Antigua Succeeds In WTO Ruling Over US Objections On Internet Gambling
 

Tiny Antigua Trumps US in WTO Ruling on Internet Gambling

WASHINGTON - The tiny Caribbean nation of Antigua and Barbuda beat the United States at the World Trade Organization in a finding that a US ban on Internet gambling violates global trade rules, officials from both countries said.

An interim report from a WTO panel in Geneva found that Internet gambling is covered under the services agreement of global trade agreements, the officials said.

The ruling, which Washington plans to appeal, is unlikely to have an immediate impact, but Internet gaming industry officials expressed hope that it could spur a move to regulate Web-based gaming in the US instead of simply trying to ban it.

A US Trade Representative's Office (USTR) spokesman acknowledged the ruling, but said it only responded publicly after Antigua released the findings of the confidential report.

"This is a confidential, interim WTO panel report that Antigua is discussing on the record," USTR spokesman Richard Mills said.

"We believe that the language on US services commitments used by the Clinton administration clearly intended to exclude gambling when the US joined the WTO in 1995," Mills added.

"We intend to appeal and will argue vigorously that this deeply flawed panel report must be corrected by the Appellate Body."

An official at the Antigua embassy in Washington confirmed the decision by the Geneva-based WTO, but declined to elaborate.

The Wall Street Journal reported the decision earlier Thursday, noting that it could have wide-ranging implications for offshore Web gambling.

US officials contend Internet gambling is illegal if it involves activity on US soil, and have vowed to prosecute those involved in the practice.

Antigua, with a population of about 68,000, is one of the centers for Internet gaming operations, but industry officials say US residents are major players in casino-style games and betting from offshore centers.

Keith Furlong, deputy director of the Interactive Gaming Council, an association of global firms involved in Web gambling, said US residents are believed to account for 65 to 75 percent of the six billion dollar Internet gaming industry.

"It's an important victory but it's hard to call it a victory because it will take so long for the operators or the country of Antigua to realize a benefit," Furlong said.

"What we'd like to see from a decision like this would be for the US to give serious consideration to some type of regulatory structure for online gaming instead of just trying to prohibit it."

Many US banks and credit card companies refuse to allow payments to offshore gaming operators, which has cut some of the business from the United States, Furlong noted.

But he said a regulatory effort could help provide safeguards against minors involved in gambling and separate legitimate from unscrupulous operators.

He added that efforts to halt Internet gambling or payments through US banks simply creates an underground system.

"Prohibiting credit cards creates other alternatives like anonymous e-cash, which causes more concerns like money laundering and underage gambling," he said.