• Reuters, Wednesday, November 21, 2007 11:30 AM

Last year, the government all but closed down the market for online gambling in the U.S., a move that shut down several gaming companies across the globe. The U.S. used to account for approximately half of all Internet gambling revenues, it's unclear what that number is now, a year after restrictions were placed before credit card companies and online payment services. Foreign outlets were also forbidden for accepting bets from U.S. consumers.

In the EU, where online gambling is legal, regulators say the U.S. ban is disingenuous, particularly because the U.S. in 1994 agreed to a world trade agreement that EU regulators believe covered many forms of commerce, including online gambling. EU fair trade chief Peter Mandelson says the American stance on online gambling shows blatant disregard for that treaty. The two parties are now embroiled in so-called "compensation talks" to aid the foreign companies that lost billions as a result of the U.S. decision.

"The U.S. has so far opted for compensation to make right what is wrong. I don't think compensation does that job," Mandelson told the European Parliament on Tuesday. "What we really need is for the legislation to be put right and for foreign operators to stop being excluded and discriminated against in the way the present U.S. legislation does."

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