Over the past 12-months, the European Union Commission held an investigation against the United States regarding their attempts to block all European online gambling sites. The EU found that in doing this, American customers are being denied the right to interact with European companies, which violates the World Trade Organization rules for international trade. The Commission stated that they would address the issue by formal complaint with the WTO. Although, the EU would much rather handle this issue with the United States administration in hopes of finding a resolution amongst each other.
The summary of the EU Commission’s report stated, “that U.S. laws on remote gambling and their enforcement against EU companies constitute a barrier to market access on EU economic interests.” The European online gambling institutions have greatly suffered deficits in market value since the passing of the Unlawful Internet Gambling Enforcement Act of 2006 was signed. This law is designed to deny all American financial companies to disburse and receive funds to these online sites.
The EU Commission began its investigation in March of 2008 after getting complaints that the U.S. were being biased against foreign online gambling companies. While the U.S. is restricting the use of foreign online gambling sites to their citizens, they have allowed domestic companies to continue operation without any limitations. “EU companies are discriminated against,” the summary of the report goes on to say. “U.S. companies are allowed to freely operate online gambling on horse racing in the U.S., while European companies and individuals cannot and even face legal action.”
“It is for the U.S. to decide how best to regulate Internet gambling in its market,” said EU Trade Commissioner Catherine Ashton. “But this must be done in a way that fully respects WTO obligations.” Ashton added that she is “hopeful that we can find a swift, negotiated solution to this issue.”
House of Representatives Financial Committee Chairman Barney Frank (D-MA) noted the hypocrisy of those “who think we have to abide absolutely and religiously by the WTO… but when it comes to banning gambling and the WTO, they ignore it.” Frank later addressed his plans to propose new legislation that would reverse the UIGEA. This proposal will likely be introduced near mid-April.
Nefeterius McPherson, speaking on behalf of the U.S Trade Representative Office, said that both the office and the Department of Justice are revising the report and plan to discuss matters with the EU Commission.