Or at least – not in relation with the US authorities, that started the 2008 by disregarding again the problems with the EU and WTO treaty on the gambling issues and decided to go an arrest 8 persons that allegedly “made millions of dollars in profits annually.”
Reuters reports :
Twelve men face charges including conspiracy and illegal gambling in an indictment unsealed on Monday in Manhattan federal court for their role in operating a gambling Web site and call center that serviced U.S.-based sports bookies.
U.S. prosecution of foreign online gambling companies has drawn criticism from such companies in Europe, who have accused the Justice Department of violating World Trade Organization rules by singling out foreign companies in such cases.
In the latest case, U.S. prosecutors said that starting in 2005 Carmen Cicalese headed the operation out of Costa Rica, charging several hundred U.S. bookies weekly fees of $15 to $30 for each gambler they registered.
The gamblers then placed sports bets either via a toll-free number or on Web sites including datawager.com and betwestsports.com, the indictment said. While the operation set the odds for the bets, the payouts were left to the bookies, authorities said.
U.S.-based “runners” for the operation collected the fees and transferred the money back to Costa Rica through couriers, credit cards and electronic funds bank transfers.
A series of important event have been happening at the end of the year in the EU-US gambling debate :
US has agreed with EU that it will pay a compensation rather than allow European online gaming companies into the American gambling sector.
This doesn’t solve the US problem with Antigua
But US has also conceded to the EU to allow European companies access to the US postal market and warehouse sector instead.
EU gambling companies accuse US of infringing the WTO rules.
Washington said it never intended to allow foreign companies to offer online gambling and made a mistake by not explicitly saying so as part of the 1994 world trade deal.
“We have been left with no choice but to pursue all legal avenues available to challenge the U.S. Department of Justice for its discriminatory enforcement activities against European online gaming operators,” Clive Hawkswood, chief executive of the Remote Gambling Association (RGA), said in a statement. So RGA has filed a formal complaint against the Department of Justice.
And on top of that Google, Microsoft, Yahoo settled with the Justice Department over claims they promoted illegal gambling by accepting ads from online betting operations.
What a world !
Â Mark Mendel, winning trade attorney for Antigua & Barbuda in their WTO case against the United States – over a protectionist US Internet gambling law passed in late 2006 – said today that he expects a decision on their 3.4 billion USD/per year compensation claim from a WTO panel on 30 November 2007.
USA says thatthey will pay $500,000 in compensation, because $3.4b is more than Antigua’s entire yearly economy.
But the funny part is that Antigua could be awared by the WTO panel with possibility to sell US copyrighted material to get their money claimed.
The World Trade Organisation has ruled that the US has acted illegally, but instead of updating the UIEGA in line with the ruling, the United States government has looked towards withdrawal from the World Trade Organisation obligations in this matter.
See also this interesting article by Ed Brayton
Update – 8.11
It appears that the date has been postponed for 14 December, giving more time for US to negotiate with the countries that have filed for damages : European Union, India, Antigua and Barbuda, Japan, Costa Rica, Macao, Canada and Australia.
A recent editorial from LA Times makes a good point on the US policy towards gambling that shifts from the recent UIGEA law that prohibited credit card companies from processing gambling transactions to a new licensed environment suggested by the Rep. Barney Frank (D-Mass.), chairman of the House Financial Services Committee.
All that in combination with the WTO-gambling conflict with Antigua, that continues to put USA in a strange position, claiming that “it was not required to comply with a WTO ruling to open its borders to the Internet gambling industry because of an “oversight” in a decade-old trade agreement.”
This stupid attitude saying – we will change the WTO terms cause we’ve changed our mind -Â shows why WTO is good only for the big countries.. Show me the contrary, please..
says Director General of the WTO, Pascal Lamy, when talking at a meeting of the Ministers of Trade, making a reference to the rulings and recommendations of the WTO Dispute Settlement Body.
Acording with Antigua Sun newspaper, he responded to a question put to him by Antigua and Barbuda’s Minister of Finance and the Economy, Dr Errol Cort, who wanted to know how the WTO intends to ensure that the rights of its smallest members are treated in the same manner as its largest.
Lamy said that it is in the best interest of the major trading nations of the world to ensure that the organs of the WTO are seen as fully functional and, in the case of its Dispute Settlement system, that its rulings and recommendations are respected and fully implemented.
UK bookmaker Ladbrokes has pulled out from the discussions with the online gambling company 888 regarding a possible merger, invoking the UIGEA law in Unite States had made the things too complicated these days.
The deal was supposed to be reached for an impressive 450 millions pounds, but the changes in the US gambling legislation have droped 888 poker revenues to half. In this situation Ladbrokes considered that the complexity of the US situation was simply too much for such a deal.
Shares of both companies have droped after the annoucement. Shares in 888 fell 4Â¾ to 117Â¾p and Ladbrokes firmed 1Â½ to 405p.
A recent World Trade Organization (WTO) report released on 30 March 2007 presented the compliance panel in the case brought by Antigua and Barbuda regarding â€œUnited States â€” Measures affecting the cross-border supply of gambling and betting servicesâ€ (DS285).
The report concludes that United States has failed to comply with the recommendations and rulings that WTO has imposed in the case that Antigua and Barbuda have brought in 2003 in its attention.
See the summary of the case here.
The result of the report could bring extra-pressure for other countries, including EU member states, regarding the strict way they regulate the online betting. This could be considered by the WTO as contrary to the free trade agreements.
Antiguan Finance Minister, Errol Cort, considered that the ruling, â€œvindicates all that we have been saying for years about the discriminatory trade practices of the United States.â€