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U.S. Disregards Complaints Made by the European Commission

by Hillary LaClair, Senior Editor

U.S. officials have essentially ignored a questionnaire presented to them by the European Union concerning U.S. discrimination against internet casino gambling. Americans are scheduled to meet next month with European Commissioner Peter Mandelson to deliberate complaints previously made by the Remote Gaming Association. That they have shrugged off this questionnaire shows that the U.S. is not prepared to consider any indiscretion on their part.

In addition to further disputes with the U.S. that involve the World Trade Organization this year, the Remote Gaming Association requested that the European Commission investigate complaints made by overseas online gaming establishments. The basis of these complaints are that European online casino gambling facilities are facing scrutiny from U.S. gambling laws in order to protect domestic operators, including websites run by the American horse-betting industry.

When U.S. Trade Representative Susan Schwab was presented with the questionnaire, she responded, “[There is] no basis for any allegation of ‘discriminatory enforcement’ of U.S. gambling laws.” She went on to say that the concerns brought to the U.S. were based on “mistaken assumptions” because legislation this year did not change which types of gambling were legal. She claims that nationality played no part in charges made by the U.S. against internet gambling establishments. This is apparently why there have been no results from numerous other disputes brought against the U.S. by other overseas nations for the same reasons.

The nonchalant response given by Schwab illustrates an unwillingness of U.S. officials to address the issue at hand. There are obvious discriminatory arrests made against European operators as the U.S. enables domestic internet gambling like horse racing betting and national lottery. Financial transactions made by domestic gamblers to European companies are no different than those made to U.S. establishments. Yet arrests are made on those that take advantage of overseas gaming facilities. It may be that the U.S. legislation that allows some gambling activities and not others is discriminatory in itself. Because of the Unlawful Internet Gambling Enforcement Act, a great deal of major European gaming sites has closed their gambling market to U.S. citizens, depriving themselves of billions of dollars in revenue. The fear of these European companies now is that they may now be prosecuted by the U.S. for past “violations” of U.S. legislation and forced into punitive settlements, as was the case with third party payment processors like NETeller and Citadel. The Remote Gaming Association’s chief executive states that the U.S. is guilty of “unfair and discriminatory treatment of the EU gambling industry and the continuing threat of prosecutions cannot be allowed to go unchecked.”

Next week legislators will gather to discuss the further enforcement of the current gaming legislation, and a bill proposed by Barney Frank and Ron Paul that seeks to regulate online gambling facilities. Frank has recently gained the support of two U.S. senators, Neil Abercrombie of Hawaii and Stephen Lynch of Massachusetts, amounting to a total of 20 representatives that sponsor the bill. We will see if this discussion will hold any water against the UIGEA, working in the favor of the European Commission’s fair trade agreements.