Online Gambling in New Jersey Could Cause WTO Disputes

New Jersey is on the verge of becoming the first state in the U.S. to explicitly legalize online gambling in an attempt to keep the state’s flailing casino industry afloat. After several attempts, legislation that would legalize online gambling in the state is closer than ever to becoming law.

Despite lagging federal attempts to legalize online gambling throughout the entire country, a great number of individual lawmakers support legalized gambling and see legalized and taxed online gambling as a good way to raise money and bridge widening budget gaps. In particular, State Senator Raymond J. Lesniak of New Jersey has made several attempts to legalize sports gambling and online betting. Earlier this month, his bill S-490 and its companion S11 were approved by the Senate Budget and Appropriations Committee, and last week it was approved by the New Jersey Senate. The final steps for the legislation will be a vote by the state assembly and for Governor Chris Christie to sign it into law — both of which are likely to occur before the end of the year:

It was one of seven bills passed by the New Jersey Senate in an effort to revive Atlantic City’s ailing casinos and horse racing. The intrastate poker sites would be hosted by Atlantic City casinos. Within the U.S., only people in New Jersey would be able to participate. However, bill sponsor Sen. Raymond Lesniak interestingly added an amendment that would allow people outside the U.S. to open an account through the New Jersey casino sites, potentially creating a larger player pool.

The amendment added by Lesniak, allowing foreign players to place bets on New Jersey Internet casinos, is likely to cause tension in the international gambling community, which has long viewed the United States’ stance on online gambling as discriminatory and a violation of international agreements. In 2005 and again in 2007, the WTO ruled against the United States after Antigua filed a complaint against the U.S.

Legalized Internet gambling in New Jersey and taking customers from foreign lands is likely to reignite claims that the U.S. is unfairly hindering international trade — something that New Jersey lawmakers are well aware of and hoping for. The hope is that renewed WTO disputes as well as the revenue brought in by online gambling in the state will prompt the federal government to take seriously the legalization of Internet gambling.

Image credit: FamilyofFun’s flickr photostream.