U.S. Online Casino Policy harms Caribbean Economy

Online casinos have proven to be one of the most lucrative businesses on the Internet and American consumers make up a large portion of the users. There are an estimated 1,900 online casinos that operate outside the US and are bringing in annual global revenues of more than $5 billion this year, with close to 70 percent of that revenue coming from U.S. customers.

Because the online gambling industry operates outside the US, American law enforcement has turned to Congress for help.  U.S. trade authorities argue that online gambling services operate outside the span of U.S. trade commitments.  They also charge that they are often used for money laundering that supports terrorism.
The WTO said it will assign a three-member panel to establish if U.S. efforts to crack down on offshore Internet gambling operations breach international trade agreements. Challenges were filed by Antigua and other Caribbean nations whose economies are pegged to the online casino industry. These countries charge that U.S. laws banning the transfer of funds to offshore gambling operations make it difficult for non-U.S. firms to obtain gaming licenses and therefore violate trade agreements ensuring market access to "cross-border services".

Internet gambling became a main part of Antigua and Barbuda's economy during the 1990s, when up to 100 different online gaming companies employing more than 5,000 people began operating. Today, there are less than 40 Internet gambling companies situated on the islands employing half as many local residents. Island officials claim the industry's decline is due in part to the U.S. crackdown.

Antiguan chief foreign affairs representative Ronald M. Sanders says that the U.S. policy is draining a significant source of the government's revenue.  "We have a responsibility to our people to maintain their jobs and to defend our small and vulnerable economy," he said.

According to the WTO, both sides will have 30 days to agree upon the appointees to the three-member board. The board's decision could come within six months of their appointment. Any ruling by the board would be binding, and could force the U.S. to change its trade policies with respect to online gambling. The decision can be appealed.