Concerned about possible federal deals on Internet gambling in World Trade Organisation negotiations, state legislators in Utah are pushing a resolution that urges Congress to ensure that states' rights to make their own gambling laws are respected….and that means that online gambling will definitely be a non-starter in the state, reports the Salt Lake City Tribune.
"Talks for the next [WTO] round are in limbo," Republican Representative Sheryl Allen told the newspaper. "It's very important that states give input and get involved before agreements get signed by 153 countries."
Allen is pitching House Joint Resolution 1, which calls for gambling to remain within the realm of states' rights – and, as a result, would keep it illegal in all its forms in Utah.
Gambling is specifically barred by the Utah Constitution, a prohibition that forces locals to head to Idaho for lottery tickets or nearby Nevada for casino games. Now legislators are worried that the cross-border accessibility of Internet gambling could be allowed to circumvent the ban if federal negotiators do a deal.
"Computers made it much easier to gamble" — even from the comfort of one's Utah home, said Allen, who heads the Utah International Trade Commission, which drafted her proposal with the intent of persuading federal officials to favour domestic interests over international priorities and allow states to make their own decisions about gambling….or barring.
"Many see gambling as a moral issue," Allen said. "But I'm looking at it as a states' rights issue."
Utah and Hawaii are the only U.S. states with zero tolerance for gambling. Most states allow it in various forms, but with certain restrictions.
The Tribune informs its readers that in 1994, the United States ‘inadvertently' approved Internet gambling by signing on to the General Agreement on Trade in Services (GATS) at the World Trade Organisation, where the pastime falls under "other recreational services."
The report goes on to recount the confrontation with the Caribbean island government of Antigua and Barbuda over discriminatory US bans on Internet gambling (see previous InfoPowa reports) which the Americans eventually lost despite two subsequent appeals.
The US then made the unprecedented and unilateral decision to withdraw its gambling agreement from GATS, triggering further disputes and a provision in WTO governance that allows compensation to other nations affected by any withdrawal. Negotiations with various nations followed, in which some deals were made, although the details of these concessions by the USA were never made public "due to reasons of national security."
Congress then passed the Unlawful Internet Gambling Enforcement Act, a provision hastily tacked on to the unrelated SAFE Port Act and rushed through a late night session of a Congress about to recess. Rather than penalising individual gamblers, the 2006 law cracks down on fund transfers from financial institutions to online gambling sites. reports the Tribune.
Fantasy sports, online lotteries and horse/harness racing are exempt from this law.
In 2007, Antigua and Barbuda sought the ability to violate U.S. intellectual-property law in exchange for these restrictions.
Commenting on the role of the US federal government throughout these events, Peter Riggs, director of the Forum on Democracy and Trade said: "States on all sides of this issue were correct to see it as a states' rights issue. Some had public morals concerns, others revenue concerns."
However, many are disturbed that the terms of the agreement have been kept secret.
Riggs suspects that research and development services – and associated tax credits – might have been part of the bargain. Those concessions would also impact how states do business.
"This is potentially a very big deal," Riggs said. "We were stunned that they [federal officials] classified it as national security and got away with it."