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Good Times for Online Gambling Lawyers

By: Joe Valentino, Thursday March 3rd 2011
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The demand for legal experts is perennially rising, but lawyers who have specialized in the field of online gambling can particularly expect good times ahead. The online gambling industry is going through a phase of intense restructuring and this will require considerable legal expertise. The nature of the legal expertise will not be the same everywhere because the issues prevalent in different parts of the world are different.

In the United States the focus will be on defending organizations in the online gambling industry against prosecution by the state authorities. The domain name seizure case in Kentucky and the periodic seizure of bank accounts of online gambling payments processors by the federal authorities are high profile cases, but there are several other cases as well. And this is only going to increase. Laws that prevent online gambling are being challenged. The UIGEA has been challenged by iMEGA and so has the federal law banning sports betting. Online gambling proponents are set to intensify their struggle. There is a third area in the United States that will require legal expertise. Many states are considering passing legislation allowing online gambling. This will require drafting of bills. If the legislations do get passed then the task of putting in place a regulatory mechanism will commence and this too will require legal inputs.

In Europe the situation is different. There are countries like the United Kingdom where regulated online gambling has been long established. There are issues related to level of taxation and treatment of offshore operators offering services in the United Kingdom. At the moment these are being treated at a policy level without getting involved in legal battles but the issue has potential for legal experts in online gambling. Countries like France and Italy have made tentative starts in online gambling regulation. Though many operators have expressed unhappiness at some of the terms imposed, by and large the industry does not want to rock the boat because the step is in the right direction. But here too there are latent possibilities for legal friction. The European Union (EU) is committed to a common regime across Europe and differences are likely to be challenged in the future. The biggest legal issues are in countries that are resisting online gambling in order to protect their state monopoly organizations. Germany and Holland are examples. Here online gambling operators have moved the courts and even the European Court of Justice has been involved.

It is evident that the online gambling industry will get less fragmented. This will be done through joint ventures and mergers. The partnership between Playtech and William Hill and the merger of Bwin and PartyGaming are examples. Many such deals are being discussed and many more will fructify in the future. A lot of legal work will be required in this area. Each party will want to ensure that its long term interests are protected and that there are no legal loopholes in the agreements that can be exploited against it. And finally as the online gambling operators jostle for space in the market there will be clashes between them. William Hill is embroiled in two of the most high profile ones. One is with 32Red over the use of trademarks and the other is with its joint venture partner Playtech.

Whether online gambling is being repressed or permitted legal expertise will be needed.

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