“WTO Gambling Decision Has Everyone Guessing: Who Won?”

Having their cake and eating it too is the way some might describe the recent WTO ruling, in which neither Antigua nor the U.S. is a clear-cut winner. Agreeing both that the U.S. has the right to maintain “public order” by banning online gambling and that American policies are violating free trade practices, the WTO has left people even more confused than they were before.

Does the U.S. ban on Internet gambling violate free trade agreements? Is this ban discriminatory against foreign operators? Antigua and Barbuda, two small island nations, believe it is, and they put their money where their mouth was, by appealing to the WTO for a ruling on the U.S. ban.

The results, however, are far from conclusive. On the one hand, the WTO seemed to confirm that the U.S. does in fact hold a double standard by allowing horse race betting and other land-based gambling to take place in certain states while prohibiting foreign online casino operators from access to U.S. gamblers. On the other hand, the WTO also stands behind the U.S. claim that by banning online gambling it means to protect “public morals.” So, many are asking, who was the victor in this case: the U.S. or the two tiny island states of Antigua and Barbuda?

For all practical purposes, it doesn’t seem to matter. The U.S. will continue to ban online gambling, and Americans will continue to engage in it. As it is, American players account for about half the $10 billion of revenues generated.

Most people in the industry are predicting that eventually the U.S. will come around to adopting the online gambling policies that have already been adopted by countries such as Australia and England. After all, many U.S. states already allow land-based gambling, and if the U.S. finally allowed American firms to compete against foreign online gambling firms, it would be doing itself a favor. If online gambling were taking place on the up-and-up, the U.S. would be able to regulate the industry and tax the revenues, turning a formerly shady business into a lucrative and perhaps even reputable one.