TWN Info Service on WTO and Trade Issues (Jan13/01)
22 January 2013
Third World Network

Antigua and Barbuda requests sanctions in US gambling dispute
Published in SUNS #7502 dated 17 December 2012

Geneva, 14 Dec (Kanaga Raja) -- Antigua and Barbuda has requested authorisation from the Dispute Settlement Body (DSB) of the World Trade Organisation (WTO) to suspend the application of concessions or other obligations under the TRIPS Agreement with respect to the United States in an amount not exceeding $21 million annually.

The request, pursuant to Article 22.7 of the Dispute Settlement Understanding (DSU), is outlined in Antigua and Barbuda's communication to the Chair of the DSB dated 13 December 2012 (WT/DS285/25). The communication has been posted on the WTO website.

The authorisation request follows the award of the arbitrators (both on the amount and the cross-retaliation), and in terms of Article 22.7, the DSB authorisation is automatic, unless the DSB by consensus decides otherwise.

The dispute, which concerns measures imposed by the United States affecting the cross-border supply of gambling and betting services, has gone through several stages.

The dispute was first raised in March 2003, with the dispute panel handing down its ruling in November 2004 and later the Appellate Body issuing its ruling in April 2005, both of whose reports were subsequently adopted by the DSB. Compliance proceedings followed under Article 21.5 of the DSU, with the compliance panel report being issued in March 2007, and later adopted by the DSB.

According to trade officials, while the request was submitted too late for it to be put on the agenda of the DSB meeting for Monday 17 December, Antigua and Barbuda is expected to make a statement on this issue under the agenda item of "Other Business" at that DSB meeting.

In its communication to the Chair of the DSB, Antigua and Barbuda explained that on 21 June 2007, it had requested the DSB (WT/DS285/22) for authorisation to suspend the application to the United States of concessions and related obligations of Antigua and Barbuda under the WTO's General Agreement on Trade in Services (GATS) and the TRIPS as a result of the failure of the United States to implement the recommendations and rulings of the DSB in United States-Measures Affecting the Cross-Border Supply of Gambling and Betting Services (DS285).

[In that request, Antigua and Barbuda had sought retaliation amounting to an annual value of $3.443 billion.]

On 23 July 2007, the United States objected to the level of suspension proposed by Antigua and Barbuda pursuant to Article 22.6 of the DSU and claimed that Antigua and Barbuda had not followed the principles and procedures of Article 22.3 of the DSU in its request.

At its meeting on 24 July 2007, the DSB referred the matter to arbitration in accordance with Article 22.6 of the DSU, it noted.

The communication further explained that on 21 December 2007, the Arbitrators determined in document WT/DS285/ARB that Antigua and Barbuda could request authorisation from the DSB to suspend the obligations under Sections 1, 2, 4, 5 and 7 of Part II of the TRIPS at a level not exceeding US$21.0 million annually.

(Section 1 relates to copyright and related rights, Section 2 is on trademarks, Section 4 is on industrial designs, Section 5 is on patents and Section 7 is on protection of undisclosed information.)

During the course of the arbitration, Antigua and Barbuda had withdrawn its request to suspend concessions or obligations under the GATS, as on further evaluation this was considered to be impractical, a conclusion with which the Arbitrators agreed.

[In the Award, the Arbitrator had determined that the annual level of nullification or impairment of benefits accruing to Antigua is $21 million and that Antigua had followed the principles and procedures of Article 22.3 of the DSU in determining that it is not practicable or effective to suspend concessions or other obligations under the GATS and that the circumstances were serious enough. Accordingly, the Arbitrator determined that Antigua may request authorisation from the DSB, to suspend the obligations under the TRIPS Agreement at a level not exceeding $21 million annually.]

In its communication, Antigua and Barbuda said that since the release of the Award, it has been working "in good faith to obtain a fair negotiated settlement to DS285 with the United States, but all efforts have proven fruitless."

It noted that Article 22.7 of the DSU provides that "the DSB shall be informed promptly of the decision of the arbitrator and shall upon request, grant authorisation to suspend concessions or other obligations where the request is consistent with the decision of the arbitrator, unless the DSB decides by consensus to reject the request".

Accordingly, on the basis of and consistent with the conclusions and determinations of the Arbitrators in the Award and in accordance with Article 22.7 of the DSU, Antigua and Barbuda said it requests authorisation from the DSB to suspend concessions or other obligations under the TRIPS, and in particular Sections 1 (Copyright and Related Rights), 2 (Trademarks), 4 (Industrial Designs), 5 (Patents) and 7 (Protection of Undisclosed Information) of Part II thereof at a level not exceeding US$21.0 million annually.

"Until such time as the United States brings its measures into compliance with the rulings and recommendations of the DSB in DS285, every year Antigua and Barbuda will notify the DSB of the suspension of concessions or obligations it intends to adopt and actions it intends to take with respect thereto prior to bringing those suspensions into force or taking those actions."

The notice will also specify how Antigua and Barbuda proposes to ensure that, in applying the suspension of concessions and obligations, they will not exceed US$21.0 million per annum, the communication concluded. +