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The alarming situation of the French online poker market

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The alarming situation of the French online poker market
Written by Philippe Ramou on Thursday, August 9, 2012

In June 2010, France liberalised its online gambling market. While shortly after the football World Cup in South Africa the performance of the sports betting sector were rather disappointing, it seemed that the online poker market could do better. However, two years later, many virtual rooms have been forced to shut down.

Several closures this summer

In less than a month, we have learned of the unexpected departure of several big names in the online poker industry. During the first week of July, Iliad Gaming, the subsidiary company of French ISP ‘Free’ specialised in online gambling that operated the site Chilipoker.fr, decided to shut its doors. A few days later, it was the turn of Winga to announce that it would cease its activities before 15 August. Finally, Titan.fr has also announced its closure plans, scheduled for 30 July 2012.

Other sites in trouble

Fortunately, not all online poker rooms have been forced to close down. Nevertheless, some of them have recorded heavy losses, such as LB Poker, owned by Française des Jeux, the Lucien Barrière Group and On Line Gaming (Karmitz group). In particular, On Line Gaming has recorded a loss of almost 30 million euros in 2011, compared to a turnover of only 4 million. BetClick Everest Group experienced an even more substantial loss, which amounted to 90 million euros. The case of Pokerleaders.fr should also be mentioned, as the site was licensed in February but has announced that in the end it will not enter the French market. Furthermore, Mypok and PokerXtrem have been forced to merge in order to continue to exist.

The reasons behind this crisis

The French online poker market has been experiencing such difficulties mainly because of the tax burden imposed on the industry. At the moment, taxes are still collected on players' bets, while all licensed operators, the ARJEL and even various ministerial studies recommend to tax the gross gaming revenue instead, i.e. the turnover. If the new government does not decide to act promptly and fails to propose an amendment to the law, more online poker rooms may have to shut their doors.


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