A number of countries, including the EU and India, have rejected the US’s offer on compensation that it made on 18 September 2007 in the online gambling dispute. On 4 May 2007, the US had announced its intention to withdraw a commitment made under the General Agreement on Trade in Services (GATS) concerning “gambling and betting services”. This announcement followed the US’s loss in a WTO dispute settlement case brought by Antigua on the cross-border supply of Internet gambling services.
34 countries (including the EU’s 27 Member States, India, Macau, Costa Rica, Canada, Australia, Japan, and Antigua) all requested, in accordance with WTO law, compensation for the withdrawal of the US’s commitment. The negotiations on compensation should have been conducted and concluded in the period between 22 June and 22 September. However, it was only on 18 September, just days before the end of the negotiating period, that the US eventually tabled a proposal for a compensation package to the EU. This offer consists of “storage and warehouse services”, and “services related to technical testing and analysis” and is evidently insufficient to replace access to the commercially attractive US$100 billion gambling market.
Unsurprisingly, the proposal has not been accepted by the countries concerned and the US has now been given 30 days extra to improve its offer. This time limit can be extended again but if one country does not agree to further extensions, that Member may refer the matter to arbitration. In that scenario, any affected WTO Member that wishes to enforce a right that it may have to compensation must participate in the arbitration.
Antigua is also currently seeking to impose US$3.443 billion in annual retaliatory sanctions against a range of US patents, copyrights, trademarks, and other intellectual property, as well as services companies. Such sanctions are the normal remedy provided for in WTO law.