Antigua Questions Efficacy Of WTO Dispute System Over IP-Related Case

Can the World Trade Organization’s smallest members use the dispute settlement system effectively? That is a question that seemed to be suggested by the tiny Caribbean nation of Antigua and Barbuda at a WTO Dispute Settlement Body meeting yesterday, in an intellectual property-related case involving a United States gambling ban.

“So just what does this dispute resolution process do for a country such as Antigua and Barbuda?” a delegate asked in a prepared statement for the 25 April DSB meeting.

“It seems,” the statement continued, “perhaps the harsh light of this prolonged action by one of the weakest against the strongest is on the verge of condemning the multilateral trading system established here some two decades ago as what its critics then feared – a vehicle by which the strong economies could extract concessions from the weak while at the same time effectively stone-walling – no, in fairness, denying – the ability of small economies to obtain any meaningful recourse when wronged by others.”

Antigua and Barbuda’s statement, delivered by Dominica on its behalf, was on its case against the United States involving measures affecting the cross-border supply of gambling and betting services. The source of its frustration is what it says is the US failure to comply with the WTO ruling the Caribbean nation won, and its inability to employ the allowed penalties against the US out of fear of recrimination.

Jamaica made a statement supporting Antigua and Barbuda, noting in particular its belief that, “For all countries who rely on the rules-based Multilateral Trading System – Small Vulnerable Economies in particular – it is extremely important that the credibility of the Dispute Settlement Mechanism be preserved and strengthened through faithful implementation of decisions not undermined through non-compliance.”

In exchange for US blocking of Antiguan gambling services in the US, Antigua has the right to not protect US$21 million worth of US intellectual property rights every year unless they mutually resolve the issue.

The United States has done nothing to resolve the issue, has cast Antigua and Barbuda as an impediment in US efforts to alter commitments under the WTO services agreement, and has set the small nation up for harsh criticism for trying to use the remedy provided it by the WTO dispute panel, Antigua said.

“Over 10 years of following the rules and prevailing, millions of dollars of cost and expense, hours upon hours of fruitless and frustrating attempts at negotiation – and what has the tiny, developing economy of Antigua and Barbuda gained from the process?” it said, noting that it is working on a programme extract the value of its lost business as approved by the DSB.

“However, even recourse to this remedy of last resort has led to public statements and pronouncements, accusations that if the Antiguan government were to actually impose the suspension of concessions, somehow Antigua and Barbuda would be the outliers here, … would be moving beyond the pale, while at the same time the United States continues to ignore a decade-old ruling against it by this body.”

“Further,” it said, “there is no doubt that the major economies of the world do not have to face the same fears and uncertainties when they – as they have indeed done – make their own recourse to such remedies.”

The dispute dates back to 2003 when Antigua and Barbuda requested consultations with the US regarding measures applied by central, regional and local authorities in the US affecting the cross-border supply of gambling and betting services from Antigua and Barbuda.

The small country considered that the cumulative impact of the US measures was aimed at preventing the supply of gambling and betting services from another WTO members to the US, according to the WTO.

In December 2007, the DSB’s arbitrator ruled that the annual level of nullification or impairment of benefits accruing to Antigua and Barbuda was US$21 million and that Antigua could request the authorisation from the DSB to suspend the country’s obligations under the WTO Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS) for the same amount annually.

At the DSB session of January 2013, according to the WTO, Antigua and Barbuda requested that the DSB authorise the suspension of concessions and obligations to the US in respect of IP rights. The DSB agreed to grant such authorisation. However, the authorisation had not been used so far by Antigua and Barbuda.