US Congressman Barney Frank has been lobbying for remedies to the Unlawful Internet Gambling Enforcement Act (UIGEA) practically since the day it passed. He was a vocal opponent to the original legislation referring to it as one of the stupidest laws ever passed. His last attempt, a proposal entitled HR 5767, didn’t get anywhere so he made some changes to the proposal. The latest incarnation as the Payments System Protection Act, or HR 6870, passed The House Committee on Financial Services last week.

The new bill offers relief to the financial institutions that were expected to take the brunt of the enforcing of the UIGEA. The new legislation would once again give Americans the ability to legally play online poker for money but would still disallow the majority of sports betting. The measure would suspend all UIGEA regulations from being implemented except for the ones affecting professional sports organizations. It also requires the US Treasury Department and the Federal Reserve Bank to work with the Attorney General’s office to delineate what is and what is not legal under the UIGEA.

The UIGEA was enacted in 2006 and prohibited financial institutions from processing payment transactions between American citizens and online gambling sites, especially offshore concerns. Many online gambling concerns pulled out immediately from the US market when this legislation passed due to threats of prosecution. The act has been controversial ever since, both within the country and without.

The World Trade Organization ruled against the United States when Antigua brought a trade violation complaint against them over this law. The WTO ruled that the US doesn’t have the right to limit such services from other countries under the General Agreement on Trade Services. Now the European Commission is conducting an investigation of its own after the Remote Gambling Association (RGA) filed a complaint alleging that the US is unfairly discriminating against its members in the enforcement of the online gambling ban while still allowing gambling on domestic horse racing.

After being talked about and an oral vote taken, the House Financial Services Committee took a formal vote and passed the proposal by a 30-19 vote. The next step is for HR 6870 to go through the House floor and Senate. This may not occur until next year, however, as Congress adjourned September 26. A “lame duck” session usually takes place after the general elections on November 4 but it is uncertain whether such session will occur this year.