David and Goliath Case Study Essay

795 Words Sep 7th, 2013 4 Pages
David and Goliath At The WTO
Case Study
1. Jay Cohen was a citizen of the United States and was charged for violating the Wire Wager Act of 1961, which prohibited using wire communications for betting within the US or between the US & foreign countries. Jurors were not moved by his basic defense that a foreign government sectioned what the US made criminal. He showed courage by returning to the US from Antigua, but he was still tried as guilty. Despite the WTO complained that international trade rules are allowed to override domestic laws and regulations, the US still defied the WTO and adhered to its domestic gambling laws. In a sense it was somewhat justified.
2. In the end, the US was given a year to comply with the WTO rulings. It
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The United States countered that this amount was “a figure more than three times the size of Antigua’s entire economy” and was “patently excessive”
The Antigua figure was based on assumptions that the United States gambling market would have been completely open and that Antigua’s betting businesses would have gained a percentage of that open market equal to their percentage of the world market. The WTO did not accept these assumptions. It ultimately ruled that the island nation’s lost online gambling revenue was only $21 million a year, less than 1 percent of what Antigua sought.
Ordinarily, a nation authorized to retaliate must seek concessions under the same trade agreement that the nation retaliated against has violated. Since the United States violated its obligations under the General Agreement on Trade in Services (GATS), Antigua could raise tariffs or other barriers on imports of American services. However, since imports of services into the tiny Antiguan economy are so limited, this would not have raised $21 million in annual revenue.
Therefore, the WTO arbitration panel gave Antigua the right to engage in cross-retaliation, that is, to seek concessions under another trade agreement. In this case, Antigua was allowed suspend its obligations under the Agreement on

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