WASHINGTON The Bush administration has said it will vigorously contest a preliminary ruling by the World Trade Organization that could open the United States to offshore Internet gambling.
The preliminary decision Wednesday came in a trade dispute with Antigua and Barbuda. The Caribbean nation contended that U.S. restrictions on Internet gambling violated trade commitments the United States has made as a member of the WTO.
Antigua and Barbuda brought the case before the WTO last year, contending that U.S. prohibitions on Americans' placing bets at offshore Internet casinos represented an unfair trade barrier.
The losing side in any WTO case has the right to appeal the decision to the organization's seven-member appellate body.
"We intend to appeal and will argue vigorously that this deeply flawed panel report must be corrected by the appellate body," Richard Mills, a spokesman for the U.S. trade representative, Robert Zoellick, said on Wednesday.
Mills said the preliminary ruling by the WTO hearing panel had not taken into account the negotiating record in the Uruguay Round of global trade talks, which created the WTO in 1995.
"We believe that the language on U.S. services commitments used by the Clinton administration clearly intended to exclude gambling when the United States joined the WTO in 1995," Mills said.
Antiguan authorities argued that restrictions that barred U.S. residents from betting at offshore casinos harmed efforts to diversify the Antiguan economy. Antigua has been promoting electronic commerce as away to end its reliance on tourism, a sector hurt by a series of hurricanes that struck the islands in the late 1990s.
The current legal status of Internet gambling in the United States is in dispute. Some site operators have been prosecuted under the 1961 Wire Communications Act, which was written to cover sports betting by telephone.
The U.S. General Accounting Office has estimated that there are 1,800 Internet gambling operations. Virtually all of them are based outside the United States, posing an enforcement problem for U.S. authorities.
Ronald Sanders, chief foreign affairs representative for Antigua, argued before the WTO that the Internet gambling industry was providing needed employment for Antigua's youth and helping to keep them away from drug trafficking.
Sanders estimated that online casinos employed some 3,000 of the 67,000 residents of Antigua and Barbuda.
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