e U.S. Treasury Department and the Federal Reserve have authorized a six-month delay in the implementation of the regulations associated with the Unlawful Internet Gambling Enforcement Act (UIGEA).
The regulations were to have taken effect on December 1. The delay will extend through June 1, 2010.
UIGEA and the corresponding regulations require payment systems to implement policies and procedures to block unlawful forms of online gambling, termed “restricted transactions.” Activities permitted under the Interstate Horseracing Act (IHA) are expressly excluded from the definition of restricted transactions, meaning that the regulations do not require anyone to block IHA activity. However, the regulations do provide a legal safe harbor for those wishing to “overblock” online transactions, even those that are conducted legally under the IHA.
The National Thoroughbred Racing Association (NTRA) and others petitioned the Treasury Department and the Federal Reserve in September to delay the UIGEA regulations, citing concerns regarding overblocking. More than 40 Members of the United States House and Senate also expressed strong bi-partisan support for the delay, which is broadly endorsed by the banking community.
“This is an important win for the racing industry,” said Alex Waldrop, President and CEO of the NTRA. “Horseracing has invested hundreds of millions of dollars in technology and infrastructure to develop the market for Advance Deposit Wagering. That market now represents nearly 15 percent of the $14 billion market for pari-mutuel wagering. We will continue to work diligently with the financial services industry and our ADW service providers to ensure that online pari-mutuel wagers are processed in accordance with the Interstate Horseracing Act.”
The NTRA is a broad-based coalition of horse racing interests consisting of leading Thoroughbred racetracks, owners, breeders, trainers and affiliated horse racing associations, charged with increasing the popularity of horse racing and improving economic conditions for industry participants. The NTRA has offices in Lexington, Ky., and Rye Brook, N.Y. NTRA press releases appear on the NTRA web site, NTRA.com.