U.S. Disavows Own Trade Agreements, Plans to Ignore WTO Judgment
The United States has announced that its way of complying with a recent online-gambling trade decision rendered by the World Trade Organization will be to ignore its own trade compacts. The U.S. announcement, the latest move in the long complaint brought by the island nation of Antigua and Barbuda, is a rare ploy that not only amounts to a rewrite of history, but has the potential to threaten the very framework of the WTO itself.
In the announcement, Deputy U.S. Trade Secretary John K. Veroneau conceded defeat in the narrow online dispute centering on accessibility to Internet-based horseracing wagering. However, all parties recognized that the narrow decision had much greater impact,
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establishing the initial precedent for online gambling as a general class of trade. Last October’s UIGEA [Unlawful Internet Gambling Enforcement Act] was not part of the original dispute, though WTO appellate officials saw fit to include the UIGEA specifically in documents connected to the denial of the U.S.’s appeal. According to the WTO at that time, the passage of the UIGEA was a strong indicator that the U.S. was intentionally choosing to not comply with the existing agreements, and was instead moving in the opposite direction.
Friday’s announcement by Veroneau confirmed those beliefs.
“U.S. laws banning interstate gambling have been in place for decades,” stated Veroneau. “Most WTO Members have similar laws. Unfortunately, in the early 1990s, when the United States was drafting its international commitments to open its market to recreational services, we did not make it clear that these commitments did not extend to gambling. Moreover, back in 1993 no WTO member could have reasonably thought that the United States was agreeing to commitments in direct conflict with its own laws.”
Veroneau continued with the following: “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. In its consideration of this matter, the WTO panel acknowledged that the United States did not intend to adopt commitments that were inconsistent with its own laws. However, under WTO rules, dispute settlement findings must be based on the text of commitments and other international documents, rather than the intent of the party. The United States strongly supports the rules-based trading system and accepts the dispute settlement findings. In light of those findings, we will use WTO procedures for clarifying our commitments.”