USA Responds To Antigua Invocation Of WTO

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The dispute between Antigua and Barbuda and the United States has flared up again after lying dormant for a few years. USA has responded aggressively to Antigua’s intent to place the issue before the Dispute Settlement Body of the WTO. Antigua had tried to bring the matter on the agenda of this body in December 2012, but was not allowed to do so. The reason given was that adequate and proper notice had not been given. The Antigua High Commissioner to London had rejected this charge, but said that the matter will be placed again on the January 2013 agenda. Antigua is expected to outline its proposals, specifying which US copy righted products and services it would produce and allow for sale, without having to pay amounts normally due to the copy right holders.

The US Trade Representative has reacted by calling Antigua’s intent “nothing less than a government-authorized act of piracy”. The US statement reiterated that its breach of the General Agreement on Trade in Service resulted because of an oversight. The US had not realized that gambling and betting services were included in the services covered and had therefore accepted the WTO trade obligations. Realizing that this was not a very convincing argument the statement outlined several other points. The US claimed that it had made conciliatory offers to Antigua. But since these had been rejected there was no justification for the Antigua retaliation. The knockout punch came in the concluding paragraph of the US statement with a more than veiled threat against Antigua. The proposed retaliation by Antigua would only hurt its own interests by closing doors to any possibility of a settlement that would provide real benefits to the island state. The statement said, “It also would serve as a major impediment to foreign investment in the Antiguan economy, particularly in high-tech industries.”

At the core of the dispute is the US ban on online gambling, which as per Antigua’s claim has devastated its economy. Antigua and Barbuda was among the first online gambling jurisdictions and its regulatory and licensing system contributed significantly to its revenues. After a long drawn procedure the dispute panel of the WTO determined that the USA had violated its commitments under GATS. The panel declared that Antigua was entitled to retaliate to the value of $21 million. This was a pittance as compared to the $3.4 billion claimed by Antigua. Thereafter Antigua sought to come to an understanding with the US on how to implement the WTO ruling but there was no response from the Americans. The Antiguan government feels that the point of no return has been crossed. It has to ask for enforcement of the WTO decision no matter how the United States retaliates.

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