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California delays iPoker vote after new changes to bad actor language

California’s Assembly will not vote on Adam Gray’s bill to legalise online poker for another week at least after its Appropriations Committee made further changes to so-called ‘bad actor’ provisions in the legislation.

Last week Gray amended AB2863 to push back the legislation’s provisions to penalise operators who were active in the US market following the passage of the Unlawful Internet Gambling Enforcement Act (UIGEA) in 2006.

Rather than the usual cut-off date of December 31st, 2006, Gray set a compromise date of December 31st, 2011, as the date after which operators served the market illegally. This was seen as a way of allowing PokerStars into California.

However, the Assembly Appropriations Committee has reintroduced the 2006 cut off date, with operators that continued to serve the market after then prohibited from securing a licence in California until 2021.

That is unless those operators pay a $20m entry fee and agree to limit the use of their customer lists and databases built up during their post-UIGEA activities.

A further amendment would give the first 10 per cent of revenue tax to the state rather than adding to the $60m racing purse subsidy. This is designed to ease concerns that online poker would not raise enough tax revenue.

Operators will also be required to pay a license fee of $12.5m, up from the original $10m proposed by Gray.

As a result of the amendments, an Assembly vote on the bill has been delayed at Gray’s request. Unlike New York’s legislative session, which ends this month, California’s session runs until August 31st, giving the bill more time to pass.

The amendments have been praised by PokerStars’ California coalition. The Morongo Band of Mission Indians, San Manuel Band of Mission Indians, California's three largest card clubs – Commerce Casino, Hawaiian Gardens Casino and Bicycle Casino – and Amaya said it was pleased that efforts were being taken to regulate iPoker.

“Finally, consumers will be encouraged to hear that a safe, regulated playing market is forthcoming,” the coalition said in a statement.

“In the last few weeks, an unprecedented and growing coalition of consumers, tribal governments, labor unions, card rooms, race tracks and many others have come together to support moving this bill forward, and it represents the most significant progress ever made in authorizing iPoker in California.

“Just today, the 2.1 million member California Labor Federation joined the growing list of supporters for AB 2863.

“We're confident that Chairwoman Gonzalez and Chairman Gray will use the coming week to resolve the final issues and move the bill forward, and we want to thank Chairman Gray and Chairwoman Gonzalez for their continued efforts and pledges today to put in the necessary work to finally regulate internet poker in order to protect consumers and create revenues for California,” the statement concluded.

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