Joost Pauwelyn, Duke Law School [on Wednesday's WTO ruling condemning the US for outlawing online gambling]:
"This is a true David against Goliath story. This dispute illustrates once more how deep WTO commitments penetrate the regulatory powers of its member countries.
Under WTO rules, the U.S. agreed not to restrict the importation of certain 'recreational services,' which Antigua argued includes the free flow of cross-border 'gambling services.' The U.S. maintained that it never intended to bind itself in this sensitive sector, invoking the WTO's escape clause for trade restrictions necessary to protect 'public morals' or 'public order' from money laundering, organized crime and unrestricted access for minors to internet gambling.
The panel made a statement that, in its view, the issue does not hinge on morality but on protectionism, an interesting outcome just one week after the U.S. presidential election was decided by 'moral values' voters.
As the WTO panel itself acknowledged, it is most likely that the U.S. simply made a mistake when scheduling its WTO commitments and genuinely did not intend to commit in the area of internet gambling. For such mistakes, the U.S. can always re-negotiate its commitments and withdraw the one on internet gambling, and either offer equivalent compensation to, or suffer reciprocal trade retaliation by, Antigua." [November 11, 2004; Duke News has more]
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