Thursday, Oct. 3, 2013

Is Poker a ‘Game of Skill’ or ‘Game of Chance’ and Why Does it Matter? An UK Perspective

This is such a silly question for most serious poker players who would with certainly claim that poker is a ‘game of skill’. After all, if a someone plays tens of thousands of hands and hundreds of hours then at the end results should speak for themselves and luck becomes irrelevant. The simple fact of the matter is that fish eventually go bust and can be found populating the play money / micro limits and sharks build their bankrolls and move up limits…

So, why are UK legislation and the Courts so adamant on calling poker a ‘game of chance,’ ?!

It all comes down to the licensing differences between ‘games of skill’ and ‘games of chance’.

The current legal position in the UK is:


Facts: Between 2004 and 2006, a club operated in London’s West End called the ‘Gutshot’. The club operated without a gambling licence and the owner argued that poker is not ‘a game of chance’ as per the 1968 Gaming Act (which has since been replaced by the Gambling Act 2005). The club argued that poker is similar to chess (and dominoes) which are considered a ‘games of skill’. Therefore, under this category, the club would not need a pricey and restrictive gaming license.

Litigation: The issue was eventually taken to court in 2006 in R v Kelly. The Court of Appeal ruled that because poker was a game that involved elements of luck as well as elements of skill it came under the restrictions of gaming legislation and needed to be licensed in order to be played in poker clubs. Kelly was fined £10,000 for operating without a license but managed to avoid imprisonment.

This case clarified that anyone thinking of hosting a poker event will have to be extremely careful not to fall foul of the Act and run the risk of prosecution.

Main Act governing Gaming in the UK is the Gambling Act 2005. The following are the Provisions relating to poker:

S6 (ss1), ‘Gaming’ means playing a ‘Game of Chance’ for a ‘prize’.

Definition: ‘Game of Chance’ s6(2)(a) includes:

(i) a game that involves both an element of chance and an element of skill;

***(ii) a game that involves an element of chance that can be eliminated by superlative skill, and

(iii) a game that is presented as involving an element of chance.

Definition: ‘Prize’ s6(5):

(a) means money or money’s worth, and

(b) includes both a prize provided by a person organising gaming and winning of money staked.

Conclusion and Author’s Opinion

It is bizarre that poker is categorised as a ‘game of chance’ along with mind-numbing games such as roulette, craps and blackjack (less so). The courts rely on a technicality that since the deal of the cards gives the game an unpredictable element of chance then it’s considered a game of chance. Without a doubt there is an element of chance but it is not a ‘substantial element’, particularly in the long-run. A recent study in the US claims that poker is 88% skill since 3/4 of hands don’t go to showdown and are won by betting and raising, not always by the best hand. Interesting read.

One way to improve the image attached to poker would be to label it once and for all as a ‘game of skill’ as has been done in Italy. By the UK changing its stance, it may hopefully draw some attention to lawmakers in the US that have taken a harsh stance against poker in the past few years.

Alexandre Rotenberg & Simon Dehaney LLB LPC