Talks between the United States and World Trade Organization members who are demanding compensation because of the U.S.'s stance prohibiting its citizens from patronizing offshore online casinos continue.
The U.S. met its Sept. 22 deadline with the WTO to make an offer to the countries that claimed America's anti-gambling stance has hurt businesses located within them - but what the U.S. is offering and what the other countries feel is fair are way off from each other.
A deadline extension has been granted by the WTO so that the parties can continue to talk about the case. The new deadline for when the sanctions should be decided upon is Oct. 22. Ultimately, it's up to a WTO panel to decide upon the proper penalties, but this negotiation period is an early step.
Antigua and Barbuda - the tiny island nation who, by going after the U.S. through the WTO in 2003, opened the door for countries to demand compensation - says that $3.4 billion is lost annually because the online casinos located there can't do business with U.S. customers. Saturday, in a WTO filing, the U.S. said $500,000 was more accurate.
It's not known if the $500,000 would be paid in cash, through services, through copyrights, or by other means. Lawyers for Antigua and Barbuda have said that the WTO ruling potentially could allow it to make up for the lost business by ignoring intellectual rights laws. This means that Antigua and Barbuda would be allowed to legally produce copyrighted material that is made by American companies, something that organizations such as the Motion Picture Association of America have protested.
The U.S. still won't admit that its anti-online gambling stance violates WTO agreements. WTO panels have ruled that the U.S. violates agreements because it permits certain companies to host online gambling sites there - particularly horse racing sites - yet works to prohibit offshore countries from accessing the world's largest consumer base of gamblers. The WTO contests that his clearly violates the GATS (General Agreement in Trades in Services) agreement the U.S. signed in the mid-90s.
The U.S.'s main argument was that it didn't know that online gambling could be considered a commodity when it signed the GATS agreement in 1995. Instead of complying with the WTO panel's ruling and allowing its citizens to access offshore gambling sites, the U.S. Trade Office decided instead to amend the agreement.
But WTO rules say that if a country post-edits agreements like this, countries that are affected by the editing change can seek compensation from the country. This is what Antigua and Barbuda and a handful of other countries are doing. Potentially, the U.S. and U.S. companies may lose billions of dollars because of this situation.
More will be learned about this case at the end of October.
