New Jersey and WTO Clash over Online Gambling Bill

New Jersey looks headed for a dispute with the World Trade Organization as legislators moved it another step closer to becoming the first US state to legalize online gambling.

The state senate approved a bill last week that would allow New Jersey residents and foreigners to bet online via serves located in Atlantic City casinos. However, the bill, which passed 29-5, would prohibit players from other US states from using the facilities to gambling online.

The bill, which included an amendment for a 15% tax on gross gaming revenue, authorized casinos to offer a myriad of services online, including slots, poker, roulette, baccarat, blackjack, craps and a host of other games.

However, the inclusion of provisions for foreigners to use the facilities could put New Jersey in conflict with the World Trade Organization, something the bill's initiator, Senator Raymond Lesniak has already admitted.

"We are going to be raising World Trade Organization issues by taking international gaming in New Jersey and showing how juvenile our federal government's policy is with regards to online gambling," he said.

Meanwhile, pro-gambling legislators in Washington are continuing to push forward bills to overturn the 2006 Unlawful Internet Gambling Enforcement Act (UIGEA), which effectively banned online gambling by criminalizing the transfer of funds from financial institutions to Internet gambling sites.