Post on 27-Dec-2015
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North American GamingRegulators Association
2009 Annual Conference2009 Annual ConferenceWashington, D.C.Washington, D.C.
Hot Topics in InternetGambling
Michael D. Lipton, QCJune 3, 2009
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Timeline of Growth of Internet Gambling
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• 1995 – first internet gambling website introduced.• 1996 – Antigua & Barbados and the Kahnawke
Territory (Canada) establish regulations authorizing i-gambling.
• 2005 – the United Kingdom Gambling Act 2005 authorizes i-gambling.
• 2006 – U.S. enacts UIGEA, ostensibly to block payments by financial institutions to i-gambling sites.
• 2008 – estimated 2,800 i-gambling websites operating.
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Economic Growth of Internet Gambling
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• 1997 – estimated $300 million in revenue
• 1998 – estimated $651 million in revenue
• 2001 – 2007 – i-gambling grows from an estimated $3 billion to a $20 billion industry.
• 2009 – estimated $22 billion in revenue.
Source: Christiansen Capital Advisors, LLC.
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Regulatory Models
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• Licensing and active regulatory models:– United Kingdom – robust regulation of operators and allows
residents to place online wagers.– Australia – regulation of operators, but generally prohibits
residents from placing online wagers.• Payment blocking:
– United States (UIGEA).– Norway– The Netherlands
• Criminal prohibitions– Viet Nam
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Current Developments: E.U. WTO
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• Antigua awarded ~ $21 million annually as a result of its World Trade Organization challenge to UIGEA.
• European Union formally studied complaints from domestic i-gambling operators that UIGEA discriminates in favor of U.S. gaming industry.
• March 2009, European Union announces intent to commence World Trade Organization proceeding with respect to UIGEA.
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Internet Gambling in the U.S.?
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• Congressman Barney Frank tries again! Introduces the "Internet Gambling Regulation, Consumer Protection, and Enforcement Act" ("IGREA") (H.R. 2267)
• IGREA already has 23 co-sponsors
• Senator Robert Menendez (D-N.J.) expected to introduce similar legislation in the Senate.
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Internet Gambling in the U.S.?
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• Challenges to enacting IGREA:1. Opposition from NFL, NHL, MLB, NBA and the NCAA despite
IGREA excluding sports betting from the permissible wagering activity.2. Games of skill vs. games of chance – IGREA would authorize all
gambling games; pragmatic observers suggest that a bill authorizing only poker or card games ("games of skill") has the best chance of passing.
3. Opt-out or opt-in – IGREA creates a regulatory system requiring States and Tribes to "opt-out" if want to ban i-gambling; States and Tribes may prefer an "opt-in" approach.
4. Federal regulation vs. State regulation – IGREA establishes a federal regulatory scheme (could delegate to States, but feds can still override); States likely to push hard to have any regulation at the State level and not at the federal level.
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Contact Information
© 2007 Dickinson Wright PLLCAll Rights Reserved
Michael D. Lipton, QC
Dickinson Wright LLP
120 Adelaide Street, Suite 2107
Toronto, Ontario M5H 1T1
e-mail: MDLiptonQC@dickinsonwright.com
Tel: (416) 367-0874