Expected by June, it arrived a few days late: Thursday, July 6th the shared liquidity agreement for online Poker was signed. The participating Countries are Italy, Spain, France and Portugal. The document was signed in Rome, an important detail inasmuch as the Italian authority has been one of the main sponsors of the initiative.
But what is shared liquidity, exactly? Specifically, it means that players from different Countries can play together on a single gaming platform. Before the agreement, an Italian player was only authorized to play Poker on Italian gaming dealer sites; with shared liquidity Italian players can challenge Spanish, French and Portuguese players on an “.eu” platform.
A change that will certainly bring a positive impetus to the Poker ecosystem, under pressure after the passing fad of 2008-2011 and revitalised lately only by the introduction of variable jackpot tournaments. Opening to shared liquidity, in fact, means increasing the number of users present on the platform and consequently the circulating capital, with the probable effect of increasing the number of gaming tables and tournaments, as well as the total value of winnings at stake.
Effects of the agreement are not immediate; six months at least will be needed before shared liquidity becomes reality. In the meantime, signatory authorities will have to work on defining common standards and on solving technical/administrative aspects to ensure that the shared liquidity is to all effects an actual opportunity to extend the market for all gaming dealers, and to guarantee the platforms are used and enjoyed properly.
The crux of shared liquidity is the taxation scheme. Individual countries have a legislative structure with own tax rates and consequently different impacts on costs, and therefore margins, of gaming dealers.
With the agreement the different Poker tax rates will remain effective, which will generate problems for players on how to manage payout and rake.
In order to guarantee fairness in redistributing gaming operator margins, dealers and authorities are working on a system to effectively manage rake. A possible solution identified is to apply a rake that varies according to the player’s nationality. In this way, the effects of different tax rates for gaming dealers would be annulled and the player would be charged the same commission that is applied within national boundaries. The solutions could be temporary since the real goal is to harmonize the taxation scheme at European Community level.
Technicalities aside, the agreement is very important for the online gaming sector: it is the first step towards a communitarian market. In the near future the agreement could be extended to other member states and/or it could be expanded to include other types of P2P games (e.g. the Betting Exchange) or jackpot games (e.g. Casino Games and Bingo), in the same way as what happened in the past with the SuperEnalotto.
Samuele Fraternali and Marco Planzi, Directors Online Gaming Observatory