EU to Challenge US Online Gambling Law
By Tobias Buck in Brussels, Financial Times


US legislation on online betting was described as protectionist by the European Unions top financial regulator on Tuesday and may trigger legal action before the World Trade Organisation.

The legislation makes it illegal for banks and credit card companies to process online bets placed by American citizens with foreign gambling sites.

Charlie McCreevy, the EU internal market commissioner, said: In my view it is probably a restrictive practice and we might take it up in another forum. He added that the case could go to the WTO, and also suggested he would pursue the matter with his American counterparts on a visit to the US in March.

Though it is not clear whether the Union will follow through on Mr Mc-Creevys threat of WTO action, his remarks highlight the deep divide between Brussels and Washington over gambling restrictions. The Commission has long argued that gambling and sports betting operations should enjoy the same rights as other service providers, and has repeatedly attacked European countries that impose undue restrictions on the industry.

The US, by contrast, has launched a broad regulatory crackdown on foreign gambling and sports betting operators, culminating in the arrest last year of two senior British industry executives for alleged violations of US anti-gambling provisions. The countrys tough stance has already sparked one legal defeat for the US at the WTO in a case brought by Antigua and Barbuda, two Caribbean island states with big offshore internet gambling operations.

The Geneva-based body ruled that the US had violated international trade agreements by allowing online horse-betting by US sites but not from abroad.

However, that case, in which the EU supported many of the complainants arguments, is not directed specifically at the October 2006 law that targets banks and credit card companies. Commission officials said they would in any case wait for a final compliance ruling in the Antigua case before making any further legal moves.

Both EU and US trade officials are currently engaged in a last-ditch attempt to restart talks on a sweeping global trade deal known as the Doha round a factor that could severely limit Brussels appetite for fresh bilateral trade spats. While Mr McCreevys advisers believe the October 2006 law includes several WTO incompatibilities, the ex-treme sensitivity surrounding gambling policy may reduce the chances of the Commission bringing a case.

Mr McCreevy stressed that there was no major momentum behind a new WTO complaint, and his officials pointed out that a final decision on such a move would in any case rest with Peter Mandelson, the EU trade commissioner.

However, Mr McCreevys intervention still marks a notable escalation in the Commissions approach towards the US gambling crackdown. It also stands in contrast to the Brussels bodys silence on the arrests of the UK gambling executives in the US in July and September last year.

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Originally published to Gambling911.com January 30, 2007 6:52 pm ET

Can't help thinking that trying to overturn the US Law( from Outside) is likely to be counterproductive - better to sort out our own laws to prevent punters' money going overseas by ensuring the "winner" is the local authority..
So, in Manchester, instead of some anon company getting all the dosh - there should be a local gambling tax that would aim to improve the area, social needs for desperate gamblers etc. etc.

Whilst on-line gambling may be just as addictive, there is much less excitement associated with it. The plush venues, siren ladies, free drinks etc must have the effect of making every loser think they are King - otherwise why do it?

I'm hoping that on-line gambling will provide suffient interest fro punters without the huge costs of setting-up a casino ----and someone has to pay for that construction and running - it can only come from the many who go home a little poorer, and a maybe a little wiser.

The US-foray was good while it lasted but I cannot see any US-Government will want to see Dollars flowing overseas. The quirk in the US-Law that troubled all the on-line fraternity was convenient to stem the flow, if it hadn't been that some other law would have been needed.

I hold PRTY and hope the US-link is restored, but Management should be planning for the likelyhood it won't. Indeed I see it like Management has up to 5 years to get the business running smoothly (based elsewhere) by becomming a little more sociable and less focussed on quick profits.
Let's see some innovative betting introduced, for starters!

The upturn in PRTY looks like other investors think there is a case for future profits, (ie without US punters)....up nearly 30% from recent lows....even though this is nowhere near the "highs" somewhat earlier.
Looks like there is a future; - with management addressing the reality, rather than trying to resurect the past.
Could this stock return to "over 1?" - why not? Gambling is something that folk like to do and provided it is safe from folks losing their shirts (and else), then I suspect that there is room for a "safe house"....the question remains whether others agree - from the investment view, the Government, do-gooders(who will favour zero gambling), and of course the gamblers themselves.
- We in Britain already gamble via the Lottery and there are many horse/football betting shops, along with greyhound racing etc. etc.
Let's see PRTY widening its scope....
I think the Ch5 Late-night Poker is sponsored by PRTY - can anyone confirm?

PRTY:LN
PartyGaming PLC
PartyGaming, Sportingbet Jump on Talk of Law Change (Update1)

By Amy Wilson and Sarah Thompson

Feb. 21 (Bloomberg) -- Shares of U.K. Internet gambling companies PartyGaming Plc and Sportingbet Plc rose on speculation that laws restricting online wagers in the U.S. may be relaxed.

``There's speculation of a lifting of the ban passed by the U.S. Congress which would be good news for companies like PartyGaming,'' said Kevin Lyne-Smith, an investment consultant at Julius Baer Holding AG's private banking division in Switzerland, which manages the equivalent of $100 billion.

PartyGaming and Sportingbet were among Web gambling operators that stopped taking bets from the U.S. after Congress unexpectedly passed legislation in September that criminalized processing of credit-card payments for the industry. U.S. gamblers accounted for about 85 percent of PartyGaming's revenue in 2005.

``A relaxation in the law is seen as a possibility with talk that it is proving too onerous for banks to track illegal payments,'' said Martin Slaney, head of spread betting at GFT Global Markets in London.

Shares of Gibraltar-based PartyGaming jumped 4.25 pence, or 11 percent, to 41.5 pence in London today. The stock fell 76 percent in 2006 after the U.S. law was passed. Sportingbet shares climbed 5 pence, or 14 percent, to 40 pence, the biggest gain since Oct. 24. They slid 87 percent in 2006.

PartyGaming is scheduled to report 2006 earnings on March 1. Neither company immediately returned calls from Bloomberg News.

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I still say this (US relaxing) is pie in the sky. The fact is that PRTY had it too easy - they were making profits which any normal=real business could only dream of. They should have used this brief time to build their brand and become a serious player in many other forms of gaming and gambling - instead I suspect the Execs took their money and ran for the golf-club and yacht showrooms.
1 March 2007:- RNS tells it like it is: "the execs need an incentive scheme" - so will that make them more effective than previously? I doubt it - a few sackings would concentrate minds, along with a move to London (or Manchester!), so shareholders would have access to these execs. As to the disposal of property - I suspect we are going to see a short-arm deal where the buyers will be grinning from ear to ear...if there isn't a shareholder-led claw-back clause you will know the deal smells. Company business must be at arms length- - -that means an open-market deal, or London-auction, so it is clear who is bidding what. I have grave suspicions that Execs should be working for the company and not doing self-deals in company time...and not at all with company property.
Will the company benefit from these EGM -specials.....don't be silly, if execs need incentive to do a day's work, or create "Shareholder-value", it is clear they are unsuited to the posts...the suggestion that they will be involved in some property-deal is further evidence, IMHO.
I guess the smart people sold at 40p, yet I'm hoping things may improve, but removing these execs will be the first step....this RNS provides the best evidence: that they have no interest in shareholders...........Grr.
All IMHO...but let's see, eh?

Well, according to Shares mag. it seems there MAY be some US gambling allowed...and the likes of PRTY should be set to benefit.
My comments re the land transaction still hold, so I doubt I shall increase my holding...just let it run .....currently about 47p to buy.

However, it would be nice to think our Execs are working hard to develop the business without-US-involvment, just in case it doesn't happen...or is overturned by another Politician keen to get the righteous ground.