Sounds right to me. I'm not sure what it's like in Amsterdam, but most cities in America have zoning laws to regulate what types of businesses can be located in a specific place.
Difference between 'regulate' and 'prevent' certain types of businesses, I guess.
Do any cities have laws which state certain areas are ok for prostitutes to work in? I'd guess not
Well, it is just displacing the problem. It does not solve anything, just hide it. Beside, wasn't the red light district precisely that, a zoning ?