The World Trade Organization ruled in 2005 that the United States is in violation of its international trade commitments by attempting to block foreign gambling operators from the Caribbean nation of Antigua and Barbuda from offering Internet and telephone gambling services to Americans. The United States is therefore required to allow access to Antigua operators and has until April 2006 to do so.

The United States has not complied with its gambling commitment as of 2009, and instead continues to harass and bring criminal charges against licensed and regulated gaming operators in other countries. The WTO has therefore assessed multi-millions of dollars in ongoing trade sanctions against the United States until it complies with or resolves the case.

In line with its free trade philosophy, the United States is a huge exporter of gambling goods and services.  Many of the largest gaming companies in the world are of United States origin. Within the United States, some of these companies operate their own casinos as well as engage in other gaming-related activities such as developing, manufacturing and distributing gambling machines and providing technical and management support services to other service providers. These companies include Alliance Gaming Corporation, Harrah’s Entertainment Inc, International Game Technology, Park Place Entertainment, Boyd Gaming Corporation, Mandalay Resort Group, MGM Mirage Corporation and Trump Hotels and Casinos.  All of these are publicly owned companies, traded on the New York Stock Exchange.

In 2003, the Government of Antigua and Barbuda brought a trade dispute before the World Trade Organization because the United States was seeking to block Antiguan providers from offering gambling services to Americans.   In 2005, the WTO ruled in favor of Antigua.   The ruling is complicated and often misunderstood.   The effect of the ruling, however, is relatively simple.   First, the WTO held that the United States had made a commitment to free trade in gambling and betting services under the General Agreement on Trade in Services (GATS).   Second, the WTO held that the United States was violating this commitment because it allowed domestic Internet and telephone gambling on horse races under the Interstate Horseracing Act (IHA) and therefore could not legitimately block similar services being supplied from Antigua.    The WTO’s final ruling was that the United States is bound to allow Antigua gambling operators to access the American market by April 2006.

In May 2007, the US admitted that it made the gambling commitment and announced it would try to withdraw it from the GATS. This is an untested, long, and complicated process involving several trading partners, including the EU. The withdrawal process is still ongoing today. In the meantime, in December 2007, the WTO has ruled that Antigua is entitled to a trade sanction of $21 million annually until the US either complies or resolves the matter. Under the WTO’s latest ruling, Antigua is entitled to cross-retaliate against the US by suspending US copyright and trademarks, a unique economic weapon under international law.