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The European Union is launching an investigation into a possible international trade violation by the United States for discriminatory trade practices against foreign online gambling companies.

 Peter Mandelson - EU Trade Commissioner

The investigation could lead to the EU taking action against the U.S. at the World Trade Organization. European online gaming companies say U.S. Justice Department investigations into their activities violate international trade laws.

"The U.S. has the right to address legitimate public policy concerns relating to Internet gambling, but discrimination against E.U. companies cannot be part of the policy mix," said E.U. Trade Commissioner Peter Mandelson. "We are interested in a constructive and mutually satisfactory solution to this issue."

The U.S. takes the position that online gambling, which is allowed in other countries, is illegal. The U.S. passed a law in 2006 that keeps U.S. banks and credit card companies from processing payments for Internet gambling.

In December the World Trade Organization ruled that the U.S. prohibition of online gambling was unlawful allowing the Caribbean nation of Antigua to receive compensation from the U.S. for trade violations. The U.S. has to pay $21 million a year to the island nation for the financial loss the country has suffered.