Bill imperils British online gambling businesses

LONDON — Shares in British online gambling companies, including Sportingbet PLC and PartyGaming PLC, dived Monday after the U.S. Congress passed legislation prohibiting the use of credit cards, checks and electronic fund transfers for online gaming.

PartyGaming, the world’s biggest online gambling company, said it would pull out of the United States if President Bush signs the legislation into law.

The company 888 Holdings PLC said it is suspending online betting operations in the United States as a result, and Sportingbet PLC said it called off takeover talks with World Gaming PLC.

The legislation was part of a port securities bill passed by the House and Senate on Saturday.

The companies hit hardest by the ruling are those that offer betting markets denominated in U.S. dollars, and usually operate from bases in the Caribbean or Central America. Most of the big British and Irish sites, by contrast, keep their operations in Europe and take deposits only off credit cards denominated in pounds and euros.

Investec Private Bank commented that it was difficult to assess the value of online betting companies with heavy exposure in the United States because the allocation of costs is unclear.