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New York Ruling Stirs Legal Controversy

This Monday, the New York Supreme Court ruled that state gambling laws apply even to Internet casinos with servers located abroad. Since the ruling, opponents and proponents of the decision have been debating the one question as old as the Internet itself: Where do the laws of different jurisdictions apply to Internet sites? Geoff Bacino, online casino attorney, argues: "Say somebody from London logged onto Amazon.com--they won't pay British sales tax, because the visit's being made here (in the U.S.). You're making a virtual visit to the country where the server resides." However, proponents of the court ruling are of a different mind. Joel Michael Schwarz, New York's assistant attorney general, considers the ruling important: "It's precedent-setting in terms of where the gambling takes place physically." Sebastian Sinclair, gaming analyst for Christian Cummings, comments that the ruling shows that "it is up to the states to determine what is legal," and that federal legislation to ban online gambling "might be irrelevant at this point." This would make the Kyl Bill superfluous.

Tue, 16 Nov 1999 13:35:03 -0800