The European Union told the United States on Tuesday that it wanted
compensation for a U.S. ban on foreign online gambling sites, which
doesn’t comply with global trade rules.

British online gaming operators such as Sportingbet PLC and Leisure
& Gaming PLC were forced to quit the profitable U.S. market last
year when Washington stopped U.S. banks and credit card companies from
processing payments to online gambling businesses outside the country.

The decision closed off the most lucrative region in a market worth
$15.5 billion (11.6 billion euros) last year. About half of the world’s
online gamblers are based in the United States.

But an EU official said the concessions Europe was looking for would likely be “commitments” to open up other trade sectors.

“We need new concessions that would be equal with the benefits
lost,” he said, speaking on condition of anonymity because he is not
authorized to be quoted by name in media reports.

Initial negotiations would focus on measuring the loss to European businesses, he said, warning that talks would take some time.

The World Trade Organization ruled in December that the law unfairly
targeted offshore casinos, telling the U.S. it could keep restrictions
against sport betting in place if they were also applied to American
businesses.

The EU – the world’s largest consumer market – joins the tiny
Caribbean nation of Antigua and Barbuda in seeking compensation. The
twin-island nation argued that online gambling had provided income for
hundreds of its citizens and was helping to end its reliance on
tourism, which was hurt by a series of hurricanes in the late 1990s.

After losing the case, the U.S. announced that it would take the
unprecedented legal step of changing the international commitments it
made as part of a 1994 treaty regulating trade in services among the
150 members of the WTO. As a result, the U.S. declined to challenge the
WTO ruling, because it says that its legal maneuver effectively ends
the case.

U.S. Rep. Barney Frank, the Democratic congressman who chairs the
committee that oversees financial services, introduced a bill in April
that would reverse the Unlawful Internet Gambling Enforcement Act – but
his plan faces long odds in Congress and likely opposition from the
Bush administration.

Associated Press Writer Bradley S. Klapper in Geneva contributed to this report.

Recovered from the Poker Players Alliance archive index. This is the archived item as preserved.