European Union Encouraged To Ask For 100 Billion

[ECB]

European online gaming companies, which have been shut out of U.S. markets, urged the EU on Wednesday to demand as much as $100 billion in compensation in the hope that Washington might yet be pressed into reversing its ban.

[Legislurker]

Gaming firms urge EU to aim high in trade row
Wed Sep 26, 2007 3:12pm BST
By William Schomberg

BRUSSELS (Reuters) - European online gaming companies which have been shut out of U.S. markets urged the European Union on Wednesday to demand as much as $100 billion (49.6 billion pounds) in compensation in the hope that Washington might yet be pressed into reversing its ban.

The tiny Caribbean island of Antigua, which built up an online gambling industry before the U.S. ban, successfully challenged U.S. online betting restrictions at the World Trade Organisation and the United States lost its appeal this year.

Now Antigua, the EU and other countries are trying to negotiate compensation deals with Washington.

The United States is offering concessions in other areas of trade to offset the online gambling restrictions.

Lawyers for European online gaming firms -- which are among the biggest in the world -- said the EU should press for as much as $100 billion in compensation, given the plunge in the market value of listed firms when Washington shut off the world's biggest market last year and the value of business lost since then.

The move wiped $7 billion off the value of the industry, which includes PartyGaming, Bwin, Sporting Bet and 888.com.

"One major question is how strong the EU will be in pushing the U.S. for all the concessions available to it," said Craig Pouncey, a trade lawyer with law firm Herbert Smith.

Antigua wants compensation of $3.4 billion -- a figure the United States says is far too high -- and the EU should demand at least 20 or 30 times that amount given the size of its online gaming industry, said Raul Herrera from law firm Arnold & Porter.

An EU industry representative said the United States should allow European countries back into the market.

"They have got themselves into a terrible mess and there is an easy way out for them," Clive Hawkswood, head of the Remote Gambling Association, told a news conference in Brussels.

He said regulation would ease what the United States says are its concerns about money-laundering and consumer protection.

Washington this year invoked a rarely used right under WTO rules to retroactively exclude gambling from its promise to open up its services market.

"The U.S. (compensation) offer to date is insufficient and we continue to negotiate in order to improve it," said Peter Power, a spokesman for EU Trade Commissioner Peter Mandelson.

The latest deadline for the United States to agree on compensation is October 22.

"The level of damage is impossible to quantify in a dollar sense," Power said, when asked about the $100 billion figure. "It is clear the EU industry was damaged ... and adequate compensation is now the subject of negotiations."

The lawyers said the dispute could drag on for years while U.S. casino operators and Internet companies such as Yahoo! and Google are free to do business in Europe.
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EU Online Gaming Sites: US Owes EU $100 Billion In Trade Concessions

BRUSSELS (AP)--The U.S. owes the European Union a jackpot of up to $100 billion in trade concessions to compensate for its illegal ban on foreign gambling companies, EU online gaming sites said Wednesday.

U.K. online gambling operators such as PartyGaming PLC (PRTY.LN), Sportingbet PLC (SBT.LN), and Leisure & Gaming PLC (LNG.LN) were forced to quit the profitable U.S. market last year when Washington stopped U.S. banks and credit card companies from processing payments to such businesses outside the country.

The World Trade Organization ruled in December that the ban broke global trade rules - paving the way for the E.U. to seek concessions that will likely be promises to open up other trade sectors. Early negotiations between the E.U. and the U.S. are still gauging the possible cost of compensation.

"One major question is how strong the E.U. will be in pushing the U.S. for all of the concessions available to it," said Craig Pouncey, a Brussels-based trade lawyer for Herbert Smith LLP law firm.

Lawyers and industry groups representing the gaming industry said European companies have lost billions of dollars in revenues and market value while U.S. companies such as Yahoo Inc. (YHOO) and the Sands Corp. were free to offer Internet games to Europeans.

The U.S. ban closed off the most lucrative region in a market the gambling companies claim is worth $100 billion - although other estimates give a far lower figure of $15.5 billion for the industry last year.

About half of the world's online gamblers are based in the U.S.

The E.U. - the world's largest consumer market - joins Antigua and Barbuda in seeking compensation. The twin-island nation argued that online gambling had provided income for hundreds of its citizens and was helping to end its reliance on tourism, which was hurt by a series of hurricanes in the late 1990s.

After losing the case, the U.S. announced that it would take an unprecedented legal step to change the international commitments it made as part of a 1994 treaty regulating the trade in services among the 150 members of the WTO. As a result, the U.S. declined to challenge the WTO ruling, because it says that its legal maneuver effectively ends the case.

[sixfour]

[ QUOTE ]
European online gaming companies, which have been shut out of U.S. markets, urged the EU on Wednesday to demand as much as $100 billion in compensation in the hope that Washington might yet be pressed into reversing its ban.

[/ QUOTE ]

I don't get this, didn't most of them opt out of the US by choice?

[DeadMoneyDad]

[ QUOTE ]
[ QUOTE ]
European online gaming companies, which have been shut out of U.S. markets, urged the EU on Wednesday to demand as much as $100 billion in compensation in the hope that Washington might yet be pressed into reversing its ban.

[/ QUOTE ]



I don't get this, didn't most of them opt out of the US by choice?

[/ QUOTE ]

Even if they "opted" out the argement stands that they did so in response to potential legal action.


D$D

[Richas]

As Obamma might say politics requires some poker skills.

FWIW given the stock market falls and the size of the market the EU would certainly be talking tens of billions. The EU will take this in "normal" trade sanctions so Boeing and US agriculture top of the list - Boeing to protect Airbus and the excuse for US agriculture being pretending to be on the side of the third world whilst propping up our own farmers.

[Skallagrim]

And wouldnt it be nice if the US just said to those "opted out" sites and their home countries - "hey you guys were wrong, just come back." Dream on (at least until 1/21/09).

Skallagrim

[Legislurker]

Here is why the EU is not the "best" ally in this. The EU doesn't give two [censored] about their own gaming sector. They WANT the concessions. So they will steer a middle course, trying to avoid the US backing away, but not going to arbitration for the full 100 bn. They would be happy with 15-25bn in certain areas. Beef, Aerospace, services, etc. This is like manna from heaven in Brussels and they hope the Bush [censored] are dumb enough to hand them this.