Internet gambling regulation. Arising legal issues

Mantas Arasimavičius

Abstract


Internet gambling is a new phenomenon, which has spread rapidly due to the development of Internet technologies and e-commerce. In real life, differently from the Internet, sovereign states were able to regulate the gambling sector appropriately: they have implemented license requirements, enforced prohibitions or left it for self regulation. However, Internet gambling appeared to be not so easily controllable with conventional regulatory measures.
The Internet – understood as global computer network – has no boundaries. Every Internet user can easily access information on servers physically existing in other jurisdictions; anyone can also browse foreign web pages, purchase goods online or gamble with money. Development of e-commerce and e-payment technologies has simplified conclusion of commercial transactions, including gambling transactions; and e-trade has lost its connection to certain jurisdictions, because they were not essential in the global Internet space. This has triggered problems in defining applicable laws and finding effective legal regulatory instruments on the Internet and Internet gambling. All of this has lead to the current situation, when games of chance in some foreign jurisdictions are organized without adequate limitations and are reachable over the Internet for the rest of the world. The USA tried to tackle this negative phenomenon by blocking certain Internet pages, prohibiting e-payments for gambling, and prohibiting Internetinternet gambling itself. Nevertheless, the legal practice showed that even these strict measures on Internet gambling were not fully effective. Improving e-payment technologies and developing market of Internet gambling has soon presented certain opportunities to avoid the application of the imposed restrictions. Practice has also showed that in most cases the states were physically unable to control all anonymous violators on the Internet.
The Internet gambling problems, analyzed in this article, lead to exploration and comparison of the alternatives of the Internet gambling regulation and its prohibition, taking into account the experience of United States of America, which prohibited Internet gambling in 2006. The ineffectiveness of the prohibition is analyzed in this article, while looking for the most effective measures of control over Internet gambling, as well as for the measures securing the most vulnerable social groups against negative impact of gambling.
The results of the research have encouraged drafting of an ideal theoretical concept of Internet gambling control.
Legal regulation on Internet gambling, applicable within the territory of the Republic of Lithuania, is not progressive; the local Law on the games of chance currently bans all gambling activities, except for the ones explicitly described in the law, but participation in Internet gambling is not prohibited. The ambiguity of the law leads to an inability of the National gaming control commission to deal with foreign Internet gambling providers. Thus, there is an objective need for creation and implementation of new and effective Internet gambling regulation.
Finally, the article deals with Internet gambling prevalence and its regulation tendencies in the world that are important indicators for the Lithuanian legislator, which accordingly is being encouraged to take some regulatory steps, dealing with Internet gambling.

Keywords


administrative law; games of chance; Internet gambling; gambling access; legal regulation of Internet; e-payments; gambling addiction; ideal legal regulation

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"Societal studies" ISSN online 2029-2244 / ISSN print 2029-2236