1 2 May 2002

News:

The US government is expected to deliver to the Supreme Court by 15 May their reply to the defence submission in the Jay Cohen case. "The US government asked for one extension and we now expect their report on the 15 May", said defence attorney spokeswoman, Melinda Sarafa, of New York criminal attorneys Brafman & Ross.<

US credit card companies' refusal to accept payments to gambling sites has had a significant impact on the industry. In announcing their first quarter figures for 2002, CryptoLogic Inc, a leading online gambling software developer, put down a drop in year on year revenues to a decline in royalty payments from licencees, whose income had been hit by the issuing banks' action.

Orange, the wireless mobile phone operator, has signed an agreement with ukbetting.com, an online bookmaker, to be the network's first wireless betting provider.

Features:

No one likes missing opportunities. 'He - or she - who hesitates is lost'. goes the saying; 'look before you leap' is the repost. In the word of online gambling the opportunities are immense but so are the threats.

Last July the Budd Report was published amidst a flurry of publicity; the most widely received wisdom being that there would be extensive deregulation in the UK to build upon what is already a fairly sophisticated and mature industry. This led to the typical headlines of Blackpool becoming the new Vegas which rather overshadowed the fact that the Budd Report also endorsed the process of licensing online gaming operators too.

The White Paper does not resile from that original aim, but the coming months will be a key period for lobbying the online industry because there are a number of details that have to be fleshed out in the proposals.

The Isle of Man was one of the first mainstream jurisdictions to grant licences for online gambling. Professor Neville Topham was one of the architects of the Online Gambling Regulation Act 2001, along with Julian Lalor-Smith from the Department of Home Affairs. In this article Professor Topham, who has acted as advisor to leading industry businesses, as well as the State of Alderney, reviews the legislation and future regulatory and tax issues.

The Government's White Paper on gambling, 'A Safe Bet for Success - Modernising Britain's Gambling Laws', published on 26 March 2002, states "Advertising restrictions will be relaxed...". Relaxing advertising restrictions will require primary legislation l and this is estimated to be at least 18 months away. This article reviews existing advertising restrictions, and considers the risks that operators may be taking by advertising their services in advance of new legislation.

The control of financial spread bets has attracted a good deal of press attention in the last few months as regulators grapple with the opportunities which spread betting presents, not only for alternative investment mechanisms and risk-hedging strategies, but also for market abuse. This article, discusses the regulatory regime and different types of market abuse and highlights the wide scope of the regulators' powers.

As ever-increasing pressure is exerted on website owners to generate new revenue streams, promotions have become a favourite tool to drive site traffic. Major brands have transposed their tried and tested marketing techniques into the online world, with the added advantage of generating personal data from visitors, which can be used to enhance marketing activities.

Most promotions will either fall into the category of lottery, prize competition or free prize draw. You may also need to consider betting and gaming law, which is not considered here.

Touching off what has been described as perhaps 'the second largest expansion of legal gambling in the history of the United States,'1 California recently amended its parimutuel wagering statutes to permit certain forms of Internet and telephone wagering that has been approved by the California Horse Racing Board ('CHRB'). While these amendments undoubtedly open the door to legalized online wagering conducted by California providers or offered to California residents, their treatment of wagering activity conducted by providers outside California is sufficiently indefinite and subject to the CHRB's discretion that this legislation may ultimately only expand the opportunities for Internet wagering providers located in that state.