William Hill left the door open for a possible future return, saying in an e-mail to its affiliates, “….we are confident that we will have the opportunity to work together in the future.”

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