World Trade Organization

• Author: International Law Group
• Pages: 217-218

Page 217

On December 21, 2007, an arbitrator under the auspices of the Dispute Settlement Body (DSB) of the World Trade Organization (WTO) issued an award in the aftermath of the dispute between the U.S. and Antigua and Barbuda over on-line gambling services. Interestingly, the arbitrator permitted Antigua and Barbuda to seek retaliation in a sector that is diffaerent (here: TRIPS Agreement, meaning intellectual property rights) from where the U.S. violations occurred (here: GATS, meaning services).

The dispute first came before the WTO in March 2003, when Antigua and Barbuda complained that the U.S. had implemented measures that impeded on-line gambling providers from offaering such services in the U.S., and requested consultations. In particular, Antigua and Barbuda Page 218 argued that the U.S. measures were inconsistent with U.S. obligations under the General Agreement on Trade in Services (GATS), Articles II, VI, VIII, XI, XVI and XVII, as well as the U.S. Schedule of Specific Commitments annexed to the GATS.

The initial Panel Report in this dispute was issued on November 10, 2004, and found, inter alia, that the U.S. Wire Act, the Travel Act, and the Illegal Gambling Business Act, as well as several state laws, impede the cross-border supply of recreational gambling services, contrary to the U.S. commitments. Thus, the U.S. failed to grant Antigua and Barbuda service providers a treatment that is "no less favorable" than provided for in the U.S. Schedule, and thus contrary to the market access provisions in Articles XVI:1 and XVI:2.

On April 7, 2005, the Appellate Body issued its report in this regard, affirming on diffa erent grounds the Panel's fi nding that the U.S. Schedule includes a commitment to grant full U.S. market access for gambling and betting services. It confi rmed that the U.S. had acted consistently with Articles XVI:1 and XVI:2 by limiting market access contrary to its commitments. Subsequently, an arbitrator ruled that the U.S. should comply with the recommendations and rulings of the...