Penn National responds to regulator’s online gambling consultation

Daily fantasy sports and high taxation were among criticisms levelled by Penn National Gaming in its response to a consultation on online gambling launched by the Pennsylvania Gaming Control Board following the recent passage of state legislation legalising online gambling in the state (see previous reports).

Among the points raised by the land and online gambling operator – probably the state’s biggest – were the following:

* The $10 million licence fee and 36 percent tax rate approved by state lawmakers are the highest in the world, and may make it impossible for a casino operator to make any return on its investment of capital.

The operator claims it could lose around 40 cents on every $100 wagered on sporting events, and believes legislators should consider the more sensible arrangements passed in New Jersey and West Virginia, which allow state-licensed operators to better compete with neighbouring jurisdictions and the unregulated market.

* The regulator should give preliminary approval to platforms that have already been extensively tested and approved for sports betting in Nevada, along with employees and vendors.

* Penn National would also like to see the removal of a legislative provision requiring servers to be located in Pennsylvania.

* The gambling group seeks relief from another provision requiring in-person registration for punters.

* Penn National is opposed to branding and partnership (skins) arrangements for mobile and online operators, noting that these would allow new white label activity by third parties using brands it alleges (incorrectly) are not currently in use in the state such as DraftKings and FanDuel (both of which are already regulated as DFS operators by the PGCB).

Penn National appears to believe that a failure to ban skins would present “significant” new competition to existing Pennsylvanian licence holders and cause market saturation!

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