New Jersey’s online gambling bill isn’t law… yet

New-Jersey-gambling-bill-lawOnline gambling proponents in the US are hailing the New Jersey Senate’s recent 29-5 vote in favor of Sen. Ray Lesniak’s Bill S490, which would establish the nation’s first intrastate online gambling system. From here, the bill goes to the New Jersey Assembly for approval, with the final step being Gov. Chris Christie adding his signature at the bottom.

We here at sincerely congratulate Sen. Lesniak and the other New Jersey legislators who voted in favor of the bill. It’s about time someone in a position of legislative authority in the US showed some common sense on this issue. However, in their enthusiasm to get things done, New Jersey’s pols may have overreached somewhat. While their bill would indeed restrict Americans living outside of New Jersey from accessing the online gaming sites, amendments to the bill would grant access to non-US international customers.

Lesniak’s bill would almost certainly have passed without these amendments, but now the US Dept. of Justice is virtually guaranteed to step in to initiate a court challenge if the bill ultimately becomes law. We’d bet the farm that the DOJ sends New Jersey a friendly letter in the next month or two and this ‘international’ amendment disappears prior to final reading.

But even if (for some bizarre reason) the DOJ doesn’t move, other countries will. As we are all too aware, just because NJ says that the gaming takes place in NJ doesn’t affect other jurisdictions’ jurisprudence as to whether the US casinos are subject to their jurisdiction for taking bets from residents. And since the US has publicly announced the withdrawal from its GATS commitments on remote betting during the Antigua arbitration process, it would have no recourse to international treaties.

Frankly, we just don’t see this bill passing or subsequently surviving in its current form as it runs afoul of the Travel Act, the Wire Act and the UIGEA on its face. Moreover, it would create the untenable political situation wherein NJ could take, for example, UK-residents’ bets, but not vice versa. Sorry, but politicians at the state level just don’t get to establish international trade policy.

That said, these are indeed strange times in US political circles, with the Tea Party freshman Senators and House reps en route to the Hill in January, together with their bumper-sticker policy depth and “no federal government interference with States’ rights” rhetoric, so who knows? At the very least, it opens up the remote possibility that we’ll eventually see NJ casino operators getting pulled off planes at Heathrow and thrown into UK jails. Now THAT would be something…