NETELLER WILL COMPLY WITH US REGULATIONS ONCE DETERMINED BY US FEDERAL RESERVE SYSTEM
19 October 2006
19 October 2006
Update on US position
Further to the Company’s announcement on 12 October 2006, NETELLER Plc today
announced the following update in the light of the action on 13 October 2006 by US
President George W Bush to approve and sign into law the SAFE Port Act
incorporating the Unlawful Internet Gambling Enforcement Act of 2006 (“UIGEA” or
the “Act”) which includes certain provisions to prohibit “unlawful internet gambling”
by restricting gambling sites from accepting certain payments from US residents.
NETELLER, a company registered outside the US, will comply with the Act and its
related regulations as if it were subject to the Act’s jurisdiction. This action is
intended to ensure that the Company is able to continue to operate with the support of
its principal commercial partners and to protect its shareholders, business partners,
employees and reputation.
Various provisions of the Act, including the obligations of financial transaction
providers such as NETELLER, remain unclear. This uncertainty should be largely
resolved when the Secretary of the Treasury and the Board of Governors of the
Federal Reserve System issue the regulations they are required to prescribe within 270
In view of the importance of these issues, NETELLER has accelerated its review of
the Act and all other relevant laws and pertinent developments. The Company also
continues to closely monitor the regulatory situation and is determining what actions
to take well before the conclusion of the 270-day rulemaking period.
In the interim, US-resident customers are able to use the NETELLER service as
normal. The funds of US-resident customers are held in trust accounts and will be
available for withdrawal, on demand. The ability to withdraw funds will exist
regardless of the customer’s location or ability to transfer to any site.
NETELLER customers not resident in the US are not affected at all by the legislative
changes in the US, and the Company will continue to operate its non-US business as
normal, maintaining existing customer and merchant support across all the other
markets it currently serves.
NETELLER remains focused on developing its business in line with its stated
strategic objectives including geographical and product diversification. The Company
continues to launch localised services within the European market, most recently in
Sweden and Denmark, and has plans for three further launches later this year. As
well as focusing on the gaming sector outside of the US market, the Board considers
the development of additional products and services for wallet users to be integral to
its diversified market strategy. We expect to share more information on these
initiatives in the coming months. The Company is committed to maximising
shareholder value both in the short and longer term, and will explore all possible
strategic alternatives, including utilising its substantial resources, to ensure the
achievement of its strategic objectives.
The Company’s trading update for the third quarter will be issued on Tuesday,
October 31st, 2006. In the meantime, the Company will endeavour to keep
shareholders informed of any material developments as and when appropriate.