Brussels has accused the U.S. government of changing commitments made to the World Trade Organization (WTO) over internet gaming.

15 October 2007

Members on the panel of a trade forum in Brussels, put out harsh criticism at towards the U.S., focusing on a burgeoning trade clash between the U.S. and Europe over internet gaming.
The forum believes that the US could be liable for more than $100 billion U.S. funds, in trade concessions to European industries after placing illegal discriminatory trade restrictions on European gaming operators.

The disputed concessions arise from Antigua’s victory earlier this year when the WTO ruled that the US violated its treaty obligations by excluding online Antiguan gaming operators, while allowing domestic operators to offer various forms of online gaming.

Instead of complying with the ruling, the Bush administration withdrew the sizeable gambling industry from its free trade commitments.

As a result, all 151 WTO members are considering seeking compensation for the withdrawal equal to the size of the entire US land-based and online gaming market, estimated at nearly US$100 billion.

The European Union, along with India and five other countries, has filed notice that it intends to seek compensation.
Nao Matsukata, former director of policy planning for the Office of the U.S. Trade Representative said “The U.S. decision is a major threat to a rules based international trading system.”

Matsukata also said “If more countries follow the U.S. lead and do the same thing, the entire WTO system could implode and that would be extremely dangerous for U.S. economic interests and for free trade generally.” “Part of what makes the U.S. such a formidable opponent in international negotiations is its credibility. That credibility is now at stake for the U.S. government not just in the trade area but in foreign relations generally.”

A trade lawyer at Herbert Smith in Brussels, Lode Van Den Hende, criticized the U.S. for presecuting foreign online gaming companies while letting domestic online gaming interest operate with impunity.
Hende said “This is absolute discrimination against foreign operators that the WTO has found to be illegal.” “It is exactly the kind of practice that the WTO was set up to eliminate, and now t he U.S. is violating this very basic principle that it fought hard to put in place at the inception of the organization.”

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