US Admits Defeat in Antigua Gambling Case at the WTO

[Jay Cohen]

US Admits Defeat in Antigua Gambling Case at the WTO

Seeks to take ball and go home

While Americans Eagerly Expand Domestic Gambling, the Normally Free-Trading United States Trade Representative Announces a Bizarre Move at the WTO to Cutoff the Foreign Competition: Is the Bush administration morally opposed to online gambling or just trying to stifle the foreign competition?

Washington D.C. (4 May 2007) - Today the Antigua Gambling case before the World Trade Organization (WTO) took a stunning turn of events. After suffering defeat after defeat, and with one appeal remaining, the United States has announced it is withdrawing its commitments in the gaming sector from its GATS schedule. This move by the United States is unprecedented in the WTO.

Antigua and Barbuda, one of the smallest members of the WTO, had successfully challenged the United States’ protectionist trade policy against remote wagering. Just when the United States was facing with having to comply with the ruling, the US is trying to walk away from the process.

This has international trade implications and could lead to the break up of the WTO. What is the point of having an international trading system enforced by a neutral court in Geneva when a developing member like Antigua successfully challenges the largest trading member in the world, and the large trading member simply quits after a losing verdict in one case? What is the developing world supposed to think after a small country with virtually no resources invests three years and millions of dollars challenging a large member who simply “takes his ball and goes home” after losing a case? How can an international trade dispute process work when a large country can change the playing field whenever there is an adverse decision against them?

This will forever mark the United States as a country not committed to free and fair trade, but as a sore loser on the global stage. The rest of the world is watching this move and it will be at the forefront of their minds as the United States tries to press for more concessions from smaller nations at the present DOHA round of negotiations.

The USTR claims today that it made its GATS commitment by mistake and that no WTO member could have anticipated remote gambling back in 1993 when the United States and other countries were drafting their international commitments to open their markets to recreational services. These claims are absurd and disingenuous.

By 1993, the concept of cross-border remote gambling was not new to anyone. At the time the GATS schedules were being drafted, the “remote” gambling industry was a thriving business in America, and had been in existence for more than 100 years! In the early 1990s there were state-owned and operated betting enterprise that had been openly offering telephone wagering to residents of New York and certain other states for years. Is the USTR claiming today it didn’t know in the early 1990s about the Interstate Horseracing Act (IHA), a federal law passed in 1978 for the specific purpose of regulating interstate bets on horse races?

The existence of cross-border gambling in America was an old concept by the early 1990s. There were mail order lotteries and race wires before the 20th century began. How could the USTR have not known in the early 1990s that gambling could occur via electronic means?

The USTR’s claim that it mistakenly committed to gambling in the early 1990s is simply untrue. Of the 150 countries who participate in the GATS, more 100 excluded gambling in their schedules. Most WTO members excluded gambling by simply not including the applicable sector, Sector 10 (Recreational, Cultural and Sporting Services), in their GATS schedules. But a number of countries, even in the early to mid 1990s, had the foresight to “opt out” making a commitment to allow foreign countries to provide cross-border gambling services. For instance, the European Community, Austria, Finland, Croatia, Slovenia and Sweden excluded cross-border gambling services from their GATS schedules under Sector 10. So did Egypt, Iceland, and Peru. Even Senegal had the foresight to exclude foreign gambling operators when it submitted its GATS schedule.

It is difficult to comprehend why the USTR is saying the gambling commitment was made by mistake. As part of the lengthy process to negotiate the GATS schedules, the US had longstanding access to its trading partners’ draft GATS schedules. These draft schedules had clear and unambiguous exclusions of remote cross-border gambling services. The US knew full and well what it was committing to back in 1993, and is only trying to back out now to avoid having to comply with the Antigua

[aislephive]

Sorry for sounding naive, but:

1. Is this good news?
2. What exactly does this mean?

[Uglyowl]

Sounds horrible to me. It sounds like the United States is saying, we hate the ruling so we're leaving the WTO. F you all.

[permafrost]

Can you show us a link to the news of this somewhat expected development?

[Little_Luck]

From the sounds of it, they will get away with it. It appears the WTO allows for such an amendment.

US Gov't has good attorneys.

Cliff notes:

WTO-"You said and committed that you want to belong to the GATS charter for gambling"

US-"Yeah, but we didn't know that by signing that we were held liable for any innovations in gambling. When Al Gore created the interweb, we didn't know people were going to just use it for porn and gambling. Children will suffer if we don't do something. See ya!"

[TheEngineer]

[ QUOTE ]
US Admits Defeat in Antigua Gambling Case at the WTO

Seeks to take ball and go home

[/ QUOTE ]

You sound surprised.

I wasn't being mean to you last week when I suggested this potential outcome. Actually, it was foregone, as the decision rejected states' rights. Essentially, Congress delegated authority to the WTO that it (probably...one could make an interstate commerce argument) lacked for itself -- the right to force individual states to allow all online gambling.

I actually hoped the U.S. would choose to comply, so I'm on your side. However, I did want to ensure that our guys wouldn't oppose the Frank bill on some false hope that somehow Antigua could force the U.S. to allow unfettered online gambling in states like Utah and Hawaii. As much as I would like that, for better or for worse it really is up to the citizens of those states, I think.

American 2+2ers: We should all still use the WTO decision in our appeals to Congress. We should also add that we need the WTO to protect our IP in China and to protect free markets. Do most Americans think we should throw Microsoft under the bus to keep Americans from CHOOSING to gamble online? After all, it's not like Antigua sent their "military" to America to force Americans to gamble against their will. Please write to your congressman and ask him/her to honor our commitments to the WTO. Let's ask that we at least negotiate a reasonable arrangement with Antigua that protects states' rights while opening access to states that have legalized gambling.

The tide is turning against the online gambling prohibitionists. Let's keep up the fight.

[TheEngineer]

[ QUOTE ]
Sounds horrible to me. It sounds like the United States is saying, we hate the ruling so we're leaving the WTO. F you all.

[/ QUOTE ]

Definitely horrible for us. Seems Antigua overreached. If they fought to be allowed to offer Internet poker in CA, where B&M poker is legal, they'd have a great trade argument. The overreach was trying to suggest that they had a right to force America to allow them to offer sports betting in Utah, where no U.S. company is permitted to offer any gambling. After all, gambling in Utah isn't a protectionist issue....it simply isn't allowed.

Hopefully we'll be able to prevail upon our Congress to revisit this issue. We need the WTO. We should negotiate a settlement with Antigua that provides their companies with the same access as U.S. ones (poker in CA, all betting in NV, none in Utah, poker and blackjack in IN, etc). Then, we can revisit GATS and add states' rights clauses, like the one that requires automobiles sold in CA to meet their emissions, rather than national ones (i.e., Japanese companies cannot sell non-compliant cars in CA, but neither can American companies...it's not protectionist).

Let's get to writing everyone. There's no way Microsoft and our other companies (or us, for that matter) should get thrown under the bus for this.

[disjunction]

If the U.S. were leaving the WTO it would be front page news, or at least front webpage news. A quick scan of cnn.com and I don't see anything.

So it sounds to me like the US strategy is still to ignore the issue until it goes away. In the words of Andrew Jackson, "Mr. Marshall has made his decision. Now let him enforce it."

[Jay Cohen]

This is a shocking development and will reverberate across the trade community. It is not clear whether or not they can change their commitments in the middle of a case and walk away from the adverse decision or if this would only apply to future cases brought by other countries. Needless to say the Antigua team is going to have a very busy week aead of them.

on the state by state issue, I meant to respond to TT in the other thread, but I may as well put it here and hope he sees it. These are two different responses from two different TRADE lawyers on the subject of the decisions and how it interacts with the domestic market. (I actually sent them TT's comments and these were their independent responses.)

Response 1

The US could pay the sanctions
assessed against them, which some commentators thinks will
happen.

But back to the point that the US only has to allow remote horse and
lottery - that's completely incorrect. The way the WTO case was
decided, the US has to allow access to any cross-border gaming services
offered by Antiguan operators unless the US can prove up its Article IV
defense (morals defense). The US made a full commitment in its
schedule - to free trade in gambling. The US could have exempted sports
gambling, or done a state-by-state exemption in its schedule of
commitments. But the US did not do so (interestingly over 100 of the
150 countries that are signatories to GATS exempted gambling services
one way or another).

The US lost its morals defense, and that opens the US to all forms of
remote gaming serviecs by Antiguan operators, and Antiguan operators
alone. The fact the US already allows remote horse wagering and to a
lesser extent remote lottery and even REMOTE ONLINE SPORTS BETTING (in
Vegas)is conclusive evidence that the US is NOT morally opposed to
remote gambing and that the US RECOGNIZES that online remote gambling
can be regulated/monitored in such a way to control any so-called moral
issues such as underage gambling, compulsive gambling, money laundering,
etc. Stated otherwise, if the US permits and recognizes remote
gambling, such gambling is per se not "immoral" under the WTO legal
standards, and then Antigua can access all types of remote wagering in
all states.

Americans often get hung up on a sport-by-sport or state-by-state
concept. They think if we Americans only have online horse racing
gambling in 18 states, then Antigua can only offer online gambling in
those 18 states. Or they think that Antigua can only offer online
horse racing. That is a misconception. First and foremost, when a
country makes a commitment and then has no moral exception to avoid that
commitment, then the commitment must be honored or the country must
otherwise comply/settle/pay sanctions. This statement alone defeats
everything you have said that limits Antigua. Second, under GATS, a
country is treated as one entity. Individual state laws don't govern
and really matter very little, if at all. Therefore, unlike our
federal system which recognizes state rights, GATS judges the US as one
collosal country. So, because 18 states offer online gambling, the
entire US is deemed to have waived any moral objection to and must
permit online gambling. The fact that the US allows horse racing
(which, after all is betting on an event - a horserace)and sports
gambling in a few states (betting on an event), the US waives any moral
objection to sports gambling on any basis.

Response 2

Under the GATS, if you give full access with no restrictions, then it
doesn't really matter what your domestic market is. So, there could be
a situation for example where there was no domestic industry at all, but
if a full commitment in the sector has been made in the GATS, then there
are no restrictions on foreign service providers.

[TheEngineer]

[ QUOTE ]
If the U.S. were leaving the WTO it would be front page news, or at least front webpage news. A quick scan of cnn.com and I don't see anything.

So it sounds to me like the US strategy is still to ignore the issue until it goes away.

[/ QUOTE ]

I've Googled for it a few ways and can't find it.

The U.S. actually isn't leaving the WTO, according to Jay. Rather, we're pulling out of the gambling-related part of it.

One irony is that our good friend Rep. Ron Paul has been trying to get us out of the WTO since we joined. I don't imagine this is what he had in mind (although his issue is the same...sovereignty).

[Wynton]

[ QUOTE ]
If the U.S. were leaving the WTO it would be front page news, or at least front webpage news. A quick scan of cnn.com and I don't see anything.

[/ QUOTE ]

For this reason, and because of its editorializing, I was curious where the quoted article came from.

[TheEngineer]

[ QUOTE ]
I've Googled for it a few ways and can't find it.

The U.S. actually isn't leaving the WTO, according to Jay. Rather, we're pulling out of the gambling-related part of it.

One irony is that our good friend Rep. Ron Paul has been trying to get us out of the WTO since we joined. I don't imagine this is what he had in mind (although his issue is the same...sovereignty).

[/ QUOTE ]

Even The Register has nothing on it yet. Here's an article about the horses (and a little about Jay's case) at www.theregister.co.uk/2007/04/18/ntra_interview_wto_waldrop/ (http://www.theregister.co.uk/2007/04/18/ntra_interview_wto_waldrop/) :

[ QUOTE ]
In a bizarrely rambling and ill-informed interview with Interactive Gaming News last week, National Thoroughbred Racing Association (NTRA) head Alex Waldrop advocated that the United States try to remove gambling services from the General Agreement on Trade in Services (GATS), thereby circumventing a string of negative rulings against the US at the WTO covering the provision of cross-border gambling services.

Never mind that the WTO resolved the status of gaming services and the GATS in the initial panel; even the hard-up Department of Justice (DOJ) has given up on that tack, choosing instead to do nothing and hope that the dispute somehow resolves itself. With trade partners such as China, Europe, and Japan breathing down the neck of the DOJ...well, good luck with that.

The dispute originated years ago in the aftermath of the arrest of Jay Cohen, the one-time head of the World Sports Exchange (WSE), who landed in federal prison after returning voluntarily to the US to fight charges that he had violated the Wire Act by operating an online casino out of Antigua. Although the company operated completely out of Antigua, where online wagering is legal, the Federal Court for the Southern District of New York felt that the WSE had marketed itself sufficiently in the US to fall under American jurisdiction......


[/ QUOTE ]

[schwza]

[ QUOTE ]
The overreach was trying to suggest that they had a right to force America to allow them to offer sports betting in Utah, where no U.S. company is permitted to offer any gambling. After all, gambling in Utah isn't a protectionist issue....it simply isn't allowed.

[/ QUOTE ]

http://www.utahlottery.com/_templates/images/A/head1.gif

[Jay Cohen]

[ QUOTE ]
[ QUOTE ]
If the U.S. were leaving the WTO it would be front page news, or at least front webpage news. A quick scan of cnn.com and I don't see anything.

So it sounds to me like the US strategy is still to ignore the issue until it goes away.

[/ QUOTE ]

I've Googled for it a few ways and can't find it.

The U.S. actually isn't leaving the WTO, according to Jay. Rather, we're pulling out of the gambling-related part of it.

One irony is that our good friend Rep. Ron Paul has been trying to get us out of the WTO since we joined. I don't imagine this is what he had in mind (although his issue is the same...sovereignty).

[/ QUOTE ]

Where did I say they were leaving the WTO?

[Jay Cohen]

Here's the Reuter's piece:

.S. to "clarify" Internet gambling ban at WTO

Fri May 4, 2007 12:02PM EDT

WASHINGTON (Reuters) - The United States will clarify to the World Trade Organization it never intended to allow Internet gambling services as part of market-opening commitments it made in the early 1990s, the U.S. Trade Representative's office said on Friday.

Washington is responding to a 2005 WTO verdict against the U.S. ban on online betting, notably on horse racing, in a case brought by Antigua and Barbuda.

A separate WTO panel ruled in March the United States had taken no steps to comply with the ruling.

U.S. laws have banned interstate gambling for decades. However, the United States failed to make clear when it was drafting commitments in the early 1990s to open its recreational services that it did not intend to include gambling, Deputy U.S. Trade Representative John Veroneau said in a statement.

"Neither the United States nor other WTO members noticed this oversight in the drafting of U.S. commitments until Antigua and Barbuda initiated a WTO case ten years later," Veroneau said.

[TheEngineer]

[ QUOTE ]
Second, under GATS, a country is treated as one entity. Individual state laws don't govern and really matter very little, if at all. Therefore, unlike our federal system which recognizes state rights, GATS judges the US as one collosal country.

[/ QUOTE ]

That sentence pretty much explains why the U.S. would pull out of the gambling related portions of GATS.

Too bad Antigua didn't negotiate more based on the realities of the U.S. than simply on what they felt was right. A little pragmatism could have gone a long way.

Let's hope it's not too late. Perhaps, now that the U.S. called Antigua's bluff (didn't just call....went all-in), we can negotiate a real deal with them...one that permits us to simultaneouly uphold our principles of states' rights and free trade.

Again, everyone please write or call your congressman. We really shouldn't ditch the WTO.

[TheEngineer]

[ QUOTE ]
Where did I say they were leaving the WTO?

[/ QUOTE ]

Nowhere. I couldn't find one that said we were....I imagine it will hit the wires soon.

[TheEngineer]

[ QUOTE ]
Here's the Reuter's piece:

.S. to "clarify" Internet gambling ban at WTO

Fri May 4, 2007 12:02PM EDT

WASHINGTON (Reuters) - The United States will clarify to the World Trade Organization it never intended to allow Internet gambling services as part of market-opening commitments it made in the early 1990s, the U.S. Trade Representative's office said on Friday.....

[/ QUOTE ]

That's different than a withdrawal. Let's hope this is the case.

[KotOD]

[ QUOTE ]
Here's the Reuter's piece:

.S. to "clarify" Internet gambling ban at WTO

Fri May 4, 2007 12:02PM EDT

WASHINGTON (Reuters) - The United States will clarify to the World Trade Organization it never intended to allow Internet gambling services as part of market-opening commitments it made in the early 1990s, the U.S. Trade Representative's office said on Friday.

Washington is responding to a 2005 WTO verdict against the U.S. ban on online betting, notably on horse racing, in a case brought by Antigua and Barbuda.

A separate WTO panel ruled in March the United States had taken no steps to comply with the ruling.

U.S. laws have banned interstate gambling for decades. However, the United States failed to make clear when it was drafting commitments in the early 1990s to open its recreational services that it did not intend to include gambling, Deputy U.S. Trade Representative John Veroneau said in a statement.

"Neither the United States nor other WTO members noticed this oversight in the drafting of U.S. commitments until Antigua and Barbuda initiated a WTO case ten years later," Veroneau said.

[/ QUOTE ]

This is hilarity.

[TheEngineer]

[ QUOTE ]
Where did I say they were leaving the WTO?

[/ QUOTE ]

You didn't.

I wrote:

[ QUOTE ]
The U.S. actually isn't leaving the WTO, according to Jay. Rather, we're pulling out of the gambling-related part of it.

[/ QUOTE ]

I meant that, according to you, the U.S. is not leaving the WTO. Rather, according to you, the U.S. is pulling out of the gambling related portion of it.

[Uglyowl]

The entire withdrawal from the WTO is probably my bad, I didn't think they could pick and choose their involvement level (although it sounds like it could lead to the U.S. leaving or the end of the WTO).

Looks like they are going to try to ask for a mulligan on their involvement.

[Grasshopp3r]

This is an interesting development, but what does it change? The US ignores plenty of international trade law. The WTO is ineffective, anyway. Surely if the WTO intends to be effective, it can simply reject the US attempt to leave this market of GATS. That would be a better response to the US, but I doubt that will occur.

[yeahright]

bottom line is this...

Stop wasting your time think Antigua is going to have any effect on what the US wants to do. The US doesn't give a damn about the WTO and the WTO isn't going to force the US to do anything.

We all heard how "eh...the US wants China to abide by the WTO.....How can they expect China to do that....."

China said last week they would work with the US on the issue.

[mengzi]

[ QUOTE ]



This has international trade implications and could lead to the break up of the WTO.

[/ QUOTE ]

this is just a bit over the top, don't you think? hyperbole like this brings the accuracy of the entire piece into doubt. why not provide details on the original source? when that info is left out it immediately raises questions about credibility

i am not an expert in international law, and judging by the responses in this thread i think it's safe to say no one else here is either, but i find it extremely unlikely that the wto is going to fall apart over this.

as the world's largest economy and largest trading nation, the us has more of a vested interest in maintaining a rules based approach to trade(which the wto is the pillar of) than any other country.

generalities aside, clearly this case has not yet reached a point of resolution. the us has lost several WTO cases(the overwhelming majority if i am not mistaken), and in some cases has chosen to pay the punitive damages handed down instead of adjusting their trade practices in accordance with wto rulings. who is to say that an agreement won't be reached in the 11th hour?

suppose i could dig around a bit....

sure hope i come up with something a bit more substantial and a bit less one sided

[Jestocost]

U.S. To Alter WTO Agreement In Light Of Gambling Issue

The United States will seek to amend its services commitments at the World Trade Organization to make clear that they do not cover gambling, in response to a successful WTO lawsuit by Antigua and Barbuda. The United States must resort to the rarely used WTO procedure because, officials said, it will not change its laws to alter current prohibitions on interstate gambling and never intended to open gambling services to foreign providers. "The process we are starting today will allow us to clarify our schedule to make clear that we did not intend to have gambling services be a part of our commitment," Deputy Trade Representative John Veroneau told reporters. "This is not a question of the U.S. rethinking its commitments, it is a question of getting us back to a place that reflects our intent at the time."

Antigua and Barbuda charged that the U.S. commitment in the General Agreement on Trade in Services to provide equal treatment for foreign providers of "recreational services"
included gambling. The case they brought to the WTO turned on the argument that the United States allows interstate bets on horseracing but does not allow similar treatment for foreign gambling interests. In March, the WTO Appellate Body ruled against the United States. The U.S. effort to amend its GATS commitments means that any WTO member may make a claim to be compensated by the United States, in the form of additional market openings elsewhere in the services area. If the U.S. refuses, the WTO could rule that members are allowed to suspend market access for U.S. service providers to the extent that it is affected by the withdrawal of the U.S. commitment. Veroneau said the United States is not obligated to provide compensation because it is not reneging on a commitment, merely clarifying a concession it never intended to make. "There is no reasonable basis that anyone in the Uruguay Round thought or expected the U.S. to be opening up its gambling services, in light of the fact that it was banned by federal and state laws," he said.

[Mendacious]

[ QUOTE ]
WASHINGTON (Reuters) - The United States will clarify to the World Trade Organization it never intended to allow Internet gambling services as part of market-opening commitments it made in the early 1990s, the U.S. Trade Representative's office said on Friday.


[/ QUOTE ]

This rings incredibly hollow after a trial on the merits. I am not sure what rights a country has to withdraw from sections of the WTO, but this type of argument or action is something that imho should have been raised at the outset of the trial. The US should NEVER have submitted to a trial on something if it had no intention of abiding by the ruling. Putting aside most of our interest in legal online poker play, this is shameful conduct on the part of our Country (those of us who are US citizens). Disgusting!

[Dunkman]

This isn't news for us, or anyone else, at all. This was inevitable as soon as the decision came down. Hopefully, Antigua will agree to compromise with H.R. 2046 or something similar, and we can use WTO compliance as one of our talking points in pushing for passage. Antigua may not like it, Jay sure doesn't like it (understandably), but it's absolutely all we can hope for in the current political climate. It's either this or the ever strengthening UIGEA regulations and enforcement.

[mengzi]

not trying to be patronizing here, but i think that there is a misconception of what the fundamental mission of the wto is. it would be great if someone who deals with these issues much more closely could come along and address this in a succinct manner

at the end of the day the wto is an international organization made up of member states. they can't force the us to do anything they dont want to do. the us has complied with the dozens of rulings that have come down against it because it is in their broader interest to have a predictable trading system.

i am unaware of any wto cases that the us has just ignored outright. when the eu raised the issue of the helms burton act before the wto, the us said that the wto had no authority to rule on the case because it involved national security. the eu backed down and a settlement was reached before the case went for a final decision. this is an extreme example though

many of the cases are settled by the parties involved before a final decision is rendered by the wto. perhaps the us is playing this card to leverage a more favorable agreement

[fnord_too]

So, basically, our defense (now that we lost, not at the time compliance was still being decided) is that we are too incompetent to read and understand the treaties we are signing? niiiiiiiice.

Is there any record of the debate and such behind joining the WTO, like the congressional record, that can show if the gambling issue was addressed?

I don't see how the WTO can allow for a post ruling ammendmant like this. That is, I don't see how this will stop their ruling that Antigua can ignore US copyrights and change our status if we wish to pursue complaints of our own in the future. I think we will still have to pay whatever damages were assessed to clear ourselves, since Antigua was acting by what we agreed to, and lost money by our failure to honor our agreement. Of course that would open the door for lots of others.

I know next to nothing about international law, but I am assuming treaties are reasonably similar to contracts, which I know a little bit about. I don't know, for instance, how we can legally pull out of international agreements and treaties. I cannot believe that the constitution would have an oversight that would say allow one administration to not be bound by a previous administrations commitments.

[Skallagrim]

Talk about sniveling, lying lawyers who will say anything to win a case... /images/graemlins/wink.gif. "Point 1, your Honors, we are right. Point 2, if we are not right then what we said isnt what we meant."

I too dont know enough about the WTO to comment on the exact mechanisms here. It sounds like the US is trying to use a provision that allows for correcting mistakes of a clerical nature to allow for correcting mistakes of a substantive nature.

From my area of law its akin to: "We didnt mean to prosecute the innocent man, we really meant to name someone else in the indictment." A statement, which of course, continuing with the analogy, is ludicrous on its face after the prosecutor spends years trying to prove that the innnocent man was guilty.

Final point, it has to be a clerical matter or the Administration cant do this on its own. Once a treaty is ratified by the Congress, the Executuve cant just change its terms on its own, Congress would have to vote again.

Unless, of course, its just a matter of having misspelled things. "Ooops, we didnt mean to sign that gambling treaty, we thought we signed the RAMBLING treaty, and of course Antiguans can ramble in the US (if they get the right papers)."

Skallagrim

[TheEngineer]

[ QUOTE ]
"Ooops, we didnt mean to sign that gambling treaty, we thought we signed the RAMBLING treaty, and of course Antiguans can ramble in the US (if they get the right papers)."

[/ QUOTE ]

Won't God cut down the ramblers too, though? /images/graemlins/wink.gif

[TheEngineer]

[ QUOTE ]
Talk about sniveling, lying lawyers who will say anything to win a case... /images/graemlins/wink.gif. "Point 1, your Honors, we are right. Point 2, if we are not right then what we said isnt what we meant."

[/ QUOTE ]

There is a sovereignty argument to be made here as well, though. The last time online gambling was put up for a vote, HR 4411 was approved overwhemingly. The U.S. really can't cede this to the WTO, under these circumstances (unfortunately).

What we need now is a vote in our favor. Let's all get out and support the Frank bill (HR 4411) and the upcoming Wexler bill. Keep getting converts who never really thought about the issue. Remind these guys about Rep. Leach and his early (not early enough) retirement. Then, the U.S. will be in a position to work with Antigua to give them some access to our markets.

Here's a Ron Paul speech against the WTO: http://www.house.gov/paul/congrec/congrec2000/cr062100.htm . I dont' necessarily agree with it, but it's an interesting read.

[Grasshopp3r]

The point about the administrative branch not having the power to change a treaty could be interesting. The history of the WTO is linked to the dems, so perhaps they will seize this as an issue that challenges their authority.

They are fighting really hard on the Antigua case, harder than I would have predicted, but why?

[whangarei]

[ QUOTE ]
[ QUOTE ]
"Ooops, we didnt mean to sign that gambling treaty, we thought we signed the RAMBLING treaty, and of course Antiguans can ramble in the US (if they get the right papers)."

[/ QUOTE ]

Won't God cut down the ramblers too, though? /images/graemlins/wink.gif

[/ QUOTE ]

Nice catch /images/graemlins/grin.gif

[whangarei]

[ QUOTE ]
This rings incredibly hollow after a trial on the merits. I am not sure what rights a country has to withdraw from sections of the WTO, but this type of argument or action is something that imho should have been raised at the outset of the trial. The US should NEVER have submitted to a trial on something if it had no intention of abiding by the ruling. Putting aside most of our interest in legal online poker play, this is shameful conduct on the part of our Country (those of us who are US citizens). Disgusting!

[/ QUOTE ]

Shocking! /images/graemlins/shocked.gif

[MiltonFriedman]

US Trade Rep has publicly said for years that it did not consider gambling to be covered by its GATT commitments. (I googled and fuond a Statement from November, 2004.)

Their fallback to this point should not be surprising.

Finally, consider who this position aids ....... Domestic gaming companies who want the US market to themselves, without WTO oversight. Online gambling is still going to come back to the US, but its name will be MGM/Venetian/Harrahs.com.

[Nathan_2]

This ought to be a fun precedent when commie mandarins in the PRC and ROK chaebols get to retroactively alter IP and market access trade law following a series of WTO loses.

It's obvious US trade folks are half-wits after decades of massive deficits therefore arguing their deficiencies resulted in a bad deal for the US makes sense nevertheless a deal is a deal, even the Bush Trade Representatives will accept that after another WTO rebuke.

If the Bushies can't work and play well with the WTO there's always another option, turn sound on THE WHEEL (http://bustadeal.ytmnd.com/)

[Lottery Larry]

I was confused at first, thinking you were quoting from a wire article.

YOU wrote this opinion piece, right?

[LadyWrestler]

http://www.eog.com/news/full-article.aspx?id=23402

[TheEngineer]

[ QUOTE ]
http://www.eog.com/news/full-article.aspx?id=23402

[/ QUOTE ]

That story quoted my reply. /images/graemlins/grin.gif

[Jay Cohen]

That was the AOGA press release.

[TreyWilly]

[ QUOTE ]
[ QUOTE ]
http://www.eog.com/news/full-article.aspx?id=23402

[/ QUOTE ]

That story quoted my reply. /images/graemlins/grin.gif

[/ QUOTE ]

Quoting replies in message boards ... that's quality journalism right there. I wonder who the anonymous person in his lead quote was. His aunt?

No offense, Engineer, of course. But if you were a credible source on the United States' WTO concerns, he should have called you IRL and spoke to you.

[daedalus]

The U.S. is stepping all over it's crank in it's actions to ban online gambling. Stupid laws, idiotic WTO actions, Justice department busting of hippy millionaires. This ain't a well run campaign boys. Ramifications will come in time. /images/graemlins/mad.gif

[Reef]

F the US govt

[Cactus Jack]

The news coming out on a Friday reminded me of an episode of West Wing. This was thrown out with the trash, as in, no one will notice and it won't get much of a reaction if we announce this on Friday when everyone is leaving for the weekend.

The arrogance of this administration never ceases to amaze. "I'm proud to be an American, where at least I know I'm free." Yeah, right.

[Cooder]

[ QUOTE ]
Can you show us a link to the news of this somewhat expected development?

[/ QUOTE ]

Reuters article (http://www.reuters.com/article/politicsNews/idUSWAT00742720070504)

[TheEngineer]

[ QUOTE ]
The news coming out on a Friday reminded me of an episode of West Wing. This was thrown out with the trash, as in, no one will notice and it won't get much of a reaction if we announce this on Friday when everyone is leaving for the weekend.

The arrogance of this administration never ceases to amaze. "I'm proud to be an American, where at least I know I'm free." Yeah, right.

[/ QUOTE ]

If there's any good news to this, it's that we now KNOW the U.S. government has no intention of implementing any WTO rulings in this matter (we knew that with passsage of UIGEA, but now there's no question). With this distraction out of the way , we can focus where we need to -- passing IGREA (HR 2046, the Frank bill) and the hoped-for Wexler poker bill. Also, progress on these bills will be good for any potential settlement with Antigua.

[Jay Cohen]

[ QUOTE ]
[ QUOTE ]
The news coming out on a Friday reminded me of an episode of West Wing. This was thrown out with the trash, as in, no one will notice and it won't get much of a reaction if we announce this on Friday when everyone is leaving for the weekend.

The arrogance of this administration never ceases to amaze. "I'm proud to be an American, where at least I know I'm free." Yeah, right.

[/ QUOTE ]

If there's any good news to this, it's that we now KNOW the U.S. government has no intention of implementing any WTO rulings in this matter (we knew that with passsage of UIGEA, but now there's no question). With this distraction out of the way , we can focus where we need to -- passing IGREA (HR 2046, the Frank bill) and the hoped-for Wexler poker bill. Also, progress on these bills will be good for any potential settlement with Antigua.

[/ QUOTE ]


Umm, the WTO matter is far from over. Just because the US says something don't accept it as fact. There are some serious questions as to whether the US can just resolve a dispute like this. It has never been done before, we are in uncharted waters.

If whether or not they can just pull back commitments to resolve a dispute ends up before a WTO panel, I am sure the panel will be quite disturbed at the concept. This could make worse WTO case law for the US than the last matter.

This move has also taken a minor trade issue between two members and blown it into a major matter with implications for all members of the WTO. It will be interesting to see how the peridocals that cover trade discuss this incident.

I can also tell you that some members of Congress who have strong interests in free trade are more upset about this move than the straight up non-compliance with the Antigua gaming decision.

The coming months will be very interesting.

[TheEngineer]

[ QUOTE ]
Umm, the WTO matter is far from over. Just because the US says something don't accept it as fact. There are some serious questions as to whether the US can just resolve a dispute like this. It has never been done before, we are in uncharted waters.

If whether or not they can just pull back commitments to resolve a dispute ends up before a WTO panel, I am sure the panel will be quite disturbed at the concept. This could make worse WTO case law for the US than the last matter.

This move has also taken a minor trade issue between two members and blown it into a major matter with implications for all members of the WTO. It will be interesting to see how the peridocals that cover trade discuss this incident.

I can also tell you that some members of Congress who have strong interests in free trade are more upset about this move than the straight up non-compliance with the Antigua gaming decision.

The coming months will be very interesting.

[/ QUOTE ]

Jay,

Again, I'm with you in hoping the U.S. accepts the WTO decision. Hell, I'd be thrilled to death. I simply wish to remind everyone to keep fighting back by writing and calling Congress.

The U.S. will be more likely to accept the WTO decision (or aspects of it, at least) if there's evidence that the American people want legal online gambling. So, our efforts to work on Congress only serve to help in getting the WTO decision recognized.

[Jay Cohen]

[ QUOTE ]
[ QUOTE ]
Umm, the WTO matter is far from over. Just because the US says something don't accept it as fact. There are some serious questions as to whether the US can just resolve a dispute like this. It has never been done before, we are in uncharted waters.

If whether or not they can just pull back commitments to resolve a dispute ends up before a WTO panel, I am sure the panel will be quite disturbed at the concept. This could make worse WTO case law for the US than the last matter.

This move has also taken a minor trade issue between two members and blown it into a major matter with implications for all members of the WTO. It will be interesting to see how the peridocals that cover trade discuss this incident.

I can also tell you that some members of Congress who have strong interests in free trade are more upset about this move than the straight up non-compliance with the Antigua gaming decision.

The coming months will be very interesting.

[/ QUOTE ]

Jay,

Again, I'm with you in hoping the U.S. accepts the WTO decision. Hell, I'd be thrilled to death. I simply wish to remind everyone to keep fighting back by writing and calling Congress.

The U.S. will be more likely to accept the WTO decision (or aspects of it, at least) if there's evidence that the American people want legal online gambling. So, our efforts to work on Congress only serve to help in getting the WTO decision recognized.

[/ QUOTE ]

I applaud your efforts. I am not arguing with you. But I do want to keep everyone properly informed about where the WTO case stands. It ain't over.

[Cooder]

Hypothetical situation: I’m driving my car at 65 MPH in a 55 MPH zone and get a ticket. The speed limit is changed to 70 MPH the next day. I still have to pay the fine unless I can get a judge to say otherwise.

From the WTO point of view, the US had an agreement that they violated. Could a WTO judge still order the US to comply? (Not that the US would comply of course.)

[TheEngineer]

[ QUOTE ]
I applaud your efforts. I am not arguing with you. But I do want to keep everyone properly informed about where the WTO case stands. It ain't over.

[/ QUOTE ]

Thanks. Your updates are appreciated.

Also, thanks for the support. I never thought either of us was arguing with the other. As for me, our efforts with Congress can only help in getting the WTO decision recognized. If we stop, it can only hurt.

[The4Aces]

I think the only way Antigua is going to have any effect is to play hardball with the US. This means break all US copyrights. sell softare over the internet for $5 and songs for 10 cents.

[AvivaSimplex]

http://i11.tinypic.com/503fmug.jpg
I am altering the deal. Pray I do not alter it further.

[Sniper]

Wow Jay,

So basically... sorry for wasting everyones time, we simply aren't going to comply, so instead we will simply consider remote gaming outside your scope of authority...

Wonder who else is going to start dropping stuff...

[Nathan_2]

LA TIMES
EDITORIAL
Gambling hypocrisy
A bill before the House would change the nation's policy on offshore betting and provide consumer protections.
May 5, 2007

BUSTED BY THE World Trade Organization for discriminating against offshore betting shops, the U.S. government is attempting a procedural maneuver to make the WTO go away. It's a legalistic move that underscores the hypocrisy of the government's approach to gambling.

The dispute stemmed from a complaint brought by Antigua and Barbuda, a haven for online betting operations. The Caribbean island nation contended that restrictions on remote gambling violated the United States' commitment to an open market for services. U.S. representatives countered that the restrictions, which date to 1961, were needed to protect public morals. The WTO agreed, but only up to a point: U.S. law allows remote betting on horse races within the 50 states (at licensed off-track betting parlors), so the government can't block foreign bookmakers from also taking those bets.

On Friday, a deputy U.S. trade representative announced plans to modify the commitment made in 1993 to open U.S. markets to "recreational services." The modification will clarify that gambling services are not included, eliminating the WTO's jurisdiction over the issue.

The little-used technique might solve the problem with Antigua, but it won't fix the flaws in U.S. policy. As the off-track-betting issue illustrates, Congress loses interest in protecting people from the lure of online gambling when thoroughbreds and trotters are involved. Similarly, interstate restrictions on games of chance evaporate for state lotteries — a form of gambling that the government enthusiastically promotes.

Meanwhile, restrictions on other forms of wagering have led to perverse results. The most closely scrutinized and stable gambling businesses — casinos in Las Vegas and Atlantic City — stayed out of online wagering, conceding the field to unregulated and, occasionally, fly-by-night operators. A federal law passed last year to prohibit credit card companies from processing bets has spawned a host of workarounds, including online wallets and repurposed prepaid phone cards.

A saner approach would be to allow online betting through licensed and regulated operators, as proposed by Rep. Barney Frank (D-Mass.), chairman of the House Financial Services Committee. Such operators could be required to meet age-verification standards, analyze betting patterns to detect and block compulsive gamblers and pay additional taxes, with a portion going to treat gambling addiction. This approach would do far more to protect the public than ineffective prohibitions that criminalize only the high-tech version of an otherwise legal act. Link (http://www.latimes.com/news/opinion/la-ed-online5may05,0,789943.story?coll=la-opinion-leftrail)

[TheEngineer]

[ QUOTE ]
LA TIMES
EDITORIAL
Gambling hypocrisy
A bill before the House .....

[/ QUOTE ]

More good press for us and our cause! /images/graemlins/grin.gif

[jschaud]

great article.

[TreyWilly]

[ QUOTE ]
great article.

[/ QUOTE ]

May deserve another thread. May not.

[rabiddog]

So if you or I used the phrase "I/we didn't know" the US government would say tough cookies. But the US government is saying it's ok for them to use it, thats different. It's like I can push you, but you can't push me back.

[whangarei]

[ QUOTE ]
So if you or I used the phrase "I/we didn't know" the US government would say tough cookies. But the US government is saying it's ok for them to use it, thats different. It's like I can push you, but you can't push me back.

[/ QUOTE ]

Very good analogy.

[Legislurker]

Ive been following this forum for awhile, but haven't posted as I've not had much to add. But, I am remembering some familiarity with the WTO and loss of sovereignty issues from college when we signed the GATS. This is a pdf with some text/explanation of what has to go down to withdraw from a sector you agreed to under the treaty, and what is covered or exempted. They reference earlier parts of the Antigua case when the US got the morals exemption that was later shot down. http://www.ifg.org/documents/WTOHongKong/GX%20GATSTalkingPoints.pdf
If that links doesn't work just enter General agreement on trade in services gambling into google, it pops up.
What I think works on our side is in order to withdraw a sector we have to compensate ALL trading partners in regards to the sector. Any other country that did not exempt gambling(we had a chance to but did not) could step up and say, give us a trade concession. The 'clarify' approach will not hold a bucket of water if they say its an oversight clerically or whatnot.
I was reading another article somewhere if I can find the search I used again. THe person who made this statement from the USTR is the old legislative
director for our old buddy, Mr. Frist. Interesting, huh?
http://www.theregister.co.uk/2007/05/05/wto_antigua_ustr_gambling/

[daedalus]

Legislurker....you need to post more.

[daedalus]

What a confusing and messed up U.S. policy. Who's running this country anyway.......oh, yeah I forgot. /images/graemlins/frown.gif

[Skallagrim]

Nice work Legislurker

[Legislurker]

http://www.iie.com/publications/papers/wunsch1205.pdf
I found this looking around for trade articles. Im not sure how recent it is. If someone with a better brain for parsing meaning from treaties, etc.... wants to parse back over it, its a very on point article. Im just too lazy and out of practice to put a legal or scholarly read on it.
Or if you can find a way to contact this guy and ask him for an opinion on what US clarification/pussyfooting I think his insight would be better than ours.

[Pitcher]

Hi All,

While this post in general is interesting it misses 3 points.

1. The Bush Administration is not going to be dictated to on ANYTHING by Antigua. They think "negotiation" is you agree to our terms 100% or we won't play (or worse, take military action /images/graemlins/smile.gif

2. There is some ulterior motive at work that is driving enforcement of the UIGEA and you can bet it has something to do with our warped "buy whatever influence you can afford" system of goverment. Some large corporate interest (I can think of several even beyond the large US gambling companies) wants to control Internet gambling in some sort of monopolistic manner.

3. Unfortunately, it appears that the facts of the case in some way support the Administration. It appears Antigua overreached in their arguments concerning states rights - giving the idiots in Washington the excuse they needed to do as they pleased. Typical, but any excuse will provide good cover.

Anything else in this discussion can refer to point #2 Follow the money and that is probably all there is to it.

Pitcher

[Jay Cohen]

Two articles:

http://www.trinidadexpress.com/index.pl/article_opinion?id=161144516

......The US government cannot have it both ways. It destroys its own credibility and weakens its own moral authority when it ignores its obligation to honour a WTO ruling in favour of little Antigua and Barbuda, but runs to the same WTO when it is unhappy with its trade relations with giant China.....

-----------------------------------------
And from a trade newsletter:

U.S. MAY NEED TO PAY BILLIONS TO “CLARIFY” INTERNET GAMBLING BAN Foreign countries that are banned from offering Internet gambling services in the U.S. could seek billions of dollars in compensation from the U.S. under a World Trade Organization (WTO) procedure Washington invoked May 4. Having repeatedly lost WTO rulings against its ban on Internet gambling operations by foreign providers, the U.S. has tried a new ploy, filing a request at the WTO to withdraw commitments in made in the General Agreement on Trade in Services (GATS) in the Uruguay Round. The institution of the Article XXI process won’t prevent the continuation of the separate WTO dispute-settlement action under which Antigua and Barbuda has won rulings that Washington has violated its GATS obligations by blocking Internet gambling services from the Caribbean nation......................

[Jeffiner99]

[ QUOTE ]
[ QUOTE ]
[ QUOTE ]
http://www.eog.com/news/full-article.aspx?id=23402

[/ QUOTE ]

That story quoted my reply. /images/graemlins/grin.gif

[/ QUOTE ]

Quoting replies in message boards ... that's quality journalism right there. I wonder who the anonymous person in his lead quote was. His aunt?

No offense, Engineer, of course. But if you were a credible source on the United States' WTO concerns, he should have called you IRL and spoke to you.

[/ QUOTE ]

Heck, I read an article today on EOG from a few days ago that was a direct cut and paste of one of my posts. No byline, no credit, not even a mention that someone else had written the article.
Ah well, joke's on him. I didn't spell check my post.

[Jeffiner99]

[ QUOTE ]
Hi All,

While this post in general is interesting it misses 3 points.

1. The Bush Administration is not going to be dictated to on ANYTHING by Antigua. They think "negotiation" is you agree to our terms 100% or we won't play (or worse, take military action /images/graemlins/smile.gif

2. There is some ulterior motive at work that is driving enforcement of the UIGEA and you can bet it has something to do with our warped "buy whatever influence you can afford" system of goverment. Some large corporate interest (I can think of several even beyond the large US gambling companies) wants to control Internet gambling in some sort of monopolistic manner.

3. Unfortunately, it appears that the facts of the case in some way support the Administration. It appears Antigua overreached in their arguments concerning states rights - giving the idiots in Washington the excuse they needed to do as they pleased. Typical, but any excuse will provide good cover.

Anything else in this discussion can refer to point #2 Follow the money and that is probably all there is to it.

Pitcher

[/ QUOTE ]

I couldn't agree more Pitcher. Yes, the UIGEA was a move to get their friends in. So they make it illegal to fund gaming. Then the banks balk. So then they amend, not repeal, the UIGEA with Frank's bill that "legislates" gaming. In other words, the licenses now required will go to all their friends. So the friends get the licenses. The other sites in business now will have to go (wouldn't want that competition would we?) and us little people will get hosed by the new regulations through taxes, fees, and according to a radio interview with Frank himself a "possible cut of each pot" going to the feds so they can have more money to spend. Our money.

In case you don't know, I don't think this Frank bill is good for us. But I get flamed for that position a lot. They think I am a wet blanket for pointing out just how much this bill will cost us. Feel free to read my other posts. I won't bother to duplicate here.

[Sniper]

Jeffiner, we have been "creating news" here for quite some time... /images/graemlins/wink.gif

[Emperor]

[ QUOTE ]
I think the only way Antigua is going to have any effect is to play hardball with the US. This means break all US copyrights. sell softare over the internet for $5 and songs for 10 cents.

[/ QUOTE ]

Copyright law is small potatos, patents is where the money is.