A precedent-setting ruling was delivered this week against online poker and online gambling in the Israeli court case involving Gibraltar-based online bookmaker Victor Chandler's CEO Michael Carlton, effectively banning online gambling companies from delivering any services to Israeli customers.

The Israeli business journal Globes Online reported yesterday that Rishon LeZion Magistrates Court Judge Abraham Heiman stated, "In the era of the Internet, the original location of content (Internet services) is marginal and negligible. The center of gravity, especially the territorial legal jurisdiction, must switch to the end point, in other words, the individual computer."

BREAKING LAW

Therefore, said Heiman, "A foreign company operating an online gambling site may not hide behind the fact that the company and its servers sit in another country, and it is breaking the law if does not block access to Israelis."

Gambling in Israel, like France and several other European countries, is a monopoly controlled by a state-run gaming board.

Israel had previously ignored the foothold Victor Chandler had established in Israel, and permitted them to operate in a kind of legal grey area, said PokerPages.com.

Last year the Victor Chandler company launched an aggressive marketing campaign in Israel, complete with advertisements on billboards and buses, and a Hebrew website. Victor Chandler, the third generation Chandler to own the company, had remarked that Israel had rapidly become its second-biggest market amongst the customers it serves from over 160 countries, in an interview with the Racing Post.

UNHAPPY

But Israeli authorities were becoming increasingly unhappy about the encroachment of online gaming companies into their state-run monopoly, said reports.

Last December, Israeli's state prosecutor, Eran Shendar, outlawed online gambling from private operators. Police warned credit card companies that processing transactions for real money gambling operators would be a felony offence.

Judge Heiman's ruling this week has now made it clear that online gambling sites are not welcome to reach Israeli customers, either online or via physical advertising.