PokerStars Takes Crucial Step Toward New Jersey Casino License

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Friday, April 19th, 2013 | Written by Shane Larson

The largest online poker site in the world took a significant step closer to operating in a regulated United States market this week.

Several sources are reporting that Rational Group – PokerStars’ parent company – has completed an application for what is known as an “interim casino authorization.”

This authorization, issued by New Jersey gaming authorities, is effectively the go-ahead PokerStars needs to complete their proposed purchase of the Atlantic Club Casino in Atlantic City, New Jersey.

Many believed PokerStars had completed this application months ago, but recent reports from those close to the process revealed that – for reasons unknown – the PokerStars application was not formally completed and submitted when reports of the application first emerged back in February.

Whatever those reasons may have been, the application is now complete and has been filed with the New Jersey Division of Gaming Enforcement.

What happens next?

The official filing date of the application was April 10th. That starts a 90-day (business days, not calendar days) clock during which the New Jersey Department of Gaming Enforcement will investigate Rational, PokerStars and any associated entities mentioned by the application.

That takes us into July, although the DGE is under no obligation to use the full 90 days. After the Department of Gaming Enforcement completes their investigation, they file a report with another regulatory body – the New Jersey Casino Control Commission. The Commission then has 30 days to schedule and execute a hearing on the matter and to issue their ruling.

Effectively we’re looking at sometime in August as the outside end of the range for a decision. It’s widely believed that Nevada is likely to have launched real-money online poker by that point.

Does PokerStars own the ACC?

Not yet. PokerStars cannot take control of the casino until they receive the necessary authorization from New Jersey authorities. But that’s basically the last step that remains on the road to a deal between PokerStars and the ACC. The Atlantic Club Casino and PokerStars have apparently reached agreement on every detail of the takeover and plans are in place for a quick transition once regulatory approval is acquired.

Is PokerStars likely to be approved?

There are a wide variety of opinions on the subject. On one hand, PokerStars has made some enemies – such as Caesars – that could prove to be substantial obstacles to PokerStars entering New Jersey. On the other hand, PokerStars is offering a unique opportunity for Atlantic City, namely the chance to rescue a casino that is apparently on the verge of financial collapse.

Will this license allow PokerStars to offer online poker in New Jersey?

No. That will be a separate licensing process. This application only concerns the ability of PokerStars to operate the Atlantic Club Casino. But the only entities who will be able to apply for an online gambling license in New Jersey are those who hold a license to operate a land-based casino, so this license is an important prerequisite for PokerStars in their attempt to gain a foothold in the regulated market for online poker in the United States (PokerStars currently does not offer online poker to US residents).

What about the AGA petition opposing PokerStars?

That is a separate – and still outstanding – matter. Authorities in New Jersey have yet to consider the petition by the American Gaming Association that seeks to block the online poker giant’s entry into the US market. The petition will be dealt with – one way or the other – during the interim casino authorization application process.