The United States is to pay compensation to the European Union rather than allow European online gaming companies into the American gambling sector.

A trade compensation deal has been agreed between the EU and US, which will now allow European companies access to the US postal market and warehouse sector instead.

An EU official described today's deal as a "meaningful compensation package from the US" but said that it was difficult to calculate losses from the gambling sector since the US banned online gaming in October last year.

The ban affected all online gambling operators, including PartyGaming, 888.com and Sportingbet.

The European gambling industry had hoped that the EU would push the US into allowing it back into the highly lucrative US market.

"We're disappointed but not surprised," Clive Hawkswood, the chief executive of the Remote Gambling Association, said. "We're hoping this isn't the last word on the subject."

The European Commission said that it would seek a non-discriminatory policy towards internet gambling in the US.

"While the US is free to decide how to best respond to legitimate public policy concerns relating to internet gambling, discrimination against EU or other foreign companies should be avoided," Peter Power, the EU Spokesman for Trade, said.

Last year the US Congress made it illegal to make payments to online gambling sites, and in May this year the US said that it was excluding gambling services from market-opening commitments it made as part of a 1994 world trade deal.

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