US Law Does Not Eliminate Possibility of U.S.-Based Casinos Opening Online Sites - AGA

A share of the $13 billion global online gambling market, with some $6 billion coming from US gamblers could be a tempting target if US politicians can be brought into line and non-American offshore companies continue to back away from the US player.

Provisions not included in Senator Frist's last minute legislative ambush over the weekend, could actually encourage hope, because it does not explicitly outlaw betting on online casino-style games, such as poker and blackjack. However, the bill does bar financial institutions from accepting "illegal" bets, leaving the question unanswered as to whether some forms of online gambling are permitted. So far, the only form of gambling that is explicitly outlawed is sports betting. 

The American Gaming Association, which lobbies for the U.S. land casino industry, took a neutral position on the bill, even though several prominent members, such as MGM Mirage, said they would like to start online sites.

Frank Fahrenkopf, AGA president and CEO, said, “my organization does not believe that the act eliminates the possibility for American casinos to open online sites, regulated by individual states or the federal government, in the future. This bill did not make anything legal or illegal. What it has done is to impact the mechanism by which Internet gambling takes place…, and there is some question as to whether or not that will be effective.”

The AGA expressed support for the idea of a bi-partisan congressional commission to study and report on Internet gambling, something that has been proposed by both Rep. Connors and more recently by Congressman Jon Porter, who introduced such a proposal in May. Such a commission would study whether online gambling sites, run by U.S. companies, could be regulated effectively. Fahrenkopf believes that the bill is likely to be considered early next year. The measure is backed by the land casino industry in the States and continues to gather support.

“Congressman Porter's intention is still to move ahead with this bill,” says the congressman's legislative director, Trevor Kolego. “We hope it will pass. If not by the end of this session, then by the next session.”

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