Get Rid of Online Poker & Online Gambling Restrictions Says LA Times

An editorial opinion published in the Los Angeles Times over the weekend criticized the United States for discriminating against foreign online gambling companies, including online poker, online gaming, online sports betting and online horse betting, and overall recommends getting rid of online gambling restrictions.

Titled "Get Rid of Gambling Restrictions," the LA Times article says that the U.S. clearly uses "arbitrary and unjustifiable discrimination" against foreign companies because it permits only US-based companies and U.S. State governments to use the Internet to offer lottery tickets, bet on fantasy sports, or bet on horse races across state lines or international boundaries.

At the heart of the matter is the recent ruling by the World Trade Organization (WTO) in the case that the government of Antigua and Barbuda brought against the United States, which the tiny Caribbean island won recently despite the failure by the U.S. to implement an earlier WTO ruling, and the loss of a subsequent US appeal (click here for related PokerPages article).

The author asks whether the U.S. has used the Federal Wire Act of 1961 and the Unlawful Internet Gambling Enforcement Act (UIGEA) of October 2006 (which he refers to as "subsequent measures also have been interpreted to ban online gambling as well"), to carry out the "arbitrary and unjustifiable discrimination" against foreign firms.

"Antigua and Barbuda argue that they do - and the World Trade Organization agrees. So do we," the writer emphatically says.

Furthermore, the writer claims that passage of the UIGEA did not succeed in stopping online gambling by making financial transactions illegal between online gambling companies and US residents.

"It hasn't stopped Americans from betting (and losing) millions of dollars at online casinos and bookmaking operations based in other countries."

Instead, he says that U.S. policy has irritated many of its trading partners, including Antigua and Barbuda, who in 2003 initially asked the WTO to rule that U.S. gambling restrictions violated the 1995 GATS treaty. They argued that by signing the treaty the U.S. was committed to allow foreign companies access to its huge online gaming market.

"Eventually, in 2005, a WTO appeals panel accepted the U.S. argument that its gambling restrictions were needed to protect public order and morals."

"But by permitting off-track betting parlors in the U.S., the WTO ruled, Congress created an exception to the ban on remote gambling that discriminated against foreign bookmakers."

So "after two more years of wrangling over what the panel's order meant, a WTO tribunal ruled late last month that the U.S. remained out of compliance."

This means that "the U.S. faces trade sanctions from the WTO unless Congress does one of two things: Either acknowledge that betting on horses from overseas is no greater threat to the nation's moral fiber than it is at an OTB parlour, or make OTB parlours illegal," the opinion piece states.

It concludes, "Maybe it [the U.S.] doesn't have the stomach for either. If so, then Antigua and Barbuda may want to ask the WTO to ponder why allowing the interstate sale of lottery tickets - a form of state-sponsored gambling - is any less hypocritical than the U.S. stance on thoroughbreds and trotters."

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