If you have been following this site for a while or are even new to it, you will notice that much of the early comments and interaction was based around a May 2005 paper I wrote on the legality of Internet gambling in the United States. So Partygaming, the Internet poker company that runs PartyPoker.com which was floated on the London Stock Exchange last week is now believed to have a greater worth than many blue chip US companies. Yet the United States government would still have you believe that Partygaming is illegal.

The company which was set up by an American citizen is headquartered in Gibraltar and has maintained no assets or employees in the United States.

So if the company is illegal in the United States, how does one explain the fact that it is estimated that $9 of every $10 it earned last year was from American citizens?

According to the company’s prospectus: “In many countries, including the United States, the group’s activities are considered to be illegal by the relevant authorities.” However the company goes on to note,

“Partygaming and its directors rely on the apparent unwillingness or inability of regulators generally to bring actions against businesses with no phyiscal presence in the country concerned.”

With $600 million in revenue in 2004 and a profit of $350 million (think about that, better than 50% profit), the Internet gaming business is so vital to developing world economies, that the US will never be able to beat public pressure and calls from its citizens to enforce its will outside the region of its border.