DAVID AND GOLIATH: ANTIGUA
CHALLENGES THE US IN THE WTO
Geneva, 24th June... In a David and Goliath scenario, the small Caribbean island
of Antigua and Barbuda today challenged the United States of America at the
World Trade Organisation requesting that a panel be established to settle
a dispute between the two countries.
Antigua and Barbuda's Chief Foreign Affairs Representative, Sir
Ronald Sanders, appeared before the WTO's Dispute Settlement Body
in Geneva to make the request.
Speaking before a packed assembly, Sir Ronald described the small
size of his country, its reliance on tourism and its vulnerability
to hurricanes. He said that Antigua and Barbuda had tried to diversify
its economy by developing financial services and electronic commerce
and had been successful in attracting Internet Gaming to its shores.
"But", he said, "the United States has passed laws
prohibiting the supply of gambling and betting services from other
countries to consumers in the US, and the enforcement of this position
prevents operators within Antigua from lawfully offering gambling
and betting services in the US under conditions of competition
compatible with the United States own obligations under WTO arrangements".
"The effect", Sir Ronald said, "is to threaten
the jobs of many bright, computer literate young people in Antigua
and to erode government revenues".
The Antigua and Barbuda senior diplomat told the WTO body, "My
government has a duty of care to our population to defend their
rights and the rights of the State under international law".
In response, the United States representative, Ambassador Linnet
Deily, reiterated that cross border gambling is prohibited under
US law, and she stated that allowing cross border gambling is not
within the scope of US commitments under the WTO.
Sir Ronald said that this is precisely why Antigua and Barbuda
is requesting a panel to settle the dispute. "The US is sticking
to its guns, and so are we. A panel is necessary to adjudicate
The Dispute Settlement Body has agreed to consider the Antigua
and Barbuda request at its next meeting on 21st July.
This is the first time that a small Caribbean country has challenged
the United States at the WTO, and the case is being watched by
the international community with great interest.
Sir Ronald Sanders' Statement to the
SIR RONALD MICHAEL SANDERS
CHIEF FOREIGN AFFAIRS REPERESENTATIVE OF ANTIGUA AND BARBUDA
THE DISPUTE SETTLEMENT BODY
OF THE WORLD TRADE ORGANIZATION
IN GENEVA, SWITZERLAND
ON TUESDAY, 24TH JUNE 2003
May I first thank you and this body for the opportunity to appear
before you to make a request for the establishment of a panel pursuant
to Article 6 of the DSU.
By way of background, I should explain that my country, Antigua
and Barbuda, is a small twin island state in the Caribbean.
It is highly dependent upon tourism for its economic survival,
and it is also subject to violent hurricanes. Consequently, our
tourism industry is held hostage to the vagaries of terrible tempests.
At some occasions, they can be less harsh than at others, but they
are always destructive. In the five years between 1995 and 2000,
we endured the ravages of six hurricanes, two of them in one year.
With the passing of each one, our islands were ravaged, hotels
destroyed, and infrastructure uprooted. The effect on our tourism
industry was disastrous.
In an effort to diversify our economy, we developed electronic
commerce. To do so, we invested in the development of the telecommunication
infrastructure and we introduced computer training in our schools,
and in special school for adult education.
In doing so, we were mindful that we were acting in pursuance
of the urgings of the international community in several fora and
public documents, not least of which is paragraph 34 of the Doha
Amongst the industries we attracted to our country was Internet
The Industry provides much needed employment to thousands of our
bright and computer literate young people. It has provided them
with a means of livelihood without which they might have been forced
to turn to unlawful activity, such as the vibrant drug trafficking
trade that now plagues the Caribbean region, which, unfortunately,
is the transit area between the supplier countries and the markets
in Europe and North America.
Additionally, the Internet Gaming industry provides the government
with revenues that are critical for the continued provision of
the basic goods and services that inhabitants of any country have
a right to expect from its government. Importantly, these revenues
are not affected by the ravages of the tempestuous storms that
make unwelcome visits to our country. They are, therefore, vital
to our economic survival and political stability.
The United States takes the view that its laws prohibit all supply
of gambling and betting services from outside the United States
to consumers in the United States. The enforcement of this position
by the United States Authorities effectively prevents operators
within Antigua and Barbuda from lawfully offering gambling and
betting services in the United States under conditions of competition
compatible with the United States own obligations under WTO arrangements.
I should mention a recent communication from the United States
to the WTO entitled "An assessment of Services Trade and Liberalization
in the United States and developing economies". In that communication
the United States explains that further liberalisation of trade
in services, and in particular the cross-border supply of services,
will be of great benefit to developing countries. Antigua and Barbuda
fully agrees with that.
In any event, the effect of the United States enforcement of its
laws is to hurt the small economy of Antigua and Barbuda which
is struggling to survive in a world of intense competition in the
trade of goods and services.
Antigua and Barbuda has always respected its international law
obligations and has always cooperated with other countries even
when it was strictly speaking not under a legal obligation to do
For instance, Antigua and Barbuda has fully cooperated with the
Financial Action Task Force of the OECD countries on money laundering
and counter terrorism issues. We were found by the FATF to be a
fully cooperative jurisdiction in the fight against money laundering.
My country did not only amend existing legislation and introduce
stringent new laws to meet the standards set by the FATF, we also
spent scare financial resources and devoted our best human resources
to the effective regulation and supervision of our financial services,
including Internet Gaming. This industry in Antigua and Barbuda
is arguably the most tightly regulated and supervised industry
of its kind anywhere in the world.
In 2002 the United States complained to Antigua and Barbuda that our reluctance
to grant a licence for cellular telecommunications to the Untied States company
AT&T violated WTO law. We looked into the matter and, although the participation
of AT&T in our small economy affectively eroded the economic viability
of an indigenous company creating unemployment and a loss of revenue to the
Government, we agreed to allow AT&T to operate a system in Antigua although
it produced less jobs than it displaced, and resulted in a flow of foreign
exchange from the country even though its earnings were in local currency.
I am sure many small, developing countries here have made similar
informal settlements that were beneficial to United States economic
interests after being told their laws were in violation of WTO
Mr Chairman, while Antigua and Barbuda respects and upholds international
law, my Government also has a duty of care to our population to
defend their rights and the rights of the State under international
The United States is the centre of the world's gambling business.
Many of the largest gaming companies in the world are of United
States origin, and a great number of them have international operations.
According to a trade association of American gaming companies,
total consumer spending in commercial casinos in the United States
reached almost US$26 billion in 2001. That is US$3 billion more
than total consumer spending on sound recordings and movie box
office sales combined. The figure of US$26 billion relates to commercial
casinos only, which is just one aspect of legalised gambling in
the United States, and is not even the biggest.
Simultaneously, the United States prohibits all cross-border supply
of gaming services from Antigua and Barbuda and there is no possibility
for our operators to obtain an authorisation. This is despite the
fact that the United States GATS schedule, when properly interpreted
in the light of the WTO classification "W/120" and the
CPC classification, implies a full commitment on the cross border
supply of gambling and betting services.
Over the last three months Antigua and Barbuda has consulted in
good faith with the United States and fully disclosed our legal
position. Our consultations have been frank and cordial as befits
two countries, which despite the great difference in their size
and resources, have enjoyed cooperative relations on a wide range
of matters. But, in the end, we did not feel that that United States
response addressed our legal position.
In the circumstances, to protect the jobs of our young people,
to safeguard government revenues, and to ensure that our legal
rights in the international community and under WTO rules are respected
and upheld, we have no other choice than to request that this distinguished
body establishes a panel to adjudicate this matter.