March 17, 2006

Antigua blasts US over new Internet gambling laws

GENEVA (Reuters) - Antigua on Friday blasted the United
States over what the tiny Caribbean island state said were
moves to ensure it could not build up its fragile economy
through revenues from Internet gambling services.

Criticising proposed U.S. laws to outlaw the $12 billion
online gambling industry, Antiguan ambassador to the World
Trade Organization John Ashe suggested Washington felt it could
act with impunity because his country did not have the economic
weight to retaliate.

"We believe the time has come for the United States to
demonstrate ... whether the WTO agreements are to work for us
all equally, or whether the WTO is indeed a 'one-way street'
for the large economies to further enrich themselves at the
expense of lesser ones," Ashe told diplomats at a session of
the WTO's Dispute Settlement Body (DSB).

Antigua, which has a population of 67,000 with few natural
resources and a declining tourist industry, has since the late
1990s sought to build up an Internet gambling industry to
provide work for its young people.

The DSB was discussing developments in the squabble, first
brought to the WTO by Antigua in 2003. A WTO panel and later
appeals judges handed down rulings in 2004 and 2005 which both
sides have claimed as vindicating their case.

The United States, which before Ashe spoke told the DSB it
was still in consultation with Congress on the way ahead, bars
the placing of bets across state lines by electronic means,
arguing that the ban is legal under WTO rules.

U.S. officials say they are working to make clear that
domestic gambling operations in the country are subject to
exactly the same rules as foreign ones, and that there is no
discrimination against Antigua.

In their ruling last year, judges on the WTO's Appellate
Body said that there did appear to be U.S. discrimination
between foreign and local operators in betting on horse racing.

The new legislative proposals were intended to clear that
up, according to U.S. officials. But Ashe argued on Friday that
they were both "as directly contrary to the DSB recommendations
and rulings as could possibly be imagined."

He said they would entrench a situation where, in violation
of WTO agreements, Antigua was barred from providing services
to U.S. consumers that could be offered by domestic operators.

Diplomats said that the case was likely to be returned to
the original panel next month when the time period runs out for
the United States to come into line with the original rulings.
The panel will have to decide if it has in fact done so.