US Cuts Deals To Keep EU, Canada And Japan From Siding With Antigua In Online Gamblin

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US Cuts Deals To Keep EU, Canada And Japan From Siding With Antigua In Online Gambling Dispute
from the so-much-for-that-plan dept
For quite some time now, we've covered the ongoing dispute between the US and Antigua over the fact that the US's ban on online gambling violates free trade agreements between the two countries. While the US has tried to unilaterally change those agreement to keep gambling out, the WTO has repeatedly made it clear that the US was at fault (even though the US has pretended otherwise). Either way, the US knew that it could simply ignore Antigua, as the tiny country couldn't do much to hurt it (even if it moved forward on its plan to become a piracy haven for digital content. However, earlier this year, there were rumblings that the EU would get involved on Antigua's side, putting a lot more pressure on the US. However, it appears that US politicians and diplomats made quick work of that signing new agreements with the EU, Canada and Japan to keep those three out of the way, leaving the dispute between the US and Antigua, with much less powerful countries like Costa Rica and Macau backing Antigua's position. Not surprisingly, online gambling firms in the EU aren't pleased that the powers that be in the EU rolled over like this -- and neither are folks in the US who still don't understand why it's okay for them to buy a lottery ticket, but they can't play a little poker online.

http://www.techdirt.com/articles/20070330/133102.shtml

http://www.techdirt.com/articles/20050407/1530229.shtml

http://www.techdirt.com/articles/20070823/194516.shtml

http://www.techdirt.com/articles/20070620/072909.shtml

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U.S. Budges (a Little) on 'Net Gambling

WASHINGTON -- The United States has reached a deal with the European Union, Japan and Canada to keep its Internet gambling market closed to foreign companies, but is continuing talks with India, Antigua and Barbuda, Macau and Costa Rica, U.S. trade officials said on Monday.

"We are pleased to confirm that the United States has reached agreement ... with Canada, the EU and Japan," Gretchen Hamel, a spokeswoman for the U.S. Trade Representative's office, said in a statement several hours after the EU had announced details of the deal it had reached with Washington.

The decision is a disappointment for European online gambling companies who hoped a case brought by Antigua several years ago at the World Trade Organization gave them a foothold to get back in the U.S. market after being kicked out by Congress last year.

In an April 2005 victory for Antigua, the WTO said a U.S. law allowing only domestic companies to provide horse-race gambling services discriminated against foreign firms.

But rather than open up the U.S. online horse-race gambling market, Congress tightened restrictions on other forms of Internet gambling last year by making it illegal for banks and credit card companies to make payments to online gambling sites.

The Bush administration also announced in May that it was retroactively excluding gambling and betting services from market-opening commitments it made as part of the 1994 world trade agreement, saying that U.S. trade negotiators had made a mistake by not expressly excluding them at the time.

That opened the door for the European Union and other trading partners to seek compensation from the United States in the form of increased access to another U.S. service market.

Hamel said the deal reached with the EU, Japan and Canada "involves commitments to maintain our liberalized markets for warehousing services, technical testing services, research and development services and postal services relating to outbound international letters."

European gambling companies had argued the EU was entitled to as much as $100 billion in compensation for being denied access to the U.S. market. But EU officials never publicly embraced that amount and U.S. official called it an exaggerated figure.

Hamel declined to say on Monday how much the deal was worth. "We're not going to get into that," she said.

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EU online gambling firms challenge US ban

Online gaming firms take action against US
European online gaming firms claim they are being discriminated against by US regulators in favour of domestic operators

European online gaming firms are filing a formal complaint against the United States for discrimination after their controversial exit from the US market.

The companies say that the US Department of Justice has violated international trade law by kicking them out of the market and taking legal action while allowing domestic online gaming operators to continue trading.

The move by the Remote Gaming Association (RGA) comes only days after the European Union agreed a trade deal with the US to compensate the bloc for loss of earnings from gaming.

European online gaming firms, such as PartyGaming, 888.com and Sportingbet, have been hit hard after they were forced to stop doing business in the lucrative US market following a rule change last year.

“We have been left with no choice but to pursue all legal avenues available to challenge the US Department of Justice for its discriminatory enforcement activities against European online gaming operators,” Clive Hawkswood, the chief executive of the RGA, said.

The group has asked the EU to investigate the situation, arguing that although the US has repeatedly stated that all forms of online gambling are illegal, it has enforced this view only with non-US businesses.

“How would US investors and businessmen feel if they invested in a business in the UK based on international law commitments, and then suddenly the UK not only passed new laws forcing them to shut down their business but tried to throw them in jail for past activities, while still allowing their domestic competitors to continue on doing the same thing?” Mr Hawkswood said.

Last year the US Congress made it illegal to make payments to online gambling sites, and in May this year the US said that it was excluding gambling services from market-opening commitments it made as part of a 1994 world trade deal.

The Department of Justice has subsequently threatened and carried out legal action against European firms.

On Monday a trade compensation deal was agreed between the EU and the US that will allow European companies access to the US postal market and warehouse sector as compensation for the lack of access to gaming.

The European gambling industry had hoped that the EU would push the US into allowing it back into the US market.

Although the trade deal gave compensation, it did not deal with the legal side of the dispute, the RGA says.