Could UIGEA Be Reversed? Part II of III

Last time we discussed the events leading up to the US government’s response to the World Trade Organization saying that they had been acting illegally in their dealings with making internet gambling illegal. They had one year to change their ways, and this is how they handled it.

The US took the year to review it, and then in April of 2005 said that they had taken the matter into consideration and had decided that they hadn’t done anything wrong and were not changing their rules. So Antigua challenged their decision saying that they were still in violation and asked the WTO to enforce their rules.

The WTO then said that the US remained out of compliance. By passing the UIGEA all the US government did was reinforce Antigua’s claims that they are being discriminatory. The new act says that all gambling is illegal, except for lotteries, horse racing, and online gambling within state borders. Therefore, they have just made internet gambling legal, but they changed the way the money was handled.

The Department of Justice is going after the offshore gambling industry now, because now that online gambling is not actually illegal – someone has to be made to be held accountable for the online gambling that is going on. But they still have not addressed the problem with the WTO since there is cause for concern even though our government is pretending there isn’t.

Twenty nine states and their Attorney Generals sent a letter to the WTO where they told them they were concerned over the ruling. They said that there will be far reaching effects from this ruling. They say that it does not matter whether the US wins or loses; the panel has made a ruling that needs to be followed. They said that the betting services in the US are subject to GATS coverage, and that we must abide by that coverage.

They went on to say that other countries have a right to compete within our borders since it is allowed in our country. They said that with the panel saying all gambling is now under their jurisdiction, that all casinos and all slot machines, etc. are now subject to GATS obligations. They went on to explain that since the US handles slot machines and gambling on a state by state basis, that they hope that the WTO would recognize that and not subject all gambling in the country to their rules.

Next time we will discuss the next steps that will likely be taken, or at least need to be.
 

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