Antigua May Be Allowed To Violate US Copyrights 482
Skleed refers us to the NYTimes for an article on the high-stakes case the US is losing before the World Trade Organization. So far the US has lost an initial hearing and two appeals on its policies regarding Antiguan offshore gambling sites. Now the lawyer pressing the case has asked for a rarely invoked, but codified, recourse under WTO rules: letting Antiguans copy and distribute American music, movies, and software. The game may be to get Hollywood and Microsoft, et al., to pressure Washington to cut a deal. But their influence may not be sufficient to move lawmakers on the question of online gambling. From the article: "But not complying with the decision presents big problems of its own for Washington. That's because Mr. Mendel, who is claiming $3.4 billion in damages on behalf of Antigua, has asked the trade organization to grant a rare form of compensation if the American government refuses to accept the ruling: permission for Antiguans to violate intellectual property laws by allowing them to distribute copies of American music, movie and software products, among others."
Re:May Be Allowed? I think not... (Score:5, Informative)
Backstory (Score:5, Informative)
They made it into a "moral issue," but that's just bullshit that they can sell to a few Evangelical hicks. The real issue was that the casinos felt that international companies were cutting into their business, so they had Congress close it down. It was pretty straightforward protectionism; online betting with U.S.-based B&M casinos (including internet off-track betting on horses, internet purchase of lottery tickets, etc.) is OK, but international ones are not.
The WTO saw this for what it is, and is basically saying, 'either you let everyone compete, or you shut it all down.' So this puts the U.S. in the position of either letting international casinos into the U.S. market, or shutting down all internet gambling (including aforementioned web-based off-track-betting, lottery tickets, sports books, etc.). The casinos -- particularly the Vegas ones -- wouldn't like that much either.
So it's going to be interesting to see how this plays out. I have to give the Antiguans -- and most of all, their lawyer [iht.com] (who is from Texas) -- credit. It takes some brass ones to go eye-to-eye with the USG, even when they're doing something that's so transparently corrupt. I hope they can pull it off.
Another reason. (Score:5, Informative)
Online gambling has been banned in the US for years by the same laws that made it illegal to wager over the phone. So there were never any domestic online gambling companies, because the US would just arrest the people running them for violating existing law.
But, the US couldn't get at people who ran online gambling companies outside the country, and while the US could have technically prosecuted individual gamblers for gambling online, that would hardly be practical. So instead, the US recently made it illegal for US banks and credit card companies to process payments to online gambling companies, effectively preventing US citizens from gambling online since it's now much harder to get your money to the gambling site.
The trick here is that the law only applies to certain kinds of online gambling, specifically, the kind of online gambling common in casinos, as it was mainly the casinos pushing for this legislation (under the guise of 'gambling is evil!'). So, the US had a situation in which certain domestic companies could engage in gambling as a trade, but certain international companies could not - and that's the basis of the WTO dispute.
The US actually has a very similar construct with regard to free trade amongst the 50 US states - it isn't legal for any state to have laws which favor domestic commerce over commerce from parties in other states. For example, in a recent ruling, the Supreme Court struck down a state law that banned companies from directly shipping alcoholic beverages to customers from out of state while allowing domestic producers to do so. Supreme Court said you had to either ban all mail-order alcohol sales or none.
And that's what the WTO is saying. The US is free to ban gambling, so long as they ban ALL gambling, not just gambling done by companies outside the country. And the US would be free to tax gambling, so long as it taxes ALL gambling. So the problem isn't that the US isn't getting a piece - they could allow gambling and tax it and get a piece. The problem is that because of the existing ban on online wagering that pit US casinos against non-US online gaming sites, the US companies were losing business to the non-US companies, so the US banned gambling at the non-US companies, which is exactly the kind of practice the free trade pacts and the WTO are supposed to prevent.
The WTO and Health and Safety Standards (Score:5, Informative)
The more important question is why does Antigua respect American copyrights at all? Well, because they gain from respecting them. It's part of free and fair trade. You aren't just allowed to take something from someone. Along the same lines, you aren't allowed to bar someone from importing goods or providing services to your citizens unless they is a defendable reason - such as an authentic health and safety standard.
The WTO is the body that makes sure everyone plays by the rules. It is a voluntary association and people can leave it - and then make whatever laws they want. So, Antigua can leave the WTO and violate copyrights as much as they want - the problem is that WTO countries then can't/won't trade with them and so they loose a lot more than they would gain.
In this case, the United States would have to prove that online gambling is sufficiently worse and different from traditional gambling (which is legal in the US) - a reason why traditional gambling doesn't pose a threat to their population, but that online gambling does. Antigua needs to prove that the US regulations on online gambling don't actually protect the American people, but are rather meant to give American companies the advantage over Antiguan companies.
This isn't some weird global government looking to get rid of sovereignty. This is about using logic to determine when rules are meant to be discriminatory based on national origin and when something is a genuine health or safety standard. The US can make the argument that online gambling becomes too accessible and is therefore a much greater danger than traditional gambling. Antigua can argue that it's the same thing that happens at casinos. A court will decide which arguments hold weight based on evidence.
Re:Backstory (Score:5, Informative)
Why does misinformation like this keep getting modded up as informative? It happens every time the online gambling issue comes up on Slashdot.
The American Gaming Association, the industry group representing those big domestic casinos, opposed legislation banning online gambling. See:
http://www.pokernews.com/news/2006/5/american-gam
http://www.americangaming.org/hillupdate/reports_
They want legalization and regulation, so they can get a piece of the pie. They're currently supporting legislation requiring a "study" of online gambling, as a preliminary to repealing the ban.
Right now online gambling is a booming international industry, but American companies can't reap any of the profits, despite what should be a very strong competitive position with their strong brands. The potential gain of locking in American gamblers to land-based casinos is negligible by comparison.
They made it into a "moral issue," but that's just bullshit that they can sell to a few Evangelical hicks.
That's not the cover story - it's the whole story. Banning online gambling has been a plank of the Republican Party platform since at least 2004:
http://www.gop.com/media/2004platform.pdf [gop.com] (see page 57)
The most recent anti-online-gambling law, the Unlawful Online Gambling Enforcement Act, was railroaded through the Senate (as a last-minute amendment to a must-pass bill) by Bill Frist. Bill Frist, at the time, was a hopeful for the Republican presidential nomination, and as such needed to shore up support among the moral conservative types.
Re:What do the hope to win? (Score:3, Informative)
Re:Goodbye, GPL (Score:1, Informative)
Re:Backstory (Score:3, Informative)
This bill never became law. This bill was proposed in a previous session of Congress. Sessions of Congress last two years, and at the end of each session all proposed bills and resolutions that haven't passed are cleared from the books.
(emphasis in the original)
Re:I am confussed (Score:5, Informative)
It's not even the worst example of this kind of behavior. I think that is saved for the conference committee trick. If you're not aware, that is where the House and the Senate pass slightly different versions of a bill, and then a "conference committee" resolves the differences in the bill. But sometimes instead of just resolving a difference, they'll add in new language, or completely change the meaning of the laws that were just passed, thus neatly overriding the intent of the legislature.
Government is a hell of a scam.
Re:WTO wont grant it. Antigua will capitulate. (Score:5, Informative)
People flock in huge numbers to Florida, Mexico, Jamaica, Puerto Rico, the Virgin Islands, etc. Why would they not go to Cuba if the choice were available, and the price was right?
I think you meant to say "Americans flock in huge numbers to ...".
And that my friend is why Cuba is such a popular destination for the rest of the world. No flocks of Americans.
Re:I am confussed (Score:3, Informative)
The system the US Congress has had since approximately forever. In committee, amendments may be proposed and the bill will be changed if the amendment passes. The same when it comes to a vote before the whole chamber. There is no rule that the amendment have anything whatsoever to the original bill. Getting what you want passed by getting it attached to a must-pass bill is a favorite tactic.
Chris Mattern
Re:it better (Score:5, Informative)
Actually, what they are complaining about is that the US is blocking commercial transactions with Antiguan businesses that would be legal if the were businesses physically located inside the US. The WTO says that's a big no-no.
The US has claimed the moral exemption allowed by the WTO - That the morals of the US do not permit online gambling. However, as Antigua pointed out, the US does permit online gambling - OTB on dog & horse racing is legal interstate, and most forms of gambling are legal intrastate - in those states which have legalized gambling of any nature.
The WTO courts have rightly held that you can't claim a moral exemption for international activities, when it is permitted within your country. Either online gambling is morally offensive to the US & it's not to be allowed at all or it's not and the US has to open up the practice to everyone. The US doesn't get to pick & choose which types of gambling are offensive - it's either morally offensive or it's not.
As a case directly on point, it is currently perfectly legal to place a bet on the Kentucky Derby through the OTB website, it is however illegal to place the same bet on the same Kentucky Derby race through an Antiguan online site. This is why the US lost the case, they were claiming that the an action was morally repugnant to the US when done with an Antiguan business, but perfectly acceptable when done through a US based one.
Personally, I think you would have seen a bigger stink if they had gone for patents instead of copyright. The cries of anguish by the US pharmaceutical companies alone should be clearly audible on Antiguan beaches.
As it is, I would like to put in my request for a legal copy of Antiguan Vistas(tm) to run on my computer - just so I can smack the next BSA person I see with it. "Why yes, it is a perfect copy of Windows Vista - without all the DRM crap & calling home. OOh look here, I see that the source code has been released by the Antiguan Software Coalition."
Re:What does poker have to do with it? (Score:3, Informative)
We have been under WTO sanctions before. As recently as 2004, trade partners sought WTO relief because the US enacted a law that granted a percentage of duties collected on foreign products to go to the American companies who compete with those foreign products. Canada, European Union, Brazil, Mexico, South Korea, India, Japan and Chile asked the WTO to impose penalties on a range of U.S. products such as cod, textiles, glassware, mobile homes and apples as retaliatory sanctions that would amount to more than $150 million annually. Those penalties would have hit American businesses hard, making them less competitive in those markets, and thus providing some pressure on the US to comply with their treaty obligations.
The ban on online gambling was a not very well thought out law, nor was it subjected to the kind of review that would have brought these kinds of concerns to the attention of the Congress and maybe stopped them from passing bad law.
As for consumer protection against potential shady practices of online casinos, honestly, there is only so much we can, or should, do to protect consumers from their own bad behavior. Most counties that have legalized online gambling operations VERY closely regulate them. Canada and Antigua both have been very aggressive in this, but so have many other counties. The pressure that can be brought to bear on nations who allow rogue casinos to operate is great. Using the potential of rogue casinos as a justification for passing bad law is a case of bad logic as well.
Re:it better (Score:3, Informative)
And this is consistent with international politics how? It's either repugnant, or it's not. "You can old do it if you are this company or in this city or on this 'special' plot of land." Doesn't exactly count with most people - whether they support gambling or not. Those who are against like the status quo because it prevents the "spread of corruption", those who are for it like it because it's a safe-heaven/money pot. But just because some company got around it by *leaving* the US doesn't make the double-standard OK.
Re:What? (Score:3, Informative)
Understanding on Rules and Procedures Governing the Settlement of Disputes (in WTO), article 22.3 [wto.org]:
In considering what concessions or other obligations to suspend, the complaining party shall apply the following principles and procedures:
(a) the general principle is that the complaining party should first seek to suspend concessions or other obligations with respect to the same sector(s) as that in which the panel or Appellate Body has found a violation or other nullification or impairment;
(b) if that party considers that it is not practicable or effective to suspend concessions or other obligations with respect to the same sector(s), it may seek to suspend concessions or other obligations in other sectors under the same agreement. (emphasis added)
How else do you really think it could work? It's not like Antigua can extract billions of dollars by placing restrictions on how its citizens may use US gambling services. It must be able to enforce the treaties in question somehow, and that's exactly what WTO is: A framework for supervising member states' implementation of free trade and providing a way to respond to violations.
Think this way: If small developing country A is a big exports of bananas to the US, while US exports iPods to country A. Now if country A places restrictions to iPods that it doesn't place to other countries or locally produced producs, do you think the US can extract the lost revenue by placing restrictions on tech imports from country A? Sure, that's the preferred way (paragraph (a) above), but if it's just not adequate, US can place import tariffs on bananas.
Fair enough?