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The Indian gaming sector may have legal and operational struggles to deal with, but new business ventures and forays keep the industry on the path of growth. Coming up soon on the poker map is Fair Play Skill Network, a platform that will offer white labels and skins to domestic online poker operators. The new project is a joint venture between QuantumSkill Gaming & Tech Pvt Ltd, the parent company of online poker site PokerHigh, and well-known international software provider Enterra Soft.
A high rate of Goods and Services Tax (GST) continues to cripple the lottery and racing industry and the last fortnight saw the race clubs operational in India make a forceful attempt to seek a GST reduction from the government. The Turf Authorities of India (TAI) that represents six racing clubs has submitted a request to the Union government seeking a GST reduction on bets taken by race clubs and bookmakers.
Meanwhile in the U.S., taking severe cognizance of the failure of Wynn Resorts to investigate the alleged sexual misconduct by former chief Steve Wynn, the Nevada Gaming Control Board (NGCB) has levied a record $20 Million fine on the company.
For another casino major, Caesars International (CZR), an agreement with billionaire investor Carl Icahn brings fresh hope for arresting the company`s falling fortunes. The company has struck a deal with Icahn that gives him 9.78% ownership of the company shares and allows him to bring three directors to the board.
The US Department of Justice (DOJ) has delayed by two months, the enforcement of its revised opinion on the 1961 Wire Act. Earlier scheduled for implementation on April 15, the opinion may come into effect mid-June.
PokerHigh Team Up With Enterra Soft to Launch Fair Play Skill Network
International gaming software firm Enterra Soft has announced a partnership with the parent company of PokerHigh, i.e. QuantumSkill Gaming & Tech Pvt. Ltd. As part of the tie-up, the two companies will jointly launch and operate a poker network in India.Called Fair Play Skill Network, the new platform will offer to the different domestic poker sites white labels and skins.
The network will be operated jointly, with shared liquidity. Already, a dedicated team has been set up in India for technology development and managing the business. Dmitry Starostenkov, founder and CEO of Enterra Soft said, “We love that we got the opportunity to launch ourselves in India with one of the biggest names in the poker industry. We’ve worked with them for some time and considering their expertise in the industry having launched some of the biggest names in the industry, we’re excited about the India chapter in our story and look forward to making Fair Play Skill Network the biggest in the years to come.”
PokerHigh had, last November merged with online poker site Hippo52. The merger saw the then head of Hippo52, Sumit Khurana assume the role of CEO of PokerHigh. Talking about the partnership, Khurana said, “We believe with the experience that our team has in the Poker industry, paired with the excellence and expertise of Dmitry and his team, PokerHigh will be a force to be reckoned with, having been one of the first white labels to partner with Fair Play Skill Network for technology. We plan on being the number one gaming website in the country, and we believe that teaming up with Fair Play was an important step towards achieving that.”
Turf Authorities Seek Reduction of GST in Horse Racing Bets
Turf Authorities of India (TAI), the representative body of six racing clubs in India has submitted a request to the Union government seeking a reduction in the Goods and Services Tax (GST) rate currently charged on bets taken by race clubs and bookmakers.
According to a Glaws report, the TAI has made a representation to Union Minister Piyush Goyal on February 14 for the same. In the request to Goyal who was then holding the Finance portfolio, the TAI stated that the 28% GST currently charged is on the face value of the bets made and not on the commission or earnings by the club, which is unfair and resulting in a considerable loss of revenue.
Referring to a Supreme Court decision, the TAI pointed out that horse racing and betting on it has been held to be a game of skill and thus exempted from the definition of gambling. Hence the classification of horse race betting under the category and as a good therefore is incorrect.
According to the figures submitted by the TAI, before the GST Act that came into effect in 2016, ₹305 Crores was being paid by race clubs and bookmakers across various states, while the taxes paid in the transition phase of 2017-18 was only ₹186 Crores.
The TAI has also pointed out that a high tax rate will eventually result in a progressive reduction of revenue, leading to an even lesser turnover for race clubs. This would be a loss-entailing scenario for the government as well since tax collection would reduce.
Nevada Gaming Control Board Fines Wynn Resorts a Record-Setting $20 Million
In the biggest-ever fine levied by the Nevada Gaming Control Board (NGCB) on a casino firm to date, the regulatory body has fined Wynn Resorts a record $20 Million in a settlement with the company over the alleged sexual misconduct by its former chief, Steve Wynn.
Wynn Resorts was levied such a massive fine for failing to investigate the claims for the alleged sexual misconduct made on Wynn before he resigned a year back.
“It’s not about one man,” Commissioner Philip Pro said. “It’s about a failure of corporate culture to effectively govern itself as it should.”
Chairman of NGCB Tony Alamo said that the severity of the allegations prompted the record-setting fine. “It needs to move needles here. It needs to ring across the entire country.”
Before this, the largest fine ever doled out by the board was on CG Technology in 2014, when the sports betting and mobile gaming setup was fined $5.5 Million. Though Wynn Resorts has been slapped with a massive fine, regulators have allowed it to keep its gambling license. The settlement also wraps up the year-long investigation by the NGCB on the allegations. Steve Wynn meanwhile still faces lawsuits for his alleged sexual misconduct even though he continues to deny all allegations of wrongdoing.
The company management commenting on the regulator’s decision said that the conclusion of the review by the NGCB was a step forward for the company and its new leadership.
The NGCB also noted that since Wynn had left the company`s management that was taken over by CEO Matt Maddox, the company had undergone a sea change in its management culture, and an influx of female employees including three new directors had taken the percentage of women on the board to 50%.
Carl Icahn Joins Caesars Entertainment as Investor &Salesman
Shares of Caesars Entertainment (CZR) shot upon Friday after billionaire investor Carl Icahn joined the company as an investor and salesman. The deal inked between Caesars and Icahn allows the activist investor to add three directors to the board.
Icahn who is the former owner of Trump Taj Mahal in New Jersey now owns 9.78% in the company. He has named Keith Cozza, Courtney Mather, and James Nelson as the new board members. The agreement also allows the Icahn Group to add a fourth new member if a new CEO isn’t named within 45 days.
Chairman of Caesars, James Hunt commenting about the new agreement said, “Our new colleagues bring diverse and relevant experience, and we look forward to them joining our board in our ongoing efforts to further enhance value for all shareholders. Since the completion of Caesars’ restructuring, we have been undergoing a strategic process to create value, and we will continue that process working with our new directors.”
Caesars has seen a 30% fall in stock prices in the past year. After news of the agreement broke, the company saw its stocks rise 4.12% to $8.98 per share in premarket trading. Icahn has stated that he wants to either sell the company or enable access to the resorts that allow it to grow.
“I believe the best path forward for Caesars requires a thorough strategic process to sell or merge the company to further develop its already strong regional presence, which will allow Caesars to continue to take advantage of the Caesars Rewards program bringing more and more players into Caesars’ Vegas market,” Icahn said.
US Department of Justice Delays Enforcement of Wire Act
In a recent development, the US Department of Justice (DOJ) has put on hold the enforcement of its publicized new opinion on the 1961 Wire Act.
Last Thursday, media reports informed that the DOJ planned to extend the enforcement of the Wire Act by 60 days, from April 15 to June 15. The DOJ later confirmed the decision, adding that the delay aimed at giving more time to online gambling operators to make the necessary changes in their set-up for ensuring compliance.
The new opinion by the DOJ was released in January and considered the prohibitory provisions of the Wire Act as applicable to most forms of online gambling. Since it does not clearly word the legality of intrastate online gambling and lottery operations, the DOJ’s revised opinion has sent the gaming industry in a spin. Amidst heavy criticism, three stakeholders have challenged the opinion in court. After the New Hampshire Lottery Commission and the state’s Attorney General filed a legal challenge early in February, the iDEA Growth trade group also followed suit.
Now that the issue is in court, it is also unlikely that the DOJ will be able to enforce the new interpretation of the Wire Act.