WTO online gaming ruling could spell trouble for US

WASHINGTON D.C., United States, Tuesday February 12, 2013 - The Center on Hemispheric Affairs (COHA) says the recent decision by the World Trade Organization (WTO) against the United States in its online gambling dispute with Antigua and Barbuda “presents a troubling scenario” for Washington

“If the United States’ claim that the world’s 15th smallest economy is engaged in some form of economic bullying, attempting to force its hand in altering gambling laws by increased pressure from Hollywood lobbies, seems farcical, then so be it,” said COHA, a major think tank center here.

“American corporations largely have taken advantage of the swelling international tribunal system that encourages investor to state relations, and Washington has controversially promoted such terms in its recent free trade agreements.

“Now, Washington is experiencing the other side of international trade regulations, and if a reward of US$21 million to Antigua and Barbuda does not prompt a recalculation of US trade policy in this part of the Caribbean, perhaps eight billion (US) dollars in litigation arising from Chinese complaints will,”  COHA said.

In its final ruling, the Geneva-based WTO has allowed Antigua and Barbuda to suspend certain concessions and obligations it has under international law to the United States in respect of intellectual property rights.

For nearly a decade, the government on the Caribbean island has sought to resolve the dispute with Washington over the US’s failure to abide by American treaty obligations with regard to remote gaming.

The Baldwin Spencer administration described the WTO ruling as a “fair and reasonable solution,” adding that it plans to break copyright laws by getting legal retribution over Washington’s refusal to let Americans gamble at online sites based in the island-nation.

Trade analysts speculate that Antigua and Barbuda’ action may involve offering downloads of American intellectual property, like Hollywood films, network television shows or hit pop songs.           

But the United Sates has warned Antigua and Barbuda about its proposed plan, stating that it might further hurt trade relations between the two countries. 

“If Antigua does proceed with the unprecedented plan for its government to authorize the theft of intellectual property, it would only serve to hurt Antigua’ own interests,” said Nkenge Harmon, a spokeswoman for the United States trade representative.

“Government-authorized piracy would undermine chances for a settlement,” she added.But with an economy mired in public debt, COHA said “there is no question that Antigua could use the additional revenue,” noting that St. John’s is currently participating in a 36-month Stand-By Agreement with the International Monetary Fund (IMF) “after a bruising 2008 financial crisis turned into the banking crisis of 2011”.

Yet, the tCOHA said, it is still unclear whether the WTO dispute is “a legitimate step toward St. John’s sponsoring an online piracy haven or if these contenders are using the edict as an American response to illegal gambling.

“It is far more likely that reality in this instance lies closer to the latter, as Washington has ample reason to make amends with St. John’s gambling strategies,” said COHA, stating that Antigua and Barbuda is situated on “extremely important trade routes to the United States, lies only 300 miles from Puerto Rico, and has hosted a US military presence for much of its modern existence as a sovereign entity”.

The think tank, however, said what is clear is that the WTO ruling “will provide ample rhetorical material for St. John’s fellow Bolivarian Alliance for the Americas (ALBA) members and a blueprint on how to utilize the evolving international system to improve an otherwise asymmetrical position on a number of debating points.

“And while Washington has taken advantage of a self-serving trade system for the past 20 years, it should brace itself for the system to push back,” COHA said, adding that the January 28 WTO ruling signalled to Washington that “it must exist in the brave new world it helped create”. (CMC) Click here to receive free news bulletins via email from Caribbean360. (View sample)