Bookmaker William Hill is pulling out of online gambling in the US on fears that the company will become the authorities' next target.

William Hill wants clarification on "the scope and enforceability of state and federal gaming laws", following the arrests of BetOnSports' David Carruthers and Sportingbet chairman Peter Dicks.

Police in Louisiana, where Mr Dicks faces charges of breaking the state's morality laws, have issued warrants for three other Sportingbet directors and are believed to have a more extensive blacklist. Andy McIver, Sportingbet's finance director and chief executive in waiting, told Reuters today he believes he is on the list.

Earlier this week, two World Gaming directors resigned to avoid possible prosecution on mounting fears that the crackdown is wider than at first thought.

William Hill said it had taken steps to stop accepting casino and poker business from clients with a US address or US-issued credit card – the same measures as are already in place to prevent internet betting on sports events by US residents.

The legality of online gaming in the US is not altogether clear. Internet sports betting, for which Mr Carruthers was arrested, appears to be outlawed by the 1961 Federal Wire Act. Mr Dicks, however, has fallen victim to Louisiana state laws that explicitly prohibit any form of online gambling – including casino bets.

Most gaming company directors have tacitly acknowledged the threat and are avoiding any trips to the US. Sportingbet has made the policy official.

Mr McIver said: "We have now formally said that no board member is to go to the US following the arrest of Peter Dicks."

Mr Dicks is due to return to New York, where he was arrested, tomorrow for a hearing on his possible extradition to Louisiana.

William Hill shares fell 2 to 644p in afternoon trading.

A recent European Court ruling eases fears of online gaming industry.

When it comes to regulation, online gaming companies haven't had much to smile about recently.

In the US, the world's largest and most lucrative online gaming market, the industry has suddenly found itself under intense regulatory scrutiny. Senior sector figures such as Sportingbet's chairman Peter Dick and BetonSports chief executive David Carruthers have been arrested in the US as authorities crack down on internet gambling.

The taxation of online gaming companies, most of which are based in the off-shore tax haven of Gibraltar, may seem a world away from the arrests of Dick and Carruthers, but until recently this issue would not have been too far behind the US clampdown on the industry’s list of concerns.

As online gaming companies are all dotcom businesses, it has been easy for them to establish headquarters in the low tax jurisdiction of Gibraltar. This has provided the companies with a significant edge on other sectors because they have not had to pay the UK corporation tax rate of 30%, creating massive savings for shareholders.

But these significant tax benefits have been under threat from the European Union, which has been working to abolish Gibraltar’s exempt company tax regime.

In April 2004 the European Commission said that tax rules in Gibraltar provided companies domiciled there with an unfair advantage.

The EC said this amounted to 'regional selectivity', and also took issue with the fact that taxes in Gibraltar were based on payroll and the occupation of business premises, which meant that businesses would be unlikely to pay any tax liability.

The commission said that by 2010 Gibraltar would have to abolish its exempt company tax regime and implement a replacement tax regime instead. This raised the possibility that online gaming groups based in Gibraltar could find themselves paying corporation tax of 30%.

A recent European Court ruling, however, has eased these fears. Gibraltar's 1969 constitution provides the territory with fiscal autonomy and the region should be able to continue providing companies with an attractive tax regime.

In an interview with cantos.com PartyGaming’s group finance director Martin Weigold said the ruling had removed the risk that PartyGaming and other companies based in Gibraltar would have to pay the full UK tax rate of 30%.

‘It’s effectively removed one of the risks associated with the replacement tax regime that will come into effect at the end of 2010. We expect a low-cost tax regime that’s non-discriminatory to take its place when the tax-exempt scheme is phased out,’ Weigold said.

September 12, 2006 - Approximately 200 people stood in traffic and protested the development of Foxwoods Casino, a proposed gambling casino whose fate is up to the Pennsylvania State Gaming Control Board.

Development plans call for two casino slots parlors in Philadelphia. Five applicants are in the running: SugarHouse Casino, Pinnacle Entertainment, Riverwalk Casino, a Trump casino, and of course, Foxwoods Casino. Two of these 5 casinos will be approved.

Protesters rallied heavily today against the proposed Foxwoods casino gambling facility. The people cheered when organizers told them they had the power to stop the project. The first rally against Foxwoods was back in May and had over 500 protestors out.

"Foxwoods is the worst of the five casino gambling sites being considered", said Ed Kranepool.

Kranepool urged supporters to call into talk radio stations, write letters to Gov. Rendell, and contact legislators to voice their objections. Advocates of the casinos have said they will bring vitalization, jobs and improved roads.

The location of the proposed Foxwoods site is a vacant, weed-choked lot along the Deleware River surrounded by a barbed-wire fence.

A series of public hearings to decide where the UK's first super-casino should be built has begun.
Why are the hearings taking place?

The hearings are taking place because of the controversial Gambling Act 2005.

The act allows for three new types of casino, the most controversial of which is the regional or super-casino.

The main variation between the three types - the super-casino, large casino and small casino - is the size of the customer area allowed, the number of slot machines and size of the jackpot.

The super-casino will have a minimum customer area of 5,000 sq m and up to 1,250 unlimited-jackpot slot machines.

The government also expects the super-casino to have hotels, conference facilities, restaurants, bars and areas for live entertainment.

Las Vegas, in the US - the gambling capital of the world - has 30 such casino and hotel complexes, according to the Good Gambling guide Website.

How many UK super casinos will there be?

Originally, the government said there would be up to 40 super-casinos but this number was cut - firstly to eight, and then to just one - in the face of heavy opposition.

Some 27 local authorities applied for the right to play host to the super-casino.

The independent Casino Advisory Panel (CAP) whittled the applicants down to a shortlist of eight, announced in May.

On the shortlist were Blackpool, Wembley Stadium, Cardiff, Glasgow, the Millennium Dome, Manchester, Newcastle and Sheffield.

But last week, the Wembley bid was withdrawn after local opposition.

Why has the Dome's application been so controversial?

There have been a series of rows about the Dome's application.

Firstly, it emerged that the Dome's redevelopers - Anschutz Entertainment Group (AEG) - had already started building work on a super-casino ahead of the licence being awarded.

And this week, AEG was accused of distorting what local religious groups thought of plans for a Dome casino.

The Dome bid also attracted controversy after it emerged that Deputy Prime Minister John Prescott had been a guest of AEG boss Philip Anschutz at his ranch in the US. Mr Prescott insists he has not been involved in the casino application process.

How will the contract for the successful super-casino be decided?

The CAP - whose five members include experts in planning and regeneration - must take several factors into account before giving its final recommendations at the end of January 2007.

The casino must address a need for regeneration in the chosen area, which is likely to have high levels of unemployment and social deprivation.

The panel must also take account of the new casino's social impact and ensure that it is not harmful.

The CAP is reportedly worried that people living close to some of the proposed sites may have a high vulnerability to gambling addiction.

How will contracts for the large and small casinos be decided?

A shortlist of 31 proposals for large and small casinos was also released in May and the CAP will make recommendations for eight of each kind in January.

Social impact and regeneration issues will be considered.

Large casinos will have a minimum area of 1,000 sq m and up to 150 slot machines with a maximum jackpot of £4,000.

The small casinos will have a minimum customer area of 750 sq m, up to 80 slot machines and a jackpot of £4,000.

As with the super-casino proposals, the panel will scrutinise bids at public hearings near proposed sites. The hearings - or examinations-in-public - will be attended by supporters and opponents of plans.

Why is the Gambling Act 2005 so controversial?

Campaigners have warned that more Britons are getting into difficulties with gambling, particularly with the explosion in online casinos. They worry the new casinos will make the problem worse.

But Culture Secretary Tessa Jowell has defended the introduction of new casinos, saying the government has modernised and tightened the laws on gambling, which would now be "the most protective legislation in the world".

She says she does not think the casinos will increase problem gambling, but says she is prepared to close them down if they do.