The US, the WTO Dispute, and UIGEA

In one of the newer developments concerning the adverse ruling the Unites States received from the World Trade Organization in it's dispute with Antigua and Barbuda over online gaming the United States has decided to withdraw from one of it's WTO commitments "We did not intend and do not intend to have gambling as part of our services agreement. What we are doing is just clarifying our commitments" said Deputy US trade representative John K Veroneau.

This despite the fact that ten years ago there was extensive debate, proposals and counterproposals from all WTO members concerning what commitments would be made. To make such a statement is the equivalent of saying I thought I was in school, I wasn't paying attention. More than a dozen countries specifically excluded gambling from their commitments and the Unites States was not one of these countries. As Antigua's Minister for Finance and the Economy said "It is almost incomprehensible that the United States would take such an action in the face of an adverse ruling. This is going to have severe consequences for the global free trade movement".

Since the original treaties were negotiated multilaterally the United States will have to renegotiate with the 149 other countries that object to the US position and who now want to renegotiate their commitments with the United States. For the United States to say they made a mistake is a blatant falsehood. The US had competent negotiators at the original treaty negotiations, they knew what they were doing, and to say otherwise damages the credibility of the US in future negotiations of any kind. This kind of decision undermines faith in a carefully negotiated system that depends on the perception that all members, large and small, rich and poor, have rights, obligations and responsibilities to be taken seriously.

This move on the part of the United States could have serious unintended consequences. Both Antigua and Barbuda have proposed suspending enforcement of US intellectual property rights. This could lead to massive bootlegging of movie DVD's and music CD's. Both countries have determined that this last ditch measure is the only way to gain the attention of the United States. Just as internet gaming is the second largest industry in both countries, after tourism, the entertainment industry in the US produces hundreds of billions of dollars in revenues and losing even a part of that income is a serious matter.

In the words of John Ashe the Antiguan ambassador to the World Trade Organization, "We believe the time has come for the United States to demonstrate whether the WTO agreements are to work for us all equally, or whether the WTO is indeed a one way street for the large economies to enrich themselves at the expense of lesser ones." It is time for the US to stop moralizing and live up to the agreements set forth in treaties the government ratifies.