Despite strong objections by the U.S., the island nation of Antigua and Barbuda could push ahead with its plan to offer American goods without copyright or intellectual property protections. The move is in response to the long-fought battle over internet gambling, for which the Caribbean nation has demanded compensation since the U.S. declared the practice illegal.
Last month, the World Trade Organization approved the outlines of Antigua’s proposed copyright haven, which would allow the country to set up a website to sell materials that infringe on U.S. copyrights without paying the American copyright holders. It is one in a series of decisions the WTO has awarded Antigua in the dispute. In 2007, the organization allowed the islands to draw $21 million annually of “nullification or impairments” from the United States—a penalty imposed for America’s refusal to allow its citizens to place bets on websites located in the Caribbean jurisdiction.
U.S. officials have argued that internet gambling was never part of the original GATS agreement. Antigua, whose small economy depends on online gambling, said the U.S. was in violation of international trade agreements. It claimed the U.S. ban cost the island’s economy $3 billion a year. In 2004, the WTO’s Dispute Settlement Body agreed. The two countries have met on several occasions to work out a form of compensation, but those talks have continuously broken down.
U.S. officials have categorized Antigua’s latest threat as “government-authorized piracy,” though Antigua maintains it is merely exercising its rights under the WTO ruling.
“We have followed the rules and procedures of the WTO to the letter,” Antigua’s high commissioner to London, Carl Roberts, said in a statement. “Our little country is doing precisely what it has earned the right to do under international agreements.”
But Antigua may not act on the copyright threat—a policy that could complicate President Obama’s second-term trade agenda. Many observers see the move as a card Antigua will hold in further negotiations.