Shareholders have received notice on Tuesday, that Party Gaming has cancelled its interim dividend following a decision to suspend all gaming business with U.S. players in the face of the new legislation. The money, they explained, was needed to fund the expansion of the firm's current and future operations in Europe and Asia.

The dividends were promised to the relevant parties last month, but shares dropped nearly 7% in mid-afternoon deals. The stock had plunged 58.66% in value yesterday. London stocks of online betting sites, which derive most of their earnings in the US, went into meltdown yesterday after Congress rushed through the Unlawful Internet Gambling Enforcement Act on Saturday.

The US legislation, if signed by President Bush, will prohibit US banks and credit card companies from processing Internet bets. The surprise measure was tucked into a bill aimed at enhancing port security, which passed on September 30th. Following the passing of the bill, and if in fact it will receive the President's seal of approval, the firm said that would suspend indefinitely all bets with US residents.