EU Trade Commissioner Turns Up Online Gambling Heat on US

The European Commission's online gambling compensation claim against the US took another step forward this week when EU Trade Commissioner Peter Mandelson arrived in Washington to address the issue with US legislators.

Reuters reports the EU's top trade official has headed to Washington as part of a concerted effort to persuade Congress to repeal the Unlawful Internet Gambling Enforcement Act of 2006 (UIGEA), which places restrictions on US financial houses in regards to online gambling transactions.

Mandelson reiterated that the UIGEA was unfair to Europe, where many of the world's largest online gaming companies are based. The World Trade Organization has already twice ruled that the UIGEA breaches WTO rules, allowing the EU to pursue compensation from the US. Some analysts have predicted the EU claim could reach as high as $100 billion.

Mandelson told reporters the US must change their online gambling laws to remove discrimination against EU operators:
"It's not in the interest of American consumers to have good responsible competitors in this market excluded by regulatory mechanisms."

Mandelson could well have been referring to industry leaders PartyGaming and 888, who both decided to withdraw from the US market late last year as a result of the new legislation. Online gambling has largely continued to prosper in the US, only now the companies raking in the profits are privately owned and not subject to stringent regulation.

The tiny Caribbean island of Antigua took the US to task over the UIGEA at the WTO and won the fight, with the WTO ruling compensation was due. Mandelson echoed this ruling, stating:
"When a member of the WTO defaults on its commitments, compensation is due. That's the case of online gambling."

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