Antigua and
Barbuda take on the U.S. at the WTO
Earlier this week, the World Trade Organization declared that
it would appoint a three-member panel to investigate if the
U.S. crackdown on offshore Internet gambling operations in the
Caribbean Nation violates their international trade accords. The Caribbean nations of Antigua and Barbuda filed
a challenge stating that "U.S. laws that ban the transfer
of funds to offshore gambling operations and make it difficult
for non-U.S. firms to obtain gaming licenses violate trade agreements
ensuring market access to ‘cross-border services’".
Some 54 nations, mostly in Europe and the Caribbean,
have legalized regulated online gambling, according to the Interactive
Gaming Council. Already, there are signs that other countries
may take sides against the United States. Several nations, including
Taiwan, Mexico, Canada and the EU states, said today they would
reserve their right to join the dispute on the side of Antigua
and Barbuda.
In the 1990's, Internet gambling became a large
part of the Caribbean Nation’s economy, helping to employ
more than 5000 people, in 100 different online gaming companies.
In addition to the jobs created, a large portion of the revenue
from taxes on the casinos is used to run health, education and
other services. The countries sought out investments from online
casinos as a way to reduce their dependence on tourism, something
that has always been vulnerable to weather such as hurricanes,
and fluctuations in the global economy. Since the new U.S. legislation
barring residents from betting over the Internet through offshore
casinos in the Caribbean, there are less than 40 gambling companies
operating, employing half as many people.
The government of the twin islands decided this
left them no choice but to exercise "its responsibility
to our people to maintain their jobs and defend our small and
vulnerable economy in a highly competitive world."
They contend that the bars placed on cross-border Internet gambling
breach the WTO commitments to be open to services provided by
other countries.
The United States counters that it made no promise
to allow cross-border gambling in negotiations for the present
WTO pact on free trade in services. U.S. trade authorities maintain
that online gambling services are not within the scope of U.S.
trade commitments. U.S. officials also have argued that online
gambling services are a haven for money laundering that supports
terrorism.
A clearly shameless United States, the biggest
single economy in the 146-member WTO, said it was confident
it would prevail in the dispute, saying online gambling services
"present psychological dangers to some segments of society,
as well as creating serious social problems and law enforcement
difficulties."
Under WTO rules, both sides in the dispute will
have 30 days to agree upon the appointees to the three-member
panel. The panel appointed by the WTO will have six months to
determine a ruling. Whoever loses the case can appeal, and if
Antigua emerges victorious, the United States would be asked
to change the laws with to respect to online gambling.
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