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Arbitrators to settle Antigua, U.S. dispute - July 30, 2007
A lot of cash is on the line in the Antigua and Barbuda online gambling dispute with the United States.
By Sarah Polson
Antigua and Barbuda officially submitted its request for $3.44 billion in compensation from the United Stated to the World Trade Organization this week. The amount is what the tiny island nation believes will make up for the loss of online gambling revenue from the United States.
The United States and Antigua and Barbuda have been locked in this battle for years now in the WTO dispute. Antigua and Barbuda had the trade regulation body look into U.S. policies for online gambling because it believes the country is violating trade regulations.
The WTO ruled in favor of Antigua and Barbuda in 2005, stating that U.S. online gambling laws that restrict or ban the business violate trade regulations it agreed to when joining the WTO.
When the United States didn't change its laws to comply with the ruling, and then also further restricted online gambling by passing the Unlawful Internet Gambling Enforcement Act (UIGEA) late in 2006, the WTO once again issued a report in early 2007 saying the nation was still not in compliance.
That ruling opened up the option for countries to seek compensation from the United States for the damage done to the online poker, casino and sports betting operations that run from within their borders.
Antigua and Barbuda is a centre for offshore Internet gaming operations, attracting large numbers of U.S. residents to its online poker, casino, and other betting games and services.
According to Forbes, Antigua has been promoting gambling and other kinds of Internet commerce to move the country away from relying so much on the tourism industry.
There are 32 online casinos licensed in the nation, which employ about 1,000 people and generate around $130 million in annual revenue.
Though tiny, the Caribbean nation was hit hard as at least one of the major betting operations on its soil was forced to shut down its U.S.-facing business and also faced prosecution in the United States.
However, the United States has already responded to the $3.44 billion compensation claim saying it is "patently excessive."
"In particular, the level sought by Antigua and Barbuda is several times higher than Antigua and Barbuda's annual Gross Domestic Product of all goods and services," the United States said in a statement in a WTO Dispute Settlement Body meeting.
The country lodged an arbitration request this week objecting to the level of sanctions being asked for and procedural issues.
While the U.S. "accepts" the outcome of the WTO rulings, it is also working to change its agreement with the WTO to exclude online gambling.
According to the Caribbean Net News, a trade source said the arbitration process normally takes about two months.
Because Americans account for 80% of the estimated $12 billion generated by online gambling around the world, the nation may also face sanctions from other countries. Several have already shown their support for Antigua and Barbuda and announced their intentions to seek compensation as well.
Australia, Canada, Costa Rica, European Communities, India, Japan and Macao have all said they plan to seek compensation.
Internet Gambling Bill Reaches 34 Total Co-Sponsors
On July 26, 2007 three more congressman signed on to co-sponsor Rep. Barney Frank's H.R. 2046 (Internet Gambling and Enforcement Regulation Act) to bring the total number of co-sponsors to thirty-four.
Reps. Joe Baca [CA-43], Lynn C. Woolsey [CA-6], and Neil Abercrombie [HI-1], have joined a growing list of congressional representatives that are in full support of regulating Internet Gambling in the United States.
The bill has been referred to the House Subcommittee on Commerce, Trade and Consumer Protection and is currently in committee at the House Financial Services and House Energy and Commerce Committees.
Rep. Barney Frank (D-MA), introduced HR2046 in April and held a hearing of the House Financial Services Committee in June at which time several prominent experts gave testimony both for and against online gambling.
The Act would establish a federal regulatory and enforcement framework to license companies to accept bets and wagers online from individuals in the U.S., to the extent permitted by individual states, Indian tribes and sports leagues.
The Act would also provide that safeguards are used to prevent underage gambling and to find ways to control compulsive gambling, combat fraud and money laundering.
Barney Frank has said that "The existing legislation is an inappropriate interference on the personal freedom of Americans and this interference should be undone," referring to the Unlawful Internet Gambling Enforcement Act (UIGEA) which was enacted last year.
The bill would also require software that can track where a gambler is making a wager to ensure that it is legal in that jurisdiction.
This bill is rapidly gaining support of congress as more Americans are calling and writing to their representatives and expressing that they need to support this as most Americans see the UIGEA as an infringement on their rights, and an invasion of privacy in their homes.
Casino Gambling Web (http://www.casinogamblingweb.com/) is one of the leading supporters of the bill. CGW is hosting an online petition to repeal the UIGEA and currently has more than 6,500 signatures of Americans that believe this law is an intrusion and a restriction to their personal freedoms. The website is also responsible for starting the Public Outcry Campaign which led angry Americans to call their representatives in Washington D.C. to express their dissent for the UIGEA.
WEXLER'S POKER BILL SUPPORT GROWING
Published: Sunday, July 29, 2007 Online-Casinos.com
Skill Game Protection Act now has 11 co-sponsors
Florida Congressman Robert Wexler's Skill Game Protection Act, which seeks to obtain a carve-out from anti-online poker laws in the United States has seen substantially increased political support since June 27, with a number of politicians signing up for his proposal as well as that for Congressman Barney Frank's Internet Gambling Regulation and Enforcement Act for the regulation and taxation of online gambling.
Since Mississippi Democrat Bennie Thompson signed up as Wexler's first co-sponsor in June, 11 more Representatives have put their weight behind the Wexler proposal, which now lists the following:
Gary Ackerman (D-N.Y.)
Shelley Berkley (D-Nev.)
Michael Capuano (D-Mass.)
Steve Cohen (D-Tenn.)
Alcee Hastings (D-Fla.)
John Larson (D-Conn.)
James Moran (D-Va.)
Tim Ryan (D-Ohio)
Linda Sanchez (D-Calif.)
Edolphus Towns (D-N.Y.)
Anthony Weiner (D-N.Y.)
In a recent and widely read interview with the publication Poker News, Wexler repeatedly emphasised how important the support of the poker playing US public was to a more liberal US government approach to the pastime of online poker.
Wexler urged US players to contact their political representatives to protest against the Unlawful Internet Gambling Enforcement Act and similar attempts to deprive them of their right to choice on a personal pastime.
Representative Wexler is also a co-sponsor of Congressman Frank's increasingly popular proposal to regulate online gambling generally in the USA.
Legalize online gambling
Doesn't the federal government have better things to do than outlaw Internet betting on the Super Bowl?
June 9, 2006
THE HOUSE OF REPRESENTATIVES is due to vote soon on proposals to ban online gambling, and the deck seems stacked in favor of sound bites over sound policy. Federal law already outlaws businesses from using phone lines to place or receive bets across state lines, particularly when the bets are on sporting events. That restriction, although it's not a clear ban on Internet gambling, has stopped the country's major casinos from taking bets online. What it hasn't done is stop Web users from gambling around the clock at offshore sites, often based in Central America and the Caribbean. According to one estimate, offshore sites offering poker games, sports betting and casino-style gambling collect $12 billion a year, about half of it coming from American wallets.
In response, the House Judiciary Committee approved a bill last month that would explicitly ban online gambling businesses of all kinds. Even worse, to cut off the money supply for virtual gaming, the committee also backed a bill that would impose significant new regulatory burdens on financial companies, which would be barred from supporting electronic wagers or payouts. The bills are expected to be consolidated and debated on the House floor this month.
All of which raises the question: Doesn't the federal government have better things to do than try to block people from going online to make a wager on the Super Bowl or the Final Four?
Supporters of the measures insist they are trying to curb the spread of gambling addiction, protect minors and crack down on unscrupulous offshore operators. They may be right about online gambling's link to self-destructive spending, given its isolating, rat-at-the-pellet-bar quality. But the fact that the House bills wouldn't outlaw online betting on horse racing, which Congress allowed states to authorize in 2000, seems to belie the sincerity of the effort. And isn't it a hallmark of a free society that we don't outlaw otherwise inoffensive vices simply because some people harm themselves?
Congress should be clarifying the law in the opposite direction. Legalizing online gambling and regulating the industry — as Britain has done — is the best way to toughen protections against gambling by minors, identify problem gamblers and ensure that online sites are more scrupulous than the back-alley bookie. Wouldn't it be preferable to have bettors deal with the sports book at Caesars Palace or the MGM Grand — heavily regulated Las Vegas casinos that are part of publicly traded companies — rather than with some fly-by-night offshore player?
Legalization also would allow the government to tax the industry and mitigate its hypocrisy in sanctioning some forms of gambling, such as state lotteries, but not others. Moralistic members of Congress should not be allowed to thwart online freedoms. It's unlikely they will succeed anyway. The issue is whether Washington is to have any leverage over the burgeoning online gambling world, or whether that world will remain beyond the reach of U.S. law.
Interactive gaming or ‘iGaming’ as it is commonly referred to, has quickly become the second most profitable business on the internet today as millions of people the world over have discovered an exciting, safe and convenient form of virtual entertainment accessible from the comforts of their home 24hours a day, 7 days a week.
iGaming as a global industry has in fact become so large, so fast, that market analysts from the likes of BearSterns and Datamonitor have been forced to reevaluate conservative growth forecasts from a low of US$4-6 billion for 2004, to a high of US$8-10 billion for 2005 and a stunning overall outlook of US $125 billion by 2015.
Exponential growth and a recession proof commodity have prompted no fewer than 100 countries and jurisdictions worldwide to lay the groundwork for a stable and regulated market environ. This burgeoning list includes Australia, Canada, China and the US, as well as the entire EU community of which Britain is squarely pacing ahead of the pack.
LARGE BONUSES (25%, 40% or more) - this is a very common tactic of new operations that don't know what they are doing. They open a new sportsbook (especially around football season) and offer large bonuses to get players to sign-up. Their business model is flawed from the beginning and will eventually lead to financial troubles, slow/no-pay disputes and eventual shutdown. Also beware of offers that combine High Bonuses with Reduced Juice, or Lines (odds) that are way out there. Obscure or soft lines can only mean one of two things: a lack of volume or that the book itself is gambling on events.
Promotions with high bonuses are also used by well-known scam operations to entice unaware players to deposit funds in their sportsbooks.
Remember: If a promotion looks too good to be true, it probably is.
NOVEMBER 2004 - Antigua beats long odds on Internet gambling challenge by US
Date entered: November 15, 2004
Source: WFP
gambling news
Antigua and Barbuda beat long odds Wednesday as the World Trade Organisation confirmed a ruling that a ban in the United States on Internet gambling violates global trading rules. The Geneva-based WTO, in a report released Wednesday, held that the US ban on web gambling is effectively an unfair trade barrier that hurts the gaming industry of the tiny two-island Caribbean nation.
US prohibitions on Internet gambling "are inconsistent with US obligations" under the 1995 General Agreement on Tariffs and Services, the WTO panel wrote in Geneva, affirming an interim decision in March.
In a statement, Antigua welcomed the decision and called it "reminiscent of the story of David and Goliath."
But Richard Mills of the office of the US Trade Representative called the decision "deeply flawed."
"We will vigorously appeal this deeply flawed report to the WTO Appellate Body and remain confident in the basis for reversing this panel report," he said.
A senior US trade official, speaking on condition of anonymity, said that if the US appeal fails, Washington may simply revise its commitment under the GATS agreement to exclude gambling.
"The parties do retain rights to make changes under GATS," the official said.
The WTO panel ruling acknowledged that Washington may have intended to exclude gambling from the treaty but that Internet gambling is covered under the services agreement of global trade agreements.
"We have, therefore, some sympathy with the United States' point in this regard," the WTO panel wrote.
"However, the scope of a specific commitment cannot depend upon what a member intended or did not intend to do at the time of the negotiations."
A patchwork of regulations in US states regulate gambling, while federal laws ban any form of "interstate" betting.
US Justice Department officials contend that any Internet gambling is illegal, but prosecution has been spotty.
Washington also maintained that GATS allows each member country latitude in regulating "public morals."
But the WTO wrote that the arguments from Washington carry less weight because of the wide variety of gambling options that are legal in the United States.
Antigua had claimed it lost more than US$90 million and 4,000 jobs because of the US ban.
"The United States has taken an aggressive approach to betting services based overseas," the government said in a statement.
"However, the US government raises significant revenue from betting services within its own borders and the Interactive Gaming Council (trade group) suggests the United States is home to at least half the worldwide online gaming market."
"The US says it wants open competition," said Ronald Sanders, Antigua's former WTO ambassador. "But it only wants free trade when it suits the US."
FEBRUARY 2004 - US State Gambling Laws
Up until reasonably recently, regulation of gambling in the United States was left exclusively to the State Legislatures, who determined the legality or otherwise of gambling activities within their jurisdiction. Some states have legalized many forms of gambling, while others have legislated to make it illegal to participate in any form of gambling other then the states lottery. Nevada is the obvious example of a State which has embraced gambling as a legal form of commerce, while Utah is a noted for its strong anti-gambling stance, and laws deeming all forms of gambling within its jurisdiction illegal.
US State gambling laws were all drafted long before the advent of the Internet, and they do not have provisions dealing specifically with online gambling.
US Federal Gambling Laws
So far, US Government attempts to pass legislation dealing specifically with online gambling have been unsuccessful. Separate Bills sponsored by Sen. Kyle and Rep. Goodlatte, which both attempted to ban online gambling both failed to attract the required 2/3 majority Senate vote required to become law. And while it is likely that there will be more attempts to pass legislation dealing specifically with online gambling (to regulate or ban), until such legislation is passed existing federal legislation serves as the only guide on this issue.
US gambling prohibition fails again
In 2003, a number of gaming prohibition bills were introduced in the US Senate and the House of Representatives: the Kyl bill (S.627), the Leach bill (H.R. 21) and the Bachus-Oxley bill (H.R. 2143). Just like in previous years, none of the proposed bills made it into law. Though most industry insiders think there is a majority in Congress supporting online gaming prohibition, there were also a couple of developments this year, opposing this view:
Opposition in the House of Representatives: Rep.John Conyers introduced the Conyers Bill ( H.R. 1223), proposing to do a one year study on the feasibility of regulating online gambling.
Opposition from tribal and state gaming lobby groups, resulting in conflicting clauses between each of the three bills.
Opposition by the general public: according to a survey conducted by the Interactive Gaming Council (IGC), 55% of all Americans oppose a government ban on Internet Gambling, while welcoming efforts to regulate online gambling.
Opposition by online gaming free haven Antigua & Barbuda, which is currently challenging the US at the World Trade Organization (WTO), for breaking WTO rules on free trade, with respect to online gaming.
A new development in this ongoing saga is a recent initiative by the Missouri office of the US Department of Justice (DOJ). Apparently the DOJ issued a series of subpoenas to gaming websites, radio stations, TV stations, and newspapers, subpoenaing financial records related to online gaming advertising, and warning the affected parties that accepting online gaming adds might be in violation of the law.
Yahoo Internet Life
March 2001
“Online casinos are cutting edge. You’re playing with realistic cards, or on handsome roulette layouts; you’re pulling on colorful, clanging slot machines.” “You can play far more hands in any hour than you can offline - no waiting for reshuffles, no major waits for slower players."
Bear Sterns
NEW YORK--(Press Release)--March 15, 2001--The popularity of online gaming continues to soar, opening the door for what could be an extremely profitable industry. According to a new report from Bear Stearns called ``E-Gaming Revisited--At Odds With The World'' online gaming sites have more than doubled in the last year. ``This is becoming a real opportunity,'' said Marc Falcone, Bear Stearns gaming analyst.
USA Today
March 13, 1999
“Las Vegas bookies say their business is being pinched because of new competition from the Internet. ...About 2.5 million people are estimated to be playing NCAA tournament pools online this year. That number is expected to reach 10 million by 2001.”
“More than $300 million was bet on sports online last year. And though other forms of gambling are expected to grow faster than sports, total online betting could grow to more than $2.3 billion by 2001. There are 280 online gambling sites.”
Testimonials
"The only way to make money in a casino is to own one." Steve Wynn, CEO Mirage Resorts
"As an entertainer, I look at the Internet as the future venue for many forms of entertainment. It is a powerful way to bring fun and safe entertainment to millions of people at the same time." - Country Singer and
online casino owner, Kenny Rogers
"A gold rush in Cyberspace." - U.S. News and World report on Internet gambling "There's no doubt you are dealing with hundreds of Billions of dollars... the amount of money we're talking is astronomical." -Wisconsin Attorney General James Doyle on Internet gambling
Nightline
"Not only is Internet gambling already possible , already a modestly thriving Industry, it promises to become huge" - Ted Koppel, Nightline
GQ Magazine
"The gambling urge is universal , mixing it with the ubiquity of the Internet is a stroke of genius."
The Baker Report
"We believe our projections of Internet gambling revenues of $100 to $ 200 Billion domestically and $200-$400 Billion in the rest of the world is reasonable, even conservative."
Datamonitor
"Online gambling turnovers have the potential to dwarf those of other interactive services , tapping into an existing traditional gambling market valued at over $700 Billion in Europe alone."
