Royalty Free Video, Music Downloads Set to Cripple Netflix: Antigua Fights Back

The tiny island nation of Antigua is set to launch its royalty free video and music site, Gambling911.com is learning.  The move is in response to the US failure to abide by a World Trade Organization decision related to online gambling.

Antigua was rewarded damages of $21m in annual sanctions back in 2003 but that amount has since swelled to $150m.  As a result, Antigua is expected to unveil a new upload site that will offer videos, music and more with prices slashed as much as 99 percent.  Antigua is allowed, under the World Trade Organization ruling, to sell copyrighted material legally up to the amount of unpaid relief.

How It All Went Down

On 21 March 2003, Antigua and Barbuda requested consultations with the US regarding measures applied by central, regional and local authorities in the US which affect the cross-border supply of gambling and betting services. Antigua and Barbuda considered that the cumulative impact of the US measures is to prevent the supply of gambling and betting services from another WTO Member to the United States on a cross-border basis.

According to Antigua and Barbuda, the measures at issue may be inconsistent with the US obligations under the GATS, and in particular Articles II, VI, VIII, XI, XVI and XVII thereof, and the US Schedule of Specific Commitments annexed to the GATS.

On 12 June 2003, Antigua and Barbuda requested the establishment of a panel. At its meeting on 24 June 2003, the DSB deferred the establishment of a panel.

A panel was assembled and appellate body proceedings moved forward over.  On 10 November 2004, the report of the Panel was circulated to Members. Among the findings:

Three US federal laws (the Wire Act, the Travel Act and the Illegal Gambling Business Act) and the provisions of four US state laws (those of Louisiana, Massachusetts, South Dakota and Utah) on their face, prohibit one, several or all means of delivery included in mode 1 of GATS (i.e. cross-border supply), contrary to the United States’ specific market access commitments for gambling and betting services for mode 1. Therefore, the United States failed to accord services and service suppliers of Antigua treatment no less favourable than that provided for under the terms, limitations and conditions agreed and specified in the US Schedule, contrary to Article XVI:1 and Article XVI:2 of the GATS (i.e. concerning market access)

At the DSB meeting on 24 April 2012, Dominica read a statement on behalf of Antigua and Barbuda which stated that the United States was not in compliance with the ruling of the panel, the Appellate Body and the compliance panel.  Antigua and Barbuda had formally notified the United States of its desire to seek recourse to the good offices of the Director-General in finding a mediated solution to this dispute.  Antigua and Barbuda requested that this matter remain under the DSB's surveillance.

At the DSB meeting on 28 January 2013, Antigua and Barbuda requested the DSB to authorize the suspension of concessions and obligations to the United States in respect of intellectual property rights. Pursuant to the request by Antigua and Barbuda under Article 22.7 of the DSU, the DSB agreed to grant authorization to suspend the application to the United States of concessions or other obligations consistent with the Decision by the Arbitrator.
- Alejandro Botticelli, Gambling911.com