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Antigua-US Online Gambling Dispute Still Under Negotiations

Posted on November 13th, 2010

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A dispute in the international gambling arena between the USA and Antigua and Barbuda has recently surfaced. The tiny country has become one of the world’s online gambling hotspots, as a number of gaming sites have established their hubs there. The US, by virtue of it not allowing its citizens to gamble online, has been barring remote gaming operators, including ones based in Antigua, to accept American customers. The result is an ongoing debate that has reached the World Trade Organization, with Antigua and Barbuda’s Minister of Finance, Harold Lovell and the Trade Representative of the US engaged in ongoing dialogue.

Several companies all around the world involved in online gambling have chosen which side to support, including Bodog Europe. Bodog Europe holds an exclusive license of the “Bodog” brand, which provides online gaming services in the areas of Europe and Canada. Among its specific services are sports betting, an online poker community, and a full online casino styled in actually Las Vegas style, offering more than 80 web-based and downloadable games. All of these services are currently not legally available for US residents. Bodog Europe is based in Antigua and Barbuda and is regulated and overseen by the Financial Services Regulatory Commission of the country. The commission’s Division of Gaming, has gained international recognition, including that of the Department of Culture, Media and Sport of the United Kingdom, as a “white listed” jurisdiction since 2008.

The dispute, first started in 2003 when Antigua and Barbuda filed a petition to the World Trade Organization. The nation argued that the USA has been violating its commitments on a treaty under the General Agreement on Trade and Services or GATS. The petitioner claimed that US domestic companies are allowed to offer remote gaming services to their citizens, but the country has imposed trade barriers by implementing federal legislation which is deemed discriminatory. This, in turn, precluded other WTO members from access to the US market for the services they offer.

The World Trade Organization is a worldwide body with 153 countries enlisted as members. The United States is actually one of the founding members of the organization which, among other things, makes sure that their governments comply with trade agreements agreed upon by member countries. The WTO has already released a number of decisions regarding the matter. The US has appealed the outcome, and a final ruling became available in December 2007. The ruling stated that the United States indeed has remote gambling services included in its GATS treaty commitments. Therefore, the country was in violation of this treaty by allowing domestic operatoes to engage in remote gambling while not allowing other member countries of the WTO from offering the same to the US market.

The WTO ruled that because the USA has been violating the treaty continuously, damages should be awarded to Antigua amounting to $21,000,000 every year. However, since the WTO couldn’t really force the US to pay even though the country violated the GATS treaty commitments, the body allowed Antigua the right to “counter-measures”. This gives Antigua the authority to suspend a number of intellectual property rights that the US would have with another treaty, and the suspension would be valued at $21,000,000 worth of IP rights every year. As of the moment, Antigua has chosen to negotiate with the USA rather than to implement these countermeasures.

Patrik Selin, CEO of Bodog Europe, a big supporter of the Antigua camp, said, “Minister Lovell has recently returned from a trip to Washington, where we are advised he conferred with the US Trade Representative in hopes of progressing an amicable resolution prior to imposition of the countermeasures.” Minister Lovell has also met with the country’s Director of Gaming and licensed remote gaming operators in Antigua for all stakeholders to be updated. Selin remarked that the meeting was productive. He added, “Though Bodog Europe has no US-facing business, we remain committed to the economic interests of Antigua and Barbuda and the ongoing strength of the Financial Services Regulatory Commission.” He also dispelled rumors that Anitgua settled the dispute for $10 million.