Antigua takes step to ignore U.S. copyrights in fight over online gaming

Antigua on Monday threatened to ignore U.S. copyrights in retaliation for an online gaming ban that the tiny Caribbean nation says has “devastated” its economy.

The country on Monday sought and received the World Trade Organization’s authorization to set up a website to sell materials that infringe on U.S. copyrights without paying the American copyright holders. The decision could rekindle congressional concerns about subjugating U.S. policy to international law and complicate President Obama’s second-term trade agenda.

{mosads}The Antiguan government said Monday, however, that it still hopes to reach a deal with the United States and avoid the retaliation.

“The economy of Antigua and Barbuda has been devastated by the United States government’s long campaign to prevent American consumers from gambling online with offshore gaming operators,” Harold Lovell, Antigua’s finance minister, said in a statement. “We once again ask our fellow sovereign nation and WTO member, the United States of America, to act in accordance with the WTO’s decisions in this matter, before we move forward with the implementation of the sanctions authorized this day by the WTO.”

The Office of the U.S. Trade Representative vowed consequences if Antigua goes forward with threats to set up a file-sharing web site or other method of repercussion.

“The United States will not tolerate theft of intellectual property and will take whatever steps are most efficient and effective to prevent this from happening,” Deputy Assistant U.S. Trade Representative Nkenge Harmon told The Hill.

“Throughout this process, the United States has urged Antigua to consider solutions that would benefit its broader economy. Unfortunately, Antigua has repeatedly stymied these negotiations with certain unrealistic demands,” Harmon said. “While an arbitrator in this dispute has determined that Antigua may apply suspension of concessions, no WTO Member has taken the extraordinary step of applying a suspension of intellectual property rights. Any action taken by Antigua will be carefully scrutinized, and Antigua will be accountable to the WTO for any suspension applied.”

Antigua says the U.S. ban costs the island’s economy $3 billion a year. The WTO ruled in 2004 that the ban violates the 1994 General Agreement on Trade in Services, and allowed Antigua to seek retaliation against U.S. property right owners in 2007.

Monday’s decision by a dispute settlement body gives Antigua final approval to retaliate against U.S. copyrights and trademarks worth $21 million a year, far short of the $3.4 billion the country had asked for. It could have broad repercussions, however, because it allows Antigua to “cross-retaliate” against a different aspect of trade — the 1994 Agreement on Trade Related Aspects of Intellectual Property Rights (TRIPS) — creating a precedent for small countries to find ways to harm much larger trading partners.

“If [the U.S. isn’t] worried enough about Antigua they should be worried about someone else coming along,” Mark Mendel, Antigua’s attorney in the case, told the intellectual property blog infojustice.org. “If we do something inventive that could pose a lot of problems for intellectual property holders, if we create that precedent, the consequences could be enormous.

“With Antigua, it’s $21 million. Maybe with China it’s going to be U.S. $21 billion. One of the messages we want to get across is that the WTO was sold to smaller countries as a level playing field and a way for them to expand the reach of commerce, subject to a set of rules that apply to everybody. I think more than anything else, this case is about fairness. The WTO is supposed to be fair.”

This story was posted at 11:06 a.m. and updated at 12:15 p.m.