The odds aren’t great, but some offshore online gambling firms have a puncher’s chance of legally returning to the United States, thanks to the dogged determination of the tiny, twin-island nation of Antigua and Barbuda.
The World Trade Organization has reportedly ruled unambiguously in Antigua’s favor in a three-year-old case that country filed against the U.S. for free trade violations.
The ruling has not been made public yet, but a spokesperson for the U.S. Trade Representative’s office has all but confirmed that the decision went against the U.S.
In 2003 Antigua complained that the U.S. government’s ban on offshore online casinos and sports books violates the General Agreement on Trades in Services (GATS) treaty since it allows the same activities within its borders (see Gaming Firms Plan Counterattack).
And since both countries are signatories to GATS, the U.S., if it abides by the spirit of the ruling, should do one of two things: Either open its market to online gambling firms based in Antigua, or shut down the firms running the same kind of operations in the U.S.
Second Victory
To most observers, the WTO already ruled in Antigua’s favor in 2005. But the U.S. government claimed victory anyway. The overly bureaucratic style in which the ruling was written lent itself to multiple interpretations.
There’s a good chance the U.S. can use the WTO’s dense bureaucratese as another clarion call to inaction. The ruling is expected to be made public within a couple of weeks.
In October the Antiguan government amended its complaint to include the Unlawful Internet Gambling Enforcement Act of 2006. The law prohibits financial institutions from transacting funds generated by offshore online gambling (see Gambling Firms Flee United States).
This latest WTO decision will reflect that amendment.
The U.S. has varied its defense over the years. Initially the Bush Administration said that GATS did not include online gambling. At least that was not the U.S. understanding of the treaty.
Since then the U.S. has come up with a “moral” defense. It says online gambling, unlike all the other forms of gambling available in the U.S., does not have adequate protection against minors betting the family house.
The Antiguan government and the offshore online gambling industry have indeed come up with techniques to weed out minors armed with their parents’ credit cards. But so far that defense has fallen on deaf ears.Antiguan Sanctions?
In October, a small group of politicians jammed the Unlawful Internet Gambling Enforcement Act of 2006 through as an attachment to a popular port security bill. President Bush soon signed it into law.
Antigua is home to 44 online gambling licensees. Seventeen of those are regulated gambling firms. But they have slim hope of a U.S. revival. For Antigua, the WTO decision is likely to be little more than a Pyrrhic victory.
It’s unlikely the U.S. government will reverse its position or its laws banning offshore online gambling. The U.S. is more likely to ignore the ruling and leave the next move to Antigua.
Antigua could impose sanctions against the U.S. But that would hurt Antigua much more than the U.S. Without additional pressure on the U.S. government, the historic WTO decision is destined to suffer a quiet death.
Soure: Red Herring