January 3, 2013 : U.S. REACTS TO ANTIGUA PLAN TO RETALIATE ON GATS BREACH (Update)
This is just authorised piracy, says US Trade Representative
The Antigua and Barbuda government's decision to use a World Trade Organisation dispute panel ruling that it can retaliate against a 2007 American breach of the General Agreement on Trade in Service regarding online gambling has been met by U.S. protestations that this would be nothing less than a government-authorised act of piracy.
A statement from the US Trade Representative again offered the excuse that its breach of GATS had its roots in an oversight when the US accepted its WTO trade obligations – the US had not realised that gambling and betting services were included.
The US had made conciliatory offers to Antigua along with other nations, which had been rejected by the islanders, the statement claimed, suggesting that there was no justification for the Antigua retaliation.
There may be a none-too-subtle threat in the concluding paragraph of the US statement, which suggests that a retaliatory move by the Antiguans "….would only serve to hurt Antigua’s own interests. Government-authorized piracy would undermine chances for a settlement that would provide real benefits to Antigua.
"It also would serve as a major impediment to foreign investment in the Antiguan economy, particularly in high-tech industries.”
The two nations have argued for many years over the issue of the US ban on internet gambling, which disastrously impacted Antigua's burgeoning regulatory and licensing system, and therefore its economy.
After extensive stalling and negotiations, and several clashes in the WTO, the dispute panels found that the United States had breached its commitments under GATS, and that the Antiguans were entitled to retaliate to the value of $21 million – a far cry from the $3.4 billion the Antiguans wanted, but at least some leverage.
After further fruitless attempts to reach an accommodation with the USA, the Antiguans have now elected to go ahead, triggering the cries of protest and piracy from the US Trade Representative.
The WTO judgement gives Antigua the international right to produce and offer for sale products that are subject to US copyrights without having to pay the copyright holders. The selection of which US products to attack lies in the hands of the Antiguans, who have been remarkably patient in holding fire on the implementation of the WTO ruling as a more amicable settlement with US officials was sought.
The tiny Caribbean nation has placed the issue on the January 2013 WTO agenda, where its trade representatives are expected to produce their proposals to collect under the WTO judgement.