Lightweight vs. Heavyweight: Round Two

by Lou on March 8, 2006

The small Caribbean nation of Antigua and Barbuda won a case in 2005 against the United States in the World Trade Organization. The dispute centered around the US prohibition on Internet gambling services offered to Americans from firms located in Antigua, and the United States was given until April 3, 2006 to bring its laws into compliance with the WTO decision.

But no legislation along these lines has been brought forth. In fact, the only legislation introduced into the Congress to date are bills sponsored by Congressmen Jim Leach (R-Iowa) and Bob Goodlatte (R-Virginia) that seek to impose additional restrictions on Internet gambling.

Antigua’s Ambassador to the World Trade Organization, Dr. John Ashe, in a letter dated February 16 to United States Trade Representative Robert (Rob) Portman, stated that both pieces of legislation are contrary to the WTO’s ruling.

Ambassador Ashe stated that, “As of today, with less than two months remaining on an 11 month and two week compliance period, to our knowledge no legislation has been introduced into the Congress that would seek to bring the United States into compliance with the recommendations. Further, your government has given no indication to Antigua and Barbuda as to how the United States intends to effect such compliance. . .”

Ambassador Ashe added that, “Antigua and Barbuda stands prepared to ensure that our people reap the benefits of this historic decision. We will use the avenues open to us at the WTO and otherwise to see that the United States complies with the decision in a timely and comprehensive manner. As always however, we encourage the United States government to engage with Antigua and Barbuda directly to craft a workable solution to our dispute that addresses the concerns of both nations.”

The climate on Capitol Hill appears completely contrary to Antigua’s hopes, especially since those opposed to Internet gambling no longer have to deal with disgraced lobbyist Jack Abramoff, who is facing prison time and no longer working against the anti-gambling activists.

Rep Goodlatte’s bill would amend the Wire Act, a law that now makes gambling over telephone lines illegal, to include Internet gambling. Rep. Leach’s bill seeks to ban credit-card and other Internet financial transactions for betting.

Rep. Goodlatte’s bill has attracted more than 100 co-sponsors, although Internet-gambling companies opposing a ban are readying for a fight, and are much better armed than they were in 2000, when Rep. Goodlatte’s legislation was last introduced. Back then there were 1,800 Internet gambling Web sites. Internet gaming revenues were $5.7 billion in 2003 and projected to grow to $17 billion by 2009, according to a study by Christiansen Capital Advisors LLC, a firm that analyzes the gambling industry.

So while the forces line up on Capitol Hill to begin skirmishing, so do the possibilities of rematch between the small island nation of Antigua and the United States. This fight will take place at the World Trade Organization, and observers are predicating an outcome much the same as before, with Antigua receiving a favorable ruling and the WTO issuing a decision that would require the Untied States to enact legislation bringing it into compliance with their decision.

That, of course, is not remotely like the current legislative scenario, with legislation already introduced that would put the US at greater variance with the WTO decision. How that resolves itself is anyone’s guess. Right now it looks like David will beat Goliath, but whether that will be a real or pyrrhic victory remains to be seen.

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