Portugal Legalizes iGaming; Shared Markets on the Horizon?

By the end of 2014 Portuguese residents could very well have access to legal online poker, casino games, and sports betting after the Portuguese Parliament approved a sweeping online gaming bill on Friday.

The bill will still have to be rubber stamped by the National Assembly, but this final step is considered little more than a formality.

The parliament was given until July 10th to vote on the bill that was drafted by the Ministry of Economics earlier this month. After years of dragging their feet on this very issue, Parliament seemed to move rather quickly this time around, perhaps indicating the inevitability of the bill’s passage and the desire to get the industry up and running by the end of the year.

What the bill does

Portugal’s online gaming industry will utilize foreign operators, who will have to be licensed by the government and abide the regulations that will be put in place –which includes an initial capital investment as well as a .pt domain for the future sites they will operate. Operators will not have to be located in Portugal to receive a license.

The licensing fee and tax rates were not hashed out in the bill, but are expected to be in line with the country’s current tax rate on brick & mortar casinos, which PokerFuse.com has speculated will be between 15% and 20%.

Another interesting aspect of the bill is with sports-betting on the table it’s likely a number of online gaming providers such as William Hill, Ladrokes, and Betfair will apply for a license in Portugal, despite the relatively small population of the country, and of course the usual suspects like PokerStars, bwin.party, and 888 will likely want in on the Portuguese action.

Online gaming in Portugal and the surrounding area

Portugal has talked about expanding into online gambling for several years, initially hoping to create a state-controlled monopoly, but pressure from the country’s creditors (the IMF and EU specifically) forced their hand and the country will now have a free market online gaming industry.

Portugal will now join Iberian neighbor Spain, as well as France, Italy, and Belgium as ring-fenced European online gaming markets.

Portugal and Belgium are the most intriguing of these markets, as their smaller populations make it difficult to offer a robust online poker industry, and their recent adoption of legal online poker may help push the EU into becoming a shared-market , where players from any country with legal online poker can compete against one another.

This type of shared market approach would be a win for all involved, and dramatically increase the current player pools. For a country like Portugal (with 10.5 million residents) it may be the only way to maintain enough player liquidity for online poker to be viable.