NJ, UK Reach Liquidity Accord

In an historic agreement, the U.S. state of New Jersey and the United Kingdom have agreed to share online poker liquidity among legal iGaming operators in both jurisdictions. The NJ Division of Gaming Enforcement last week sent letters to those common operators to determine how such a system would work. DGE Director David Rebuck (l.) says the deal would expose NJ iGaming to more than 70 million people.

The New Jersey Division of Gaming Enforcement last week sent letters to the iGaming platforms that operate both in that state and the United Kingdom asking them to recommend how a system sharing liquidity between the two jurisdictions would work. DGE Director David Rebuck says the arrangement would expand the reach of iGaming in New Jersey to more than 70 million people.

“With 9 million people in New Jersey, and more than 63 million in the United Kingdom, this would mean a massive increase in liquidity for New Jersey operators,” he says. “Even when you discount children and non-gamblers, it gives us access to a market that is very familiar with online gaming. That number is one-fifth of the total U.S. population.”

Initially, the effort is designed to increase participation in online poker, but could eventually be expanded to include online casino games as well, according to a DGE spokeswoman. But the UK also permits online sports betting, which obviously would be prohibited to U.S. players under current federal laws.

The common platforms include 888.com, GVC (the former PartyPoker), PokerStars, Gamesys and Betfair. But not all New Jersey iGaming operators offer poker, so it’s unclear how they would participate, at least in the initial stages. Players from each platform would be limited to playing on that platform and would not cross over. To play on another platform, they would have to sign into their account on that platform. New Jersey online poker market is led by the recently licensed PokerStars, owned by Amaya Gaming. WSOP (an 888 client), PartyPoker and Borgata (on the GVC platform).

The letters to the operators are just a beginning, stresses Rebuck, should the operators decide its feasible. He said the letters were issued after an agreement in principle was reached with the UK Gambling Commission, which governs all gaming in that nation.

“We’d still have to figure out lots of issues: specific regulations, how the tax rate from each jurisdiction would be applied, player ID and geolocation issues, and other things we probably haven’t even considered yet,” he says. “But you have to start somewhere.”

In the U.S., there is only one interstate iGaming compact, between Delaware and Nevada, which has one common operator in 888.com that also powers the Caesars casino sites in New Jersey and WSOP.com. That has been the hold up in any talks with Nevada for a similar agreement, says Rebuck.

“We’ve talked to Nevada but the fact we’re limited to one operator makes it a difficult proposition to make to our other operators,” he says. 888/WSOP is by far the dominant player in the Nevada market, with the demise of original operator Ultimate Gaming and the later addition of also-ran Real Poker, operated by the South Point casino in Las Vegas.

The DGE letter has requested a response from the New Jersey operators with common UK platforms by August 1.

“We’re very serious about this,” says Rebuck, “and we want to move it along as quickly as possible so iGaming in New Jersey will continue the impressive growth we’ve shown over the last 15 months.”