TPM. Tatooine. It's clearly established the Republic's laws don't extend that far out into space. The Hutt species is aparently the legitimate government, enforcing contracts and even hosting sporting events.
How can they be gangsters? Whose laws are they breaking?
By ROTJ it's not clear how the Hutts operate, as Tatooine is now at least somewhat under Imperial control.
It's worth noting that in the EU there are actual places known as Hutt Space, where the Hutts appear to have total control, are recognized by the Republic and even negoiated with.
Is it fair to call Jabba a gangster? Or is he actually a sovreign government unto himself?