Legislative Issues & Policies - Internet Gambling Study Act

Introduction

On May 3, 2007, Congresswoman Shelley Berkley (D-NV) introduced the Internet Gambling Study Act (H.R. 2140). The bill calls for a detailed study by the National Research Council of the National Academy of Sciences “of the issues posed by the continued spread and growth of interstate commerce with respect to Internet gambling, as well as the impact of the Unlawful Internet Gambling Enforcement Act on Internet gambling in the United States.”

This is one of several bills introduced regarding Internet gambling since the Unlawful Internet Gambling Enforcement Act of 2006 was passed in the last Congress.

Internet Gambling Study Act

Findings. The findings to the bill note that the number of Americans gambling on the Internet has risen over the last ten years to several million and that Americans account for over half of the billions wagered.

The findings also refer to the decision by the World Trade Organization (WTO), which held that the U.S. was in violation of the General Agreement on Trade and Services by allowing some Internet gambling, including that on horse racing, and that the WTO decision “calls into question whether certain federal and state gambling laws violate the commitments of the U.S. under the General Agreement on Trade and Services” and that “while only Antigua and Barbuda are parties to the dispute, the ruling could have ramifications for all interested parties from the European Union to Australia.”

Issues to Be Considered. Among many issues specified to be studied are:

• A review of the existing federal, state, tribal, local and international laws governing various forms of Internet wagering, their effectiveness and “the extent to which such provisions of law conform or do not conform with each other;”

• An assessment of the proliferation of Internet gambling, including an analysis of its availability and use within the U.S.;

• The impact of Internet gambling on minors and compulsive gamblers and the availability of regulatory and technological safeguards to prevent or mitigate these impacts;

• An assessment of the impact of the Unlawful Internet Gambling Enforcement Act on the availability and use of Internet gambling in the U.S.;

• An analysis of the potential for State governments to create a legal and regulatory framework for online gambling within their jurisdictions or among those jurisdictions where online gambling is legal;

• An analysis of the potential impact of the WTO rulings regarding Internet gambling and the long-term impact on existing and future United States trade agreements under the General Agreement on Trade and Services; and

• An analysis of the potential tax revenue that could be generated by a legal, licensed, regulated Internet gambling industry in the United States.

The study must be presented to the President and Congress within a year of the contract being signed with the National Academy of Sciences.

Congressional Action

The bill has sixty cosponsors and was referred to three committees, the Judiciary Committee, the Financial Services Committee and the Ways and Means Committee.

On November 14, 2007, the House Judiciary Committee held a hearing on “Establishing Consistent Enforcement Policies in the Context of Online Wagers.” That Committee is chaired by Congressman John Conyers (D-MI). Witnesses and Members of Congress testified on this legislation during this hearing.