The island nation of Antigua and Barbuda (which is approximately 216-miles east of the U.S. Virgin Islands) has had a 14-year legal battle with the United States stemming from the U.S. prohibition of foreign online gambling operations which devastated what was once a $3.4 billion industry in Antigua. In 2004, the World Trade Organization (WTO) ruled in Antigua favored and, after efforts to resolve the dispute proved “fruitless,” the WTO authorized Antigua to suspend compliance with US intellectual property law up to $21 million annually.
(The full chronology of this “Mouse That Roared” sage is detailed in our earlier post.)
What followed was a series of exchanges between Antigua and the U.S. in which Antigua vowed to move forward and the U.S. warned of serious consequence- with no resolution. Now it appears that a December 31st deadline for resolution has passed without any deal.
Antigua Draws a Line in the Sand
In a November submission to the WTO, Antigua stated:
It has been 12 long years since [the WTO’s initial ruling, which was] upheld by several Appeals panels.
Over that entire 12-year period, [Antigua] a country with a Gross Domestic Product of just $1 billion has been deprived of trade revenue which now exceed $250 million. . . . Its loss has significantly retarded our economic growth and development. . . . Further, over the last 12 years, the United States has enjoyed a balance of trade surplus with [Antigua] of over $1 billion.
Over all this time, [Antigua] has patiently engaged in good faith consultations with the Government of the United States in the genuine hope that the harm to our economy by US action would be repaired through a settlement that recognizes justice and fairness.
Alas, the US has not been able to propose terms for a settlement that would even remotely compensate for the harm that has been done to our economy and continues to impact it negatively. . . . My government has almost exhausted its patient efforts to reach a settlement with the US.
We advise this body that we are now engaged in a final effort with [the U.S., but] we cannot go beyond the end of this year.
The United States said it remained committed to resolving this matter, but that it was disappointed that Antigua and Barbuda had characterized the US as having acted in bad faith when the US had taken a constructive approach to resolving the matter. The US said it had, on multiple occasions, attempted to settle this dispute.
The US also noted that such suspension of intellectual property rights would be counter to Antigua and Barbuda’s own interests and urged it to reconsider before taking this unprecedented step.
Implementing Pirates of the Caribbean
Photo: By David Stanley from Nanaimo, Canada (Fort James) [CC BY 2.0 (http://creativecommons.org/licenses/by/2.0)%5D, via Wikimedia Commons
The WTO decision essentially would allow Antigua to sell copyrighted books, music or movies and retain whatever royalty would normally be paid to the rights holder up to $21 million each year. Before doing so, however, Antigua must first notify the WTO of how it intends to implement this plan which must address how it would not exceed $21 million per year.
Such a move is likely to trigger a strong condemnation from the US and US entertainment companies.