Vice Squad
Saturday, April 09, 2005
US Makes a Comeback In WTO E-Gambling Case

There for a while it looked like the World Trade Organization was going to come down on the side of Antigua and Barbuda in its trade dispute with the US over internet gambling. But the final ruling largely went the US way, with the WTO accepting that the US can keep its federal restrictions on sports betting. Horse racing is another matter, however, since some states allow internet betting on racing. The WTO's non-discrimination orientation suggests that if a service is legal for domestic suppliers, foreign suppliers cannot be prohibited.

It isn't easy to tell exactly what is going on in the ruling, which takes the form of a 138-page document (in the English-language version) released on April 8. (The document can eventually be found from this page; scroll down to DS285, from March, 2003.) But it seems as if the major finding is that the US federal gambling statutes at issue (the Wire Act, the Travel Act, and the Illegal Gambling Business Act) are measures that fall under the exception of being necessary to protect public morals or to maintain public order. So in this case, the commitment to free trade is not allowed to trump domestic vice regulation.

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