In just three days the poker world will mark a one year anniversary – April 15th – otherwise known as Black Friday in the United States. U.S. legal enforcement institutions shut down three major online poker sites and charged them with illegal operation, money laundering and fraud, and as severe as it was, it only exposed the tip of the iceberg.
And we're not talking in terms of the U.S. government fighting international organized online gambling crime. On the contrary, we're talking about the U.S. government applying double standards when it comes to complying with the international trade liabilities.
The legal mess with the United States trying to get rid of off shore online gaming started way before Black Friday. In 2006 U.S. President George W. Bush signed the infamous Unlawful Internet Gambling Enforcement Act aka the UIGEA which made all online gambling operations illegal within the United States and caused many businesses to retreat from the American market. However, those that stayed, including the three major online poker sites - PokerStars, Full Tilt Poker, and Absolute Poker - suffered the consequences five years later.
While the government’s actions of making online gambling illegal in order to “protect public order and public morals” may seem somewhat justifiable, at least by some part of the American public, violating international treaties is a whole other thing. And the UIGEA brought the United States to another level in terms of its conflict with the World Trade Organization (WTO).
The small Caribbean nation of Antigua and Barbuda argued that the Act was not compatible with international laws which do not prohibit online gambling and therefore the United States should let online gaming companies based in Antigua and Barbuda operate in the American market.
In 2007 the issue was brought before the WTO tribunal, which after a number of hearings came to the final ruling that “The U.S. had the right to prevent offshore betting as a means of protecting public order and public morals. But Washington was violating trade law by targeting online gambling without equal application of the rules to American operators offering remote betting on horse and dog racing.”
Yes, horse and dog racing was the main issue as the United States decided to go for double standards and allow local gambling companies to provide the service while those based in other jurisdictions could not. That was the meat of the international trade violation.
And since the United States was not willing to cancel any of its decisions or cooperate with the WTO or Antigua in solving the problem, the small nation required that it be paid 3.4 billion in lost earnings. The U.S. was willing to pay $500,000. The WTO settled the argument by authorizing sanctions against the United States which allowed Antigua to legally use U.S. services, copyrights, and trademarks of an estimated value of $21 million a year.
The U.S. authorities reacted to the decision by saying that “the ruling could establish a harmful precedent for a WTO member to affirmatively authorize what would otherwise be considered acts of piracy, counterfeiting or other forms of infringement.”
The story goes way back to 2007, it's now 2012, but nothing has really changed. The U.S. does not allow Antigua to run online gaming operations in America. The Caribbean nation never really took advantage of the right to use U.S. copyrights and trademarks, waiting for the other side to do the right thing. It didn't.
However, now the Antigua authorities believe that the December 2011 DoJ's ruling on the Wire Act changed things. “The American government has now admitted that we were right all along in our assertions about US gaming law,” Mark Mendel, Antigua’s lead attorney in the WTO case against the U.S. said in a report from CalvinAyre.com. “It is going to be very hard for them to fall back on the ‘old reliable’ that they ban all remote gaming because it is incapable of regulation. I am hopeful that they will realize at this point that settlement is in everyone’s best interest and engage on a constructive basis with Antigua.”
With online gaming the second largest revenue source after tourism in Antigua and Barbuda, the Caribbean state is willing to go all the way in order to protect its interests. Mendel says they are now considering new ways of making the United States obey their obligations. One of the means for doing so may be “commencing a new case altogether.”
Antigua's battle of David against Goliath continues with U.S. poker players cheering for the two Caribbean islands to put the giant in its place.