| European Union Investigates U.S. on Internet Gambling |
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The European Union announced yesterday that it will open an investigation into a possible international trade violation by the United States for discriminatory trade practices against European online gambling companies. A solution to this international trade dispute is contained in the Internet Gambling Regulation and Enforcement Act (H.R. 2046), introduced by Rep. Barney Frank (D-Mass.).
That's according to those who support the Frank legislation.
This legislation would bring the United States into compliance with World Trade Organization (WTO) requirements by regulating Internet gambling and creating a level playing field among domestic and foreign Internet gambling operators, according to supporters of the Frank legislation.
"The U.S. has the right to address legitimate public policy concerns relating to Internet gambling, but discrimination against E.U. companies cannot be part of the policy mix," says E.U. Trade Commissioner Peter Mandelson. "We are interested in a constructive and mutually satisfactory solution to this issue."
The European Union investigation comes following a contentious trade dispute over Internet gambling, in which the Caribbean nation of Antigua successfully challenged the regulation of Internet gambling in the United States, Internet gambling supporters say. During the WTO dispute last year, Mandelson stated that the U.S. Congress should consider opening its market to overseas operators. "I think [Frank] takes a fair-minded, common sense approach to this and we look forward to that being effective legislation," said Mandelson in an interview with Reuters.
"The EU investigation only highlights the reckless manner in which the U.S. has handled its withdrawal of gaming commitments under the GATS (General Agreement on Trade in Services)," says Nao Matsukata, formerly director of policy planning for former US Trade Representative Robert Zoellick and now a senior advisor for the law firm Alston & Bird, LLP. "This situation would not be possible if the United States had chosen to resolve the GATS dispute from the beginning by appropriately changing U.S. law and adopting the Frank bill."
The investigation by the E.U. is the result of a Trade Barrier Regulation complaint filed by the Remote Gambling Association (RGA), which represents the largest remote gambling companies in Europe. The RGA claims the United States is in violation of international trade law by threatening and pursuing criminal prosecutions, forfeitures and other enforcement
actions against foreign Internet gambling operators, while allowing domestic U.S. online gambling operators, primarily horse betting, to flourish, proponents of online gambling say.
"To move into a formal investigation reflects the E.U.'s belief that this matter is serious enough for them to put at risk the larger transatlantic relationship and other positive developments in the bilateral trade relationship," Matsukata says.
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