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Antigua gets favorable WTO gambling ruling over U.S.

Insider BuzzInsider Buzz: Antigua gets favorable WTO gambling ruling over U.S.

The United States has suffered a new setback in a four-year-old legal battle with Antigua and Barbuda over U.S. restrictions on Internet gambling, a U.S. trade official said on Thursday.

At issue is an April 2005 World Trade Organization ruling against U.S. prohibitions on online horse race betting. Since then, the U.S. Congress has passed additional legislation to ban certain financial transactions related to gambling over the Internet.

Gretchen Hamel, a spokesman for the U.S. Trade Representative's office, confirmed press reports that a WTO panel "did not agree with the United States that we had taken the necessary steps to comply" with that ruling.

At the same time, Hamel downplayed the decision contained in a preliminary, confidential report to the two parties.

"The panel's findings issued today involve a narrow issue of federal law" and the United States will have opportunity to submit comments to the WTO before it issues its final, public report in March, Hamel said.

"Nothing in the panel's interim report undermines the broad, favorable results that the United States obtained from the WTO in April 2005," she said.

The issue is a touchy one for the Bush administration, which supports free trade, but signed the gambling bill that Congress attached to unrelated, but important, port security legislation.  Had Bush not signed the bill, the port security provisions would have been erased as well.

The bill passed by Congress last year, with broad bi-partisan support, restricts online gambling by going after the financial transactions passing through the United States, to and from gambling sites.

Antigua and Barbuda, with few natural resources, has sought to build up an Internet gambling industry to provide jobs to replace those in its declining tourist industry.

It argued in a case first brought to the WTO in 2003 that U.S. laws barring the placing of bets across states lines by electronic means violated WTO rules.

An April 2005 ruling by the WTO's Appellate Body, which both sides claimed as vindication, focused on the narrower issue of horse racing, saying that foreign betting operators appeared to suffer discrimination.

Antigua and Barbuda complained the United States had not complied with the decision and the WTO agreed in July 2006 to look into the matter, resulting in the ruling on Thursday.

The United States will decide after the final panel decision ruling in March whether to appeal.

The Bush administration may not have to ask Congress to pass new legislation in any case, Hamel said.

"The panel report clarifies that compliance does not necessarily require new legislation, but could instead involve other steps, such as administrative or judicial action," she said.

Reuters and Lottery Post Staff

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3 comments. Last comment 10 years ago by rdc137.
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KyMystikal's avatar - 1457224010054
Florence, Alabama
United States
Member #8658
November 13, 2004
1993 Posts
Offline
Posted: January 28, 2007, 12:51 am - IP Logged

Why doesn't the government just tax online betting and be done with it?  I'de pay taxes on winnings just to be able to play other states.

I love doubles and remember, it's just a game!!!!!!

    Konformthismfs's avatar - lisasham
    CA
    United States
    Member #4429
    April 23, 2004
    426 Posts
    Offline
    Posted: January 28, 2007, 3:40 am - IP Logged

    Why doesn't the government just tax online betting and be done with it?  I'de pay taxes on winnings just to be able to play other states.

    Because they want to control the flow of the whole dollar spent! And collect the max out of it! Why settle for the tax???  I also think it has to do with G-tech selling and individual states selling their lotteries to private companies. They have to prove they have control of it, and can do away with any outside competitors in order to make these deals.

    This is were the whole "illegal wire transfer of funds" for gambling puzzles me. With Mega Millions,Powerball and any other multi-state games, money has to be wired across state lines somehow to somewhere to pay the winners. And what about the G-tech deal selling to an Italian company? Once again, money/payouts, from gambling, will be wire transfered globally...

    It's not what you got,  It's what you give,  It's not the life you choose, It's the life you live! Guitar

      Avatar
      Delaware
      United States
      Member #30273
      January 14, 2006
      494 Posts
      Offline
      Posted: January 28, 2007, 9:53 pm - IP Logged

      Because they want to control the flow of the whole dollar spent! And collect the max out of it! Why settle for the tax???  I also think it has to do with G-tech selling and individual states selling their lotteries to private companies. They have to prove they have control of it, and can do away with any outside competitors in order to make these deals.

      This is were the whole "illegal wire transfer of funds" for gambling puzzles me. With Mega Millions,Powerball and any other multi-state games, money has to be wired across state lines somehow to somewhere to pay the winners. And what about the G-tech deal selling to an Italian company? Once again, money/payouts, from gambling, will be wire transfered globally...

      Of course the participating states in Powerball, Mega Millions, Tri-State Lotto, and Win for Life will not be prosecuted for it as they will have a loophole. However, that is an interesting scenario. What if some "do-gooder" group decided to make a federal case out of Powerball or Mega Millions and the judge ruled that the money can't be transfered for prize payments? Effectively all multi-state games would then be shut down, and it might affect horse betting and even the new Cashola slot machines in DE, WV, and RI.

      I personally would love to actually see that happen. Then the states would put the heat on to axe the laws so they can resume PB/MM.