US online gambling laws ruled offside

The World Trade Organisation has ruled that US actions against online gambling violate international trade agreements.

But the US will appeal the decision.

The case against the US was brought by the small Caribbean nation Antigua and Barbuda, which argued that online gambling was protected by agreements banning limitations on trade in services - and the WTO agreed.

The US is saying that it agreed to no such thing – largely because the internet hardly existed at the time of the agreements. Legislation to ban online gambling is currently in preparation in the US Congress.

And, while gambling in the US is governed by individual state laws, the federal Justice Department has always held that online gambling is illegal. The only federal law that could apply is 1961 Wire Act, aimed at the Mafia-controlled and illegal sports-betting information service.

Antigua, which has a population of 67,000, once had around 5,000 people employed in its online gambling operations. This number has now shrunk to less than 1,000 because of US action designed to prevent its citizens from online gambling.

So far, US action has consisted of prosecuting people who run gambling websites and putting pressure on credit card companies to stop them handling transactions involving offshore gambling companies.