European Union Struggles With Internal Debacle on Online Gambling

Even as the EU tries to persuade the US to drop its online gambling ban, member nations are creating protectionist gaming laws of their own.

The European Union has advised the US government that refusal to accept trade from foreign online casinos, and selective prosecutions of European online gambling sites, violates World Trade Organization rules and commitments to free trade. Yet, inside the EU, the battle rages over Internet gambling as over half the supposedly unified market obstructs fair competition for online casinos.

Joe Brennan, Jr., head of iMEGA, has told OCA that US legislators have not paid serious attention to the EU demands to resolve trade conflicts regarding online casinos because the EU has failed to take care of its internal strife. One problem is that the movement through the EU system of justice and enforcement can be exceedingly slow.

Several EU members, such as Sweden and the Netherlands, attempt to ensure government gambling revenues by protecting monopolies for domestic state-owned operators. Threats by the EU can lead to infringement proceedings, but a series of escalating warnings and hearings must be conducted to reach this step.

Members are allowed to block gambling services, as long as they follow suit domestically. However, countries such as France are seeking to introduce online gambling to create revenue, while still blocking licensed EU operators outside the country.

EU regulators have told France and the Nertherlands to revise their laws to conform to EU standards. But, while addressing one country's gaming issue, the EU finds other member nations contemplating illegal blocks, such as the one currently before German courts which demands Betfair block its product from German citizens.

Political observers say the EU must act more harshly to violators, or risk a widening fracture in the supposed single market.