EU probe finds US gambling rules violate WTO rules

U.S. attempts to ban European betting companies from operating in the United States violated world trade rules, according to a yearlong EU investigation published Thursday.

U.S. companies were allowed to freely operate online gambling on horse racing while EU companies could not and individuals even faced legal action, the European Commission said.

The probe was launched last year after European betting companies complained that U.S. laws on Internet gambling forced them out of the lucrative American market. Online gambling is worth more than $15.5 billion a year worldwide.

The European Commission found that U.S. laws on online gambling "constitute a barrier to market access which has had adverse effects on EU economic interests."

The EU Trade Commissioner Catherine Ashton said Washington had "find a swift, negotiated solution" with the 27-nation EU and others. It did not recommend filing a complaint to the WTO.

The WTO in 2006 ruled against a U.S. ban that stopped American banks and credit card companies from processing payments to online gambling businesses outside the country.

Washington responded by doing a deal with the EU, Japan, Canada and others in 2007 to allow it to effectively opt out of WTO rules on gambling in return for offering them compensation in other areas.

The EU probe says attempts to sanction European companies before the ban is "legally not justified and discriminatory."

The WTO has already awarded Antigua and Barbuda the right to impose $21 million a year in sanctions on the United States in retaliation for restrictions on online betting, but the sum was a fraction of the $3.4 billion sought by the Caribbean nation.