EU Inspired by Caribbean Challenge to UIGEA

2007 February 03, Jonny Vincent

The European Union has boosted the online gambling industry with news it may launch its own challenge to the Unlawful Internet Gambling Enforcement Act.

The tiny island of Antigua in the Caribbean has been locked in a battle with the mighty US at the World Trade Organization (WTO) over the UIGEA. Antigua's economy is heavily dependant on the online gambling industry, and Antigua has seen the UIGEA as protectionist and monopolistic.

The tiny island has had some recent success in their battle to have the WTO hand down a decision in their favour, however industry analysts have said it is unlikely the case will bear much fruit, with the US unlikely to be frightened by the prospect of Antiguan trade sanctions.

However, the industry received a massive boost this week when Charlie McCreevey, the European Commissioner for Internal Market Services, was quoted as referring to the UIGEA as "probably a restrictive practice" and that "we might take it up in a different forum", leading to hopes that the matter might be reported to the European Union Trade Commissioner.

If Europe ends up challenging the UIGEA through the WTO, this would be a massive development for the industry, as the WTO would likely be forced to find in favour of the European submission. If the WTO found the bill was protectionist, this would allow Europe to impose trade sanctions on the US, which may force the US to scrap the bill altogether.

The comments from McCreevey resulted in online gambling shares bouncing back last night, as the industry feels this could be an extremely positive development. The US has simply invested too much in the WTO to ignore multiple decisions handed down in favour of challenges to the UIGEA.

There would be some industry executives who feel that, whilst this development is in its earliest stages, the end result could see either the scrapping of the UIGEA altogether or possible serious modifications to the bill.

One of the largest online gambling companies, PartyGaming, which withdrew from the US market following the passing of the UIGEA through Congress, jumped up 10% following the reporting of the European Commissioner for Internal Market Services comments.

Watch this space for ongoing news in this exciting development.