...related to a possible U.S. trade violation for discriminatory trade practices against European online gambling companies .

"The cumulative effect of U.S. WTO (World Trade Organization) related actions over the past year have forced the European Union to take this dramatic step. The line of inquiry opened by the questionnaire could reveal that the U.S. is engaging in unfair, discriminatory, and selective prosecution of European online gaming operators," said Naotaka Matsukata, a senior advisor to the law firm of Alston & Bird, LLP.  "If the E.U. takes the nuclear option and brings the U.S. to the WTO, serious damage would be inflicted on the bilateral relationship at a delicate time in transatlantic relations," added Matsukata.

Rather than taking this risk, the U.S. Trade Representative should work with Congress, as the U.S. Constitution instructs, to resolve the dispute by adopting Congressman Frank's Internet Gambling Regulation and Enforcement Act to bring the U.S. into WTO compliance, said Matsukata.
Many policy experts believe Rep. Barney Frank's (D-Mass.) bill, H.R. 2046, may end the trade dispute by regulating Internet gambling and creating a level playing field among domestic and foreign Internet gambling operators.

The European Union's Trade Commissioner Peter Mandelson says that discrimination against E.U. companies cannot be part of the policy of the U.S. Mandelson earlier indicated that the U.S. Congress should consider opening its market to overseas operators as a solution to the WTO trade dispute over Internet gambling.
Others are concurring.

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"The European Commission investigation further highlights the reckless manner in which the USTR has sought a protectionist trade policy, setting a precedent that threatens to expand beyond online gambling into other areas of trade," said Jeffrey Sandman, spokesperson for the Safe and Secure Internet Gambling Initiative.
The European Commission investigation comes just after a recent WTO decision in a case brought by the Caribbean nation of Antigua against the U.S. The ruling affirmed that the U.S. engages in illegal trade discriminatory practices against foreign online gambling operators. 

The investigation by the EC is the result of a Trade Barrier Regulation complaint filed by the Remote Gambling Association (RGA: 49.22, -2.20, -4.27%), which represents the largest remote gambling companies in Europe . The RGA claims the United States violates international trade law by threatening and pursuing criminal prosecutions, forfeitures and other enforcement actions against foreign Internet gambling operators, while allowing domestic U.S. online gambling operators, primarily horse betting, to thrive.

The European Commission, as a possible way to settle the matter, may, in the future, pursue discussions with the U.S. to find an appropriate solution to end the discrimination.



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