Antigua, Barbuda, C'mon Gamblers

♠ Posted by Emmanuel in , at 3/31/2007 05:54:00 AM
Here is a heartening story that contradicts those who say the WTO is unfair in hearing cases of small countries. Sometime ago, the US decided that online gaming sites operating from abroad could not ply their trade Stateside for they violated laws banning interstate gaming. Antigua and Barbuda, a small Caribbean island nation with a population of 68,000 (not featured in Cocktail or the "Kokomo" video by the Beach Boys) then brought the matter to the WTO Dispute Settlement Mechanism (DSM), alleging that US actions violated General Agreement on Trade in Services (GATS) provisions. Antigua won, and the US said it would adopt the binding WTO ruling. However, the US has been tardy in doing so. In response, Antigua returned to the DSM to ask for US compliance. Once again, the US came out on the losing end. This ruling paves the way for possible remuneration for Antigua from losses sustained by US non-compliance.

The issue at hand is in regard to discrimination. The US claims that it prohibits interstate gaming to "protect public morals." Yet, it still allows the placement of interstate bets on horse racing through the 1978 Interstate Horseracing Act (IHA). Although the WTO allows countries to ban such forms of gambling, the problem is that the US discriminates by banning operators in Antigua while allowing horse racing bets to be placed across borders. The US passed the Unlawful Internet Gaming Enforcement Act (UIGEA) that prohibited credit transfers for cross-border betting in October of last year, but did nothing to clear up conflicts with the IHA. In fact, the WTO cited UIGEA as a source of further confusion. In the meantime, the online gaming industry, which has been hard-hit by legislative moves, is seeing this ruling as a potential respite. The US will have to allow offshore Internet gaming operators to ply their trade in America once more, or eliminate off-track betting on horses once and for all.