Gambling News - August 2005 Edition

"US Handed Deadline to Clarify Net Gambling Rules"

U.S. confirms it intentions to comply with the WTO finding on online gambling.

The Caribbean nation of Antigua filed a complaint with the World Trade Organization (WTO) against the United States in 2003 for what Antigua claimed were discriminatory policies regarding the Internet gambling industry. Antigua basically alleged that the Untied States was violating international trade agreements because of U.S. federal and state laws that prohibited online gambling. Antigua argued that in its attempt to wean its economy from being entirely based on tourism, it had come to rely heavily on cross-border gambling and the betting industry and that this industry had become a critical component of Antigua’s economy. Now U.S. restrictions on the industry were hurting Antigua’s efforts to boost its economy.

When Antigua first filed the complaint, the U.S. countered by arguing that its stand prohibiting offshore Internet gambling was necessary in order to uphold public morals. The WTO said, in its ruling, that while the U.S. had a right to enforce policies in the interest of public morals, it had to clarify those policies so that they would not be discriminatory. Of particular concern, was a U.S. law known as the Interstate Horseracing Act. This law, says the WTO ruling, violates international rules because it only permits domestic out-of-state betting, while prohibiting International out-of-state betting.

To date, the United States has not clarified its policy, but the WTO recently issued a 31-page ruling that said the deadline for the U.S. to do so is April 3 rd of next year. According to the WTO arbitrator, the United States government has less than a year to clarify its rules about offshore Internet gambling. “The U.S. has already announced its intention to comply with the WTO finding," said Neena Moorjani, press secretary for the U.S. Trade Representative. "We will continue our ongoing compliance efforts.... All we have left to do is to clarify one narrow issue concerning Internet gambling on horse-racing."

Moorjani also noted that any action taken by the US will “not involve weakening U.S. restrictions on Internet gambling”. Moreover, says Moorjani, the U.S. is currently examining various options regarding the clarifications that have been requested by the WTO. As yet there is no decision whether it is Congress that will make the move.

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