The European Commission dealt a blow to European online gaming
companies on Monday when it accepted a U.S. offer of openings in other
sectors to compensate for closing the U.S. gambling market to foreign
firms.

European companies such as PartyGaming and bwin Interactive
Entertainment had hoped the European Union executive might shun a
settlement and fight on instead to restore their ability to operate in
the world’s biggest market.

Shares in PartyGaming were down 4.1 percent at 29 pence at 0700 EST, and bwin stock was down 2 percent at 26.11 euros.

“A bilateral agreement was signed in Geneva, which provides EU
service suppliers with new trade opportunities in the U.S. postal and
courier, research and development, storage and warehouse sectors,” the
Commission said in a statement.

“The U.S. also made concessions in the testing and analysis services
sector,” the Commission said, adding it would still try to dissuade the
United States from discriminating against foreign operators.

A representative of Europe’s online gaming sector — which saw
billions of euros of market value wiped out by the U.S. restrictions –
said the announcement was a disappointment.

“The Commission can still press for an opening up of the market, but
the leverage of the outstanding (compensation) negotiations has been
taken away,” said Clive Hawkswood, chief executive of the Remote
Gambling Association.

The case dates to April 2005 when the World Trade Organisation ruled
that a U.S. law allowing only domestic companies to provide online
horse-race gambling services discriminated against foreign companies.

Last year, Congress tightened restrictions on Internet gambling by
making it illegal for banks and credit card companies to make payments
to online gambling sites.

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