A top-level EU trade delegation is set turn up the heat on US gambling laws which ban online gaming.
Current US laws dating back to 1961 effectively prohibits ALL gambling by telephone, telegraph and internet. The most recent of these — the 2006 Unlawful Internet Gaming Enforcement Act (UIGEA) — forces banks, credit card companies, and credit unions to enforce all state laws which bar internet betting.
But the EU says the rules are being unfairly enforced, with European and Caribbean operators being prosecuted while US-based horse betting websites operate freely, in breach of World Trade Organization agreements on free trade.
Some European operators — including 888.com and partygaming.com — are also being investigated by US authorities, even though they pulled out of the American market as soon as UIGEA came into force. Federal prosecutors have even begun legal action against European BANKS who offered the companies financial advice.
Brussels has now launched a formal complaint over the legal mess with the WTO.
US trade chief Susan Schwab brushed off the claims, saying they were based on mistaken assumptions. Enforcing US law and bringing charges was based on a number of factors, she added, but nationality was NOT one of them.
Next month EU trade commissioner Peter Mandelson leads a top-level delegation to Washington looking for answers.
The big fear in America is that even if the dispute never becomes a formal case before the WTO, because the enforcement of UIGEA falls almost entirely on hard-pressed US banks, Europe could impose SANCTIONS on them directed at getting the US to change its behavior.