PokerPulse Letters - Comments on EU Action Against U.S., March 2008

From: Dennis
To: report at USAToday
Sent: Tuesday, March 11, 2008 11:21 AM
Subject: RE: Any thoughts on EU, Dennis?

Hi Jon,
 
In a word: YIPPPEEEEE!
 
Having recently negotiated the GATS-slash compensation over the U.S. decision to effectively assert its sovereign right to continue protectionism in the gambling sector, the EC may now devote itself fully to pursuing a GATS-breach challenge similar to Antigua's. Antigua after all only won on behalf of Antigua. It's up to other WTO nations similarly affected by discrimination to determine whether the U.S. market is worth fighting for. I'm guessing it is. And while the EC will certainly benefit from Antigua's double victory at the WTO, its claim for compensation will probably be less hampered than Antigua's because of the UK Gambling Bill and regulatory bodies created to enforce it. Europe's older, more established industry, including significant, much more transparent reporting requirements, would likely overcome the gaps in accounting cited by two of the three arbitration panelists in December as the main reason for the massive and, frankly, controversial reduction to Antigua's claim  - from $3.4 billion to a paltry $21 million.
 
An EC challenge to U.S. remote gambling prohibitions post-Antigua might accomplish several goals important to the industry:
 
1. It may provide a threat sufficient to force the U.S. to reconsider its current position - still very much a possibility despite GATS-slash negotiations with eight countries separately, which, again, dealt only with the removal of the GATS term - not the discrimination;
 
2. It may uncover the U.S. agenda behind such selective prosecution of the industry. Many of us would like to know why, for example, private companies such as PokerStars and FulltiltPoker whose ownership is not clearly identified, are allowed to continue accepting U.S. bets without penalty, which in turn allows them to claim the monster share of world market;
 
3. Perhaps most important, it may draw attention even among anti-globalization advocates to the reasons behind the WTO's creation in the first place, which was to promote and facilitate a more equitable, ECO_FRIENDLY use of shared world resources, a rationale that is again and increasingly at the fore as more and more of us wake up to the reality of global warming.The Clinton administration was well aware of climate change as is evidenced by a number of policy papers then analyzing the eco-cost-effectiveness of growing various crops, where it makes the best economic and environmental sense to do so and so on. All of this makes the U.S. decision to bear these continued challenges as the cost of its protectionism even more grievous. As part of our Gamble Green campaign, we have actually begun tracking the environmental impact of developing super-sized luxury casino resorts especially in places with fragile eco-systems, where the profits most often leak back to foreign owners. When you compare it to the carbon footprint of gambling online, well, it's revealing, to say the least.
 
Certainly an EC challenge would benefit Antigua, whose economy has been ravaged by U.S. discrimination, but Antigua also has the added burden of some sort of partnership arrangement with Kahnawake, which may be the reason behind the UK decision to deny Antigua operators coveted inclusion on the White List. Kahnawake is in a jursdictional nomad's land, sort of. Basicially, Canada recognizes and actively promotes aboriginal self-government, but it doesn't allow First Nations to contract out of Canada's laws, which currently prohibit Kahnawake's activities. That's why more Canadians aren't doing it, too. Feds on both sides of the border have been reluctant to prosecute although both could. Diplomacy, we reckon. The good news is that Mohawks may have a safety net in s. 35 of the Constitution, which would allow them to make a case for gambling as a traditional right. It's not as big a stretch as it sounds, either. We've collected an abundance of literature on this at the Roll & Shuffle. Of course, even if they persuaded officials that they have a traditional right sufficient to support the current enterprise, they would nevertheless have a hard time obtaining exclusive control of the industry. Best case scenario is they persuade Canada to remove the barriers to the industry here while at the same time grandfathering in Mohawks. It's a win-win that would also send a message to the U.S.
 
Dennis Boyko
(with files from LegalAtPokerPulse

 

 

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