WTO Again Rules Against U.S.Panel Says U.S. Is Violating Rules by Pursuing Online Gaming Sites |
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The World Trade Organization has again sided with Antigua in a dispute between it and the United States concerning online gambling.
The WTO panel has rejected the U.S.'s appeal of a decision it made in April of 2005 that said Antigua was right in claiming the U.S. violates WTO rules by working to prohibit its residents to play on online sites located outside U.S. borders. The panel said the U.S. is violating the WTO's general trade agreement because it allows remote gambling, particularly betting on horse races, to take place within its borders.
Tiny Antigua, which now derives most of its income by housing online gambling books, made the initial filing because the U.S. began to charge and issue warrants for the arrests of operators of the online gambling firms located there with crimes.
In the appeal, the U.S. asked the panel to throw out the initial conclusion that the U.S. wasn't in compliance with WTO rules. The panel refused.
The report also noted that the Unlawful Internet Gambling Enforcement Act (UIGEA), which was passed after Antigua's initial complaint, has the same loopholes that exist in the laws that encouraged Antigua to file the complaint. These loopholes are the main reasons that the panel ruled the U.S. is violating trade laws. Because the U.S. allows certain types of online gambling transactions to take place within its borders, but actively tries to stop the same services from being offered by companies located outside the U.S., the U.S. is violating WTO agreements.
It's unclear how this ruling will change the current online gambling climate in the U.S. By WTO rules, Antigua will be able to place sanctions against the U.S., but that will have little effect on the U.S. because of Antigua's size and lack of exports.
This ruling will come into play if and when a larger, more powerful country, like the United Kingdom, decides to challenge U.S. and WTO law on this issue. Later this year, the U.K. will allow online companies to be based there, and depending on how far officials in the U.K. want to pursue U.S. customers, the U.K. may ask the WTO intervene to allow free trade of online gambling.
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