WTO Panel Deals US Latest Setback in Dispute with Antigua

Media reports released this morning suggest the United States has been dealt another unfavorable ruling by the World Trade Organization (WTO) in its ongoing legal dispute with the Caribbean island nation of Antigua and Barbuda over U.S. restrictions on I-gaming.

Antigua initiated the WTO's dispute settlement process in June 2003, and in April 2005, the tiny twin-island nation with a population of 70,000 obtained a ruling that the United States gives preferential treatment to domestic I-gaming operators, which is a violation of an international pact called the General Agreement on Trade in Services (GATS).

The United States was advised by the WTO's Dispute Settlement Body to adjust its laws to provide fair treatment to both domestic and foreign I-gaming providers, giving it until April 3, 2006, to do so.

Since then, however, the United States has taken measures against online gambling. In October 2006, President George W. Bush enacted the Unlawful Internet Gambling Enforcement Act (UIGEA).

Reuters quotes Gretchen Hamel, a spokeswoman for the U.S. Trade Representative's office, as saying on Thursday that a WTO panel "did not agree with the United States that we had taken the necessary steps to comply" with that ruling.

The news source reports that Hamel downplayed the decision contained in a preliminary, confidential report to the two parties.

"The panel's findings issued [Thursday] involve a narrow issue of federal law," and the United States will have the opportunity to submit comments to the WTO before it issues its final, public report in March, Hamel said.

Mark Mendel, counsel for the government of Antigua, also confirmed that there was a ruling of the WTO issued yesterday to Antigua and the United States "on a confidential basis."

"Apparently the United States has disclosed it for whatever reason, but we are keeping silent until the WTO tells us we can release it," Mendel said.

Following the final panel decision ruling in March, the United States will decide whether to appeal.