Internet gaming dispute continues

GENEVA, Switzerland, November 28, 2006 – The Caribbean island of Antigua, not to be scared off by the Mighty Uncle Sam, is now hoping a World Trade Organization Dispute Settlement Body can help it get the United States to comply to lift its ban on Internet gambling.

The panel hearings are a culmination of a process that began earlier this year, when Antigua and Barbuda and the United States informed the DSB that they disagreed as to the existence or consistency of measures taken by the United States to comply with the recommendations and rulings of the DSB that were made last April.

A three member panel of the body yesterday began two days of hearing on the challenge mounted by Antigua and Barbuda to the claim by the United States that it is in compliance with the DSB’s 2005 rulings on the Internet gaming dispute between the two countries.

“This is just another step in our ongoing efforts to ensure that the United States complies with its obligations under WTO agreements and implement the rulings and recommendations of the DSB,” said Antigua and Barbuda’s Minister of Finance and the Economy, Dr. Errol Cort. “We believe that, notwithstanding the size of its economy, every WTO member has an obligation to play by the rules and accept and implement the outcomes of an established judicial process all members agreed to for resolving their trade disputes.”

The current chain of events was set in motion by the decision of both parties to appeal the original panel’s findings on certain issues of law and legal interpretations to the WTO’s Appellate Body. That body subsequently ruled that, among other things, the original panel’s finding that an alleged “total prohibition” on the cross-border supply of gambling and betting services cannot, in and of itself, constitute a “measure” subject to dispute settlement under the GATS, while upholding the finding that the United States’ schedule includes a commitment to grant full market access in gambling and betting services.

After the adoption of the appellate body’s report, the United States stated its intention to implement the DSB’s recommendations and indicated that it would need a reasonable period of time to do so. Both parties could not agree on what constituted “a reasonable time period,” and Antigua and Barbuda requested that the reasonable period of time be determined through binding arbitration of the Dispute Settlement Unit.

An arbitrator was appointed and he determined that the reasonable period of time for implementation was 11 months and 2 weeks from 20 April 2005, expiring on 3 April 2006. At the end of that period, the US issued the unilateral declaration that it needed to do nothing since it was in compliance all along. This led to Antigua and Barbuda’s request for the establishment of the current panel, which is expected to issue its rulings and recommendations in late January or early February 2007.

The dispute between Antigua and Barbuda and the United States started in 2003 as the U.S. began its crack down on Internet gambling, a sector that’s increasingly becominng part of the foreign exchange earner of Antigua’s small economy. (