RGA Refuses To Cut Deal

Published on: December 20, 2008 

We recently spoke about the lawsuit and subsequent charging of Anurag Dikshit, a founding member of PartyGaming by the U.S. government for being in violation of the law regarding online gambling.  Dikshit pleaded guilty to online gambling charges and agreed to pay $300 million in restitution to the American government for the company’s online poker and gambling business that was being conducted prior to the passing of the Unlawful Internet Gambling Enforcement Act.  While some may think this was the right thing to do, many do not and the entire online gambling industry is up in arms over it.

The Remote Gambling Association (RGA) released a press statement the day after Dikshit was charged asking that the European Commission move forward and take steps towards protecting any European Union interests from the ‘retroactive and discriminatory’ enforcement of the law that the government is taking against online gambling entities.  The law that PartyGaming was charged with has to do with sports betting and the regulation against bets, including sports betting, being placed over the telephone.  At the time that PartyGaming was operating in the United States – they stopped accepting American players after the UIGEA was passed – the site did not offer sports betting to any of their players.

Clive Hawskwood, RGA’s chief executive stated in response to the deal, “These events show that the outgoing U.S. administration and the Department of Justice have shown a total disrespect for the legal rights of European online gaming companies and those associated with them and a complete disregard for U.S. international commitments under GATS.”

Peter Mandelson, the EU Commissioner, wrote the American government in June asking for a freeze on any enforcement actions against European online gambling companies.  His reasoning behind the request was that he and others in the European Union felt that the American governments actions were violating international trade agreements that had been set in place by the World Trade Organization and that proper dialogue needed to be opened up between the United States and the European Union to halt any unnecessary disputes or actions like the one taken against PartyGaming.  At this time an inquiry had already been launched into the American online gambling actions after the RGA filed a complaint that fell under EU Trade Barrier Regulations.  The request and the complaint have summarily been ignored, and according to members of the EU a dangerous precedent may have been set.

PartyGaming is considered one of the premier online gambling websites in the world that is fully licensed in an EU jurisdiction, is listed on the London Stock Exchange, and has followed watchdog principles since its inception.  The company has never offered sport betting.  Hawkswood commented, “It's amazing really that a company which has just been voted by the leading industry publication as 'responsible operator of the year' is the one that has been most targeted for this sort of enforcement activity while other businesses that are still active in the U.S. market, including notably U.S. operators, do not appear to be targeted in the same way.”  He even went as far as pointing out that even with the UIGEA in place, the online gambling market in the US is continuing to grow and is developing their business in Europe.  He continued by saying, “In the circumstances it is not unreasonable for us once again to seek the support and protection of the European Commission. We hope and believe that these continuing breaches of international law by the U.S. will serve to strengthen the Commission's resolve.”

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