The World Trade Organization has formed an investigative panel that will research whether recent U.S. restrictions on online gambling are in compliance with international trade rules.
The WTO is an international, multilateral organization that sets the rules for the global trading system and resolves disputes between its member states, all of which are signatories to its approximately 30 agreements.
The organization set up the panel after recent talks with the U.S. were ineffectual in providing a solution to Washington’s continuing involvement to prohibit bets placed by Americans in online gambling.
The Caribbean states of Antigua and Barbuda asked the WTO to erect the panel. The two states said the U.S.’ prohibitions were hurting the economy of their country, citing the country’s recent investments in online offshore gambling as a way to avert dependence solely on tourism related revenue.
Antigua says the U.S. laws that are effectively prohibiting companies from providing gambling services to consumers in the U.S. are the Wire Act, the Travel Act, and the Illegal Gaming Business Act.
A previous WTO ruling held that some U.S. laws were in line with international commerce rules, but others were not.
“The United States has been busy passing legislation that is directly and unequivocally contrary to the [previous] ruling,” an Antigua representative told a meeting of the WTO’s dispute settlement body.
Antigua, a former British colony, contends that the U.S. has taken no measures to comply with the previous recommendations and rulings of the dispute settlement body.
The appearance of the panel comes on the heels of federal authorities charging an online gambling business with racketeering and wire fraud. The gaming site, BetOnSports, is based in London and licensed in Antigua. The company has since shut down its website and stopped transactions in order to review the situation.
According to The Associated Press, the U.S. contends that online gambling should be prohibited because it violates some state laws. The U.S. in April told the WTO’s dispute settlement body that it believes its laws are in line with trade rules.
The panel has 90 days to report on how the U.S. is complying with earlier WTO rulings, after which an appeal can be made by either party.
