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Antigua-Barbuda to file compensation claim for US web
gambling ban |
By Warren Giles
May 23, 2007: LONDON, England (Bloomberg): Antigua
and Barbuda will file a claim for compensation from the US
for a ban on Internet gambling, its lawyer said after the
Caribbean nation won a complaint at the World Trade
Organization.
The value of any compensation is "a massive unknown and one
of the reasons it's a very poor idea for the US," Mark
Mendel, Antigua's legal counsel, said in a telephone
interview Tuesday. "One route for us is filing a claim for
compensation, which we will do, and we will also continue on
the WTO track because the US has a commitment and it could
be years until they're allowed to withdraw that."
The US moved May 4 to "clarify" its commitments to the WTO,
saying that opening of its market to offshore Internet
gambling was "never intended" to be part of pledges made
when joining the Geneva-based arbiter in 1994.
Compensation may be calculated based on loss of income for
the 32 registered online casinos in the island nation of
80,000 people. Income has fallen to $130 million a year from
$1 billion among Antigua's online casinos in 2000, when
earlier US restrictions on online gaming were imposed, the
government says.
The country developed Internet gambling to boost a
tourism-dependent economy after several hurricanes in the
1990s.
Antigua, the smallest nation to ever take a case at the WTO,
says it's entitled to compensation for its losses. The
government estimates that Americans spend $10 billion a year
in online bets.
Under WTO rules, a country can withdraw commitments to open
its market in services to foreign investors. It can't opt
out of tariff cuts. The US must negotiate with any countries
that object to the move and want to withdraw any of their
commitments or force other changes in US rules as
compensation.
The WTO ruled that the US ban on offshore Internet gambling
was illegal on March 30. |
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"No one involved in" negotiating the 1994 global trade
accord which created the WTO "could possibly have thought
that the United States would make a market access commitment
on cross-border gambling" because international wagers "by
wire transmission" have been illegal since "at least the
early 1960s," the US said in a statement to a meeting of
ambassadors at the WTO on Tuesday.
Antigua says its head of offshore gaming met with US
officials in 1997 to discuss how to improve regulations and
supervise the industry. "If a 'mistake' had been made, why
not tell us then?" Antigua said in a statement to the same
meeting in Geneva.
The US Congress, then controlled by Republicans, passed
legislation last September that curbs financial payments
from banks to offshore Internet casinos that are illegal
under US law. The law was aimed at shutting down the payment
system for Internet gambling and caused betting sites such
as SportingBet Plc to cease US operations or sell them for
nominal amounts.
"While the withdrawal of a commitment might be at least
understandable if the US possessed a strongly anti-gambling
culture," said Mendel, "this is certainly not the case
here." |
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