In a report published on 10 June 2009, the European Commission has found that U.S. laws prohibiting the cross-border supply of remote gambling and betting services and the enforcement of those laws against EU companies are in violation of Articles XVI (Market Access) and XVII (National Treatment) of the General Agreement on Trade in Services (GATS) and are not justified under Article XIV (General Exceptions).
The report is the result of a formal examination procedure initiated on 11 March 2008 under the EU Trade Barriers Regulation. The Commission launched the procedure following a complaint lodged by the Remote Gambling Association, which represents several of the EU operators that were forced to flee the U.S. market in 2006 as a result of legal proceedings brought against them by the U.S. authorities.
The Commission's investigation has concluded that the U.S. prohibition on online gambling is an obstacle to trade that has serious adverse effects on EU economic interests. These effects include: (i) revenue and stock market value lost by the affected companies as a result of their absence from the U.S. market and (ii) the threat of serious sanctions hanging over them that affect their normal operation outside the United States.
Although the Report finds that WTO proceedings would be justified, the Commission has indicated its preference to pursue a negotiated solution, notably in the light of the ongoing U.S. withdrawal from its GATS commitments on gambling and betting services.