BRITISH GOVERNMENT COMMENDS ONLINE GAMBLING REGULATION TO AMERICANS

14 December 2007

Good on you, Emily!


The Safe and Secure Internet Gambling Initiative, a UK-based pressure group promoting the regulation of Internet gambling, has drawn attention to a British government recommendation to the United States that regulation and not prohibition is the way to go.

The contentious trade dispute between the European Union and the U.S.A. over Internet gaming industry has seen claims that are potentially worth billions submitted through the World Trade Organisation, and the British government has said it favours U.S. regulation of Internet gambling in preference to prohibition.

"The British Government has signaled quite clearly its support for regulation rather than prohibition," said Emily Bourne, private secretary of the British Department for Business Enterprise and Regulatory Reform in a letter to several financial service and gambling companies recently.

Europe's trade director and other trade experts acknowledge that legislation introduced by US Congressman Barney Frank (D-MA), as the Internet Gambling Regulation Enforcement Act, could resolve the gambling dispute and bring the U.S. into compliance with international trade agreements by creating a level playing field among domestic and international operators.

During a recent visit to Washington, European Union Trade Commission Peter Mandelson said that the U.S. Congress should either open its market to overseas operators or compensate Europe for blocking the American gambling market to European operators.

"You will no doubt have been encouraged to read the recent media reports of Commissioner Mandelson's visit to Washington, which the Secretary of State thinks reflects the level of interest at the Commission in the U.S.'s approach to gambling," added Bourne.

"Rather than negotiating away settlements that could negatively impact the U.S. economy, the Administration and U.S. Congress should seek a more sensible policy solution and regulate Internet gambling," said Jeffrey Sandman, spokesperson for the Safe and Secure Internet Gambling Initiative. "As the British Government has correctly acknowledged, it is clear that the futile approach by the U.S. to prohibit Internet gambling is a failure. Regulation of Internet gambling could bring the U.S. into compliance with W.T.O. requirements, protect consumers and generate billions in revenue needed for critical government programs."

The trade dispute over Internet gaming resulted from Antigua's World Trade Organisation (W.T.O.) victory over the U.S. earlier this year. After the W.T.O. ruled that the U.S. had violated trade rules in barring Antiguan online gaming operators from the U.S. market, the U.S. withdrew its W.T.O. obligations with regard to free trade in the gaming area.

The U.S. withdrawal allows Europe and other countries to demand trade concessions up to the size of the entire sector on an annual basis. Already, the two parties have agreed to extend settlement discussions twice because they could not agree on the size of the compensation.

If the parties cannot settle the matter themselves, the E.U. could demand a binding arbitration before a W.T.O. panel. Separately, Antigua is involved in arbitration with the U.S. to determine the size of the compensation due it. Other countries seeking compensation include India, Costa Rica, Japan and Canada.

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