Poker Sites Announce Departure from Portugal

The regulation of online poker has resulted in an exodus of online poker sites from Portugal, with even PokerStars putting a temporary hold on registrations.

A new online gambling regime came into effect this week in Portugal – one that officially ended the state lottery´s monopoly on legal online gambling and allowed international online gambling operators to apply for Portuguese licenses.

Unfortunately the ridiculously high levels of taxation will make it financially unviable for most online operators to provide a service in Portugal. Online poker and casino revenues will be taxed at between 15% and 30% depending on income, while sports betting companies have to pay 8% tax on betting turnover up to €30 million (turnover not profits) – rising to 16% thereafter.

The implementation of the new regulations has resulted in several major online gambling operators announcing their departure from the Portuguese market, while Amaya Gaming has told affiliates to stop marketing PokerStars and Full Tilt Poker as they will not be accepting any new registrations from Portuguese players until they are in receipt of license later this year.

Hills, PKR and Party Poker Confirm Exit

Although the new regulated market in Portugal will not be ring-fenced like neighbouring Spain, Italy and France, many operators have confirmed that they will not be applying for a Portuguese online gambling license. At the end of last week William Hill advised Portuguese players to withdraw their bankrolls as they were closing down their operation in Portugal, and PKR – who withdrew from the French market last month – has also said that the new tax regime is unviable and that they are pulling out of the market.

Party Poker – who has a daily average of just 22 players in Spain – stopped accepting new registrations a while ago and is not expected to apply for a license, while the situation regarding several other leading players in the Portuguese market remains unclear. Players are waiting for announcements from three other leading online gaming providers in Portugal – Betfair, 888 and Bet365 – while the major affiliate site in Portugal PokerPT.com has cancelled all room-based promotions until it is clear which sites will still be providing a service to Portuguese players by the end of the year (significantly one featuring 888Poker.com).

Significant Changes will Affect Players Also

Although the new regulations for online poker on Portugal have (so far) avoided taxing players on their winnings, there is no doubt that online poker operators will have to start charging higher levels of rake and reducing player benefits to make up the money they are losing to the taxman. There are also several other licensing conditions included in the new regulations that players are particularly unhappy about. These include:

• Freeroll tournaments will not be able to award cash prizes or entries into a tournament with a cash prize.
• Players will not be able to use HUDs or other poker software to store hand histories or collect information about other players
• There has to be a minimum of 6 seats in a poker tournament – so that rules out Spin & Gos and heads-up tournaments.
• Late registration into poker tournaments, re-entries and re-buys will be limited to just three levels.

The likely outcome of the new regulations is that the online poker market in Portugal will become very uncompetitive. PokerStars will undoubtedly remain as the dominant force, but how many other online poker sites will be able to provide any level of competition with such high tax rates? Probably very few if any at all.

Because of this, concerns have been raised that many players will look to offshore, unregulated sites for their poker action. Although unregulated sites will be illegal under the new legislation, Portuguese players are likely to follow the example of the neighbours in Spain – where 46% of players have accounts with offshore gambling operators – to get better value.

Unfortunately, the withdrawal of players from the domestic player pool will have even more negative consequences for the online poker market in Portugal.