Why, therefore, do we need laws regulating or banning gambling? The fact that problem gambling is a myth takes care of a Hartian positivist/utilitarian justification. This leaves only Fuller and his “natural law”, which in this case amounts to antiquated Victorian morality. With such a foundation, I’d bet that today’s gambling laws are little different in substance from those of a hundred years ago.[1]

Such questions are all the more relevant today because of the rise of online gambling. Anyone who has watched movies on Megavideo knows that there are two rules: 1) there’s a 72-minute limit, and 2) popup ads for a certain gambling website – let’s call it “MartyMoker.com” – are ubiquitous. But are these kinds of betting sites legal? The truth is that in Canada today the answer is not entirely clear.

The situation is complex because online gambling by its nature involves cross-border transactions. It is clear that running an unregulated online casino from within Canadian territory would be illegal. But what about Canadians betting on websites based in other countries? At the present time, there seem to be no laws addressing this question. Internationally however, there are several models we could follow.

In the United States, prohibition is the rule. The 1961 Wire Act, which banned gambling using phone lines, has been used by the federal government as the basis for strong action against international gambling websites with American customers. The Unlawful Internet Gambling Enforcement Act updated the Wire Act and required financial institutions not to transfer funds to gambling sites. This led to the arrest of two Canadian heads of an “e-wallet” company which had transferred money from U.S. residents to online casinos. More recently, the Gibralter-based parent company of the aforesaid “MartyMoker” site paid over $100m to the U.S. government after admitting to targeting Americans in its advertising (though the Megavideo ads remain).

Clearly the American government’s efforts are misguided. Having sampled both interpersonal and internet-based gambling, I can attest that the latter is to be preferred. By providing your credit card number to an online gambling site, you only risk personal insolvency – which is much less painful for my thumbs than becoming indebted to a bookie. For this reason, the British approach – legalisation and regulation – is far more practical.

The 2005 UK Gambling Act made online casinos legal, with regulations to keep internet gambling free of crime, fair and open, and to protect minors and vulnerable adults. The British government has even attempted to work with other countries to draft a code of conduct for online gambling sites, though the U.S. did not participate in these talks. An approach similar to Britain’s has been adopted in other EU countries. But if Canada must choose a system, my personal recommendation is to follow the Caribbean nation of Antigua’s lead.

Antigua has made itself a haven for online casino corporations catering to Americans, who make up a majority of their customers despite the U.S. government’s policies. Furthermore, Antigua has actively stood up for the industry. In 2003 Antigua filed a complaint with the WTO against the U.S. for its anti-internet gambling laws, arguing that the laws in question were inconsistent with the U.S.’s obligations to allow for the free flow of goods and services. The American laws were upheld in a 2005 appeal as “necessary to protect public morals or to maintain public order”. However the WTO held that the American Interstate Horseracing Act, which allows for interstate electronic betting on horse races, creates a discriminatory policy, since equivalent international betting is prohibited. The U.S. has been ordered either to allow comparable international gambling (an International Law of the Seabiscuit?), to outlaw all electronic gambling equally, or to pay compensation to other WTO members. So far the U.S. has not implemented the WTO orders, and Antigua now seeks permission from the WTO to violate American intellectual property law as an enforcement mechanism.

Antigua’s openness to online gambling companies isn’t just logical from a legal standpoint, it’s good business. I myself have contributed several hundred dollars to the Antiguan economy just while writing this article. But if Canada followed Antigua’s lead in international electronic gambling, we could be the next E-Vegas! Just imagine: instant access to a wide variety of home-grown internet gambling operations, with all the corresponding social benefits…

In the meantime, if any burly fellows are asking around for someone of my description named Rusty Shackleford, I don’t know anything about it.

THAT'S ME WITH THE ORANGE HAT