The ban will cover any Web site authorities in the Italian government deem to be out of compliance with Italian law. This would apply for essentially all companies without a license to operate in Italy.

Since Italy charges a prohibitive tax rate for online operations, it is understandable that the operators have no intentions of getting licensed. Further, Italy will likely discriminate against non-Italian operations with a preference given to local gambling powerhouses which mostly operate lotteries.

Lotteries are so profitable, and accustomed to operating under high tax rates, that they won’t miss a beat paying for the privilege of a near-monopoly. Since sports betting and casino games are far lower margin products, they can’t afford the tax and remain competitive.

What could be even more troubling is the regulatory licensing procedure. Since it is a new licensing regime, it’s anyone’s guess what onerous requirements or arbitrary denials will result.

Back in the U.S., such ideas have been floated around and quickly shot down. The U.S. has an edge over Italy in that it doesn’t have a European commission that requires allowing foreign operations. The WTO has essentially tried that, but it appears it won’t result in any changes. If the U.S. did pass such a requirement, it might stand in court challenges and force the nation to face further howls of protest from WTO members.

So why hasn’t this approach been taken? The backers of these bans realize they don’t have enough support to pass a bill with real teeth. With every new attempt to pass some sort of ban, the language just gets further watered down. While financial institutions could theoretically face serious issues with the latest Leach/Kyl Bill, they have been offered some large loopholes to escape true liability.

The same would have to apply to ISPs. Putting aside the belief that Web site bans can easily be circumvented, this appears to make the most sense and possibly offer a solution that would serve everyone well.

What would happen is that some government agency would come up with a first-cut list of Web sites to ban. The ISPs could dutifully follow the ban in a first-round purge. Then the operators could change their Web site locations and everyone could go back to doing what they were before.

U.S. officials and lawmakers would be able to say with a straight-face that they banned online gambling. However, in reality, they would be doing little to stop it. Politicians still try making political hay by supporting moot legislation.

It seems utterly stupid that we operate this way, but such is politics in our times. Politicians and law enforcement hate the idea of online gamblers being above the law. However, they hate the idea of enforcing a law against otherwise law-abiding citizens even more. This one simple move would serve the needs of most, insuring a “stand” is taken against online gambling while effectively doing little to stop the activity.

Meanwhile, operators and players get some quasi-cover in that the government will lose interest in an issue for awhile thinking they had stopped it. It saves face for everyone and therefore might be the best solution available to remove this never-ending cloud over the industry and its customers.