WT/DS285/R  
Page A-1 
 
 
ANNEX A 
 
Working Procedures for the Panel 
in United States – Measures Affecting the Cross-Border Supply 
of Gambling and Betting Services 
 
 
1. The Panel will provide the parties with a tim etable for panel proceedings and will work 
according to the normal working procedures as set out  in the DSU and its Appendix 3 plus certain 
additional procedures, as follows: 
2. The Panel shall meet in closed session.  The par ties to the dispute, and the third parties, shall 
be present at the meetings only when invi ted by the Panel to appear before it. 
3. The deliberations of the Panel and the documents  submitted to it shall be kept confidential.  
Nothing in the DSU shall preclude a party to a dis pute from disclosing statements of its own positions 
to the public.  Members shall treat as confidentia l information submitted by another Member to the 
Panel which that Member has designated as confidentia l.  As provided in Article 18.2 of the DSU, 
where a party to a dispute submits a confidential ve rsion of its written submissions to the Panel, it 
shall also, upon request of a Member, provide a non-confidential summary of the information 
contained in its submissions that could be disclosed to the public. 
4. Before the first substantive meeting of the Pane l with the parties, the parties to the dispute 
shall transmit to the Panel written submissions in which they present the facts of the case and their 
arguments. 
5. At its first substantive meeting with the par ties, the Panel shall ask the party which has 
brought the complaint to present its case.  Subseque ntly, at the same meeting, the party against which 
the complaint has been brought shall be  asked to present its points of view. 
6. The third parties shall be invited in writing to  present their views during a session of the first 
substantive meeting of the Panel set aside for that purpose.  The third parties may be present during 
the entirety of this session. 
7. Formal rebuttals shall be made at a second s ubstantive meeting of the Panel.  The party 
complained against shall have the right to take the fl oor first to be followed by the complaining party.  
The parties shall submit, prior to that meeting, written rebuttals to the Panel. 
8. The Panel may at any time put questions to the pa rties and ask them for explanations either in 
the course of a meeting with the parties or in writi ng.  Written replies to questions shall be submitted 
at a date to be decided by the Pane l in consultation with the parties. 
9. The parties to the dispute and any third party i nvited to present its views shall make available 
to the Panel and the other party a writte n version of their oral statements. 
10. In the interest of full transparency, the presenta tions, rebuttals and statements referred to in 
paragraphs 5 to 9 shall be made in the presence of the parties.  Moreover, each party's written 
submissions, including responses to questions put by  the Panel, comments on the descriptive part of 
the report, and comments on the interim report, sh all be made available to the other party. 
11. Any request for a preliminary ruling (including rulings on jurisdictional issues) to be made by 
the Panel shall be submitted no later than in a pa rty's first written submission.  If the complaining 
party requests any such ruling, the respondent shall submit its response to such a request in its first 
written submission.  If the respondent requests any su ch ruling, the complaining party shall submit its WT/DS285/R 
Page A-2  
 
response to such a request prior to the first substa ntive meeting of the Panel.  The complaining party 
shall submit this response at a time to be determined  by the Panel after receipt and in light of the 
respondent's request.  Exceptions to this proce dure will be granted upon a showing of good cause. 
12. Parties shall submit all factual evidence to the Panel no later than during the first substantive 
meeting, except with respect to evidence necessary for purposes of rebu ttals or answers to questions.  
Exceptions to this procedure will be granted upon a showing of good cause.  In such cases, the other 
party shall be accorded a period of time for comment, as appropriate. 
13. To facilitate the maintenance of the record of th e dispute, and for ease of reference to exhibits 
submitted by the parties, parties are requested to number their exhibits sequentially throughout the 
stages of the dispute.  
14. The parties and third parties shall provide the Panel with an executive summary of the facts 
and arguments as presented to the Panel in their wr itten submissions and oral presentations within one 
week following the delivery to the Panel of the wr itten version of the relevant submission.  The 
executive summaries of the written submissions to be provided by each party should not exceed 10 
pages in length and the executive summaries of th e oral presentations should not exceed 5 pages in 
length each.  The summary to be provided by each third party shall summarize their written 
submission and oral presentation, and should not ex ceed 5 pages in length.  The executive summaries 
shall not in any way serve as a substitute for the subm issions of the parties in the Panel's examination 
of the case.  However, the Panel may reproduce th e executive summaries provided by the parties and 
third parties in the arguments section of its report, subject to any modifications  deemed appropriate by 
the Panel.  The parties' and third parties' rep lies to questions, and the parties' comments on each 
other's replies to questions will be a ttached to the Panel report as annexes. 
15. The parties and third parties to this proceeding have the right to determine the composition of 
their own delegations.  Delegations may include, as  representatives of the government concerned, 
private counsel and advisers.  In this regard, it is noted that the complainant has undertaken to ensure 
as far as possible that a government official be presen t at all meetings with the Panel.  The parties and 
third parties shall have responsibility for all member s of their delegations and shall ensure that all 
members of their delegations act in accordance with the rules of the DSU and the Working Procedures 
of this Panel, particularly in regard to confidentia lity of the proceedings.  In particular, private lawyers 
acting on behalf of the compla inant are bound by the same ob ligations and responsibilities as WTO 
Members.  Parties shall provide a list of the particip ants of their delegation before or at the beginning 
of the meeting with the Panel. 
16. Following issuance of the interim report, the par ties shall have no less than 10 days to submit 
written requests to review precise aspects of the inte rim report and to request a further meeting with 
the Panel.  The right to request such a meeting must  be exercised no later than at the time the written 
request for review is submitted.  Following receipt  of any written requests for review, in cases where 
no further meeting with the Panel is requested, the parties shall ha ve the opportunity within a time-
period to be specified by the Panel to submit wr itten comments on the other parties' written requests 
for review.  Such comments shall be strictly limite d to commenting the other parties' written requests 
for review. 
17. The following procedures regarding service of documents apply: 
(a) Each party and third party shall serve  its submissions directly on all other 
parties, including where appropriate the third parties, and confirm that it has done so 
at the time it provides its submission to the Panel. 
(b) The parties and the third parties should provide their written submissions and 
written answers to questions by 5:30 p.m. on the deadlines established by the Panel, WT/DS285/R  
Page A-3 
 
 
unless a different time is set by the Panel.  In  this regard, the parties have agreed that 
they will exchange written submissions a nd written answers to questions, including 
all exhibits, electronically, in word processing format (Word or WordPerfect). Where necessary (for example, due to the nature and/or size of the document in question), 
exhibits may be submitted in .pdf format or by fax.  In cases where the size of the 
exhibits is so large as to render it impracti cable to send the documents in .pdf format 
or by fax by the stipulated deadlines, hard  copies shall be sent by courier for receipt 
the day after the due date.  Hard copies of all submissions and answers will be sent by 
courier within 24 hours of the deadlines .  These procedures apply to the submission 
of documents to the Panel, to the other party and to third parties. 
(c) Parties and third parties shall provide the Secretariat with copies of their oral 
submissions by noon of the first working day following the last day of the substantive meetings.   
(d) The parties and third parties shall provide the Panel with 9 copies of all their 
submissions, including the written versions of oral statements and answers to 
questions.  All these copies shall be filed with the Dispute Settlement Registrar, 
Mr. Ferdinand Ferranco (office number 3154). 
(e) At the time they provide a hard c opy of their submissions, the parties and 
third parties shall also provide the Pane l with an electronic copy of all their 
submissions on a diskette or as an e-mail attachment in a format compatible with the Secretariat's software.  E-mail attachment s shall be sent to the Dispute Settlement 
Registry (DSRegistry@wto.org) with a copy to Ms Mireille Cossy (e-mail: 
mireille.cossy@wto.org).  
(f) Each party shall serve executive su mmaries mentioned in paragraph 14 
directly on the other party and confirm that it has done so at the time it provides its submission to the Panel.  Each third pa rty shall serve executive summaries mentioned 
in paragraph 14 directly on the parties and confirm that it has done so at the time it 
provides its submission to the Panel.  S ubparagraphs (d) and (e) above shall be 
applied to the service of executive summaries. 
 
_______________ 
  WT/DS285/R 
Page B-1 
 
 
ANNEX B 
 
REQUEST FOR PRELIMINARY RULINGS 
  
A. D
ECISION OF THE PANEL* 
1. This communication from the Panel is in respon se to the United States request for preliminary 
rulings in respect of Antigua and Barbuda 's request for establishment of a panel1 and issues relevant to 
that request in Antigua and Ba rbuda's first written submission.2  The request was received on Friday 
night, 17 October 2003.  
2. On 20 October 2003, the Panel invited Antigua a nd Barbuda and the third parties to comment 
on the US request.  Antigua and Barbuda submitt ed its response on 23 October 2003, the European 
Communities and Japan on 24 October 2003.  Chinese Ta ipei, Mexico and Canada informed the Panel 
that they would not submit any comments to  the US request for preliminary rulings. 
1. Procedural background 
3. On 13 March 2003, Antigua and Barbuda requ ested consultations with the United States 
regarding measures applied by central, regional and local authorities in the United States that 
(allegedly) affect the cross-border supply of ga mbling and betting services.  In an Annex to its 
original request for consultations3, Antigua and Barbuda identified a number of documents as 
"measures", indicating that "these measures and th eir application may constitute an infringement of 
the obligations of the United States under GATS". 
4. Sections I and II of the Annex to the request for consultations contai n a list of federal and 
state statutory measures.  Section III lists other doc uments, categorised by An tigua and Barbuda in its 
Annex as "Other United States and State actions or measures."  These documents include case law, Attorney Generals' opinions, press releas es and pages from Internet websites.   
5. With respect to the items identified in the Anne x, Antigua and Barbuda claimed in its request 
for consultations that: 
"It is my Government's understanding that the cumulative impact of the Federal and 
State measures of the type listed in the Anne x to this request is that the supply of 
gambling and betting services from another WTO Member (such as Antigua and Barbuda) to the United States on a cross-border basis is considered unlawful under United States law."
4   
6. On 10 April 2003, Antigua and Barbuda notified an addendum to its request for 
consultations.5  That addendum purported to "clarify some of the references to US legislation in the 
original Annex".6  Attached to the addendum was a new vers ion of the Annex that had been attached 
to the original request for consultations.  The a ddendum also reiterated Anti gua and Barbuda's claim 
that a prohibition on the cross-border supply of  gambling and betting services results from the 
                                                      
* Sent to the parties on 29 October 2003.  The arguments by the parties and third parties are found, 
respectively, in sections B and C of this Annex. 
1 WT/DS285/2, 13 June 2003. 
2 1 October 2003. 
3 WT/DS285/1, 27 March 2003.  
4 WT/DS285/1, para. 2. 
5 WT/DS285/1/Add.1, 10 April 2003. 
6 WT/DS285/1/Add.1, para.1. WT/DS285/R 
Page B-2  
 
cumulative application of the measures listed in the Annex.  In particular, the addendum provided 
that: 
"As explained in our request for cons ultations of 13 March 2003 it is our 
understanding that the prohibition on the cross-border supply of gambling and betting 
services in the United States arises from th e cumulative impact of measures of the 
type listed in the Annex.  The corrected Annex clarifies some of the references to 
United States legislation and replaces references to a few measures which are no longer in force with references to current measures.
 "7 
7. On 13 June 2003, Antigua and Barbuda submitted to the DSB its request for establishment of 
a panel (hereinafter referred to as the "Panel request").8  As in the case of the request for 
consultations, the Panel request cont ained an Annex, the contents and structure of which is virtually 
identical to the Annex attached to the revised request for consultations. 
8. The Panel request reiterates the claim made  in Antigua and Barbuda's request for 
consultations that the laws referred to in Sections I and II of the Annex have the effect of prohibiting 
all supply of gambling and betting services from outside  the United States to consumers in the United 
States.  However, with respect to the items contai ned in Section III of the Annex, the Panel request 
states that: 
"Section III of the Annex lists examples of measures by non-legislative authorities of 
the United States applying these laws to the cross-border supply of gambling and betting services."
9 
9. Finally, the Panel request also states that:  
"The measures listed in the Annex only come within the scope of this dispute to the 
extent that these measures prevent or can  prevent operators from Antigua and 
Barbuda from lawfully offering gambling and betting services in the United States 
under conditions of competition compatible  with the United States' obligations."10 
10. At the first and second meetings of the DSB at  which Antigua and Ba rbuda's Panel request 
was considered, the United States alleged a number of inadequacies associated with Antigua and 
Barbuda's Panel request.11  In particular, the United States stated that a number of items contained in 
the Annex to the Panel request were not "measures"  that could be properly included within the scope 
of a panel request; that the Annex included sever al measures which appeared not to have been 
included in the revised request for consultations; a nd that not all of the measures cited in the Annex 
were related to the supply of cr oss-border gambling and betting services.12 The United States raised 
the issue of these alleged inadequacies again at the Panel's organizational meeting held on 3 
September 2003.  
11. On 1 October 2003, as provided in the Panel's Working Procedures and timetable, Antigua 
and Barbuda made its first written submission to the Panel in which it addressed some of the concerns 
that had previously been raised by the United States regarding its Panel request.  
                                                      
7 WT/DS285/1/Add.1, para. 2.   
8 WT/DS285/2. 
9 WT/DS285/2, para.2. 
10 WT/DS285/2, para.2. 
11 First meeting held on 24 June 2003: WT/DSB/M/151; Second meeting held on 21 and 23 July 2003: 
WT/DSB/M/153.  
12 WT/DSB/M/151, p.11, para.9; WT/DSB/M/153, para. 47 WT/DS285/R 
Page B-3 
 
 
12. According to the Panel's timetable for these pr oceedings, the United States was due to make 
its first written submission on 29 October 2003.  However, as noted above, on 17 October 2003, the 
United States requested the Panel to make a numbe r of preliminary rulings, which are the subject-
matter of this communication.   
2. The US request for preliminary rulings 
13. We have been requested by the United States to issue pr eliminary rulings pursuant to 
paragraph 11 of the Panel's Working Procedures.  Paragraph 11 of our Working Procedures reads as 
follows: 
"Any request for a preliminary ruling (including rulings on jurisdictional issues) to be 
made by the Panel shall be submitted no later than in a party's first written 
submission.  If the complaining party requ ests any such ruling, the respondent shall 
submit its response to such a request in its first written submission.  If the respondent 
requests any such ruling, the complaining party shall submit its response to such a 
request prior to the first substantive mee ting of the Panel.  The complaining party 
shall submit this response at a time to be de termined by the Panel after receipt and in 
light of the respondent's request.  Exceptions  to this procedure will be granted upon a 
showing of good cause." 
14. The Panel understands the United States to seek preliminary rulings on four issues.  
According to the United States:  
(a) Some of the measures listed in the Annex to  the Panel request were not included in 
the request for consultations. Therefore, such measures were not consulted on and 
should not be considered by the Panel.  
(b) Some of the items listed in the Annex to th e Panel request are not "measures" within 
the meaning of Article 6.2 of the DSU and, therefore, are not within the Panel's terms 
of reference. 
(c) Some of the measures listed in the Panel re quest are unrelated to cross border supply 
of gambling services.13  
(d) Antigua and Barbuda has not made a prima facie  case of violation and, therefore, its 
complaint should be rejected.   
15. We deal with each of th ese issue in turn below. 
3. The Panel's assessment of the US request for preliminary rulings 
(a) General Considerations 
16. We note as a starting-point that the jurispruden ce confirms that, according to Article 6.2 of 
the DSU, a request for establishment of a panel mus t: (i)  be in writing;  (ii)  indicate whether 
consultations were held;  (iii)  identify the specific measures at issue;  and  (iv)  provide a brief 
                                                      
13 We note that in para. 14 of the US request for preliminary rulings, the United States raised this 
argument as part of its claim that Antigua's request fo r establishment of a panel im properly included certain 
measures that were not the subject of consultations.  However, the Panel has decided to treat this argument as a 
separate issue. WT/DS285/R 
Page B-4  
 
summary of the legal basis of the complain t sufficient to present the problem clearly.
14  I n  EC – 
Bananas III , the Appellate Body made clear that: 
"It is important that a Panel request be sufficiently precise for two reasons:  first, it 
often forms the basis for the terms of refere nce of the Panel pursuant to Article 7 of 
the DSU;  and, second, it informs the defendi ng party and the third parties of the legal 
basis of the complaint."15 
17. In assessing the United States' request for preliminary rulings, the Panel considers that it is 
important to bear in mind what Antigua and Ba rbuda considers to be the measure(s) that it is 
challenging and in respect of which it requested consulta tions.  In this regard, we note that in its Panel 
request, in its first written submission, and in its comments on the US request for preliminary rulings, 
Antigua and Barbuda emphasised that it is effectiv ely challenging the overall and cumulative effect of 
various federal and state laws whic h, together with various policy statements and other governmental 
actions, constitute a complete prohibition of the cross-border supply of gambling and betting services. 
18. In this regard, we recall the Appellate Body' s guidance in Korea – Dairy16 and in US – 
Carbon Steel  as to how a panel should approach challeng es to the sufficiency of Panel requests under 
Article 6.2 of the DSU: 
"As we have said previously, compliance w ith the requirements of Article 6.2 must 
be demonstrated on the face of the request fo r the establishment of a panel.  Defects 
in the request for the establishment of a pa nel cannot be "cured" in the subsequent 
submissions of the parties during the panel proceedings.   Nevertheless, in considering 
the sufficiency of a Panel request, submissions and statements made during the course 
of the panel proceedings, in particular th e first written submission of the complaining 
party, may be consulted in order to confirm the meaning of the words used in the Panel request and as part of the assessment of whether the ability of the respondent to defend itself was prejudiced.
  Moreover, compliance w ith the requirements of 
Article 6.2 must be determined on the mer its of each case, having considered the 
Panel request as a whole, and in the light of attendant circumstances."17 
19. It is also important to bear in mind that the measures(s) that have been challenged in a Panel 
request must be capable of enforcement under Ar ticle 19.1 of the DSU, which provides that:  
"Where a panel or the Appellate Body concl udes that a measure is inconsistent with a 
covered agreement, it shall recommend that the Member concerned18 bring the 
measure into conformity with that agreement." 
20. Finally, with regard to the timing of preliminar y ruling requests, we recall the Appellate Body 
statement in US – FSC : 
"Article 3.10 of the DSU commits Members of the WTO, if a dispute arises, to 
engage in dispute settlement procedures "in good faith in an effort to resolve the 
dispute".  This is another specific manifestation of the principle of good faith which, 
we have pointed out, is at once a general pr inciple of law and a principle of general 
international law. This pervasive principl e requires both complaining and responding 
Members to comply with the requirements of the DSU (and related requirements in 
                                                      
14 Appellate Body Report on Korea – Dairy , para. 120. 
15 Appellate Body Report on EC – Bananas III , para. 142. 
16 Appellate Body Report on Korea – Dairy , paras. 120-128. 
17 Appellate Body Report on US – Carbon Steel , para. 127. 
18 The "Member concerned" is the party to the dispute to which the panel or Appellate Body 
recommendations are directed. WT/DS285/R 
Page B-5 
 
 
other covered agreements) in good faith. By  good faith compliance, complaining 
Members accord to the responding Members the full measure of protection and 
opportunity to defend, contemplated by the letter and spirit of the procedural rules.  The same principle of good faith requires that responding Members seasonably and 
promptly bring claimed procedural deficiencies to the attention of the complaining 
Member, and to the DSB or the Panel, so th at corrections, if needed, can be made to 
resolve disputes.  The procedural rules of WTO dispute settlement are designed to 
promote, not the development of litigation t echniques, but simply the fair, prompt and 
effective resolution of trade disputes." (emphasis added)19 
(b) Assessment of the US request 
(i) Some of the measures listed in the Annex to th e Panel request were not included in the request 
for consultations and should not  be considered by the Panel 
21. As indicated above, the issue here is whether the Panel is entitled to consider provisions of 
legislation referred to in the Panel request in cases where the request for consultations referred to the 
same legislation but contained references to different provisions of that legislation.  
22. The concerned measures indicated by the United St ates in this regard are the state laws for 
Colorado, New York and Rhode  Island.  In particular: 
(1) With respect to Colorado, the revised  request for consultations referred to 
COLO. REV. STAT. §§ 18-10-101 to 18-10- 08 (1999)" whereas the Panel request 
referred to " COLO. REV. STAT. §§ 18-10-101 to 18-10- 108 (1999)".  
(2) In relation to New York, the revised re quest for consultations refers to "N.Y. 
CONST.  art. II, §9" whereas the Panel request refers to "N.Y. CONST.  art. I, §9". 
(3) With respect to Rhode Island, the revi sed request for consultations refers to 
"R.I. CONST. art. I, § 22" whereas the Panel request refers to "R.I. CONST. art. VI, 
§ 22".  
23. The Panel notes that, pursuant to Article 6.2 of the DSU, it is incumbent upon complaining 
parties to, inter alia , indicate in their request for establishmen t of a panel whether consultations were 
held on the matter in dispute.  This requirement s eeks to ensure that parties have had an adequate 
opportunity to discuss the matter in dispute before a panel is established to adjudicate that dispute.  
Indeed, jurisprudence exists to indicate that a Member will be prevented "from requesting the 
establishment of a panel with regard to a di spute on which no consultations were requested".20  
24. Given the discrepancies between the Panel re quest and the request for consultations, the 
United States argues that consultations were not  conducted in relation to the measures for which 
references were amended in the Panel request.  In deciding the significance and consequences 
associated with these discrepancies, we not e that the Appellate Body stated in Brazil – Aircraft  that: 
"We do not believe … that Articles 4 and 6 of the DSU, or paragraphs 1 to 4 of 
Article 4 of the  SCM Agreement, require a  precise and exact identity between the 
specific measures that were the subject of  consultations and the specific measures 
identified in the request for the establishment of a panel."21   
                                                      
19 Appellate Body Report on US – FSC,  para.166. 
20 Panel Report on Canada – Aircraft, para. 9.12. 
21 Appellate Body Report on Brazil –Aircraft,  para. 132. WT/DS285/R 
Page B-6  
 
25. We take this to mean that there may be diffe rences between the measures listed in the request 
for consultations and those listed in the request for establishment of a panel. Indeed, we consider that 
such differences may well be justified given that f acts may emerge during the course of consultations 
so as to "shape the substance and the sc ope of the subsequent panel proceedings".
22 However, we do 
recognize that a balance is needed between, on the one  hand, the right of the complainant to alter the 
request for establishment of a panel in light of  information that may become available during 
consultations and, on the other hand, the need to ensure that a Member does not request the 
establishment of a panel with regard to a di spute on which no consultations were requested. 
26. As to whether or not, in this case, the differe nces between the Panel request and the revised 
request for consultations referred to above are such  that the Panel is still entitled to consider the 
measures implicated by the US argument, we note that both the revised request for consultations and 
the Panel request contain references to the same legislation  for each of the relevant states.  However, 
the discrepancies that exist as between th e two sets of requests relate to the provisions  referred to.  On 
the face of it, the discrepancies appear typograp hical in nature.  Given that the jurisprudence 
anticipates alteration of Panel requests in certain ci rcumstances referred to a bove, it would seem that 
alterations to Panel requests in cases of typographical  errors should be accepted given their apparently 
less egregious nature.   
27. However, we are unable at this stage to make a definitive assessment of whether the 
differences are purely typographical in nature given that Antigua and Barbuda has not yet completed 
establishing its prima facie  case23 and the legislation in questio n has not yet been adduced as 
evidence.  In addition, the Panel considers that it w ill be better placed to make this assessment once it 
has heard the parties' substantive arguments.  Therefor e, for the time being, the Panel declines to rule 
on this aspect of the US request. 
(ii) Some of the items listed in the Annex to the Panel request are not "measures" within the 
meaning of Article 6.2 of the DSU and, therefo re, are not within the Panel's terms of 
reference 
28. In its response to the United States' request for a preliminary ruling on this issue, we note that 
Antigua and Barbuda emphasised that the Panel need  not determine whether the items contained in 
Section III of the Annex to the Panel request cons titute separate and individual measures.  Indeed, 
Antigua and Barbuda has stated that the items contained in Section III are based on  the legislative 
provisions listed in Sections I and II. 
29. As to the legal status that should be attribut ed to the items contained in Section III of the 
Annex to the Panel request, we reca ll the Appellate Body statement in US – Carbon Steel : 
"The party asserting that another party's munici pal law, as such, is inconsistent with 
relevant treaty obligations bears the burde n of introducing evidence as to the scope 
and meaning of such law to substantiate that assertion. Such evidence will typically 
be produced in the form of the text of the relevant legislation or legal instruments, 
which may be supported, as appropriate, by ev idence of the consistent application of 
such laws, the pronouncements of domestic courts on the meaning of such laws, the 
opinions of legal experts and the writings of recognized scholars.  The nature and extent of the evidence required to satisfy  the burden of proof will vary from case to 
case."
24  
                                                      
22 Appellate Body Report on India – Patents US, para. 94. 
23 In this regard, see the Panel's conclusions in pa ras. 38 to 40 below regarding the US claim that 
Antigua and Barbuda has failed to make a prima facie  case.  
24 Appellate Body Report on US – Carbon Steel , para. 157. WT/DS285/R 
Page B-7 
 
 
30. Therefore, in light of the foregoing, a complain ing Member is entitled to use various types of 
evidence to display how a measure violates a WTO provision.25  Whilst the items listed by Antigua 
and Barbuda in Section III of the Annex to its Panel request may not (all) be measures26, these items 
may, nevertheless, be relevant for Antigua's demons tration that the legislative measures referred to in 
Sections I and II of the Annex to its Panel request result in a complete prohibition on the cross-border 
supply of gambling and betting services. 
31. Given that Antigua and Barbuda has indicated that it does not intend to treat the items listed 
in Section III as distinct and autonomous "measure s" but, essentially, will seek to rely upon them as 
evidence to illustrate the existence of a general prohibition against cross-border supply of gambling 
and betting services in the United States, we decline to  rule out the relevance of such items.  However, 
as suggested by Antigua and Barbuda, during our substa ntive consideration of this dispute, we will 
not consider and examine them as separate, autonomous measures. 
(iii) Some of the measures are unrelated to  cross border supply of gambling services 
32. In paragraph 14 of its request for preliminar y rulings, the United States has identified some 
legislative provisions which it argues are "unrelated to cross-border gambling" and that, therefore, 
they should not be considered by the Panel in this dispute.27 
33. Article 6.2 of the DSU provides that the requ est for the establishment of a panel "shall … 
identify the specific measures at issue and provide a brief summary of the legal basis of the complaint 
sufficient to present the problem clearly".  
34. We agree with the argument made by the Europ ean Communities that, since Article 6.2 of the 
DSU is a general provision regulating the content of requests for panel establishments, it must be read 
together with relevant provisions contained in the WTO agreements. In this regard, relevant 
provisions in the GATS include Article XXIII of the GATS Agreement, which effectively provides 
that the DSU governs disputes arising under the GATS.   We note, in addition, that Articles I:3 and 
XXVIII(a) and (c) together broadly define the measu res to which the provisions of the GATS apply.28  
To the extent that the GATS defin ition of a "measure" is broader than that contained in Article 6 of 
                                                      
25 Appellate Body Report on US – Carbon Steel , paras. 156-157. 
26 We agree with Japan that the issue of what constitute a "measure" under WTO law is a sensitive 
matter that was recently debated before the panel on US – Corrosion-Resistant Steel Sunset Review .  
27 See Georgia Code § 16-12-37; Iowa Code § 725.11; Arkansas Statutes § 5-66-115; California Penal 
Code §§ 337b through 337e; Georgia Code §§ 16-12-33 and 16-12-34; Massachusetts General Laws, Chapter 
271, §§ 39 and 39A; California Penal Code §§ 337u th rough 337z; Delaware Code §§ 1470 and 1471; Maryland 
Code, Criminal Law, § 12-109; Massachusetts General Laws, Chapter 271, §§ 12 and 32; Ohio Revised Code § 2915.05; Oregon Revised Statutes § 167.167; Virginia Code § 18.2-327; Washington Revised Code 
§§ 9.46.196 through 9.46.1962; California Penal Code §§  337f through 337h; Vermont Statutes title 13, § 2153. 
Massachusetts General Laws, Chapter 271, § 46. 
28  Article I:3 of the GATS reads as follows: (a) "m easures by Members" means measures taken by: (i) 
central, regional or local governments  and authorities;  and ( ii) non-governmental bodies in the exercise of 
powers delegated by central, regional or local governments or authorities.  In fulfilling its obligations and 
commitments under the Agreement, each Member shall take such reasonable measures as may be available to it 
to ensure their observance by regional and local governments and authorities and non-governmental bodies within its territory.  Article XXVIII(a) provides that "measure" means any measure by a Member, whether in the 
form of a law, regulation, rule, procedure, decision, administrative action, or any other form.  In addition, 
Article XXVIII(c) provides that "measures by Members aff ecting trade in services" include measures in respect 
of (i) the purchase, payment or use of a service; (ii) th e access to and use of, in connection with the supply of a 
service, services which are required by those Members to  be offered to the public generally; (iii) the presence, 
including commercial presence, of persons of a Member fo r the supply of a service in the territory of another 
Member. WT/DS285/R 
Page B-8  
 
the DSU, it would supplement the meaning of "measures" in  Article 6.2 of the DSU,
29 as interpreted 
by the jurisprudence.  
35. Recent jurisprudence has established that before  the provisions of the GATS can be applied in 
determining whether or not a GATS inconsistency exists, a panel mu st in the normal course of its 
analysis determine whether the measure in question "affects trade in services".30  The Appellate Body 
has emphasized further that "the term 'affecting' reflec ts the intent of the drafters to give a broad reach 
to the GATS".31 
36. It seems to us that the majority of the laws challenged by the United States as being unrelated 
to the cross-border supply of services are concerned primarily with prohibiting bribery, cheating, etc. 
rather than regulating the supply of gambling services per se .  Although it may be difficult at this 
stage to understand why Antigua and Barbuda is cha llenging such penal laws and how they violate the 
GATS, it is conceptually possible that these measu res are measures affecting cross-border trade in 
gambling and betting services within the meaning of th e GATS.  In any event, the Panel notes that 
Antigua and Barbuda stated in its Panel request th at "the measures listed in the Annex only come 
within the scope of this dispute to the extent th at these measures prevent or can prevent operators 
from Antigua and Barbuda from lawf ully offering gambling and betting services in the United States 
under conditions of competition compatible  with the United States' obligations."32  A s  t o  w h e t h e r  
these measures do, in fact, affect cross-border trad e in gambling and betting services, this is to be 
answered during the Panel's proceedings and cannot, in  our opinion, be the subject of a preliminary 
ruling at this early stage. 
37. Moreover, since Antigua and Barbuda appears to be arguing that all laws listed in the Annex 
to the Panel request are to be read together in de monstrating that the United States generally prohibits 
the cross-border supply of gambling and betting services,  the Panel is of the view that it would be 
more appropriate to abstain from reaching any defi nitive conclusion as to whether any of the listed 
laws, whether read in isolation or in conjunction wi th others, are "unrelated to cross border supply of 
gambling services" at this stage of the proceedings. 
(iv) Antigua and Barbuda has not made a prima faci e case of violation with the GATS and, 
therefore, its complaint should be rejected 
38. We note that Appellate Body jurisprudence has established that a complainant has two sets of 
written submissions and two panel h earings within which to convince the Panel that it has established 
its prima facie  case that the measure(s) at issue do(es) violate one or more WTO provisions.33 
39. In addition, we recall the panel's conclusion in Thailand – H-Beams , which stressed the 
importance of the distinction between, on the one ha nd, the sufficiency of the Panel request and, on 
                                                      
29 The Appellate Body has already determined (in Guatemala –Cement I,  para. 75) that in a dispute 
under the Anti-dumping Agreement, the requirements of both the Anti-dumping Agreement and the DSU must 
be respected in determining what the "m atter" referred to the DSB is:  "The f act that Article 17.5 contains these 
additional requirements, which are not mentioned in Ar ticle 6.2 of the DSU, does not nullify, or render 
inapplicable, the specific requirements of Article 6.2 of the DSU in disputes brought under the Anti-Dumping 
Agreement.  In our view, there is no inconsistency between Article 17.5 of the Anti-Dumping Agreement and 
the provisions of Article 6.2 of the DSU.  On the contrary, they are complementary and should be applied 
together.  A Panel request made concerning a dispute brought under the Anti-Dumping Agreement must 
therefore comply with the relevant dispute settlement provisions of both that Agreement and the DSU.  Thus, 
when a "matter" is referred to the DSB by a comp laining party under Article 17.4 of the Anti-Dumping 
Agreement, the Panel request must meet the requirements of Articles 17.4 and 17.5 of the Anti-Dumping 
Agreement as well as Article 6.2 of the DSU".  (emphasis added) 
30 Appellate Body Report on Canada – Autos , paras. 150-155. 
31 Appellate Body Report on EC – Bananas III , para. 220 
32 WT/DS285/2, para. 2. 
33 Appellate Body Report on EC – Bananas III, paras. 145-147. WT/DS285/R 
Page B-9 
 
 
the other hand, the issue of whether or not the complaining party has established a prima facie  case of 
violation:   
"Thailand argues that 'a panel may only accept the mere listing of a particular article 
as sufficient if absolutely no prejudice was possible during the course of the proceedings.'  According to Thailand, "t his would be the case only where (1) a panel 
found that the complainant had failed to present a prima facie case and thus the 
adequacy of the defence was irrelevant or (2) a panel did not reach the claims under the listed articles because it decided the case solely on claims properly described in 
the request." We are concerned here that Thailand is blurring the distinction between, 
on the one hand, the sufficiency of the Panel request and, on the other, the issue of 
whether or not the complaining party establishes a prima facie  case of violation of an 
obligation imposed by the covered agreements.  We recall that "there is a significant 
difference between the claims identified in  the request for the establishment of a 
panel, which establish the panel's terms of reference under Article 7 of the DSU, and 
the arguments supporting those claims, which are set out and progressively clarified 
in the first written submissions, the rebu ttal submissions and the first and second 
panel meetings with the parties."34  Article 6.2 DSU does not relate directly to the 
sufficiency of the subsequent written and oral submissions of the parties in the course of the proceedings, which may develop the ar guments in support of the claims set out 
in the Panel request.  Nor does it determine whether or not the complaining party will 
manage to establish a prima facie  case of violation of an obligation under a covered 
agreement in the actual course of the pane l proceedings.  To the extent that the 
requests by Thailand under Article 6.2 DS U relates to whether or not Poland 
established a prima facie  case of violation of the relevant provisions, we examine this 
below."
35 (emphasis added)  
40. In accordance with this jurisprudence, the qu estion of whether or not Antigua and Barbuda 
has established its prima facie  case is independent of, and must be considered separately from, the 
question of whether the Panel request meets the requi rements of Article 6.2 of the DSU.  Given that 
Antigua and Barbuda has two sets of written submi ssions and two panel hear ings to convince the 
Panel that it has established a prima facie case, we cannot accept the Unite d States' request that we 
conclude at this early stage of the Panel's proceedi ngs that Antigua and Barbuda has failed to make its 
prima facie  demonstration that the measures listed in the Annex to its Panel request are inconsistent 
with the United States' obligations under the GATS Agreement. 
41. The above rulings are without prejudice to the Panel's right to further elaborate and develop 
its findings on these issues having heard all partie s and third parties on the substantive aspects of 
Antigua and Barbuda's claims. 
                                                      
34 Appellate Body Report on EC – Bananas III , para. 141. 
35 Panel Report on Thailand –H-Beams , para. 7.43. WT/DS285/R 
Page B-10  
 
4. Adjustment of Panel's Timetable 
42. In light of the above, we request that the Un ited States file its first written submission by 
Friday, 7 November 2003 and its executive summary by Friday, 14 November 2003.  Third parties' 
submissions will be due on Friday, 14 Novemb er 2003 with executive summaries of these 
submissions due on 21 November.  As a consequence of the changes to the tim etable that result from 
the US request for preliminary rulings, it is necessar y to postpone the first substantive meeting with 
the parties.  Due to the panelists ' commitments, the first panel meeti ng with the parties will take place 
on 10, 11 and 12 December 2003.  The rebuttals of  the parties will be due on Friday, 9 January 2004 
and the second panel meeting will take place on 26 and 27 January 2004.  A revised calendar was 
attached. 
      [signed:  B.K. Zutshi, Chairman of the Panel] 
 B. A
RGUMENTS OF THE PARTIES  
1. Arguments of the United States 
43. Having reviewed the first submission of Antigua, the United States  requests the Panel to 
make preliminary rulings on the following issues, pursuant to paragraph 11 of the Panel's working 
procedures:  (i) the items cited as "measures" in  Section III of the Annex to the panel request36 are not 
in fact "measures" within the meaning of Article 6.2 of the DSU, and are therefore not within the 
terms of reference of the Panel;  and (ii) Antigua 's request for establishment of the Panel improperly 
included certain measures that were not the subject of  consultations.  In addition to these requests, the 
United States wishes to bring to the Panel's attention the fact that Antigua's first submission fails to 
establish a prima facie  case of WTO inconsistency with respect  to any specific US measure.  Instead, 
Antigua bases its claim on a proposition about the eff ect of one or more unspecified measure(s) from 
among the hundreds of items listed in the Annex to  its panel request.  For the reasons explained 
below, this approach cannot form the basis for a prima facie  case.   
44. Concerning the first issue raised in paragr aph 43, the United States argues that, among the 
numerous items challenged by Antigua are several items in Section III of the Annex to its panel 
request, labelled "other ... actions or measures," th at do not constitute "measures."  Consequently, the 
United States requests that the Panel find that these pa rticular items are beyond its  terms of reference.  
A "matter" referred to the DSB consists of one or more "specific" measure(s), together with one or 
more legal claims relating to such measures.37  A panel with standard te rms of reference may only 
examine this matter, i.e. , claims relating to a "measure" in the panel request.  For something to be a 
measure for purposes of WTO dispute settlement, it mu st "constitute an instrument with a functional 
life of its own" under municipal law – i.e., it must " do something concrete, inde pendently of any other 
instruments."38  For example, a  Panel recently found that a US government "policy bulletin"  did not 
constitute a measure that could be  challenged in WTO dispute settlement proceedings because, in and 
of itself, it was not a legal instrument that operates on its own.39 
                                                      
36 WT/DS285/2. 
37 DSU Article 6.2.  See also Appellate Body Report on  Guatemala – Cement I,  para. 72. 
38 Panel Report on US – Corrosion-Resistant Steel Sunset Review , para. 7.119, citing  US – Export 
Restraints,  para. 8.85 ("In considering whether any or all of the measures individually can give rise to a 
violation of WTO obligations, the central question that mu st be answered is whether each measure operates in 
some concrete way in its own right. By this we mean th at each measure would have to constitute an instrument 
with a functional life of its own,  i.e., that it would have to do something concrete, independently of any other 
instruments, for it to be able to give rise independently  to a violation of WTO obligations." (original emphasis)); 
US – Steel Plate,  para. 7.23 (finding that a challenged practice "lacks independent operational status";  Panel 
Report on US – Section 129(c)(1) URAA,  note 89 (discussing US – Export Restraints ). 
39 Panel Report  on US – Corrosion-Resistant Steel Sunset Review , para. 7.125.  See also Panel Report 
on US – Section 301 Trade Act , para. 7.133 (finding that the US Statement of Administrative Action WT/DS285/R 
Page B-11 
 
 
45. The United States notes that Antigua's panel request cites several press releases as measures.40  
These press releases are self-evidently informational in character and are merely designed to inform 
and educate the public about actions taken by offici als.  They do not in themselves have any force 
under US law,41 and therefore do not constitute "measures" under the DSU.  The same is true of a 
Michigan Gaming Control Board web page cited by Antigua.42  This web page (consisting of a 
"Frequently Asked Question" section) conveys in formation to the public, but does not have any 
independent legal status under US law.  The site provides an answer to a question designed to inform 
the public about laws relating to Internet gambli ng. The answer lacks any independent operational 
status under municipal law.  On the contrary, it me rely describes how state and/or federal law would 
operate.  As such, this website does not constitu te a measure under the DSU.  The United States 
submits that Antigua's panel request also cit es an opinion of the Kansas Attorney General43 as a 
measure.  This opinion is an interpretation of the la w applicable to Internet gambling provided by the 
Attorney General and Deputy Attorney General in 19 96 at the request of a State Senator.  In Kansas, 
as in other states, Attorney General opinions are not legally binding.44   The opinion states on its face 
that it is merely "our opinion" and does not presu me to have any independe nt legal status under US 
municipal law.  Therefore it does not constitute a measure under the DSU.  The same reasoning 
applies with even greater force to the two web pages of Attorney Generals' offices in Kansas and 
Minnesota cited as measures by Antigua in its panel request.45  The two documents are similar.  Each 
one "sets forth the enforcement position" of the Atto rney General.  An "enforcement position" is at 
best a non-binding guide to the public about the attitude that state officials are likely to take in future 
prosecutions.  The two statements are comparable in this respect to the "policy bulletin" that the panel 
in US – Corrosion-Resistant Steel Sunset Review  found was not a "legal instrument" that could 
"operate independently from other legal instruments," and therefore could not be challenged in WTO 
dispute settlement proceedings.46  As mere policy statements or position papers, these documents lack 
independent legal status beyond the laws upon whic h they rely, and therefore cannot be measures 
under the DSU. 
46. The United States further notes that Antigua's panel request cites two judicial opinions as 
measures.47  The operational status of a judicial opi nion under US municipal law flows from the 
                                                                                                                                                                     
accompanying the Uruguay Round  Agreements Act "could be considered not as an autonomous measure of the 
Administration determining its policy of implementing Section 304, but as an important interpretative element 
in the construction of the statutory language of Section 304 itself."). 
40 Florida Attorney General, Press Release: Western Union Cuts Off Sports Betting Accounts  
(December 23, 1997); New York Attorney General, Press Release: Ten Banks End Online Gambling With 
Credit Cards-Spitzer Hails Establishment of New Banking Industry Standard  (February 11, 2003); New York 
Attorney General, Press Release: Agreement Reached with Paypal to Bar New Yorkers from Online Gambling-
Campaign Against Illegal Gambling Web Site in New York Continues  (August 21, 2002); New York Attorney 
General, Press Release: Financial Giant Joins Fight Against Online Gambling- Leading Credit Card Issuer 
Agrees to Block Key Internet Transactions , June 14, 2002. 
41 See Appellate Body Report on US – Certain EC Products , para.73 (finding that statements by US 
officials in a press release did not "in and of themselves" allow the Appellate Body to determine the legal 
relationship between two measures). 
42 Michigan Gaming Control Board, Frequently Asked Questions: Is it Legal to Gamble Over the 
Internet in Michigan?  The site states that "all forms of gaming are illegal in Michigan except those specifically 
permitted under Michigan law" and directs the public to "[c]ontact the Michigan Atto rney General's Criminal 
Division (517/334-6010) for more information." 
43 Kansas Op. Att'y Gen. No. 96-31 (25 March 1996). 
44 See Kansas Ass'n of Public Emplo yees v. Public Employee Rel. Bd.,  13 Kan. App. 2d 657, 660; 778 
P.2d 377, 379 (Court of Appeals of Kansas 1989) ("Attorney general opinions, of course, are not binding on the 
courts."). 
45 Kansas Attorney General, Internet Gambling Warning ; Minnesota Attorney General, Statement of 
Minnesota Attorney General on Internet Jurisdiction . 
46 Panel Report on US – Corrosion-Resistant Steel Sunset Review , paras. 7.125 and 7.126. 
47 United States v. Cohen , 260 F.3d 68 (2nd Cir. 2001);  Vacco ex rel. People v. World Interactive 
Gaming Corp., 714 N.Y.S.2D 844, 854 (N.Y. Sup. Ct. 1999).  WT/DS285/R 
Page B-12  
 
measure interpreted and applied, a nd from the scope of the court's authority.  The opinions of a US 
court of competent jurisdiction are binding as to the parties to the dispute only.  They may also have 
value as precedent in future decisions – but opinions of courts inferior to the US Supreme Court have 
such value only with respect to the same court and lower courts within the scope of the originating 
court's authority.
48  The United States submits that, while the Panel may consider the two opinions 
cited by Antigua in order to help determine the mean ing of the US laws they interpret (to the extent 
that those laws are within the scope of this di spute), these opinions are not "measures" under the DSU 
for purposes of this dispute.  In conclusion, the Un ited States requests that the Panel make preliminary 
rulings finding that the items discussed above are not  "measures" within the meaning of Article 6.2 of 
the DSU, and that therefore these items are not  within the Panel's terms of reference. 
47. With respect to the second issue raised in pa ragraph 43, the United States argues that Antigua 
requested establishment of a panel for three measures that were not the subject of consultations:  Article I, Section 9 of the New York Constituti on; Article VI, Section 22 of the Rhode Island 
Constitution; and Sections 18-10-101 to 18-10- 108 of the Colorado Revised Statutes.  These 
provisions were not cited in An tigua's consultations request,
49 were not discussed during the 
consultations, and are unrelated to any of th e measures and purported measures cited in the 
consultations request.  A Member may not request th e establishment of a panel with regard to just any 
measure; rather, it may only file a panel request w ith respect to a measure that was consulted upon.50  
Article 4.4 of the DSU provides that a request for c onsultations must state the reasons for the request 
"including identification of the measures at issue and an indication of the legal basis for the 
complaint" (emphasis added).  In this case, there is no dispute that Antigua failed to include the cited 
provisions in its request for consultations.  Antigua  did include different citations to the New York 
Constitution, the Rhode Island Constitution, and th e Colorado Revised Statutes in its request for 
consultations, but those citations  were, by Antigua's own admissi on, wholly irrelevant and/or 
nonsensical.  
48. The United States notes that Antigua attempts to  characterize the different citations in its 
request for consultations as "nothing but typogra phical errors" and argues that, based on the context 
and the subject matter of the errone ously cited provisions (voting rights and the right to bear arms), "it 
should have been clear" to the United States what th e correct citations were.  Contrary to Antigua's 
implication, many of the items listed in the Annex to Antigua's consultations request are unrelated to 
cross-border gambling, and have not been "correct ed" in Antigua's panel request.  They include, 
among others, laws against dogfighting51 and bullfighting;52 laws against bribery,53 cheating,54 and 
                                                      
48 The United States notes that the U.S. v. Cohen  case cited by Antigua was decided by the United 
States Court of Appeals for the Second  Circuit.  The Second Judicial Circ uit, of which the United States Court 
of Appeals for the Second Circuit is th e highest court, consists of only the federal courts within the states of 
New York, Connecticut and Vermont, including the federal district and bankruptcy courts for the Southern, 
Northern, Eastern and Western Districts of New York, the District of Connecticut and the District of Vermont.  
The Vacco v. World Interactive Gaming  case cited by Antigua was decided by the Supreme Court of New York, 
New York County.  Under New York's ju dicial system, the Supreme Courts ar e courts of original instance, not 
courts of appeal.  Their opinions thus have very limited precedential value. 
49 WT/DS285/1/Add.1. 
50 See Appellate Body Report on  US – Certain EC Products,  para. 70 (finding that an action "not 
formally  the subject of the consultations" was, for that r eason, not a measure at issu e in the dispute and not 
within the Panel's terms of reference (original emphasis)). 
51 See Georgia Code § 16-12-37. 
52 See Iowa Code § 725.11. 
53 See, e.g., Arkansas Statutes § 5-66-115 (prohibiting br ibery of participants in sporting events); 
California Penal Code §§ 337b through 337e (same); Georgia Code §§ 16-12-33 and 16-12-34 (same); 
Massachusetts General Laws, Chap ter 271, §§ 39 and 39A (same). 
54 See, e.g., California Penal Code §§ 337u through 337z; Delaware Code §§ 1470 and 1471; Maryland 
Code, Criminal Law, § 12-109; Massachusetts General Laws, Chapter 271, §§ 12 and 32; Ohio Revised Code 
§ 2915.05; Oregon Revised Statutes § 167.167; Virginia Code § 18.2-327; Washington Revised Code §§ 9.46.196 through 9.46.1962. WT/DS285/R 
Page B-13 
 
 
drugging of racing animals;55 and a state statute making it illegal to dispose of a refrigerator without 
first removing the door.56  In any event, the ability of a party to predict changes in the measures cited 
in the request for consultations is irrelevant.  Th e request for consultations is not a guessing game.  
Antigua indisputably failed to request consultations on Article I, Section 9 of the New York 
Constitution; Article VI, Section 22 of the Rhode  Island Constitution; and Sections 18-10-101 to 
18-10-108 of the Colorado Revised Statutes.  Therefor e, the United States requests that the Panel find 
that the measures cited for the first time in Antigua 's panel request are outsi de the Panel's terms of 
reference. 
49. Finally, the United States argues that Antigua failed to offer a prima facie  case regarding 
specific US measures.  After listing hundreds of statutory provisions, and other items, as possibly 
being among the challenged measures in its panel re quest, Antigua states that, in its view, "[t]he 
subject of this dispute is the total prohibition on the cross-bord er supply of gambling and betting 
services ."  While appearing to accept that this "total pr ohibition" is comprised of particular "laws or 
regulations," Antigua has neither quoted, attached , nor argued the meaning of any such law or 
regulation.  Instead, Antigua asserts that "there is no need to conduct a debate on the precise scope of 
specific United States laws and regulations."  It fu rther states that "[t]he precise way in which this 
import ban is constructed under United States law" – allegedly thr ough one or more of the measures 
and purported measures listed in its panel request  – "should not affect the outcome of this 
proceeding."  So long as Antigua refuses to id entify specific measures as the subject of its prima facie  
case, the United States submits that Antigua has established no prima facie  case with respect to any 
measure.  As explained above, it is well established that a "matter" refe rred to the DSB consists of one 
or more "specific" measure(s), together with one or more legal claims relating to such measures.57  A 
panel with standard term s of reference may only examine this matter, i.e. , claims relating to the 
"specific" measures included in a panel request. 
50. The United States argues that Antigua, as the complaining party, bears the burden of 
identifying the specific me asures as to which it asserts violations of WTO provisions.  Even under the 
minimal requirements applicable to a panel requ est, a panel has recently found that "[d]ue process 
requires that the complaining party fully assume the burden of identifying the specific measures under challenge" so that the opposing party does not bear  the burden of determining what measures are or 
are not at issue.
58  If this much is required of the panel request, due process clearly requires no less 
specificity with respect to identif ication of specific measures that ar e the subject of the complaining 
party's prima facie  case.59  The complaining party bears this burden, and cannot shift it to the 
responding party – as Antigua is explicitly seeking to do here.60  Antigua must make it clear what 
specific measures are at issue in this dispute. 
                                                      
55 See, e.g., California Penal Code §§ 337f through 337h; Vermont Statutes title 13, § 2153. 
56 Massachusetts General Laws, Chapter 271, § 46 (imposing a fine for failure to remove doors from 
discarded refrigerators). 
57 DSU Article 6.2.  See also Appellate Body Report on  Guatemala – Cement I,  para. 72. 
58 Panel Report on Canada – Wheat Exports and Grain Imports, para. 24. 
59 The United States notes that the Appellate Body clarified in India – Patents (US) that parties may not 
be deliberately vague regarding their claims and factua l allegations, including what specific measures are at 
issue.  ("All parties engaged in dispute settlement under the DSU must be fully forthcoming from the very beginning both as to the claims involved in a dispute and as to the facts relating to those claims."  Para. 94). 
60 The United States recalls that Antigua and Barbuda states that the United States is "better positioned 
than Antigua to coherently construe its own laws".  Th e United States notes that, if necessary, it will address the 
burden of proof issue further in its first submission.  For the moment, the United States simply notes that the 
Appellate Body has previously clarified that a party making a claim of WTO inconsistency regarding another 
party's municipal law "bears the burden of introducing evidence as to the scope and meaning of such law to substantiate that assertion."  Appellate Body Report on US – Carbon Steel , para. 157.  WT/DS285/R 
Page B-14  
 
51. United States submits that Antigua's proposition regarding a "total prohibition" is not itself a 
measure.
61   As explained above, the term "measure" refe rs to something that has a "functional life of 
its own" under municipal law.62  Under US municipal law, Antigua's "total prohibition" assertion has 
no functional life.  For example, US authorities c ould not prosecute a service provider by alleging a 
violation of the "total prohibition."  Prosecutors mu st rely on some specific law, such as the federal 
statute relied upon in the U.S. v. Cohen  case cited in Antigua's panel request.63 
52. United States submits that it raised this c oncern many times with Antigua, including during 
consultations and at the DSB meetings at which Antigua requested establishment of a panel.  The 
United States, and indeed the third parties, w ould suffer prejudice if Antigua were allowed to 
substitute a general proposition for specific measur es in this dispute.  Because Antigua has not 
identified the specific measures that are the subject of its prima facie  case, the United States has not 
been able to prepare its defense; it simply does not know which specific US measures of the hundreds 
listed by Antigua are being challenged.  Moreover,  without knowing the specific measures at issue 
and how such measures are allegedly violating WTO rules, the third parties will confront the same 
difficulties as the United States in presenting their view s to the Panel.   Finally, Antigua must not be 
permitted to hide behind the excuse that US law is supposedly too complex and opaque; Antigua and 
its two outside law firms are certainly capabl e of identifying and attempting to establish a prima facie  
case as to specific measures if they choose to do so.64 
53. In the interest of providing for a construc tive first panel meeting and ensuring a full 
opportunity to respond to any claims that Antigua ma y wish to make regarding specific measures, the 
United States requests that the Panel invite Antig ua to make a further submission, identifying the 
specific measures at issue from the Annex to its pa nel request and presenting arguments with respect 
to these measures, before 29 October 2003, the date the US first written submission is currently due. 
If the Panel agrees and if Antigua accepts this invi tation, the United States requests that the Panel 
adjust its timetable so that the US first submission would be due four weeks after receipt of Antigua's 
supplemental submission (duplicating the time in itially provided between Antigua's first written 
submission and that of the United States).  This is  because ample time will be required for the United 
States to respond to any arguments Antigua may wish to advance regarding specific measures in a supplemental submission.  Moreove r, there is potentially a large number of measures at issue, 
including sub-federal measures; as the United States  noted during the Panel organizational meeting, 
consultations with sub-federal entities are required by US law in preparing the defence of specific 
sub-federal measures.  Since Antigua has done nothing  thus far to shed light on the specific measures 
that are the subject of its prima facie  case, the United States will require sufficient time to prepare its 
submission, pursuant to Article 12.4 of the DSU. 
                                                      
61 The United States notes that Antigua makes much  of the supposed agreement between the parties 
about the existence of a "total prohibition."  It relies in this regard on the United States' statement at the 24 June 
DSB meeting, where the United States stated that it had "made it clear th at cross-border gambling and betting 
services are prohibited under US law" and that such serv ices "are prohibited from domestic and foreign service 
suppliers alike" (WT/DSB/M/151).  The United States submits that this statement does not relieve Antigua of its 
responsibility, as the complaining party, to state which specific measures are at issue and to make a prima facie  
case of a WTO violation as to each measure identified. 
62 See above footnote 38. 
63 See United States v. Cohen,  260 F.3d 68, 71 (2nd Cir. 2001) ("Cohen was arrested in March 1998 
under an eight-count indictment charging him with conspiracy and substantive offences in violation of 18 
U.S.C. § 1084."). 
64 The United States recalls that an official of the US Department of Justice was flown in for 
consultations with Antigua in Geneva on 30 April 2003, for the purpose of explaining to Antigua and its outside 
counsel in some detail various US laws relating to gambling.   In addition to this explanation, the United States 
notes that Antigua appears to have no shortage of other expertise on US gambling law, since it was able to 
devote more than 18 pages of its first written submissi on to explaining the various forms of gambling it alleges 
to be authorized under US law.  The United States therefore finds it curious that Antigua should profess itself unable to cope with the supposed "complexity and opacity" of US laws restricting gambling. WT/DS285/R 
Page B-15 
 
 
54. The United States proposes that, should Antigua state that it does not intend to make any 
arguments with respect to any specific measures, th ere would be no need for the Panel to adjust the 
timetable to provide for a supplemental submission.  In this regard, the United States further requests 
that Antigua be invited to state, no later than  24 October 2003, whether it will make a supplemental 
submission, so that the United States can know in advance if its first written submission will still be 
due on 29 October.  In the event Antigua confirms that it will not file this further submission, the 
United States would request that the Panel make a preliminary ruling to find that all the measures and 
purported measures listed in the Annex to Antigua's  panel request are no longer at issue in this 
dispute.  This ruling would ensure that the United States is not prejudiced and deprived of due process 
by having the WTO-consistency of specific measure s raised at some later stage of the proceedings, 
when the US and third parties will not have a fu ll opportunity to respond to Antigua's claims with 
respect to these specific measures.65  
55. In conclusion, he United States requests that th e Panel make preliminary rulings finding that:  
(i) the items discussed above are not "measures" with in the meaning of Article 6.2 of the DSU;  and 
(ii) the measures cited for the first time in Antigua 's panel request are outsi de the Panel's terms of 
reference.  The United States also requests that the Panel invite Antigua to make a further submission 
presenting any arguments it wishes to advance with re spect to specific measures listed in the Annex to 
its panel request; and that the Panel make a prelim inary ruling – if Antigua chooses not to make this 
further submission – that all the items listed in th e Annex are no longer at issue in this dispute. 
2. Arguments of Antigua 
56. Antigua argues that, overall the approach of the United States represents the starkest possible 
of contrasts to the principles of WTO dispute settlement as stated by the Appellate Body.66  The points 
raised at this stage by the United States are unfair,  they are far from prompt and will, if accepted, lead 
to the most ineffective means of resolving this tr ade dispute.  The US argument that it cannot prepare 
its defence is a transparent attempt to delay this  proceeding and extend the timetable, while at the 
same time, it should be noted, the United States is aggressively attempting to destroy the Antiguan 
gambling and betting industry through a number of law enforcement and other actions.67   
57. On 30 April 2003 the United States and Antigua held consultations in Geneva.  The only 
explanation regarding US gambling law given by the United States on that occasion was that, whilst a number of the laws listed in the request for consulta tions did not relate to the cross-border supply of 
gambling, such cross-border supply was in any even t unambiguously prohibited by United States law.  
On 8 May 2003, Antigua sent a letter to the United St ates offering to enter into further consultations.  
Importantly, in the 8 May communication, Antigua stated, among other things: 
"In any event, the debate about the speci fic scope and nature of the individual 
measures has become much simpler, if not moot, because the US team explained that the provision of cross-border gambling and betting services is always unlawful in the entire US in whatever form.  Thus we thi nk it is no longer relevant to continue the 
debate about the impact or the applicabilit y of specific measures.  What matters in 
                                                      
65 Panel Report on US – Steel Plate , para. 7.28 (finding that allowing a party to resurrect a claim after 
stating that it would not pursue the claim would "deprive  other Members participating in the dispute settlement 
proceeding of their full opportunities to defend their interest with respect to that claim"). 
66 "[The] procedural rules of WTO dispute settlement are designed to promote, not the development of 
litigation techniques, but simply the fair, prompt and effective resolution of trade disputes." Appellate Body 
Report on US –FSC , para. 166;  and Appellate Report on Thailand –H-Beams , para. 97. 
67 Antigua notes that, at the end of September 2003, the United States subpoenaed so-called "internet 
portal sites" and other media companie s because they carried advertisements  for cross-border gambling services. 
Prior to doing so the United States Department of Justice had sent letters to media companies warning them not 
to cooperate with "offshore" gaming operators.  (US Depart ment of Justice, Letter to the National Association of 
Broadcasters, dated 11 June 2003). WT/DS285/R 
Page B-16  
 
terms of WTO law is the effect of one or more measures and, in that regard, you have unambiguously told us that the provision of these types of services from Antigua and 
Barbuda to persons in the US is unlawful in the US." 
58. Antigua notes that, in May 2003 the United States  apparently did not consider this point 
worthy of further discussion.
68 Since then Antigua has unambiguously repeated this approach to the 
United States' general prohibition.69  During this same period the United States has unambiguously 
repeated that it prohibits all cross-border gambling.70 Furthermore the United States has prosecuted 
and incarcerated an individual for operating a licensed Antiguan gambling and betting company71 and 
has taken a number of steps to prevent the use of  credit cards and other financial instruments and 
transactions in connection with access by United St ates consumers to gambli ng and betting services 
located in other countries such as Antigua.72  Clearly, the United States considers such services illegal 
and has made public statements and ta ken actions consistent with that.  In that context, for the United 
States now to claim inability to respond to the ar guments of Antigua based upon ignorance of its own 
measures is simply not credible.73 
59. Antigua notes that the United States argues, with regard to the "specific measures" issue, that 
it "has raised this concern many times with Anti gua, including during consultations and at the DSB 
meetings at which Antigua requested establishment of  a panel." This is incorrect.  The United States 
                                                      
68 On 28 May the United States (only on being asked by Antigua) confirmed that it was "in the process 
of drafting a response".  On 5 June Antigua receive d the following two paragrap h response from the United 
States:   
Thank you for your letter of May 8, 2003, suggesting a continuation of consultations in the matter of 
[US – Gambling].   
The United States appreciates the written explanation of your views on the issues referred to in your 
letter and the further explanation of your views on the interpretation of the United States services 
schedule.  We recall that the United States provided its views on these issues during the consultations 
held with your delegation in Geneva on April 30, 2003.  While the United States would be willing to 
meet again in Geneva with the representatives of your government, we believe that we have already 
presented our position on the points raised in your letter of May 8, 2003.  We note that it is the consistent view of the US Justice Department that internet gambling is prohibited under US law. 
69 In Antigua's panel request of 12 June 2003, at the DSB meeting of 24 June 2003 (WT/DSB/M/151, 
para. 44), at the DSB meeting of 21 July 2003 (WT/DSB/M/153, para. 46), during the organisational meeting with the panel on 3 September 2003 and in Antigua's first submission of 1 October 2003. At the DSB meeting of 
21 July 2003 Antigua also stated its willingness to "try to answer any specific questions that the United States 
might have, just as it would welcome a US detailed and written explanation of what it did not understand about 
its panel request." (WT/DSB/M/153, para. 46) 
70 At the DSB meeting of 24 June 2003 the United States' representative stated that "[j]ust as 
importantly, the United States had made it clear that cr oss-border gambling and betting services were prohibited 
under US law" (WT/DSB/M/151, paragraph 47); at the DSB meeting of 21 July 2003 the United States' 
representative stated that: "it was also clear that these services were prohibited under US law"  
(WT/DSB/M/153, para. 47). See  also the letter dated 11 June sent by the US Department of Justice to the 
National Association of Broadcasters, dated 11 June 2003, referred to in footnote 67. 
71 See United States v. Cohen,  260 F.3d 68 (2nd Cir. 2001). 
72 See the discussion in para. 3.80 of this Report and Press Release by the New York Attorney General 
(dated 21 August 2002), at http://www.oag.state.ny.us /press/2002/aug/aug21a-02.html, visited on 23 September 
2003 and the Assurance of Discontinuance  signed between the New York A ttorney General and Paypal Inc. 
dated 16 August 2002. 
73 Antigua notes that it is noticeable that, while the United St ates complains about the fact that some of 
the (deliberately misinterpreted – see para. II.B.2.65 below) references in the Annex to the panel request also 
regulate other matters than cross-border gambling services  (such as refrigerator disposal), it makes no attempt to 
explain why exactly it is that the numerous references to laws that do clearly prohibit the provision of cross-
border gambling and betting services, combined with the text of the panel request, Antigua's first submission 
and other communications by Antigua, do not allow it to pr epare its defence.  The only legal defence that the 
United States has raised with Antigua until now is that its GATS Schedule does not cover gambling and betting 
services.  Antigua does not see how the issues raised in the Request could have an impact on the development of that argument. WT/DS285/R 
Page B-17 
 
 
has raised other procedural issues regarding the "measures" (see below paragraphs 3.78 to 3.80).  
Until submitting its request for preliminary rulings, the United States has at no point stated that it cannot understand Antigua's claim in th e absence of further explanation of  that claim as it relates to 
each individual law.  If the United States had done so , Antigua would have addressed this issue in its 
first submission.  With respect to the US assertion th at Antigua has not submitted sufficient "proof" to 
establish a prima facie  case that each individual law listed in the Annex to its panel request effectively 
prohibits the provision of cross-border gambling se rvices, Antigua submits that the United States 
accepts that the total prohibition of cross-border ga mbling exists.  In view of its explanation of United 
States v. Cohen  applying the Wire Act,
74 the United States clearly also accepts that at least one 
specific law in the Annex to Antigua's panel request (i.e . the Wire Act) prohibits provision of cross-
border gambling services.  A report from the GAO confirms this for other specific United States laws 
mentioned in the Annex to the panel request.75  Furthermore the United Stat es has yet to dispute that 
most of the laws cited in the Annex to the panel re quest do in fact relate to the prohibition of cross-
border gambling and betting services (it only claims that some do not, and only on the basis of a 
deliberate misreading of the references to these laws).76  In this respect Antigua submits that to the 
extent that "proof" is an issue here, Antigua has in any event established a prima facie case with 
regard to the measures listed in its panel request that come within the scope of this dispute (i.e . those 
that do relate to the cross-border supply of gambling and betting services).77 
60. Antigua submits that it is doubtful that anyone  could compose a definitive list of all United 
States laws and regulations that could be applied ag ainst cross-border gambling.  The reason for this is 
that United States law with regard to this issue is itself unclear and Antigua is certainly not the only 
party with some difficulty in understanding the US le gal system as it relates to the provision of cross-
border gambling and betting services.  As the Unit ed States' own General Accounting Office has 
stated: 
"Internet gambling is an essentially borderless activity that poses regulatory and 
enforcement challenges.  The legal framewo rk for regulating it in the United States 
and overseas is complex.  US law as it applies to Internet gambling involves both 
state and federal statutes."78 
61. There is also significant debate within the United States legal community as to the exact 
nature of the United States' prohibition on the supply of cross-border gambling and betting services.79  
Further, there is even disagreement among courts in the United States on the precise interpretation of 
                                                      
74 See above para. II.B.1.51 and footnote 63. 
75 United States General Accounting Office, Internet Gambling: An Overview of the Issues  (GAO-03-
89), December 2002, page 11. See also  the letter from the Department of Justice of 11 June 2003 to the National 
Association of Broadcasters, re ferred to in footnote 67. 
76 Antigua notes in this regard that the seemingly i rrelevant statutes delineated in para. II.B.1.48 above 
are, in point of fact, included within a "range" of statut es that otherwise relate to gambling and betting activity.  
It is an accepted method of citation in United States law to include a "range" of related statutes even if the range 
includes repealed or irrele vant statutes as well. 
77 Antigua's panel request explicitly states that:  "T he measures listed in the Annex only come within 
the scope of this dispute to the exte nt that these measures prevent or can  prevent operators from Antigua and 
Barbuda from lawfully offering gambling and betting services in the United States under conditions of 
competition compatible with the United States' obligations." 
78 United States General Accounting Office, Internet Gambling: An Overview of the Issues  (GAO-03-
89), (December 2002), p. 3. 
79 See Jeffrey R. Rodefer, Internet Gambling in Nevada.  Overview  of Federal Law Affecting Assembly 
Bill 466  published on 18 March 2003 on the website of the Department of Justice of Nevada 
(www.ag.state.nv.us), pp. 8-13 in the co ntext of the Wire Act.  In the article the author notes "(…) there is a 
secondary debate ongoing about whether the definition of  'wire communication facility' is limited to telephone 
companies."  Ibid., p. 13. WT/DS285/R 
Page B-18  
 
United States laws on this issue.
80  This lack of clarity of US la w confronted Antigua with a dilemma 
when it drafted its panel request.  If it were to have listed the Wire Act only there is little doubt that, at 
the stage when the United States needed to implement any reco mmendations and rulings resulting 
from this dispute, the United States would have ta ken the position that it needed only to disapply or 
adapt the Wire Act and could conti nue to apply other laws because these would have been outside the 
terms of reference of the Panel.  This concern has b een vindicated by the fact  that the United States 
now adopts a very similar formalistic  and obstructive approach in the request for preliminary rulings.  
It was for these reasons – as well as the oft-repeated  statements by the United States that it prohibits 
all cross-border gambling and betting services – that Antigua determined to challenge the general 
prohibition of cross-border gambling and betting servi ces that effectively exists  in the United States 
whilst at the same time making a serious and good faith effort to identify specific measures after 
conducting a detailed investigation of an arcane area  of United States law.  In doing so Antigua has 
already done more than can reasonably be expect ed of a complainant in WTO dispute settlement 
proceedings.81   
62. Antigua also rejects the US argument that, pursuan t to its terms of reference, the Panel would 
be obliged to investigate separately the impact of  each specific law listed in the Annex to Antigua's 
panel request.82  Antigua finds it difficult to see how – mu ch less why – the Panel would go about 
assessing "separately" the specific impact of each of the 93 legislative prohibition measures listed in 
the Annex to Antigua's panel request.  Such an approach would be unnecessary, cumbersome, 
repetitive, time consuming and would not serve to e nhance the legitimate rights of the defence (other 
than by simply frustrating the effectiveness of WT O dispute settlement).  To require Antigua and the 
Panel to spend time and effort in analysing exac tly how the US measures operate and interact in 
practice given the unambiguous legal position of the United States regarding th e services at issue, 
would be patently absurd.  In any event, the te rms of reference for the Panel are determined by 
Antigua's panel request and Antigua is not aware of  any provision or doctrine of WTO law that would 
prevent the Panel from investigating in aggregate the impact of a series of specific measures that all 
have the same effect, i.e. prohibition.  The Panel should note that, in relation to this argument the 
United States incorrectly states that: "Antigua refu ses to identify specific measures as the subject of 
its prima facie  case."  As stated in paragraph 61 above, notwithstanding the difficult nature of doing 
so,  Antigua has made a serious and good faith effort  to identify specific measures in the Annex to its 
panel request.83   
                                                      
80 See with regard to the Wire Act, the discussion in United States General Accounting Office, Internet 
Gambling: An Overview of the Issues  (GAO-03-89) (December 2002), p. 13. 
81 Antigua is of the view that, putting the threshold even higher will make WTO dispute settlement 
virtually unmanageable for all but the largest WTO Me mbers – for instance in cas es involving a complex 
domestic legal background against a WTO Member the laws of which are not generally available in English (or 
another language that is widely understood across the worl d).  In such a situation an obligation to first conduct a 
detailed investigation of all these laws, even when the WTO Member at issue does not deny the alleged impact 
of its legislation, could take years and would serve no purpose. 
82 See para. 49 above. 
83 For instance, Antigua's panel request identifies 18 U.S.C. §§ 1081, 1084.  As the United States points 
out itself in footnote 63 above this statute was used to convict Mr Jay Cohen in the United States v. Cohen  case 
also cited in the panel request.  Mr Cohen was convicted because he worked for an Antiguan supplier of 
gambling and betting services.  The panel request also mentions 18 U.S.C. § 1952 (the "Travel Act") and 18 
U.S.C. § 1955 (the "Illegal Gambling Business Act") wh ich according to the United States General Accounting 
Office "have been used to prosecute gambling entities that take interstate or international bets over the telephone and would likely be applicable to Internet gambling activity".  With regard to these three laws, see also the letter 
of 11 June 2003 from the United States Department of Justice to the National Association of Broadcasters 
mentioning "Sections 1084, 1952 and 1955 of Title 18 of the United States Code".  Antigua has further listed the specific measures of individual states that are desc ribed as follows by the GAO: "Some states have taken 
specific legislative actions to address Internet gambling, in some cases criminalizing it and in others relying on 
existing gambling laws to bring actions against entities engaging in or facilitating Internet gambling"  GAO, Internet Gambling, op. cit., page 11. WT/DS285/R 
Page B-19 
 
 
63. With respect to the US argument that certain "items" listed in Section III of the Annex to 
Antigua's panel request are not "measures" that ca n be investigated under the DSU, Antigua maintains 
that, since the measures listed in Section III of the Annex are based on the legislative provisions listed 
in Sections I and II of the Annex,84 they are in any event covered in that capacity. In Antigua's view it 
does not really matter whether the measures lis ted in Section III "do something concrete, 
independently of any other instruments" or whethe r these are taken into account by the Panel "to help 
determine the meaning of US laws."  In fact, acti ons by criminal enforcement authorities (such as the 
ones listed in Section III of the Annex) could very  well be classified under both categories. What 
matters is that the United States maintains and en forces a total prohibition on cross-border gambling 
(and this is clearly the case).  In this respect An tigua suggests that the Panel utilise its discretion to 
exercise judicial economy and to decide this cas e without ruling whether measures such as the ones 
listed in Section III of the Annex are "measures" that  can be the subject of WTO dispute settlement.   
64. In case the Panel nevertheless wants to address this issue, Antigua refers back to the 
discussion in paragraph 3.77 of this report.  Anti gua would add only that the four press releases and 
related documents from Attorneys General are obvious ly not included in the panel request as press 
releases but because they d escribe the measures, i.e.  the prosecution actions (on which little or no 
other official information is publicly available).   
65. Antigua rejects the US argument that Antigua 's panel request improperly includes measures 
that were not the subject of consultations and not es it has already responded to this argument in 
paragraph 3.78 of this report .  The United Stat es simply ignores these arguments and the Appellate 
Body ruling in Brazil – Aircraft85 referred to by Antigua in its first submission.  Antigua notes the 
United States' reference to the Appellate Body Report in US – Certain EC Products .86  Antigua 
submits, however, that whether or not a measure that  was not formally part of consultations can be 
included in a panel request depends on the specifi c circumstances of each case.  In this instance 
Antigua believes this to be possible (as did the Appellate Body in the circumstances at issue in Brazil 
– Aircraft ). As in Brazil – Aircraft , the parties in this instance have  in fact consulted on the gambling 
prohibition in the New York Constitution, the R hode Island Constitution and the Colorado Revised 
Statutes (because the parties consulted on the to tal prohibition of the provision of cross-border 
gambling and betting services of which these measures form  a part).  Antigua further submits that the 
typing errors that were corrected for the New York Constitution, the Rhode Island Constitution and 
the Colorado Revised Statutes are different from the al legedly incorrect referenc es to laws against dog 
fighting and other irrelevant laws which the United States mentions in paragraph 14 of the Request.  
The latter are instances where these non-gambling rela ted provisions are include d within a "range" of 
statutes that otherwise relate to gambling and betting activity.  It is an accepted method of citation in 
United States legal writing to include a "range" of re lated statutes even if the range includes repealed 
or irrelevant statutes. When the United States sugg ests that the references to these "range" statutes 
complicate its understanding of Antigua's claim it is merely being disingenuous. 
66. In conclusion, Antigua believes it is not n ecessary to submit a supplemental submission as 
suggested by the United States.  Nevertheless, were the Panel to decide that it would like a further 
submission from Antigua on the issues raised by the United States (or on other issues), Antigua 
requests that the Panel allow Antigua to submit this on a date to be determined by the Panel, but not to 
delay the 29 October 2003 due date fo r the United States' first submission.87  Antigua further requests 
that the Panel dismiss the request for preliminary rulings on the three issues  raised by the United 
States in the Request.  
                                                      
84 Antigua submits that this is explicitly confir med by the United States in para. II.B.1.52. 
85 Appellate Body Report on Brazil – Aircraft . 
86 Appellate Body Report on US – Certain EC Products . 
87 Antigua notes that the United States cites as a justification for delay its need to hold "consultations 
with sub-federal entities (…) required by US law (…)."  However, under the applicable federal statute, these 
state-federal consultations were to have been initiated no later than seven days, and to have been actually held 
within 30 days, after the re quest for consultations from  Antigua was received.  S ee 19 U.S.C. §3512(b)(1 )(C). WT/DS285/R 
Page B-20  
 
C. A
RGUMENTS OF THE THIRD PARTIES88 
1. Arguments of the European Communities 
67. The European Communities notes that the United States first challenges the qualification as 
"measures", within the meaning of Article 6.2 of the DSU, of certain documents referred to in 
Section III of Antigua and Barbuda's panel request.  These are:  press releases;  the replies of a 
gaming control board of a State of the United States  to "Frequently Asked Qu estions";  opinions and 
statements of Attorneys General of States part of the United States;  and judicial decisions of US Courts.  The European Communities recalls that in  its request for panel establishment, Antigua and 
Barbuda distinguishes between, on the one hand, Sec tion I and II of the Annex, and, on the other 
hand, Section III thereof.  In respect of Section I and II, Antigua claims that "these laws (separately or 
in combination) have the effect of prohibiti ng all supply of gambling and betting services from 
outside the United States".  By contrast, it qualifi es the documents listed in Section III as "examples 
of measures by non-legislative authorities of the Un ited States applying these laws to the cross-border 
supply of gambling".  There is therefore some ambiguity as to whether the purpose of these references is more an exemplifying and clarifactory one than a list of further measures in their own right.  Also, 
the issue raised by the United States is strictly connected with the substance of the case, which is 
legally and factually rather complex.  As such, it is not suited for adjudication through a summary 
preliminary ruling proceeding brought under Article 6.2 of the DSU.   
68. For the case the Panel considers that the US cl aim needs to be addressed at this stage, the 
European Communities would offer the following consid erations.  Article 6.2 of the DSU is a general 
provision regulating the content of requests for pane l establishments for virtually the entirety of the 
WTO provisions.
89  As such, it must be able to be read in such a way that it does not restrict the 
content of any of the provisions in the covered ag reements.  The term "measure" in Article 6.2 cannot 
be read any narrower than covering any action that  can amount to a violation of a WTO provision.  
Article 6.2 is meant to apply to the whole of the WTO Agreement .  Otherwise, it would risk unduly 
reduce the scope of obligations in other provisions of the covered agreements.  Thus, for example, 
several WTO provisions use the term "measure" or "requirement" and have been interpreted in 
previous reports.  All those generally suggest a broa d reading of the term "measure", in particular as 
to the form that measures can take.  In particular , since there is a specific definition to measures for 
GATS purposes in Article XXVIII of the GATS any inte rpretation of the term "measure" that is 
narrower than the definition laid down therein would amount to restricting the scope of Article XXVIII, and of the entire GATS with it.
90  This would amount to diminishing the rights and 
obligations of the Members under the WTO Agreement , contrary to Article 3.2 of the DSU.  
69. Moreover, the range of WTO Members' action that can come within the purview of dispute 
settlement review is even broader than that resu lting from Article XXVIII of the GATS.  For example, 
violations can result not only from a particular "i nstrument", but also from an omission (e.g. the 
failure to publish trade-related legi slation, regulations, judicial decisions and administrative rulings of 
general application, contrary to Article X:1 of  the GATT 1994).  Also, Article XXIII:1(c) of the 
GATT 1994 allows complaints to be brought based on th e existence of "any other situation" (that is, 
other than (a) the failure to comply with a WT O obligation and (b) nullification or impairment 
resulting from a measure whether or not in violation of the GATT).  Such complaints are still possible 
and generally governed by the DSU, including Ar ticle 6.2, pursuant to Article 26.2 thereof.  
Therefore, any interpretation of the term "measure" in Article 6.2 would be overly restrictive if it 
would risk preventing examination of such type of  complaints on grounds that it is not allowed by 
Article 6.2. 
                                                      
88 Canada, Mexico and Chinese Taipei  informed that Panel that they would not submit their views on 
US request for preliminary rulings. 
89 According to the European Communities, a notable exception is Article 17.4 of the Anti-Dumping 
Agreement  (see Appellate Body Report in Guatemala – Cement I,  para. 14). 
90 Pursuant to its Article I:1, the GATS "applies to  measures by Members affecting trade in services". WT/DS285/R 
Page B-21 
 
 
70. The European Communities argues that, in many of these cases, the standard the US proposes 
(i.e. that a measure within the meaning of Article 6.2 must "constitute an instrument with a functional 
life of its own" under municipal law – i.e., it must " do something concrete, inde pendently of any other 
instruments."91) would not allow a panel to review th e violation of these provisions.  The US 
references to WTO "jurisprudence" under the Anti-Dumping Agreement92 are in any way of no 
relevance, as they relate to a special and a dditional rule to the DSU (Article 17.4 of the Anti-Dumping 
Agreement ) and not the general standard set out in Article 6.2.   
71. The European Communities emphasizes that it is  not arguing that the term "measure" in 
Article 6.2 is devoid of any autonomous meaning compared to, for example, the provisions of the covered agreements.
93  For one thing, Article 6.2 could be relied upon by a panel to decline full 
examination of a dispute in some manifest cases: wh ere, for example, the alleged measure referred to 
in a panel request was not even attributable to a body of a WTO Member (e.g., a policy statement of a 
non-governmental organization).  Furthermore, it is  clear from Article 6.2 that it is necessary to 
identify a specific measure.  Finally, should the Pa nel decide to review the documents that the US 
challenges under this claim and should it further conclude that some of them do not constitute 
"measures" within the meaning of Article 6.2 of the DSU, its conclusion should not have any bearing 
on the evidentiary relevance that they may have to  review whether Antigua and Barbuda's claim is 
overall well founded.  Indeed this ac tivity pertains to the Panel's review of the substance of the case.  
72. Turning to the US second claim that certain provisions of three US measures (New York 
Constitution; Rhode Island Constitutio n; Colorado Revised Statutes) are outside the Panel's terms of 
reference because they do not appear in Antigua  and Barbuda's request for consultations under 
Article 4 of the DSU,94 the European Communities understands that these measures and the specific 
provisions thereof referred to by the United States are properly referenced in Antigua and Barbuda's 
request for panel establishment, and that the refere nces to those specific provisions in the request for 
panel establishment replaced refere nces to other provisions of the same measures contained in the 
request for consultations.  The issue raised by the Un ited States must be appreciated in the light of the 
purpose of consultations and the request therefor, the purpose of Article 6.2 of the DSU, and more 
generally the nature and function of  dispute settlement procedures.   
73. The European Communities submits that, in co nnection with the first aspect, a very clear 
indication has been provided by the Appellate Body in Brazil – Aircraft :95 
"[W]e do not believe, however, that Articles 4 and 6 of the DSU, or paragraphs 1 to 4 
of Article 4 of the  SCM Agreement, requi re a  precise and exact identity  between 
the specific measures that were the subject of consultations and the specific measures 
identified in the request for the establishmen t of a panel.  As stated by the Panel, 
'[o]ne purpose of consultations, as set forth in Article 4.3 of the SCM Agreement, is 
to 'clarify the facts of the situation', and it can be expected that information obtained 
during the course of consultations may enable  the complainant to focus the scope of 
the matter with respect to which it seeks establishment of a panel." 
74. The European Communities fully  agrees with the approach and the conclusions of the 
Appellate Body and would add that they apply a fortiori  in a case, like the present one, where the 
measures are the same in both the request for consulta tions and in the request for panel establishment.  
It appears to the European Comm unities that the only provisions of, e.g., the New York Constitution 
that could have been the subject of consultations  are those relating to restrictions on betting and 
gambling.  It would thus be absurd if, while An tigua and Barbuda continues to rely on the same 
                                                      
91 See above para. II.B.1.44. 
92 See above footnote 38. 
93 Appellate Body Report on US – Gasoline , p. 23. 
94 See above para. II.B.1.47. 
95 Appellate Body Report on Brazil –Aircraft , para. 132 (footnotes omitted). WT/DS285/R 
Page B-22  
 
measure  as it indicated in its request for consultations , the Panel would be barred by Article 6.2 from 
reviewing the consistency of that measure with the WTO provisions relied upon by the claimant.  
Furthermore, the purpose of consultations has to be co ntrasted with that of the panel request, which is 
to define the scope of the Pane l's terms of reference, and to notify the responding party and third 
parties of the complainant's case.
96  It is in view of that different function that "[d]efects in the request 
for the establishment of a panel cannot be "cured" in  the subsequent submissi ons of the parties during 
the panel proceedings".97  But, again, Antigua and Barbuda's request for panel establishment does 
include not only the relevant specific measures, but also the specific provisions thereof referred to by 
the United States.  
75. The European Communities also wishes to reca ll how the role of the parties in dispute 
settlement procedures was very effectively characterized by the Appellate Body in US – FSC :98 
"Article 3.10 of the DSU commits Members of the WTO, if a dispute arises, to 
engage in dispute settlement procedures 'i n good faith in an effort to resolve the 
dispute'.  This is another specific manifest ation of the principle of good faith which, 
we have pointed out, is at once a general pr inciple of law and a principle of general 
international law.  This pervasive princi ple requires both complaining and responding 
Members to comply with the requirements of the DSU (and related requirements in other covered agreements) in good faith. By  good faith compliance, complaining 
Members accord to the responding Members the full measure of protection and opportunity to defend, contemplated by the letter and spirit of the procedural rules.  The same principle of good faith requires that responding Members seasonably and 
promptly bring claimed procedural deficiencies to the attention of the complaining 
Member, and to the DSB or the Panel, so th at corrections, if needed, can be made to 
resolve disputes.  The procedural rules of WTO dispute settlement are designed to 
promote, not the development of litigation t echniques, but simply the fair, prompt and 
effective resolution of trade disputes." 
76. The European Communities notes in this conn ection that, whereas it must be acknowledged 
that the United States raised th is issue before the DSB, it should be equally acknowledged that 
Antigua and Barbuda promptly offered to enter into further clarifactory contacts.
99  There is therefore 
no question that the United States was fully enabled to effectively defend itself.   
77. With respect to the US assertion that Antigua  did not make a prima facie case because 
"Antigua has neither quoted, attached, nor argued the meaning of any such law or regulation", the 
European Communities considers that  this issue is concerned with the substance of the dispute and 
indeed the very core of dispute settlement proceedin gs.  As such, it is not suitable for a preliminary 
ruling issued on a summary proceeding basis such as the present one, relying on Article 6.2 of the 
DSU, but needs to be addressed by the Panel throughout the (full) proceeding.100  Otherwise, parties 
would be denied the benefit of full panel review of  complex legal and factual matters such as the ones 
at issue in this dispute, with clear due process im plications.  A panel has a duty to make an objective 
assessment of the facts.  That assumes a fully in formed assessment.  Acco rdingly, the European 
Communities reserves the right to further comment on th is substantive aspect of the dispute in its third 
party submission and at the third party session of the Panel's first substantive meeting. 
                                                      
96 In this sense, Appellate Body Report on Brazil – Desiccated Coconut , page 22;  Appellate Body 
Report on US – Carbon Steel , paras. 125-126. 
97 Appellate Body Report on US – Carbon Steel , para. 127. 
98 Appellate Body Report on US – FSC , para. 166. 
99 WT/DSB/M/153, paras. 43 and 46. 
100 The European Communities is of the view that the United States confuses the jurisdictional aspect, 
regulated by Article 6.2 of the DSU, with the substantive aspect for example in footnote 61 above.  The 
European Communities agrees with the United States that Antigua and Barbuda is not relieved from its burden of making its prima facie  case; but this is, precisely, the core substantive issue. WT/DS285/R 
Page B-23 
 
 
78. The European Communities submit s that the US clai m that Antigua and Barbuda has not 
made a prima facie  case also seems to assume that a claimant is precluded from doing so beyond a 
particular point in time (presumably the filing of its first written submission, as in the present case).  
Such assumption would be clearly incorrect.101  What is more, inasmuch as the United States relates 
its claim that Antigua and Barbuda has not made a prima facie  case to the obligation to identify 
specific measures set out in Article 6.2 of the DSU,  its argument is also incorrect and should be 
rejected.  First of all, Antigua and Barbuda has cl aimed that there is a prohibition of all supply of 
gambling and betting services from outside the United States to consumers in the United States.102  
Second, in the Annex to its request for panel est ablishment it has identified a number of specific 
measures.  There is therefore a po ssibility for the other parties to  understand the subs tance and basis 
of the complaint, and for the responding party speci fically to rebut the legal qualification of these 
measures made by Antigua and Barbuda. 
79. The European Communities considers that the ve ry fact that the United States is able to 
discuss the nature of the documents cited to in th e Annex to Antigua and Ba rbuda's request for panel 
establishment shows that it is perfectly able to iden tify them.  There is therefore no prejudice to the 
parties concerned, which is a factor that needs to be considered in appreciating whether a violation of 
Article 6.2 has been committed.103  The fact that a violation of WTO provisions may result from 
multiple measures of a WTO Member – for example, a bundle of trade defence measures – may render litigation more complex, but is not a reason fo r a panel to decline jurisdiction under Article 6.2 
of the DSU.   
2. Arguments of Japan 
80. Concerning the US claim that several items ci ted in the request for the establishment of a 
panel by Antigua and Barbuda do not  constitute "measures" provided for in Article 6.2 of the DSU, 
and thus are beyond the Panel's te rms of reference, Japan does not  wish to prejudice the Panel's 
decision on the specific items in question, nor is in  a position to comment on the factual aspects of the 
current proceeding. Nevertheless, Japan cannot agree with the argument presented by the United 
States that relies on the Panel's finding in US – Corrosion-Resistant Steel Sunset Review .  Although 
the Panel in US – Corrosion-Resistant Steel Sunset Review  found that the "Sunset Policy Bulletin" 
was not a measure that in and of itself gave rise to a WTO violation, this finding is now under review 
by the Appellate Body.  Japan, as specified in its notice of appeal104, is requesting the Appellate Body 
to reverse this finding of the Panel.  Therefore, Japan reiterates its disagreement with the finding of 
the Panel in US – Corrosion-Resistant Steel Sunset Review  on this issue, and submits that the Panel on 
US – Gambling  should disregard this erroneous finding. 
81. With respect to the US claim that Antigua and Barbuda's first submission states that the 
subject of the current proceeding is the total pr ohibition on the cross-border supply of gambling and 
betting services without specifying laws and regulati ons comprising such total prohibition, and that, 
because Antigua and Barbuda "refused" to iden tify specific measures as the subject of its prima facie  
case, it failed to establish a prima fa cie case with respect to any measure, Japan submits that the 
United States appears to be confusing two totally sep arate matters.  Japan believes that the question of 
whether Antigua and Barbuda has successfully established a prima facie  case is a substantive one, and 
thus, should not be subject to pr eliminary rulings of the Panel. 
                                                      
101 See e.g. Appellate Body Report on Korea – Dairy , para. 145, and the reference therein to Appellate 
Body Report on India – Quantitative Restrictions , para. 143. 
102 WT/DS285/2, para. 2. 
103 Appellate Body Report on Korea – Dairy , paras. 126-127 (referring to Appellate Body Report on EC 
– Computer Equipment , para. 70). 
104 "The Panel erred in its legal conclusions in paras. 7.145, 7.195, and 7.246 of the Panel Report, and 
the reasoning leading thereto, that the Sunset Policy Bulle tin, … cannot, by itself, give rise to a WTO violation, 
and is therefore not a measure challengeable under the WTO Agreement as such."  WT/DS/244/7, sub-para. 4. WT/DS285/R 
Page B-24  
 
82. Japan notes that, as the United States itself admi ts, a panel's preliminary rulings on the 
specificity of measures relate to due process rights of  defence.  In contrast, as the Appellate Body 
found in US – Wool Shirts and Blouses , the party asserting the affirmative of a particular claim or 
defence establishes a prima facie  case by adducing evidence sufficient to raise a presumption that 
what is claimed is true, and "precisely how much and precisely what kind of evidence will be required 
to establish such a presumption will necessarily vary from measure to measure, provision to 
provision, and case to case."
105  Panel's deliberations on this matter are of important substantive nature 
and form the basis of its findings of consistency/in consistency of the measures in question with the 
WTO Agreement.  Consequently, the question of wh ether or not Antigua and Barbuda has established 
a prima facie  case is independent of, and must be separate d from, the question of whether or not the 
United States' due process rights are affected by the alle ged lack of specificity.  Even if the Panel were 
to find that the identification of the measures by Antigua and Barbuda is not sufficiently specific, it would only be a finding of a violation of Article 6. 2 of the DSU, and would not have any other legal 
effect. 
 
_______________ 
 
 
                                                      
105 Appellate Body Report on US –Wool Shirts and Blouses, p. 14. WT/DS285/R 
Page C-1 
 
 
ANNEX C 
PANEL'S QUESTIONS TO THE PARTIES 
 
 Note 
 This Annex contains the questions posed by the Panel and written answers provided by the 
Parties during the first (Section I) and second (S ection II) substantive meetings, as well as the 
questions posed to the Third Parties during th e first substantive meeting and their answers 
(Section IV).  
 The Panel expressly invited each Party to reply to  questions posed to the other Party, if it so 
wished, as well as to questions posed to the Third Par ties.  At the first meeting, Third Parties were 
also invited to reply to questions posed to the Parties (Section I).   Moreover, with respect to the questions posed  at second substantive meeting, each Party was 
invited to comment on the responses provided by the other Party.  These comments are reproduced in 
Section III of this Annex.  
I. PANEL'S QUESTIONS TO THE PART IES AT THE FIRST SUBSTANTIVE 
MEETING 
A. US
 SCHEDULE  
For both parties: 
1. What is the legal status and value of the 1993 Scheduling Guidelines and  W/120 in 
WTO dispute settlement proceedings and to what extent are they relevant for the 
interpretation of GATS Schedules where no explicit reference to the CPC is contained in those Schedules? 
Antigua 
 
 Pursuant to Article 31 of the Vienna Conve ntion, the 1993 Scheduling Guidelines circulated 
by the Secretariat during the Uruguay Round negotiations106 and the W/120 represent important tools 
to the interpretation of Members' schedules unde r the GATS.  Whether or not a GATS schedule 
contains explicit references to the CPC has no impact on the interpretative value of the 1993 
Scheduling Guidelines and W/120 as determined pursu ant to Article 31 of the Vienna Convention. 
  The 1993 Scheduling Guidelines are part of the context  of the GATS and GATS schedules 
because they are an "instrument" made in conn ection with the conclusion of the treaty as per 
Article 31(2) of the Vienna Convention.  Admitte dly the 1993 Scheduling Guidelines were technically 
not "made" by "one or more parties" but by  the then GATT Secretariat.  However, the 1993 
Scheduling Guidelines explicitly mention that they we re "circulated by the S ecretariat in response to 
requests by participants."  At the time of the Uruguay Round negotiations they were also accepted by 
all parties as a basis for the drafting of services sch edules.  This was explicitly confirmed when the 
Council for Trade in Services unanimously adopte d new scheduling guidelines in 2001 (the "2001 
Scheduling Guidelines"
107), footnote 1 of which states that:  "[I]t should be understood that schedules 
in force prior to the date of this document have been drafted according to MTN.GNS/W/164 and 
                                                      
106 MTN.GNS/W/164 (3 September 1993). 
107 S/L/92 (28 March 2001). WT/DS285/R 
Page C-2  
 
MTN.GNS/W/164/Add.1).  Against this backgro und Antigua submits that the 1993 Scheduling 
Guidelines cannot be disqualified as "context" si mply because their formal author is the GATT 
Secretariat and not a Member of the World Trade Organisation (the "WTO").
108  The purpose of treaty 
interpretation under Articles 31 and 32 of the Vienna  Convention is to identify the common intention 
of the parties.109 Articles 31 and 32 of the Vienna Convention should be applied with that objective in 
mind and not literally.110  What is important in determining whether an instrument, such as the 1993 
Scheduling Guidelines, expresses the common  intention of the parties is whether it is accepted by all 
the parties, not whether its formal author is one of the parties.  Antigua further submits that the 2001 
Scheduling Guidelines comprise a subsequent agreement  between the parties (as per Article 31(3) of 
the Vienna Convention) regarding the interpretati on of existing schedules in the light of the 1993 
Scheduling Guidelines.  As mentioned above, footnote 1 of the 2001 Scheduling Guidelines 
(unanimously approved by the Council for Trade in Services) provides that:  "It should be understood 
that schedules in force prior to the date of this document have been drafted according to 
MTN.GNS/W/164 and MTN.GNS/W/164/Add.1."  
 Antigua believes that W/120 qualifies as part of the context of the GATS and GATS 
schedules for two primary reasons:  (i) W/120 is inco rporated by reference in the Dispute Settlement 
Understanding ("the DSU") of the WTO (Article 31(2)  of the Vienna Convention);  and (ii) W/120 is 
an instrument made in connection with the c onclusion of the treaty and accepted by all parties 
(Article 31(2)(b) of the Vienna Convention).  Furthe rmore there exists a subsequent agreement within 
the meaning of Article 31(3)(a) of  the Vienna Convention and subse quent practice within the meaning 
of Article 31(3)(b) of the Vienna Convention confirming the interpretative value of W/120. 
  According to Article II:2 of the Marrak ech Agreement Establishing the World Trade 
Organization (the "WTO Agreement"), the GATS, th e DSU and the other multilateral and plurilateral 
agreements are integral parts of the WTO Agreement.  Article 31(2) of the Vienna Convention defines 
context as (amongst others) the text of the treaty, including its preambles and annexes.  Thus the DSU 
qualifies as context for the interpretation of the GA TS (and vice-versa) because they are both part of 
the same treaty—the WTO Agreement.  Article 22( 3)(f)(ii) of the DSU explicitly refers to W/120 to 
define "sector" of trade for purposes of suspension of concessions.  In doing so it incorporates W/120 by reference in the DSU.  As a part of the DSU, W/120 is context of the GATS and the US Schedule, which itself is an integral part of the GATS under Article XX:3 of the GATS. 
 
 W/120 further qualifies as "context" because, like the 1993 Scheduling Guidelines, it is an instrument made in connection with the conclusi on of the GATS under Article 31(2)(b) of the Vienna 
Convention.  The Montreal Ministerial of Decemb er 1988 explicitly requested the GATT Secretariat 
to compile a "reference list of sectors."
111 W/120 was the result of this exercise and it follows from the 
1993 Scheduling Guidelines and the reference to W/ 120 in the DSU that all Members accepted W/120 
as a starting point, a "reference list" for the drafting of their GATS schedules.112  The common 
intention of the parties (expressed in the 1993 Sche duling Guidelines) allowed a party to depart from 
                                                      
108 Antigua is of the view that neither can the 1993  Scheduling Guidelines be disqualified because they 
state that they "should not be consid ered as an authoritative legal interpre tation of the GATS" (See I. Sinclair, 
The Vienna Convention  on the Law of Treaties , (Manchester University Press, 1984), pp. 129-130. 
109 Appellate Body Report on EC – Computer Equipment ,  para. 84. 
110 See, e.g ., I. Sinclair, Vienna Convention, at pp. 117-118:  "In their commentary the Commission 
refer to the rich variety of principles and maxims of inte rpretation applied by international tribunals.  They point 
out that these are, for the most part, principles of logic and good sense which are valuable only as guides to 
assist in appreciating the meaning which parties may have intended to attach to the expressions employed in a document; and that recourse to many of these principles is discretionary rather than obligatory, interpretation 
being to some extent an art ra ther than an exact science." 
111 MTN.TNC/7(MIN), Part II. 
112 With regard to the issue that W/120 was "mad e" by the GATT Secretariat and not by a party, 
Antigua submits that the argumentation developed on this issue with regard to the 1993 Scheduling Guidelines 
equally applies to W/120. WT/DS285/R 
Page C-3 
 
 
that "reference list," provided it did so explicitl y.  Paragraph 5 of the US Draft Final Schedule 
confirms that the United States explicitly s ubscribed to this "common intention."  
  The 2001 Scheduling Guidelines comprise a subsequent agreement confirming the 
interpretative value of the 1993 Scheduling Guidel ines.  The 1993 Scheduling Guidelines explicitly 
establish W/120 as the "default" reference list for Uruguay Round Schedules.  Thus, by confirming 
the interpretative value of the 1993 Scheduling Gu idelines the 2001 Scheduling Guidelines have also 
confirmed the interpretative value of W/120.   A "subsequent practice," within the meaning of  Article 31(3)(b) of the Vienna Convention, 
exists establishing the agreement of  the WTO Members regarding the interpretative value of W/120.  
Since the entry into force of the GATS, Member s have consistently referred to W/120 as the 
classification used for GATS purposes and as the main  point of reference for any discussion on the 
classification of services.  This includes the Un ited States' own communication to the WTO on 
Classification of Energy Services
113 and the USITC Document.  
 
 As explained above, the reasons why the 199 3 Scheduling Guidelines and W/120 qualify as 
important interpretative factors within the mean ing of Article 31 of the Vienna Convention for all 
GATS schedules, are not related to references to th e CPC.  Thus the absence or presence of explicit 
references to the CPC in a specific schedule can have  no impact on the legal status and interpretative 
value of the 1993 Scheduling Guidelines or W/120. 
 
United States 
 
 These negotiating history documents are "preparato ry work" within the meaning of Article 32 
of the Vienna Convention.114  Insofar as these documents mention the CPC, the CPC is only relevant 
to the interpretation of a particular commitment if  a Member included an explicit reference to the CPC 
in that commitment.  This is confirmed by:  (i) the text of the US Schedule (which does not include 
CPC references);  (ii) the context of the US Schedule (which shows that other schedules did include CPC references for some or all commitments, thus c onfirming that they were optional);  (iii) other 
negotiating history of the GATS (which confirms th at the parties to the GATS negotiations did not 
intend to be bound by any specific nomenclature);  and (iv) the subsequent statements of Members 
reflected in discussions in the Committee on Specifi c Commitments (which confirm that a Member 
scheduling GATS commitments during the Uruguay Round was free to choose to refer or not refer to 
the CPC; and that the result of doing so is that CPC definitions do not control the interpretation of that 
Member's commitment(s)).
115 
 Canada 
  Canada recalls the arguments made in its  Third Party written submission to the Panel.
116 
  At the outset, Canada submits that the issue be fore the Panel is to determine, in accordance 
with the rules of interpretation set out in Artic les 31 and 32 of the Vienna Convention, the common 
intention of the Members with respect to the sp ecific commitments undertaken by the United States 
and inscribed in the latter's Schedule.  That comm on intention must be ascertained by interpreting the 
US Schedule in good faith, in accordance with the ordi nary meaning to be given to the terms of the 
Schedule in their context and in the light of the object and purpose of the GATS and the WTO 
                                                      
113 Communication from the United States:  Classi fication of Energy Services.  S/CSC/W/27. 
18 May 2000. 
114 The 1993 Scheduling Guidelines expressly state that they "should not be considered as an 
authoritative legal interpretation of the GATS."  
115 See Section III.B.2 of this Report. 
116 See Section IV.A. of this Report. WT/DS285/R 
Page C-4  
 
Agreement more generally.  To th e extent appropriate, recourse ma y also be had to supplementary 
means of interpretation.   The United States clearly used and followed the structure of the W/120 to schedule its 
specific commitments.  However, its Schedule do es not include explicit references to the CPC 
numbers that, in the W/120, are associated with a pa rticular services sector or sub-sector.   This does 
not mean, as the United States suggests, that the CP C numbers associated with a particular services 
sector or sub-sector in the W/120 are irrelevant, inap plicable or to be ignored when interpreting the 
United States' specific commitments.  Rather, they form part of the context , or, alternatively, 
constitute a supplementary means of interpretation , which, in accordance with Articles 31 and 32 of 
the Vienna Convention, is relevant to interp reting and ascertaining the meaning of the specific 
commitments of the United States.   When the US Schedule is interpreted in accordance with Articles 31 and 32 of the Vienna Convention, and all the elements that are rele vant to ascertaining the common intention of the 
Members with respect to the United States' specific commitments are taken into consideration, there is 
only one reasonable conclusion: where the US Schedule mirrors the W/120, without clearly and explicitly departing from it and the corresponding CPC numbers, it must be inferred that the 
United States' specific commitments were meant and are to be interpreted in the light of the W/120 
and the CPC numbers associated with it.    
 When the United States scheduled its specific commitments, it was free to clearly reject the 
W/120 and the corresponding CPC numbers.  It did not.  On the contrary, it expressly indicated to its 
trade partners that except where specifically noted in its Schedule, the scope of the United States' 
specific commitments corresponds to the sectoral coverage in the W/120.
117  Since the W/120 defines 
sectoral coverage by referring to relevant CPC num bers, this means that, except where specifically 
noted in the US Schedule, the scope of the Unite d States' specific commitments corresponds to the 
scope of relevant CPC numbers (setting out the scope  of particular services sectors or sub-sectors) 
referred to in the W/120.  This was and is the co mmon understanding of the Members with respect to 
the specific commitments undertaken by the United States under the GATS, and it must be respected. 
  As regards more specifically the W/120, Cana da recalls its conclusion that the W/120 and the 
corresponding CPC numbers form part of the context  that, pursuant to Article 31 of the Vienna 
Convention, must be taken into account by the Pa nel when interpreting the specific commitments of 
the United States under the GATS.  In Canada's  view, the W/120 (and by implication the CPC 
numbers referred to in it) at least qualifies as an "i nstrument which was made by one or more parties 
in connection with the conclusion of the treaty and accepted by the other parties as an instrument 
related to the treaty" under Article  31(2) of the Vienna Convention.118  Indeed:  (i) the W/120 is an 
instrument; (ii) the W/120 was prepared by the GATT Secretariat at the request and for the benefit of 
Uruguay Round participants.  It was reviewed and commented upon by these countries.119  Uruguay 
Round participants used the W/120 as the genera l benchmark for the scheduling of specific 
commitments, thereby incorporating into their Schedules the W/120's nomenclature, except where 
specifically noted.  These same countries also ag reed to the use of the W/120 in the DSU.120  The  
W/120 was in effect made by Uruguay Round particip ants acting through the then GATT Secretariat – 
quite possibly the only practical and effective way to work in a concerted manner on such a complex 
matter.  In these circumstances, the W/120 can be c onsidered to have been "made by the parties" 
                                                      
117 Communication from the Un ited States of America, Draft Final Schedule of the United States of 
America Concerning Initial Commitments , MTN.GNS/W/112/Rev.3, 7 December 1993, para. 5.   
118 See Section IV.A of this Report. 
119 Ibid. 
120 DSU, Article 22(3)(f)(ii). WT/DS285/R 
Page C-5 
 
 
within the meaning of Article 31(2)(b) of the Vienna Convention121;  (iii) the W/120 was finalized in 
July 1991 and used by Uruguay Round  participants until the end of the market access negotiations.  It 
was also specifically referred to in the DSU.  It  was thus made in connection with the conclusion of 
the GATS;  and (iv) the notable fact that th e W/120 is specifically referred to in the DSU,122 which is 
one of the Multilateral Trade Agreements binding on all Members,123 necessarily establishes that it 
was accepted by all Uruguay Round participants as an instrument related to the GATS and the WTO 
Agreement.  This, in itself, invalidates the United St ates' assertion that the W/120 is only part of the 
negotiating history of the GATS and therefore cannot constitute anything more than a supplementary 
means of interpretation under Article 32 of the Vienna Convention.124   
 
 In the event that the W/120 and the corresponding CPC numbers are found not to qualify as 
"context" within the meaning of Article 31(2)  of the Vienna Convent ion, Canada submits, 
alternatively, that they do qualify, and should be referred to by the Panel, as supplementary means of 
interpretation  of the US Schedule under Article 32 of the Vienna Convention.125 
 
 In the end, what is certain is that the W/ 120 and the corresponding CPC numbers are relevant 
and ought to be considered by the Panel when interpreting the specific commitments in the US 
Schedule in accordance with the applicable rules of  interpretation set out in Articles 31 and 32 of the 
Vienna Convention.  When the US Schedule is interpreted in accordance with these rules of 
interpretation, and all the elements that are releva nt to ascertaining the meaning of the United States' 
specific commitments are taken into consideration,  the only reasonable conclusion is that where the 
US Schedule mirrors the W/120, without clear ly and explicitly departing from it and the 
corresponding CPC numbers, it must be inferred that  the United States' speci fic commitments are to 
be interpreted consistently with the W/ 120 and the CPC numbers associated with it.126   
  As regards the 1993 Scheduling Guidelines per se , they constitute a supplementary means of 
interpretation within the meaning of Article 32 of th e Vienna Convention.  Ca nada recalls that it does 
not challenge the fact that these Guidelines do not co nstitute an authoritative legal interpretation of the 
GATS.
127  Indeed, they specifically state that they are not such an authoritative legal interpretation of 
the GATS.  In any case, the authority to adopt inte rpretations of the WTO agreements, including the 
GATS, is reserved exclusively to the Mi nisterial Conference and the General Council.128  T h i s  i s  
beside the point, however.  The fact that the 1993 Scheduling Guidelines do not consist of formal 
legal interpretations of the GATS does not mean that they cannot be used to shed light on the general 
understanding of the Uruguay Round participants as  regards the scheduling of specific commitments.  
While there is no question that the 1993 Schedu ling Guidelines are not an authoritative legal 
interpretation of the GATS, there is also no questi on that, in accordance with their stated purpose, 
they assisted all Members in the preparation of  their Schedules and the listing of their specific 
                                                      
121 Canada in no way suggests that any document from , or involving the participation of, the Secretariat 
may qualify as an "instrument" or "agreement" under Article 31(2) of the Vienna Convention.  Canada argues that the W/120 qualifies as relevant "context" for the interpretation of the US Schedule based on the specific and 
unique characteristics and circumstances pertaining to that document. 
122 DSU, Article 22(3)(f)(ii).  
123 WTO Agreement, Article II:2. 
124 See Section III.B.2. of this Report.  This may also support the argument that the W/120 qualifies as 
an "agreement" within the meaning of Article 31(2)(a)  of the Vienna Convention . 
125 Canada wrote that the United States does not cont est that the W/120 may qualify as a supplementary 
means of interpretation within the meanin g of Article 32 of the Vienna Convention  (see United States' first 
written submission, para. 63).  In its argumentation, howev er, the United States simply ignores the relevance and 
application of the W/120 as such a s upplementary means of interpretation of its Schedule, and does not address 
its effect on the interpretation of its sp ecific commitments in the present case.  
126 See Section IV.A of this Report. 
127 Ibid. 
128 WTO Agreement, Article IX:2. WT/DS285/R 
Page C-6  
 
commitments.  As such, they may be used as an element that confirms other evidence of what the 
United States has done in its Schedule.   In the present case, the 1993 Scheduling Guide lines constitute one element among others that 
refutes, rather than supports, the United States ' argument that the W/120 and the corresponding CPC 
numbers are irrelevant and should be  ignored.  They are concordant with other factors demonstrating 
that, in its Schedule, the United States espoused  the W/120, and by implication the corresponding 
CPC numbers, except where specifically noted.  Th ese factors are: (i) the US Schedule generally 
mirrors the W/120;  (ii) in a number of instances, the United States did depart from the W/120 and the corresponding CPC numbers in a clear and unambiguous  manner, that is, in the manner suggested in 
the 1993 Scheduling Guidelines (and the revised 2001 Scheduling Guidelines);  (iii) in elaborating 
upon how Members may suspend concessions with resp ect to services sectors, Article 22 of the DSU 
relies on the W/120 to define these sectors;  (iv) th e cover note in draft schedules circulated by the 
United States indicating that specific commitme nts are scheduled in accordance with the W/120's 
nomenclature;  and (v) the USITC concordance.  Notwithstanding how much the United States wishes 
that it be otherwise, all these factors point to the conclusion that the US Schedule follows the W/120 
and the corresponding CPC numbers except where it explicitly diverges from them.  
European Communities 
 
 As already pointed out by the European Comm unities in its third party submission and oral 
statement, both the 1993 Schedu ling Guidelines (W/164) and the 1991 Sectoral classification (W/120) 
are documents relevant to the interpretation of  the US Schedule of specific commitments.  
Specifically, in the EC view they constitute suppl ementary means of interp retations under Article 32 
of the Vienna Convention.129 
 
 It is not necessary, for a document to be relevant  to treaty interpretation, that it be specifically 
mentioned, referred to or reprinted in the text of the treaty to be interpreted.  The Vienna Convention 
(Article 32) gives specific relevance to other docum ents too.  The United States contends that since 
there is no express reference to the CPC codes in its  Schedule, these are essentially irrelevant to the 
interpretation of its specific commitments.  Howeve r, if only documents expressly referred to were 
relevant in interpreting a treaty provision, th e very category of "preparatory works" and 
"circumstances of conclusion" would virtually di sappear.  This would mean rendering certain 
customary rules of treaty interpretation redundant.  Although neither the 1991 Sectoral classification nor the 1993 Scheduling Guidelines are meant to be a legally binding agreement or an authoritative 
interpretation, they provide important gui dance on how the WTO Members understood the 
commitments that they were negotiating.  Both docum ents were referred to or used extensively by 
negotiators.  The United States admits as much in its draft Schedules it tabled until the final phase of 
the Uruguay Round.
130 
 
                                                      
129 See Section IV.B of this Report.  The European Communities notes that reference has been made in 
this dispute to the Panel Report on US – Section 110(5) Copyright Act  WT/DS160/R, adopted 27 July 2000 to 
support the proposition that the 1991 Sectoral classification constitutes "context" within the meaning of Article 
31(2) of the Vienna Convention.  In that report (footnote 55) the panel refers to explanatory reports drawn up in 
parallel to conventions within the framework of the Coun cil of Europe.  Unlike such explanatory reports, which 
are adopted by representatives of the Council of Europe Members, the 1993 Scheduling Guidelines did not form 
the subject of adoption by the contracting parties to the GATT.   
130 Communication from the United States of America, Draft Final Schedule of the United States of 
America to the members of the Group of Negotiations on Services , MTN.GNS/W/112/Rev.3, 7 December 1993;  
Communication from the United States of America, Revi sed Conditional Offer of the United States of America 
concerning initial commitments , MTN.GNS/W/112/Rev.2, 1 October 1993; Communication from the 
United States, Schedule of the United States Concerning Initial Commitments on Trade in Services , 
MTN.GNS/W/112/Rev.4, 15 December 1993;  See also Section IV.B of this Report.   WT/DS285/R 
Page C-7 
 
 
Mexico 
 
 The 1993 Scheduling Guidelines and the W/120 constitu te part of the preparatory work of the 
GATS and the WTO Agreement.  At the very least , both thus qualify as "supplementary means of 
interpretation" pursuant to Article 32 of the Vienna  Convention.  As such, both documents can always 
be used to confirm the meaning of the United States' specific commitments resulting from the 
application of the general rule of interpretation in Article 31 of  the Vienna Convention, or to 
determine the meaning when the interpretation acco rding to Article 31 leaves that meaning ambiguous 
or obscure.  Accordingly, both documents are highl y relevant to the interpretation of the GATS 
Schedule of Specific Commitments of the United Stat es on the basis of the Vienna Convention in this 
dispute.  The fact that no explicit reference to the CPC is contained in the US Schedule has no bearing 
on this issue.  The relevant question is rather  whether the 1993 Scheduling Guidelines and document 
W/120 support the conclusion that sub-sector 10.D of the US Schedule includes a commitment on 
gambling and betting services.  Chinese Taipei 
  The 1993 Scheduling Guidelines and the W/120 do not have independent legal status within 
the WTO in the sense that they do not have any formal binding legal authority on Members.  In fact, 
the introduction to the Guidelines cl early states that the explanatory answers contained in it "should 
not be considered as an authoritativ e legal interpretation of the GATS.
131  Nevertheless, the 
documents do constitute part of the tools for the interpretation of Members' GATS Schedules, even 
where no explicit reference to the CPC is contained in  the Schedules.  To the extent that Members, in 
general, have relied on the Guidelines and the W/120 to shape their own GATS Schedules and to 
understand other Members' Schedules, they are rele vant in WTO dispute settlement proceedings.  
With regard to how the Panel should use th e 1993 Scheduling Guidelines and the W/120 as 
interpretative tools, the Separate Customs Territo ry of Taiwan, Penghu, Ki nmen and Matsu agrees 
with the third party written submission and the oral statement made by Canada.  The Appellate Body 
reasoning in EC – Computer Equipment132 that a GATT schedule is a integral part of the GATT 1994 
and is thus subject to the rules of treaty interpre tation set out in the Vienna Convention is equally 
applicable in the GATS context.  The 1993 Scheduling Guidelines and the W/120, among other 
documents, therefore form part of the context pursuan t to Article 31 of the Vienna Convention, to be 
considered when interpreting Members' GATS Schedules, and in this case, the specific GATS 
commitments of the United States.  
2. With respect to the USITC Document contained in Exhibit AB-65
133: 
(a) What is the legal status and value of this document in WTO dispute settlement 
proceedings?   
(b) How does this document compare with the US Statement of Administrative 
Action? 
(c) Can a statement by the USITC be attributed to, and bind, the United States?  
(d) With reference to the previous question,  please comment on whether Article 4 of 
the International Law Commission (ILC) Draft Articles on the Responsibility 
for States of Internationally Wrongful Acts annexed to the UN General 
Assembly Resolution of  12 December 2001 (A/RES/56/83), is of any relevance.  Article 4 provides as follows: 
                                                      
131 1993 Scheduling Guidelines, para. 1. 
132 Appellate Body Report on  EC – Computer Equipment , para. 84. 
133 Exhibit AB-65 is the USITC Document submitted by Antigua, see Section III.B.2. of this Report. WT/DS285/R 
Page C-8  
 
"1. The conduct of any State organ shall be considered an act of that 
State under international law, whether the organ exercises legislative, executive, judicial or any other functions, whatever position it holds in the organization of the State, and whatever its character as an organ of the central government or of a territorial unit of the State. 
2. An organ includes any person or entity which has the status in 
accordance with the internal law of the State."  
Antigua 
[a]& [c]: The USITC is an ag ency of the United States federa l government, created by Act of 
Congress134 and given a number of powers and respons ibilities under a number of federal statutes,135 
including the power to make rules and regulations.136  The USITC Document consists of "explanatory 
materials" produced by the USITC in connection with the US Schedule.   The USTR is also an agency 
of the United States federal government, created by Act of Congress137 and given a variety of powers 
and responsibilities under a number of federal statutes,138 including the power to make rules and 
regulations,139 the power to "utilize, with their consent, the services, personnel, and facilities of other 
Federal agencies,"140 the power and responsibility for the conduct of all international trade 
negotiations, including "any matter considered under the auspices of the World Trade Organization"
141 and, in particular, to "develop (and coor dinate the implementation of) United States 
policies concerning trade in services."142  By letter dated April 18, 1994, the USTR requested that the 
USITC take responsibility for compiling and maintain ing the US Schedule, and it has done so since 
then to the present.143 
 
 As agencies of the United States govern ment with specific responsibilities and powers, 
actions taken pursuant to those responsibilities and powers are acts of the United States.  While the 
USITC Document is an "explanation" and not sp ecifically rulemaking or regulations, nonetheless 
under United States law it is binding on the govern ment unless contrary to "governing statutes and 
regulations of the highest or higher dignity (…)."144  In the case of Fiorentino v. United States  the 
United States Court of Claims was confronted with the issue of an internal agency policy manual that 
contained terms contrary to federal law.  In th at case, the court noted that the United States 
"government is not bound by pronouncements purporte dly made in its behalf  by persons not having 
actual authority,"145 but in the case of "informal" publica tions it is necessary to examine the 
publication to "see if it was really written to fasten legal consequences on the government."146  Under 
this standard, the plain language of the USITC Document demonstrates th at it was intended to 
"facilitate comparison of the US Schedule with foreign schedules (…)" as well as to "[demonstrate] the relationships between sectors found in the US Schedule, sectors identified in the GATT Secretariat's Services Sectoral Classification List, and sectors defined and numbered in the United Nations' Provisional Central Product Classifica tion (CPC) System."  As such, it cannot be 
                                                      
134 19 U.S.C. §1330. 
135 See,  e.g., 19 U.S.C. §§1331-1339;  19 U.S.C. §2151. 
136 19 U.S.C. §1335. 
137 19 U.S.C. §2171(a). 
138 See,  e.g., 19 U.S.C. §§ 2171(c)-(f). 
139 19 U.S.C. §2171(e)(3). 
140 19 U.S.C. §2171(e)(4). 
141 19 U.S.C. §2171(c)(1)(C). 
142 19 U.S.C. §2114c(1)(A). 
143 In the period from 1994 to December 2003, the USITC has maintained, revised, amended or 
supplemented the US Schedule on at least three occasions. 
144 Fiorentino v. United States,  607 F.2d 963, 968 (Ct. Cl. 1979), cert. denied, 444 U.S. 1083 (1980).  
145 Ibid., at 967. 
146 Ibid., at 968. WT/DS285/R 
Page C-9 
 
 
contested that the USITC Document serves as an interpretative aid to the US Schedule and, as an 
official pronouncement of an agency of the Unite d States government with the power to exercise 
authority in connection with the United States' relationships with the WTO, the statement has 
significant value in this proceeding.147 
 
 Under general principles of international la w the USITC Document, made on behalf of the 
United States by an organ of government expressly de legated powers to act in the area, is binding 
upon the United States.  The USITC has, at the request of the USTR, assumed responsibility for 
"maintaining" the US Schedule.148  In the USITC Document, a public document clearly intended to 
explain the US Schedule to the world at large, th e USITC has indicated that sub-sector 10.D of the 
US Schedule corresponds to CPC category 964.  The United States has not disputed the USITC's 
interpretation until the emergence of this dispute.  It  is a fundamental rule of international law that a 
state party to a treaty has a right to designate the organ or organs of its government that are responsible for the carrying out of its responsibilities under that treaty.
149  Some treaties provide for 
this expressly.150  Other treaties rely implicitly on this rule.151  The USTR designated the USITC to 
(emphasis added): "[I]nitiate an ongoing program to compile and maintain the official  US Schedule of 
Services Commitments."152  This entails:  "[T]he compilation of an initial US Schedule reflecting the 
final services commitments in the Uruguay Round."153 
  In "maintaining," "compiling" and "explaini ng" the US Schedule, the USITC was acting on 
behalf of the United States and engaging its respon sibility under international law. Therefore, in 
interpreting the US Schedule in accordance with appli cable international law rules, the statements of 
the USITC as to the meaning of its provisions are of fundamental importance.  In addition to the 
jurisprudence under WTO law,
154 other rules of international law also support this conclusion, 
particularly:  (i) the interpretation of treaties in th e light of subsequent practice in the application of 
the treaty;  (ii) the international law principle of estoppel;  and (iii) the international law concept of 
the binding unilateral declaration.  
  The USITC Document is highly relevant subsequent practice.  It is a fundamental rule of 
international law that, whenever there is a doubt as to the meaning of a provision or an expression 
contained in a treaty, the relevant conduct of the cont racting parties in the application of the treaty has 
a "high probative value" as to the intention of  the parties at the time of its conclusion.
155  T h e  
                                                      
147 See,  e.g., Panel Report on US – Section 301 Trade Act. para. 7.112, where the panel stated with 
respect to the United States Statemen t of Administrative Action "[t]his offi cial statement in the SAA (…) is a 
major element in our conclusion (…)." 
148 USITC Document, p. vii and footnote 6 and Letter from USTR to USITC (18 April 1994). 
149 McNair, The Law of Treaties  (Clarendon Press, 1961), at p. 345.  
150 See e.g, Article 25(1) of the 1965 Convention on the Settlement of Investment Dispute between 
Contracting States and Nationals of Other Contracting States. 
151 Bilateral investment treaties, for example, prov ide for standards of treatment that will apply to 
investments embodied, inter alia , in "concession contracts" or "investment  agreements."  Once such contracts or 
agreements are concluded at any level of government, the state party will be bound to observe the treaty 
standards as regards the investments embodi ed in those contracts or agreements (see  e.g. Azurix Corp. v 
Argentine Republic  (ICSID Case No ARB/01/12); and Lanco International Inc. v. Argentine Republic  (ICSID 
Case No ARB/97/6)). 
152 Letter from USTR to USITC (18 April 1994). 
153 Ibid.  
154 See the discussion at footnote 147 above. 
155 McNair, The Law of Treaties  at p. 424.  Similarly, Rousseau has commented that: 
 
"Il arrive assez fréquemment que la jurisprudence internationale procède à l'interprétation d'un 
traité d'après l'application qui en a été faite par les Parties contractantes, cette attitude relevant 
l'interprétation qui en fait a été effectivement suivie par les auteurs du traité". ( Principes 
Généraux du  Droit International Public  (1944), pp. 704-707.) 
 WT/DS285/R 
Page C-10  
 
Permanent Court of International Just ice has applied this rule widely.
156  This rule has also been 
applied by the International Court of Justice, even  prior to the Vienna Convention, in its Advisory 
Opinion on the International Status of South-West Africa ,157 where the Court stated that:  
"[I]nterpretations placed upon legal instruments by the parties to them, though not conclusive as to 
their meaning, have considerable probative value wh en they contain recognition by a party of its own 
obligations under an instrument."  This conclusion is consistent with Article  31.3(b) of the Vienna 
Convention which provides that, in interpreting a tr eaty, account shall be taken of "any subsequent 
practice in the application of the treaty which est ablishes the agreement of the parties regarding its 
interpretation." 
 This approach should be particularly relevant  to the interpretation of a text, such as the 
schedules established under the GATS, that originates from only one of the contracting parties.158  
Furthermore, special credence should be given to s ubsequent practice of state organs that, like the 
USITC in this instance, have been given a specific role in relation to the treaty obligation at issue.159  
In the USITC Document the USITC explained how the US Schedule corresponds to the CPC.  No 
other agency, organ or official of the United States has taken a different view prior to the advent of 
this proceeding and no WTO Member has objected to  the USITC interpretation.  This absence of 
protest indicates that the WTO Members, and Anti gua in particular, have acquiesced in the USITC's 
interpretation.160  
  Further support for the binding character of the USITC interpretation of the US Schedule can be found in the international law principle of estoppel.  The doctrine of estoppel has been recognized 
and applied in many contexts by international courts and tribunals.
161  The United States, acting 
through the USITC, has consistently stated that  sub-sector 10.D of the US Schedule corresponds to 
CPC category 964.  It has done so by means of a public document intended to clarify the United States' obligations under the GATS.  The USITC's ce ntral role in the compilation and maintenance of 
                                                      
156 See,  e.g., Advisory Opinion on the Competence of the International Labour Organization with 
respect to Agricultural Labour  (1922), Series B, Nos. 2 and 3, pp. 40, 41; Advisory Opinion on the 
Interpretation of Article 3(2) of the Treaty of Lausanne  (1925), Series B, No. 12 at p.24; and Advisory Opinion 
on the Jurisdiction of the Courts of Danzig  (1928), Series B, No. 15 at p. 18. 
157 I.C.J. Reports, 1950, at pp. 128, 135. 
158 See Appellate Body Report on EC – Computer Equipment , para. 93:  "In the specific case of the 
interpretation of a tariff concession in a Schedule, the cl assification practice of the importing Member, in fact, 
may be of great importance." 
159 This approach has been endorsed by the United States Supreme Court, which has stated that:  " … 
the meaning attributed to treaty provisions by the Government agencies charged with their negotiation and 
enforcement is entitled to great weight" ( Sumitomo Shoji America, Inc. v. Avagliano , 457 U.S. 176, 184-5 
(1982), 101 ILR 570, at 576-7, citing Kolovrat v. Oregon , 366 U.S. 187, 194 (1961), 32 ILR 203, at 207). 
160 See the Case Concerning the Territorial Dispute  (Libya/Chad) , I.C.J. Reports 1994, Judgment of 13 
February 1994, separate opinion of Judge Ajibola, para. 96.  McNair has stated that "when one party in some 
public document … adopts a particular meaning, circumst ances can arise, particular ly after the lapse of time 
without any protest from the other party, in which that evidence will influence a tribunal" ( The Law of Treaties , 
at p. 427). 
161 See,  e.g., the Eastern Greenland  case, P.C.I.J. (1933), Series A/B,  No. 53 at pp. 22 and 68, where 
the Permanent Court of International Justice held th at Norway could not object to the Danish claim to 
sovereignty over Greenland because the Norwegian Minister of Forei gn Affairs had previously made a 
statement consistent with the Danish claim.  See also the Case concerning the Temple of Preah Vihear 
(Cambodia v. Thailand) , I.C.J. Reports 1962 at p. 6; El Salvador-Honduras Land, Island and Maritime 
Frontier , I.C.J. Reports 1990 at pp. 92, 118; the Case concerning the Gab číkovo-Nagymaros Project (Hungary 
v. Slovakia)  I.C.J. Reports 1997 at p. 7 (separate opinion of Judge Weer amantry at pp. 88, 115-6); the Cameroon 
v. Nigeria (Preliminary Objections)  case, I.C.J. Reports 1998 at pp. 275, 303; Amco Asia Corporation and 
Others v. The Republic of Indonesia  (Rectification), ICSID Case No ARB/81/1 (resubmitted case), 89 ILR 366 
at pp. 400-401, where the concept was described as being based on the fundamental requirement of good faith; 
and general discussion of the doctrine of estoppel at international law by Judge Ajibola in the Case Concerning 
the Territorial Dispute  (Libya/Chad) , I.C.J. Reports 1994, Judgment of 13 February 1994, at pp. 77-83. WT/DS285/R 
Page C-11 
 
 
the "official" US Schedule indicates the intention of the United States  that it should be bound by the 
USITC's statement.  Trade in gambling and betting services has in fact taken place from Antigua to 
the United States consistent with the USITC interp retation.  A binding estoppel has therefore arisen 
under international law to prevent the Unite d States from unilaterally abandoning the public 
interpretation made by the USITC to the detrimen t of other WTO Members that may have relied on 
the interpretation. 
  It is further submitted that the USITC Docume nt constitutes a unilateral declaration by the 
United States to the effect that sub-sector 10.D of the US Schedule corresponds to CPC category 964 
that is binding on, and engages the responsibility of , the United States.  As such, it creates enforceable 
rights for other WTO Members.  In  the Nuclear Tests  cases,
162 the International Court of Justice 
concluded that statements made by the French gove rnment, intended to be relied upon by other states 
as an expression of future French conduct, cons tituted an undertaking possessing legal effect.  As 
such, they were binding on, and engaged the responsibility of, France.163  Similarly, in the present 
case, the statement of the USITC constitutes a binding unilateral declaration in which other WTO 
Members are entitled to place confidence. 
  Antigua concludes that, considering the role of the USITC as the agency of the United States 
government given the responsibility for the compila tion and maintenance of the US Schedule, the 
consistency of its interpretation,
164 the lack of any inconsistent inte rpretations or statements from any 
other agency of the United States government and the absence of any protest from other WTO 
Members, the USITC Document represents an aut horitative interpretation by the United States of the 
US Schedule in accordance with applicable rules of  customary international law and Article 31 of the 
Vienna Convention.  That inte rpretation is binding on, and e ngages the responsibility of, the 
United States.  The USITC Document also comprises a binding unilateral declaration upon which other WTO Members are entitled to rely.  The United States is estopped, in its relations with WTO 
Members, from now adopting an interpretation of the US Schedule inconsistent with that of the 
USITC.   [b]: Antigua assumes the Panel's question refe rs to the SAA accompanying the Uruguay Round 
Agreements Act ("URAA").
165 According to the URAA, the SAA constitutes "an authoritative 
expression by the United States concerning the interp retation and application of the Uruguay Round 
Agreements and [the URAA] in any judicial pro ceeding in which a question arises concerning such 
interpretation or application."166  According to the SAA itself: 
 
… this Statement represents an auth oritative expression by the Administration 
concerning its views regarding the interp retation and application of the Uruguay 
Round agreements, both for purposes of US international obligations and domestic 
law.  Furthermore, the Administration understands that it is the expectation of the Congress that future Administrations will ob serve and apply the interpretations and 
commitments set out in this Statement.  Moreover, since this Statement will be approved by the Congress at the time it implements the Uruguay Round agreements, 
                                                      
162 I.C.J. Reports 1974 at pp. 253, 267; paras. 43 and 46 ( Australia v. France ) and pp. 457, 472-473; 
paras. 46 and 49 ( New Zealand v. France ). 
163 On the subject of binding unilateral declarations at international law, see  further: Case Concerning 
the Frontier Dispute (Burkina  Faso/Republic of Mali) I.C.J. Reports 1986 at pp. 554, 573-4; and Military and 
Paramilitary Activities in and against Nicaragua, Jurisdiction and Admissibility , I.C.J. Reports 1984, at pp. 392, 
418. 
164 The USITC repeated its interpretation in August 1998 when it published a second edition of the 
USITC Document. 
165 H.R. 5110, H.R. Doc 316, Vol 1, 103d Congress, 2nd Session, 656 (1994). 
166 19 U.S.C. § 3512(d). WT/DS285/R 
Page C-12  
 
the interpretations of those agreements in cluded in this Statement carry particular 
authority.
167 
 Thus the SAA qualifies as binding under interna tional law because it explicitly states it is "an 
authoritative expression" of the United States' views "for purposes of US international obligations."  Such an explicit statement, however, is not a requi rement for an interpretation to become binding on a 
country under international law.
168  In fact, countries will rarely make such explicit statements and 
even the SAA was primarily produced as a guide to the interpretation of domestic legislation169 and 
has mainly, if not exclusively, been used for th at purpose by the Appellate Body and various WTO 
panels.170  The SAA explicitly states that it was "designed to describe changes  in US laws and 
regulations proposed to implement the Uruguay Round agreements." (original emphasis).171  Before 
doing that it "briefly summarizes the most im portant provisions of the [WTO Agreements]."172  
  The concordance of industry classifications contained in the USITC Document, however, is 
exclusively concerned with the explanation and clar ification of the international obligations assumed 
by the United States in the US Schedule: 
 
To facilitate comparison of the US Schedule with foreign schedules, the USITC has developed a concordance that demonstrates the relationships between sectors found in 
the US Schedule, sectors identified in [W/120] and sectors defined and numbered in the [CPC]. 
The concordance developed by the USITC clarifies how the service sectors 
referenced in [W/120], the CPC system, and the US Schedule correspond.
 173 
In this respect Antigua submits that the USITC Document has even  higher interpretative value than 
the SAA.  [d]: The ILC Draft Articles are relevant to the question of whether or not a statement by the 
USITC can be attributed to, and bind, the United States.
174  They confirm with clarity, in relation to a 
specific context, the conclusions reached above in re lation to questions 2(a) and 2(c).  The ILC Draft 
Articles concern the premises for establishing the r esponsibility of states for their internationally 
wrongful acts.  They do not concern responsibility fo r conduct that does not constitute an international 
wrong.  However, although they represent an attemp t to codify one branch of the law of state 
responsibility, many of the principles referred to are of  broader application.  Chapter II of Part One of 
the ILC Draft Articles, entitled "Attribution of condu ct to a State," which includes Article 4, reflects 
general principles of international law capable of tr ansposition and application to the present context.  
Article 4 of the ILC Articles concerns the attr ibutability of the conduct of state organs.  It  reflects a 
                                                      
167 SAA, p. 656. 
168 See, e.g., Advisory Opinion on the International Status of South-West Africa (I.C.J. Reports, 1950, 
at pp. 128, 135), cited above; and the Case concerning  the Temple of Preah Vihear (Cambodia v. Thailand), 
I.C.J. Reports 1962 at p. 6. 
169 See also the Panel Report on US – Section 301 Trade Act , para. 7.114. 
170 See,  e.g., the Appellate Body Report on US – Corrosion-Resistant Steel Sunset Review,  the Panel 
Report on US – Export Restrains, and the Panel Report on US – Section 301 Trade Act.  
171 SAA, p. 657.  
172 Ibid., p. 656. 
173 USITC Document, p. viii. 
174 The International Law Commission is a subsidiary organ of the United Nations General Assembly.  
Although the ILC Draft Artic les have no binding force per se  at international law, they do reflect agreement 
reached by leading publicists from a variety of political and regional backgr ounds.  Given the ILC's mandate to 
codify international law, the ILC Draft Articles thus co nstitute weighty evidence of customary international law. WT/DS285/R 
Page C-13 
 
 
rule of customary international law175 that a sovereign state is responsible for the conduct of all of its 
organs, acting in that capacity, as part  of the principle of the unity of the state at international law.  
The reference to a state organ in Article 4 is extremely wide, extending beyond organs of central 
government to all kinds of state organ, whatever its functions, position or character and whatever its 
level in the state hierarchy.  The conduct of any stat e organ is therefore capable of giving rise to state 
responsibility and to this extent can bind the state to the consequences flowing therefrom.  Applying 
these general statements about the rules of state r esponsibility and attribution to the present case, the 
USITC is an organ of the United States tasked with, inter alia , the compilation and maintenance of the 
US Schedule.  Its statements of interpretation of the US Schedule therefore represent acts carried out 
in its capacity as an organ of the United States and in relation to which the United States can be held 
responsible at international law.176 
 
United States 
 The document in question is merely an "explanat ory" text prepared by an independent agency 
with no authority to negotiate or interpre t agreements on behalf of the United States.177  The document 
states that  "[t]o facilitate comparison  of the US Schedule with foreign schedules, the USITC has 
developed a concordance...."  This does not in dicate that USITC was purporting to issue an 
interpretation.   [a]:  Antigua appears to assert th at the USITC Document represents "subsequent practice" within the 
meaning of Article 31(3)(b) of the Vienna Convention.
178  Antigua is mistaken.  The Appellate Body 
has referred to such "subsequent practice" as a "discernible pattern of acts or pronouncements 
implying an agreement among WTO Members."179  Clearly explanatory materials prepared 
unilaterally by only one independent organ of one of the Members do not constitute such a pattern, 
and therefore have no particular status under the cu stomary international rules of treaty interpretation 
as reflected in the Vienna Convention. 
 
[b]:  The SAA of the URAA was prepared and subm itted with the URAA.  The function of this SAA 
is set forth in its preamble, as follows:  
This Statement describes significant administrative actions proposed to implement the Uruguay Round agreements.  In addition, in corporated into this Statement are two 
other statements required under section 11 03:  (1) an explanation of how the 
implementing bill and proposed administrativ e action will change or affect existing 
law; and (2) a statement setting forth the reasons why the implementing bill and 
                                                      
175 Difference Relating to Immunity from Legal Process of a Special Rapporteur of the Commission on 
Human Rights , 121 ILR 405, at p.432, para. 62, referring to Article 6 of the previous version ILC Draft Articles, 
now Article 4. 
176 Antigua states that for the purposes of the ILC Dr aft Articles, even if the USITC were not an organ 
of the United States, its statements of interpretation of the US Schedule would still be attributable to the United 
States by virtue of Article 5 of the ILC Draft Articles.  Article 5 deals with the conduct of bodies that are not 
state organs so as to be covered by Article 4, but th at are nonetheless authorised  to exercise elements of 
governmental authority.  The USITC has been explicitly authorised by the United States federal government to 
compile and maintain the US Schedule.  That role clearly  involves the exercise of an element of governmental 
authority in relation to the United States' WTO obligations .  The USITC's statements about the interpretation to 
be given to the US Schedule were made in that capacity and would thus be attributable to, and bind, the United 
States  by virtue of Article 5 even if the USITC were not an organ of the United States. 
177 The USITC is an independent, quas i-judicial federal agency that ad ministers U.S. trade remedy laws 
within its mandate and also provides non-binding, independent information and advice to the President and 
Congress on tariff and trade matters. 
178 The United States infers this from Antigua's reference to the document under the heading of 
"practice in the application of the treaty."  See Section III.B.2 of this Report.   
179 See Appellate Body Report on  Chile – Price Band System , para. 214. WT/DS285/R 
Page C-14  
 
proposed administrative action are necessary or appropriate to carry out the Uruguay Round agreements. 
As is the case with earlier Statements of Administrative Action submitted to the 
Congress in connection with fast-track bills, this Statement represents an authoritative 
expression by the Administration concerning its views regarding the interpretation 
and application of the Uruguay Round agreements, both for purposes of US 
international obligations and domestic law.  Furthermore, the Administration 
understands that it is the expectation of th e Congress that future Administrations will 
observe and apply the interpretations and co mmitments set out in this Statement.  
Moreover, since this Statement will be approved by the Congress at the time it 
implements the Uruguay Round agreements, th e interpretations of those agreements 
included in this Statement carry particular authority. 
 The SAA is a type of legislative history.  In  the United States, legislative history is often 
considered for purposes of ascertaining the meaning of a statute, but cannot change the meaning of, or 
override, the statute to which it relates.  It provid es authoritative interpretativ e guidance in respect of 
the statute.  The status granted to the SAA under the US system, however, is only in respect to its 
interpretive authority vis-à-vis  the statute. 
  By contrast, the USITC "explanatory" document prefatory to the copy of the US Schedule of 
Specific Commitments maintained by the USITC we re prepared only "to facilitate comparison" for 
the reader.  It is not, and does not purport to be, in  any way binding or authoritative as a matter of US 
law.  Nor has it been approved by Congress.  Mo reover, the United States notes that facilitating  
"comparison" with other documents in no way imp lies identity of meaning between the US schedule 
and such other documents.  [c]: Statements of the USITC cannot bind the Unite d States with regard to the interpretation of a 
multilateral treaty.  It is important to note that the is sue here relates to the in terpretation of a term of 
an annex to the GATS, not the meaning of US law or the legal status of the USITC.  Neither the United States (through the USITC or otherwise) nor any other Member may unilaterally adopt multilaterally binding interpretations of a term of the GATS, or any other WTO agreement. 
 [d]:  The United States does not consider that Ar ticle 4 of the Draft Articles on the Responsibility for 
States of Internationally Wrongful Acts has any rele vance to the interpretation of the US Schedule, 
the issue in this dispute.  First, the United States notes that it is not a "customary rule of interpretation 
of international law" within the meaning of Article 3. 2 of the DSU.  Second, it is inapplicable in any 
event because USITC is not purporti ng to interpret the US schedule. 
 Canada 
[a]:  The United States says that the USITC Do cument has no legal significance since the explicit 
purpose of the concordance in the document is only to "facilitate comparison of the US Schedule with 
foreign schedules."180  This statement is factually incomplete and legally incorrect.  The relevant part 
of the USITC Document reads:  
To facilitate comparison of the US Schedule with foreign schedules, the USITC has 
developed a concordance that demonstrates the relationships between sectors found in 
the US Schedule, sectors identified in th e GATT Secretariat's Services Sectoral 
Classification List, and sectors defined and numbered in the United Nations' Provisional Central Product Classification (CPC) System. In preparing national 
schedules, countries were requested to iden tify and define sectors and sub-sectors in 
                                                      
180 See Section III.B.2. of this Report.  WT/DS285/R 
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accordance with the GATT Secretariat's list [the W/120], which lists sectors and their respective CPC numbers. Accordingly, fore ign schedules frequently make explicit 
references to the CPC numbers. The US Schedule makes no explicit references to CPC numbers, but it corresponds closely with the GATT Secretariat's list.  
The concordance developed by the USITC clarifies how the service sectors 
referenced in the GATT Secretariat's list, the CPC system, and the US Schedule 
correspond . […]
181 
 Such a statement by the United States federal agency that, "[a]t the request of the Office of 
the United States Trade Representative[,] […] assu med responsibility for maintaining and updating, 
as necessary, the [US Schedule]"182 has probative value and is a factor confirming other evidence that 
there is a close correspondence between the United States' specific commitments, the W/120 and the 
CPC numbers referred to in it.     In Chile – Taxes on Alcoholic Beverages , the Panel found that statements by a government 
against WTO interests are most probative.
183  The USITC Document is such  a statement to the extent 
that, in this dispute, the United States is ta king the position that there is no close correspondence 
between the United States' specific commitments, the W/120 and the CPC numbers referred to in it.   
 [b]: The conclusion in [a] above is not affect ed by the fact that, unlike the United States' 
Statement of Administrative Action, the USITC Docu ment does not specifically state that it represents 
an "authoritative" expression by the United Stat es government concerning its views regarding the 
interpretation and application of the Uruguay Round agreements.
184  The probative value of a 
statement made by an organ of a State (Member) needs to be assessed on a case-by-case basis.  This may depend, for instance, on the identity of the organ making the statement, and the nature and circumstances of that statement.    
 In the present case, the organ of the United States that made pronouncements concerning the 
structure and content of the US Schedule is not just any agency.  It is the United States federal agency 
that, at the request of the Office of the USTR as sumed responsibility for maintaining and updating, as 
necessary, the US Schedule.
185  The nature of the pronouncements, and the circumstances of their 
making, are also formal, explicit and unequivocal.  In  the circumstances of this case, Canada is of the 
view that the USITC Document can legitimately be considered to be probative of the United States' 
interpretation of its own Schedule under the GATS.   That document (concordance) undermines any 
argument by the United States that its Schedule h as no relation whatsoever with the W/120 and the 
corresponding CPC numbers, and thus that the latter s hould be ignored or considered irrelevant when 
ascertaining the meaning of the specific commitments undertaken by the United States.  Rather than 
supporting the United States' position, the USITC Docu ment confirms other evidence that there is a 
                                                      
181 USITC Document, p. viii. 
182 Ibid., p. vii. 
183 Panel Report on Chile – Alcoholic Beverages , para. 7.119. 
184 The United States' Statement of Administrative Action states: As is the case with earlier Statements 
of Administrative Action submitted to the Congress in connection with fast-track trade bills, this Statement 
represents an authoritative expression by the Administ ration concerning its views regarding the interpretation 
and application of the Uruguay Round agreements, both for purposes of U.S. international obligations and 
domestic law.  Furthermore, the Administration understands that it is the expectation of the Congress that future 
Administrations will observe and apply the interpretations and commitments set out in this Statement.  Moreover, since this Statement will be approved by the Congress at the time it implements the Uruguay Round 
agreements, the interpretations of those agreements in cluded in this Statement carry particular authority.  
Statement of Administrative Action, H.R. 5110, H.R. Doc. 316, Volume 1, 103d Congress, 2nd Session, 1994, p. 656.  See Panel Report on US - Exports Restraints , paras. 8.93-8.100, where interpretive value was given to 
the United States' Statement of Administrative Action. 
185 USITC Document, p. vii. WT/DS285/R 
Page C-16  
 
close correspondence between the United States' specific commitments, the W/120 and the CPC 
numbers referred to in it.       [c]: As indicated above, in the circumstances of  this case, the pronouncements of the USITC can 
legitimately be attributed to the United States, and thus be considered to be evidence of the 
United States' interpretation of its own Schedule under the GATS.  It has probative value in that it is a 
statement of the United States that is contrary to the position taken by the United States in the present 
case.  It is one credible element among others that  undermines, and refutes, the position advocated by 
the United States in this case.  It is a unilateral statement of the United States made spontaneously, 
and it can be used for the "purpose of throwing li ght on a disputed question of fact," namely, the 
intention of the United States to adopt and mainta in a Schedule that corresponds closely with the 
W/120 and the corresponding CPC numbers.
186   
 [d]: Canada notes that the attribution, in this case, of the USITC Document to the United States is 
in line with Article 4 of the International Law Commission's Articles on State Responsibility,
187 which 
expresses the well-known and general international law principle of the unity of the State at 
international law.188  Another expression of that principle of th e unity of the State at international law 
can be found in Article 27 of the Vienna Convention.  That principle also finds its expression in the 
GATS itself, in that the measures of a Member th at are subject to the GATS are those taken by 
central, regional or local governments and authoriti es, as well as those taken by non-governmental 
bodies in the exercise of powers delegated by such governments or authorities.189  Any measure taken 
by such governments or authorities, whether in th e form of a law, regulation, rule, procedure, 
decision, administrative action, or any other form, is covered.190  Just as a measure of the USITC can 
be a measure for which the United States is r esponsible under the GATS, a pronouncement by the 
USITC, such as in the document containing the concor dance, may be attributed to the United States 
when considering the obligations of the United States under the GATS. 
 
European Communities 
 
[a]: The document of the USITC contained in Exhibit AB-65 is a document from a WTO Member 
– the United States – providing indications as to the content of its Schedules of specific commitments, compared to the W/120 and the CPC.  The attri butability of this document to the United States as a 
WTO Member is beyond doubt as discussed below, in the reply to question 2(c).  The USITC 
Document contained has to be seen together with other documents issued by different US authorities 
during and after the conclusion of the Uruguay Ro und and addressing the issue of GATS Schedules.  
These documents include, in the first place, the vari ous versions of the US Schedule tabled by the 
United States in the final phase of the Uruguay Round, referred to above in the reply to question 1.  
They further include other documents referred to  by the European Communities at the Third Party 
session of the Panel's first substantive meeting with  the parties.  These are the 1998 version of the 
                                                      
186 See Anglo-Iranian Oil Co. Case , 1952 ICJ  93, at p. 107. 
187 The Draft Articles on Responsibility of States for Internationally Wrongful Acts were adopted by 
the International Law Commission on 9 August 2001. The General Assembly of the United Nations has taken note of the Draft Articles adopted by the International Law Commission: Resolution of the General Assembly of 
the UN, A/RES/56/83, Responsi bility of States for internationally wron gful acts, adopted on 12 December 2001. 
188 For instances where the Articles on State Respon sibility have been referred to for additional 
interpretive guidance, see: Appellate Body Report on US – Line Pipe , paras. 259-262; Appellate Body Report on 
US – Cotton Yarn , para. 120; US – FSC (Article 22.6 – US) , paras. 5.58-5.60;  Brazil – Aircraft (Article 22.6 – 
Brazil) , para. 3.44.  See also In the Matte r of an Arbitration under Chapter El even of the North American Free 
Trade Agreement Between ADF Group Inc. and United States of Ameri ca, ICSID Case No. ARB(AF)/00/1, 
Award of 9 January 2003, Judge Florentino P. Feliciano (President), para. 166, where it was determined that Article 4 of the Articles on State Responsibility reflects an established rule of customary international law. 
189 GATS Article I:3(a). 
190 GATS Article XXVIII(a). WT/DS285/R 
Page C-17 
 
 
document contained in Exhibit AB-65 and two annual USITC reports on trends in US service trade for 1996 and 2003.
191  
  The 1998 version of the USITC Document reproduces the table of concordance already contained in such exhibit.
192  The 2003 Annual Report, when mentioning the classification issues 
arising in the area of utility services, considers that193 
 
[i]ndustry classification issues present a centr al challenge to negotiations on utility 
services, principally because utilities are poorly defined in the classification system 
used by WTO members in negotiating co mmitments under the Uruguay Round. This 
classification system is based on the UN Provisional Central Product Classification 
(Provisional CPC), a product and service classification intended to provide a general 
framework for international comparison of data. Because the Provisional CPC was 
developed during the 1980s and published in 1991, it does not reflect the major changes in the structure of the utility indust ries brought about by the privatization and 
regulatory reform programs that proliferated during the 1990s. As a result, the CPC 
does not contain categories that adequately describe markets where production, transmission, distribution, and commercialization activities have been unbundled into discrete functions that are open to private participation and, to some degree, competition.
38  
_____________ 
38 The Provisional CPC was updated in 1998 with the publication of CPC Version 1, 
which does reflect some of the industry cha nges more accurately.  However, because 
GATS commitments are based upon the Provisional CPC, shifting to Version 1 could 
alter the legal standing of existing commitments.  
For its part, the 1996 Annual Report refers to W/120 "[f]or a complete list of service industries 
addressed during the Uruguay Round."194 
  It is noteworthy that these statements are abso lutely unqualified and do not distinguish either 
between the United States and other Members, or between WTO Members that included express references to the CPC in their Schedules and those that did not.  In other words, the United States 
itself does not seem to see a fundamental difference between Members' Schedules that include express 
references to the CPC and those not including such  references.  Taken together, these documents 
show a consistent position, on the part of the United States, that GATS specific commitments, 
including its own commitments for recreational services, follow the CPC categories but for express departures.    
 As to the legal status of the USITC Document contained in Exhibit AB-65, in the EC view it 
constitutes practice of the United States in the application of the WTO Agreement  subsequent to its 
conclusion.  As such, it is a relevant instrument of interpretation of the US WTO obligations, within 
the meaning of Article 31.3(b) of the Vienna Convent ion.  As noted in the EC Third party submission 
                                                      
191 USITC, U.S. Trade Shifts in Selected Industries: Services , Investigation No, 332-345, June 1996, 
Publication No. 2969 (available at the Internet addr ess: http://www.usitc.gov/wai s/reports/arc/w2969.htm); 
USITC, Recent Trends in U.S. Services Trade , 2003 Annual Report, Investigation No. 332-345, May 2003, 
Publication No. 3599 (available at the Internet address: ftp://ftp.usitc.g ov/pub/reports/studies/PUB3599.PDF). 
192 Compare p. xxv of Exhibit AB-65 and p. xxiv of the 1998 version.  
193 USITC, Recent Trends in U.S. Services Trade , 2003 Annual Report, Investigation No. 332-345, 
May 2003, Publication No. 3599, p. 12-9 (emphasis added). 
194 USITC, U.S. Trade Shifts in Selected Industries: Services , Investigation No, 332-345, June 1996, 
Publication No. 2969, p. 4-4, footnote 14. WT/DS285/R 
Page C-18  
 
and Oral statement, this document merely conf irms what already results from the 1993 Scheduling 
Guidelines and the W/120, as well as from the cover note to the US draft final schedule. 
  The European Communities is aware of the obj ection raised by the United States as to the 
value of "unilateral practice" of one party to a treaty.
195  The relevance of unilateral practice has to be 
evaluated in the light of the obligation to be im plemented.  In particular, implementation of a 
Schedule of specific commitments is incumbent upon the WTO Member concerned.  Therefore, the 
practice of that Member is particularly relevant to  interpret that part of the WTO Agreement.  The 
"implementing practice" of other Members in respect of such Schedule appears to be limited to either 
acceptance of or objections to the way in which the Member concerned applies its Schedule.  To the 
best of the EC knowledge no WTO Member has objected to the concordance provided by the USITC 
in its document.  Also, in its Report in EC – Computer Equipment  the Appellate Body referred to 
practice of one Member, the European Commun ities, in order to review the EC Schedule.196  T h e  
documents issued by US authorities after the Uruguay Round, and the lack of objections, by other WTO Members, to the position that GATS commitments, and specifically US commitments for sub-
sector 10.D, are based on the CPC but for express departures, constitute a "discernible pattern" of a 
concordant sequence of acts implying an agre ement of the various WTO Members on this 
interpretative issue.
197 
 [b]: The relevance for interpretation of treat y obligations in accordance with the Vienna 
Convention of each instrument must be evaluated on its own merits, irrespective of the status and 
value of other possible documents and instruments.   
  The SAA is one document in which the United States indicated what it believes to be the 
interpretation of the Uruguay Round texts and the ob ligations of the United States.  As noted by the 
Panel in US – Section 301 Trade Act , the SAA provides, in its own terms,
198 "[…] this Statement 
represents an authoritative expression by the Administration concerning its views regarding the 
interpretation and application of the Urugua y Round agreements, both for purposes of US 
international obligations and domes tic law."  Based on this, in the words of the Panel, "[T]he SAA 
thus contains the view of the Administration, subm itted by the President to Congress and receiving its 
imprimatur, concerning both interpretation and ap plication and containing commitments, to be 
followed also by future Administrations, on which domestic as well as international actors can 
rely."199  Of course, the fact that the SAA is a doc ument in which the US Administration position was 
set out does not exclude that other documents also express positions attributable to the United States.  
The US authorities are subject to the international customary rules on attributability of acts to a State 
just as authorities of all other Members are.   
 The European Communities also notes that the SAA contains no general interpretation of the 
US Specific commitments.  Nor was the US oblig ed to do so, since paragraph 16 of the 1993 
Scheduling Guidelines clarifies that in the absence of  express departures, reference should be made to 
the CPC codes.  Instead, the SAA refers to a specific instance in which the United States decided to 
depart from the CPC system:  
[s]ome commitments made in the financia l services sector, including those made by 
the United States, have been schedul ed according to the Understanding on 
Commitments in Financial Services, wh ich formed part of the Uruguay Round 
                                                      
195 See Section III.B.2. of this Report.   
196 Appellate Body Report on EC – Computer Equipment,  para. 93. 
197 Appellate Body Report on Chile – Price Band System , paras. 213-214, quoting Appellate Body 
Report on Japan – Alcoholic Beverages II,  p. 11.  
198 Panel Report on US – Section 301 Trade Act , para. 7.110; see also  Panel Report on US – Export 
Restraints , para. 2.4 and Panel Report on US – Section 129(c)(1) URAA , para. 6.36. 
199 Panel Report on US – Section 301 Trade Act , para. 7.111. WT/DS285/R 
Page C-19 
 
 
package.  The Understanding describes certa in commitments that differ from, and in 
some cases are more detailed than, those found in the GATS.200   
 This specific indication in the SAA confirms th at when so needed, the United States was able 
to indicate a departure from the general CPC system.  No other such departure is indicated in the 
Statement of Administrative Action.  Given that th e SAA contains no general explanation of the scope 
of the US Schedules, the US authorities must presum ably have considered it useful to provide such 
explanation elsewhere, also for the benef it of business operators.  This was done, inter alia , in the 
USITC Document.  Providing such clarifications is indeed one of the missions of the USITC201 and 
the information contained in the USITC Document is presumably correct – witness the fact that the 
same concordance table was reproduced in the 1998 ve rsion of Exhibit AB-65.  Otherwise, one might 
infer that the USITC has not fulfilled the task it w as entrusted with by the  USTR (see reply to 
question 2(d) below).  Of course, the USITC Document itself does not "create" or "determine" the scope of the US obligations under the US Schedule (nor does, for that ma tter, the SAA).  A WTO 
Member does not have a right to determine unila terally and subsequently the content of its 
international obligations.  Rather, the USITC Docu ment confirms what can already be gleaned from 
the 1993 Scheduling Guidelines and what was stated by the United States when it submitted its Draft 
Final Schedule, also containing an offer for sub-sector 10.D.   [c]: Yes.  It should be noted that the "statement " to which the Panel presumably refers – that is, 
the concordance between the US Schedule, the W/120 and the CPC is not a incidental or spontaneous 
one.  It is one rendered by the USITC at the  requ est of the USTR, in turn acting under legal authority 
delegated to it by the US President under Section 332 of the Tariff Act of 1930.
202  The position 
expressed by the USITC in Exhibit AB-65 is also not  an isolated one.  As already noted above in 
reply to question 2(a), the USITC has, for sever al purposes, taken the general position that GATS 
commitments were negotiated on the basis of the CPC.  As to the legal value of the USITC Document, such document confirms the position consis tently taken by the United States as to the way 
in which its Schedule is structured and the scope of the US specific commitments.  It does not create a 
legal obligation to interpret the US Schedule cons istently with the 1993 Scheduling Guidelines and 
the W/120 (and thus the CPC).  That obligation already flows from the value of the 1993 Scheduling Guidelines and W/120 as interpretative tools within th e meaning of the Vienna Convention.  It also 
results from the express indication, in the explanator y note to the drafts and final version of the US 
Schedule, that "Except where specifically noted , the scope of the sectoral commitments of the 
United States corresponds to the sectoral coverage in the Secretariat's revised Services Sectoral 
Classification List (MTN.GNS/W/120, dated 10 July 1991)." 
203  This matter is further addressed 
below in reply to question 2(d).   
                                                      
200 Statement of Administrative Action, H.R. 5110, H.R. Doc. 316, Vol. 1, 103d Congress, 2nd Session, 
p. 976 (1994).  
201 See,  e.g., the USITC strategic plan (availa ble at the Internet address: 
http://www.usitc.gov/webabout.htm), p. 21, whereby it is stated:  
 Stable mission. The Commission maintains an extensive repository of trade data and trade-
related expertise and provides information servi ces relating to U.S. international trade and 
competitiveness. 
202 19 U.S.C. 1332(g) (the provisions governing the organization and functioning of the USITC are 
available at the Internet address: http://www4 .law.cornell.edu/uscode/19/ch4stIIpII.html). 
203 Communication from the United States of America, Draft Final Schedule of the United States of 
America to the members of the Group of Negotiations on Services , MTN.GNS/W/112/Rev.3, 7 December 1993; 
Communication from the United States of America, Revi sed Conditional Offer of the United States of America 
concerning initial commitments , MTN.GNS/W/112/Rev.2, 1 October 1993; Communication from the United 
States, Schedule of the United States Concerning Initial Commitments on Trade in Services , 
MTN.GNS/W/112/Rev.4, 15 December 1993.  WT/DS285/R 
Page C-20  
 
[d]: State responsibility is not the only context in which the issue of attributability of an act to a State (or other subject of public international law) arises.  For example, the same issue arises – as an 
implied threshold question – in treaty-making.  Thus, it is submitted that Article 4 of the Draft 
Articles on the Responsibility for States of Internationally Wrongful Acts
204 is relevant in that it 
codifies the customary law principle of attribution, concerning attributability of actions to a State 
generally – not just with a view to establishing inte rnational responsibility.  In fact, the act of the 
USITC is not a wrongful act.  Chapter II of Part I of the International Law Commission Articles on the Responsibility of States defines the circumstances in which a certain  conduct is attributable to the 
State, the latter being an essential requirement for th e establishment of international responsibility of a 
State.  In particular Article 4, on the basis of the pr inciple of the unity of the State, lays down the rule 
that the conduct of an organ of a State is attribut able to that State.  As the International Law 
Commission points out in its commentary on the Artic les on State Responsibility the rule that "the 
State is responsible for the conduct of its own organs, acting in that capacity, has long been 
recognised in international judicial decisions."
 205  Furthermore, the International Court of Justice has 
recently confirmed the above rule as well as its customary character.  In Difference Relating to 
Immunity from Legal Process of a Special Ra pporteur of the Commission on Human Rights the Court 
held that "According to a well-established rule of international law, the conduct of any organ of a 
State must be regarded as an act of that State.  This rule, which is of a customary character, is 
reflected in Article 6 of the Draft Articles on State Responsibility … ".206 
  As the International Law Commission explains, th e term "state organ" is to be understood in 
the most general sense.
207  It extends to organs from any branch  of the State, exercising legislative, 
executive, judicial or any other functions .  It should be noted that it has been held that these functions 
might involve the giving of administrative guidance to the private sector.208  Article 5 of the  
International Law Commission Articles on the Responsibility of States  goes further to attribute to the 
State the conduct of a person or entity which is not a St ate organ in the sense of Article 4, but which is 
nevertheless authorised by the law of that State to exercise governmental authority.  As the ILC 
explains in its commentary to Article 5, the generi c term ‘entity' covers a wide variety of bodies 
which may include public corporations, semi-public entities, public agencies of various kinds, 
"provided that the entity in question is empowered by the law of the State to exercise functions of a 
public character normally exercised by State organs".209 
 
 The members of the USITC are appointed by th e President, with the consent of the Senate.210  
Furthermore, the Commission acts at the request  of the USTR, being obliged to carry out 
investigations and reports as requested by the President or the Congress.211  The USITC is clearly 
entrusted with special powers, which are normally exercised by State organs.  For example, it is empowered to "prosecute any inquiry necessary to its du ties in any part of the United States or in any 
foreign country".
212  Equally, the USITC has the authority to obtain information by, among others, 
                                                      
204 The text of the Draft Articles is reflected in a resolution adop ted on 12 December 2001 by the UN 
General Assembly (A/RES/56/83). 
205 Commentaries to the draft articles on Responsibility of States for internationally wrongful acts , 
adopted by the International Law Commission at its fifty- third session (2001), Official Records of the General 
Assembly, fifty-sixth session, Supplement No . 10 (A/56/10), chp. IV.E.2; J. Crawford,  The International Law 
Commission's Articles on State Responsibility- Introduction, Text and Commentaries , Cambridge, Cambridge 
University Press, 2002, commentary to Article 4 at p. 94, para. 3 and footnote 108. 
206 Difference Relating to Immunity from Legal Process of a Special Rapporteur of the Commission on 
Human Rights, I.C.J. Reports 1999, p. 62, at p. 87, para. 62, referring to then Draft Article 6, now embodied in 
Article 4. 
207 The International Law Commission's Articles on State Responsibility, p. 85, para. 6. 
208 Panel Report on Japan – Semi-conductors , BISD 35S/116; Panel Report in Japan – Film .  
209 The International Law Commission's Articles on State Responsibility, p. 100, para. 2. 
210 19 U.S.C. 1330 (a). 
211 19 U.S.C. 1332 (g). 
212 19 U.S.C. 1331 (d). WT/DS285/R 
Page C-21 
 
 
having access to any documents pertaining in its investigations, summoning witnesses, and requesting 
any person to provide it with the required information.213  The letter by which the USTR requested the 
USITC to undertake responsibility for maintain ing the US Schedule of specific commitments214 is 
absolutely clear in this respect:    
[u]nder the GATS, the US Government is obligated to develop and maintain a US 
Schedule of Services Commitments.  I believe that the maintenance of the US 
Schedule and list is a task that is mo st appropriately performed by the US 
International Trade Commission.  The Co mmission has significant experience in 
maintaining our GATT Schedule XX, reflec ting US tariff concessions in the goods 
area.  I therefore request, pursuant to authority delegated by the President under 
Section 332 of the Tariff Act of 1930, that the Commission initiate an ongoing 
program to compile and maintain the offici al US Schedule of Services Commitments.   
 Furthermore, domestic law, though relevant, is  however not decisive in determining what 
constitutes a State organ.  Otherwise, a State w ould be in a position to escape responsibility for the 
conduct of its own organs, acting in that capacity, si mply by denying them that status under its own 
law.  Therefore, as the International Law Co mmission points out, certain institutions performing 
public functions and exercising public powers (e.g. the police) are to be considered State organs even 
if they are regarded in internal law as autonomous and independent of the executive government.215  
Specifically, the fact that that the USITC is term ed as an "independent agency" has no impact on the 
attributability of its actions to the United States.  What is relevant is of course not the formal 
qualification of the body concerned, but the activit y at issue in a particular case.  Indeed, several 
actions of the USITC have been revi ewed by panels and the Appellate Body in the past – for example, 
safeguard investigations and injury in vestigations in anti-dumping proceedings.216 
 
Mexico 
 
[a]: At the very least, that document constitu tes relevant evidence on the USITC's position and 
practice with respect to the definition and scope of the United States' GATS commitments.  Such 
evidence must be assessed by the Panel when appl ying Articles 31 and 32 of the Vienna Convention 
as part of its analysis of Antigua and Barbuda's claims.  
[b]: Mexico notes that Exhibit AB-65 and the SAA do not appear to have been published for the 
same purposes.  While the purpose of Exhibit AB-65 appears to be to provide a comprehensive explanation of the US Schedule of Specific Commitments, the SAA constitutes an "authoritative expression by the United States concerning the interp retation and application of the Uruguay Round 
Agreements and [the Uruguay Round Agreements Act ] in any judicial proceeding in which a question 
arises concerning such interpretation or application."
217 
 
                                                      
213 19 U.S.C. 1333. 
214 Letter from M. Kantor, United States Trade Repres entative, to D. E. Newq uist, Chairman of the 
U.S. International Trade Commission, 18 April 1994 (emphasis added). 
215 The International Law Commission's Articles on State Responsibility, p. 92, para. 6 and p. 98, 
para. 11. 
216 See. e.g., for safeguards, Appellate Body Report on US – Steel Safeguards ; for anti-dumping, e.g. 
Appellate Body Report on US – Hot-Rolled Steel .  The acts of other independent agencies of the United States 
have also been reviewed by international jurisdictions: for example, actions of the Environmental Protection Agency (EPA) (e.g. Appellate Body Report, US – Gasoline , or of the Central Intelligence Agency (CIA) Case 
Concerning Military and Paramilitary Activities in and Against Nicaragua  (Nicaragua v. United States of 
America), Merits, I.C.J. Reports 1986, p. 14).  Bo th entities share with the USITC the qualification of 
"independent agencies" (see Offici al US Executive Branch Web S ites, with Internet address 
http://lcweb.loc.gov/global/e xecutive/fed.html, visite d on 17 December 2003). 
217 Panel Report on US – Export Restraints , para. 2.3. WT/DS285/R 
Page C-22  
 
[c]: In the context of this disput e, the issue is whether the statem ent by the USITC can be used to 
interpret the US Schedule of Specific Commitments within the rules of interpretation set out in 
Articles 31 and 32 of the Vienna Convention.  See Mexico's response to question 2(a) above. 
 [d]: See the response to the previous question. 
 
3. Antigua and Barbuda as well as the European Communities (Exhibit AB-74 and 
paragraph 15 of the European Communities' oral statement to the first meeting of the Panel with the parties) have referred to the cover note of the Draft Final Schedule of the 
United States of America concerning Initial Commitments, dated 7 December 1993, 
which contains a paragraph that reads as follows: 
"Except where specifically noted, the scope of the sectoral commitments of the 
United States corresponds to the sectoral coverage in the Secretariat's revised Services Sectoral Classification List (MTN.GNS/W/120, dated 10 July 1991)." 
(a) In which revision of the Uruguay Round Draft (Final) Schedule of the United States  
was that cover note omitted? 
(b) What is the legal status and value of that cover note for the interpretation of the US 
GATS Schedule? 
Antigua 
[a]: To Antigua's knowledge document MTN.GNS /W/112/Rev.3 is the final schedule submitted 
by the United States and the sente nce from the cover note was never omitted. During the first 
substantive meeting with the Panel the United States pointed out that this cover note was not part of 
the actual schedule as annexed to the GATS.  This is not because it was omitted or withdrawn by the United States but simply because such a cover note is not formally part of a GATS schedule as it is attached to the GATS by Article XX:3.  
[b]: The cover note is part of the preparatory work  of the US Schedule.  Article 32 of the Vienna 
Convention provides that such a document may be u sed as a supplementary means of interpretation to 
confirm the meaning resulting from the application of Article 31 of the Vienna Convention.  As 
mentioned above the cover note also confirms the acceptance by the United States of the scheduling 
method set out in the 1993 Scheduling Guidelines and W/120, thus confirming the status of these two documents as instruments accepted by all parties (p er Article 31(2)(b) of the Vienna Convention).  
 
United States 
 
[a]:  A note substantially similar to the quoted text appeared in documents MTN.GNS/W/112/Rev.2 
and MTN.GNS/W/112/Rev.3.218  It does not appear in the final document. 
 
[b]:  These negotiating history documents are "prepara tory work" within the meaning of Article 32 of 
the Vienna Convention.  The value of these notes is minimal, since at most they only confirm what 
the United States has already stated – that it genera lly followed the W/120 structure in its schedule of 
specific commitments.  The Panel should distingu ish, however, between a Member's use of W/120 as 
a basis for scheduling, and the inscription of re ferences to the CPC to further describe its 
                                                      
218 See Communication from the United States of America, Draft Final Schedule of the United States of 
America Concerning Initial Commitments , 7 December 1993, MTN.GNS/W/112/Rev.3, para. 5; 
Communication from the United States of America, Revised Conditional Offer of the United States of America 
Concerning Initial Commitments, 7 December 1993, MTN.GN S/W/112/Rev.2, p. 1.  Th e word "revised" in the 
text quoted by the Panel does not appear in the cited materials. WT/DS285/R 
Page C-23 
 
 
commitments.  Like other Members, the United Stat es was free to choose to inscribe or not inscribe 
CPC references to further describe its commitmen ts.  The United States chose not to do so. 
 
Canada 
 
[a]: The Draft Final Schedule of the United States of America Concerning Initial Commitments  
("Draft Final Schedule"), dated 7 December  1993, contains the following cover note: 
 
Except where specifically noted, the scope  of the sectoral commitments of the 
United States corresponds to the sectoral coverage in the Secretariat's Services 
Sectoral Classification List (MTN.GNS/W/120, dated 10 July 1991) [the W/120].219   
 The Draft Final Schedule is the fourth and, as its name indicates, final, draft schedule 
circulated by the United States in the context of the market access negotiations under the GATS.  The 
third draft schedule circulated by the United States c ontains a cover note identical to the cover note in 
the Draft Final Schedule.220  Such a cover note does not appear in the first and second draft schedules 
circulated by the United States.221 
 [b]: The cover note contained in the last two dr aft schedules circulated by the United States forms 
part of the circumstances of the conclusion of the market access negotiations under the GATS.  As 
such, it qualifies as a supplementary means of interp retation within the meaning of Article 32 of the 
Vienna Convention.  Pursuant to that provision, th e Panel may have recourse to such a supplementary 
means of interpretation in order, e.g., to confirm the meaning of the United States' specific 
commitments resulting from the application of the gene ral rule of interpretation set out in Article 31 
of the Vienna Convention, or to determine that meaning when the interpretation according to Article 
31 leaves it ambiguous or obscure.  Canada has alread y demonstrated in its submission that the only 
reasonable conclusion, when ascertaining the common intention of the Members with respect to the 
United States' specific commitments, is that where the US Schedule mirrors the W/120, without any 
clear and explicit departure from it and the corresponding CPC numbers, the specific commitments at issue are to be interpreted in the light of the W/ 120 and the CPC numbers associated with it.  The 
cover note contained in the last two draft sche dules of the United States is yet another factor 
confirming, or clarifying, that this is the correct meaning to be given to the specific commitments of 
the United States.  The Panel is justified in havi ng recourse to that additional element under Article 32 
of the Vienna Convention.   
  While the cover note does not appear in a ll four draft schedules circulated by the 
United States, the fact that it is contained in the last two is significant and gives it particular probative value.  It clearly indicates that as the negotiations  progressed and were finalized, the understanding of 
the Members with respect to the United States' sp ecific commitments was, as Canada has already 
argued, that the United States followed the W/120 (and by implication the corresponding CPC numbers), except where specifically noted.
222   
 
                                                      
219 Communication from the Un ited States of America, Draft Final Schedule of the United States of 
America Concerning Initial Commitments , MTN.GNS/W/112/Rev.3, 7 December 1993, para. 5.  
220 Communication from the United States of America, Revised Conditional Offer of the United States 
of America Concerning Initial Commitments , MTN.GNS/W/112/Rev.2, 1 October 1993, para. 4. 
221 Communication from the Un ited States of America, Conditional Offer of the United States of 
America Concerning Initial Commitments , MTN.GNS/W/112, 13 November 1990. Communication from the 
United States of America, Revised Conditional Offer of the United States of America Concerning Initial 
Commitments , MTN.GNS/W/112/Rev.1, 21 January 1992.  
222 Ibid. Canada notes that the mere fact that the first two draft schedules do not specify explicitly that 
they are based on the W/120 does not necessarily mean that that was not the case.  The specification, or 
clarification, included in the last two draf t schedules tends to show otherwise.   WT/DS285/R 
Page C-24  
 
 Canada recalls that in EC – Computer Equipment , the Panel, when interpreting the European 
Communities' Schedule under the GATT, did not consider the Harmonized System  and its 
Explanatory Notes .  The Appellate Body reacted as follows: 
 
We are puzzled by the fact that the Panel, in  its effort to interpret the terms of [the] 
Schedule […], did not consider the Harmonized System  and its Explanatory Notes .  
We note that during the Uruguay Round negotiations, both the European Communities and the United States were parties to the Harmonized System .  
Furthermore, it appears to be undisputed that the Uruguay Round tariff negotiations 
were held on the basis of the Harmonized System's nomenclature and that requests 
for, and offers of, concessions were normally  made in terms of this nomenclature.  
[…] We believe […] that a proper interpre tation of [the] Schedule […] should have 
included an examination of the Harmonized System  and its Explanatory Notes .223 
 The inclusion of the cover note in the last tw o draft schedules circulated by the United States 
constitutes evidence that through to the end of  the market access negotiations between the 
United States and other Uruguay Round participants, these negotiations were held on the basis of the 
W/120's nomenclature.  In other words, it constitute s evidence of what the common intention of the 
Uruguay Round participants was (and still is) w ith respect to the United States' specific 
commitments.224  That common intention must now be respected.  It cannot be changed a posteriori , 
as suggested by the United States, by relying almost  exclusively on definitions of dictionaries that 
result in reading the United States' specific commitments  out of their context and without regard to the 
object and purpose of the GATS and the WTO Agreement .225 
 
European Communities 
 
[a]: In addition to the documents referred to by the EC in its oral statement, there was another 
revised final schedule of commitments of the Un ited States, circulated as MTN.GNS/W/112/Rev.4 on 
15 December 1993.226  This was only distributed in paper fo rmat in the very last weeks of the 
negotiations, when the United States decided to with draw some of its proposed commitments (e.g. in 
the maritime transport sector).  Such document only includes a few amendments related to some 
entries in the US Schedule, but does not modify the cover note to the previous final draft (MTN.GNS/W/112/Rev3).  On the contrary, it contains the very same statement as quoted by the 
Panel from the previous revision.  It thus does not  change in any way the conclusion on the issue at 
stake.  The only further activity was a process of "technical verification of schedules", which did not modify at all the scope of the results of negotiations.
227  Thus, never before the end of the negotiations 
                                                      
223 Appellate Body Report on EC – Computer Equipment , para. 89. 
224 Appellate Body Report on EC – Computer Equipment , paras. 84 and 109.  
225 In any case, Canada agrees with the European Communities that the definitions of dictionaries 
referred to by the United States do not support the conclusion that the specific commitments taken by the 
United States under sub-sector 10.D – Other Recreationa l Services (except sporting)  exclude as such gambling 
and betting services.  One may refer to the Preamble of th e GATS for guidance on the ob ject and purpose of that 
treaty.  The Preamble of the GATS emphasizes, e.g., the wish of the Members to "establish a multilateral 
framework of principles and rules for trade in serv ices with a view to the expansion of such trade under 
conditions of transparency  […]." [emphasis added] The United States' approach to the interpretation of its 
Schedule, which leaves its specific commitments ambiguous  and unclear, is the antithesis of this objective 
expressed by the Members in the Preamble of the GATS.  
226 Communication from the United States, Schedule of the United States Concerning Initial 
Commitments on Trade in Services , MTN.GNS/W/112/Rev.4,  15 December 1993. 
227 See GATT/AIR/3544, 15 January 1994, para. 1:  
[i]l est signalé que, les négociations sur les services étant terminées, l'objet 
de ce processus est de confirmer l'exac titude des listes sur le plan technique 
et non d'en modifier la teneur. WT/DS285/R 
Page C-25 
 
 
did the United States contradict its position that the scope of its commitments is based on the 1991 
Sectoral Classification W/120 and the CPC.228 
 [b]: The legal status and value of the cover note is  the same as that of its attachment.  It is a 
preparatory document where the United States explaine d the scope of its final offer and thus of the 
obligations it was offering to undertake.  As such, it is part of the supplementary means of 
interpretation of the US Schedules of specific commitm ents.  It is the document which the other [then] 
GATT contracting parties had availa ble in order to evaluate the US services final offer.  If the 
United States had meant, after the issuan ce of documents.  MTN.GNS/W/112/Rev.3 and 
MTN.GNS/W/112/Rev.4, to depart from the 1991 Sectoral Classification and thus from the 
corresponding CPC categories, good faith in the c onduct of international negotiations would have 
required it to warn the other contracting parti es of its changed position before the end of the 
negotiations.  Since the United States failed to do so , its Schedules, as finally adopted, are to be read 
in the light of W/120 and the corresponding CPC numbers since their entry into force.    Mexico 
 [a]: To Mexico's knowledge, the cover note appear s in the Final Draft of the US Schedule of 
Specific Commitments (Communication from the United States of America, Draft Final Schedule of 
the United States of America to the Members of the Group on Negotiations on Services , 
MTN.GNS/W/112/Rev.3, December 1993) and in the introduction to the US Revised Conditional 
Offer tabled during the Uruguay Round negotiatio ns (Communication from the United States of 
America, Revised Conditional Offer of the United States of America Concerning Initial Commitments, MTN.GNS/W/112/Rev.2, 1 October 1993).  [b]: The United States Draft Final Schedule, which contains the cover note, constitutes a part of 
the preparatory work of the GATS and the WTO Agre ement.  At the very least, these documents thus 
qualify as "supplementary means of interpretation" pu rsuant to Article 32 of the Vienna Convention. 
 For Antigua and Barbuda : 
 
4. What is the legal status and value of the other Members' Schedules in interpreting the 
US GATS Schedule? 
Antigua 
 
 Article XX:3 of the GATS provides that schedules form an integral part of the Agreement. 
Consequently, the other Members' GATS schedules provi de "context" for the interpretation of the US 
Schedule as per Article 31(2)(a) of the Vienna Conve ntion.  In paragraphs 41-60 of its Third Party 
Submission the European Communities has shown that  an interpretation of the US Schedule in the 
context of other Member's schedules confirms th e conclusion that the United States has made full 
modes 1 and 2 market access and national treatment commitments with regard to gambling and betting services.   Canada 
  It is striking that when addressing the context of the specific commitments at issue in this 
case, the United States, instead of referring to its own Schedule, e.g. its structure and the fact that it 
generally mirrors the W/120, seeks to rely on a few entries in a very limited and selective number of 
                                                      
228 As it was clear to all (future) WTO Members that the United States had, until the finalization of its 
Schedule, followed the 1993 Scheduling Guidelines and the 1991 Sectoral classification and CPC codes but for 
express departures, there was no need to repeat in doc . GATS/SC/90 what already fl ows, for all Members, from 
para. 16 of the 1993 Scheduling Guidelines. WT/DS285/R 
Page C-26  
 
other Members' Schedules in order to interpret its  own Schedule.  As the European Communities has 
shown, these entries referred to by the United Stat es do not clearly support the United States' position.  
In any case, what a very few Members out of a hundred and forty-six
229 may have done in their 
Schedules with respect to specific services is not re levant for purposes of determining what the United 
States has done in its own Schedule.  Canada has ma de clear that a Member may, in certain cases, 
have departed from the W/120 and the corresponding  CPC numbers associated with it.  No Member 
was obliged to schedule specific commitments in  accordance with the W/120 and the corresponding 
CPC numbers.  The fact that a few Members may have scheduled specific commitments on gambling and betting services differently than the United States simp ly reflects that fact.  The task of a panel is 
to look at what the United States has done in its Schedule, not at what a few other Members may have 
done.   
 
For the United States: 
 
5. Which classification system, if any, did the United States follow in establishing its GATS 
schedule of specific commitments?  If the United States has followed a specific 
classification system, could the United States provide the Panel with a table of concordance between that system and W/120 for the entire schedule?  In the absence of 
an explicit reference to the CPC in the US Schedule, what is the definitional framework within which the US commitment in the first column of its Schedule should be interpreted?  
United States 
 Subject to some changes ( e.g., "except sporting"), the Unite d States generally followed the 
W/120 structure  in its schedule of specific commitments.  However, the United States did not refer to 
the CPC or any other particular nomenclature to describe the terms of th e US Schedule, preferring 
instead that those terms be interpreted according to their ordinary meaning, in their context and in 
light of the object and purpose of the GATS.  Those rules, reflected in Articles 31 and 32 of the 
Vienna Convention, provide the definitional fra mework within which the description of the 
US commitment in the first column of its Schedule should be interpreted.  Be cause the United States 
did not agree to any special meanings for the te rms in its schedule, such as by agreeing to any 
particular nomenclature, there is no additional document that could be used as the basis for a 
concordance.  
 
6. What is the relevance of the US industry cla ssification system for interpreting the US 
GATS schedule?  How are gambling and betting services classified in that system? 
United States 
 
 The North American Industry Classification Sy stem (NAICS 2002) is intended for classifying 
types of establishments for statistical purposes.  It  is the result of trilateral negotiations among three 
WTO Members (Canada, Mexico, and the United States) .  Accordingly it is not negotiating history for 
the US GATS Schedule, but does provide evidence that  there are internationally accepted, alternative 
ways to classify services other than the CPC.  The NAICS supports the US view that gambling is not 
part of "other recreational services (except spor ting)."  NAICS 2002 includes the two-digit heading 
71, "Arts, Entertainment, and Recreation."  W ithin that heading, three-digit heading 713, 
"Amusement, Gambling, and Recreation Industri es," includes four-digit heading 7132 "Gambling 
Industries."  Significantly, "Gambling Industries" is  a stand-alone heading, and is not part of the 
separate four-digit heading 7139, covering "Other Amusement and Recreation Industries" (7139).  
"Internet game sites" falls under separate NAIC S 2002 heading 516110, "Internet Publishing and 
                                                      
229 As of 4 April 2003. WT/DS285/R 
Page C-27 
 
 
Broadcasting."  Definitions of these categories may be found on the US Census Bureau website "2002 
NAICS Codes and Titles" by clicking on the hyperlinks for individual codes.230 
 
Antigua 
 
 At the time of the Uruguay Round negotiations th e United States used the Standard Industrial 
Classification system (the "SIC"), introduced in 19 87.  Although this classification has since been 
reorganised (in 1997), to the current North Americ an Industry Classification System (the "NAICS"), 
only the SIC system could possibly be relevant for any examination of United States commitments 
agreed in the Uruguay Round as the NAICS postd ates the Uruguay Round Agreements.  The SIC 
contained a broad category, "79 – Amusement and Recreation Services."231  This in turn contained a 
subcategory "7999 - Amusement and Recreation Se rvices [not elsewhere classified]." This last 
subcategory included "casinos" and "lottery, bi ngo, bookie and other gaming operations."  Thus, 
under the SIC gambling and betting services were classified in precisely the same way  as they are 
under the CPC and W/120 in a "residual" subcategory of a general category for recreational services. 
 
7. Could the United States provide a breakdown of the services sub-sectors that are 
covered under: 
(a) Sub-sector 10.D of the US Schedule, entitled Other recreational  services (except 
sporting) ?   
(b) Sub-sector 10.A of the US Schedule, entitled Entertainment services ? 
United States 
 
 No such breakdown was provided by the GATS ne gotiators in regard to the US Schedule, 
therefore it is not possible to provide an a priori  list of the contents of 10.A and 10.D based on the 
text of the GATS and its annexes.  The meaning of each of these sub-sectors must be discerned in the 
same manner as that of any other term of a treaty – through application of the customary rules of 
treaty interpretation.  Even a Member that referre d to the CPC in its schedule would be unable to 
provide a complete breakdown of 10.A and 10.D, in asmuch as the CPC categories are no less subject 
to interpretation than the W/120 headings.  (Indeed, th is observation is implicit in the Panel's question 
regarding the meaning of "gambling and betting services" (question 13)). 
 
 Subject to the foregoing observations, the United States believes that an interpreter could find, 
consistent with customary rules of treaty interpreta tion, that:  (i) "Other recreational services (except 
sporting)" (10.D) includes services that fall squarely  within the plain meaning of "recreation" and are 
distinguishable from either "s porting" or "entertainment."  Such activities could include, inter alia,  the 
operation of such recreational facilities as marinas,  beaches, and parks, as well as the organization 
and/or facilitation of non-sporting recreational activiti es;  and (ii) "Entertainment services" (10.A) 
includes services that fall squarely within the plain meaning of "entertainment" and are distinguishable from either "sporting" or "recreation." Such activities could include, inter alia,  
services consisting of the operation of entertainmen t facilities, such as theaters, dance halls, music 
halls, and other performing arts ve nues; and the organization and/or facilitation of such entertainment 
activities. 
 
 To the extent that other services fall within sector 10 but do not fall within sub-sectors 10.A through 10.D, those services reside by default in sector 10.E, "other."  
                                                      
230 See http://www.census.gov/epcd/naics02/naicod02.htm. 
231 See  1987 Standard Industry Classification ("SIC") system matched to 1997 North American 
Industry Classification System. WT/DS285/R 
Page C-28  
 
8. The United States argues, inter alia , that (i) "except sporting" is meant to exclude 
gambling and betting from its commitment under 10.D and, (ii) had the US undertaken a commitment on gambling and betting, it would have done it under 10.E ( Other ).  Why 
would the United States feel the need to exclude "sporting" (including, in its view, gambling and betting) from sub-sector 10.D if  it considered that gambling and betting 
are included under 10.E?  How can this be reconc iled with the principle that entries in a 
classification system ar e mutually exclusive? 
United States 
 
 The two assertions to which the Panel refers  respond to two alterna tive arguments advanced 
by Antigua (which bears the burden of proving the existence of a US commitment).  In response to 
Antigua's assertion that sub-sector 10.D of the US Schedule is defined by the CPC and includes 
gambling services, the United States has pointed out that (1) the US Schedule is not and cannot be 
defined by the CPC; and (2) even if 10.D did include gambling services ( quod non ), the words 
"except sporting" exclude gambling, which is within the ordinary meaning of "sporting."232  In 
response to Antigua's assertion that gambling is wi thin the ordinary meaning of "entertainment" and 
also within the ordinary meaning of "recreational, " the United States has pointed out that (1) Antigua 
fails to prove this; and (2) even if it were true ( quod non ), the logical consequence would be that 
gambling really fits neither of these categories, and thus belongs in "10.E Othe r."  The latter point is 
even more persuasive if the Panel finds that W/120 entries for "entertainment" and "other recreational 
services" are mutually exclusive.   
 
 Regarding why the United States would find it useful to exclude "sporting" (including gambling) if it belongs in 10.E in any event, the United States considers that the exclusion provides an 
added assurance against misinterpretation of the US commitments, while at the same time clarifying 
the status of other (non-gambling) forms of sporting. 
 
B. T
HE MEASURE (S) AT ISSUE  
For both parties: 
 
9. What is the legal status and value of comments made by the US representative at 
meetings of the DSB233 to the effect that the supply of  cross-border gambling and betting 
services is prohibited under US law? 
Antigua 
 
 In the context of this dispute the United Stat es has twice before the DSB unequivocally stated 
that "cross-border gambling and betting services are prohibited under US law,"234 confirming earlier 
statements made to Antigua during consultations.  It has also made the same statement on a number of 
                                                      
232 With respect to the meaning of "sporting," the United States attaches for the Panel's examination 
copies of the following definitions:  New Shorter Oxford English Dictionary,  p. 3000 (1993) ("Now esp[ecially]  
pertaining to or interested in betting or gambling"); Merriam-Webster's Collegiate Dictionary,  p. 1134 (10th ed. 
2001) ("of or relating to dissipation and esp[ecially] gambling "); Webster's Third New International Dictionary,  
p. 2206 (1986) ("of, relating to, or preoccupied with dissipation and esp[ecially] gambling"); The American 
Heritage Dictionary,  p.1681 (4th ed., 2000) ("Of or associated with gambling."); The Random House Dictionary 
of the English Language,  p. 1844 (2d ed. 1987) ("interested in or connected with sports or pursuits involving 
betting or gambling: the sporting life of Las Vegas. "); Webster's II New Riverside University Dictionary,  p. 1124 
(1988) ("Of or having to do with gambling."); Encarta World English Dictionary, available at  
http://encarta.msn.com/dictionary_/sporting.html (2004) ("of gambling: relating to gambling, or taking an 
interest in gambling").   
233 WT/DSB/M/151, para. 47 and WT/DSB/M/153, para 47. 
234 WT/DSB/M/151, para. 47; WT/DSB/M/153, para. 47. WT/DS285/R 
Page C-29 
 
 
other occasions not directly related to this proceeding.235  Although at the first Panel session in this 
matter the United States appeared initially to have withdrawn that statement, during the final Panel 
meeting of the session the United States once more made clear its position that the cross-border 
provision of gambling and betting services from Anti gua to the United States was illegal under United 
States law.236 
 
 The discussion contained in US – Section 301 Trade Act  is very helpful in assessing the effect 
of the United States statements before the DSB as we ll as before the Panel in this proceeding.  In US – 
Section 301 Trade Act the United States had "explicitly, offici ally, repeatedly and unconditionally 
confirmed [a United States] commitment (…)"237 both at a meeting of the panel and in response to 
questions from the panel.  While observing that "[a]ttributing international legal significance to 
unilateral statements made by a State should not be done lightly and should be subject to strict 
conditions,"238 the panel found that the statements made be fore it "were a reflection of official US 
policy (…)" and  
"were solemnly made, in a deliberative ma nner, for the record, repeated in writing 
and confirmed in the Panel's second hearing.   There was nothing casual about these 
statements nor were they made in the heat  of argument.  There was ample opportunity 
to retract.  Rather than retract, the US ev en sought to deepen its legal commitment in 
this respect."
239 
The panel concluded that: 
 
"We are satisfied that the representatives of the US appearing before us had full 
powers to make such legal representations and that they were acting within the 
authority bestowed on them.  (…) It is in conceivable except in extreme circumstances 
that a panel would reject the power of the legal representatives of a Member to state 
before a panel, and through the panel to th e DSB, the legal position of a Member as 
regards its domestic law read in the light of its WTO obligations.  The panel system 
would not function if such a power could not be presumed."240 
 Turning to the facts in this proceeding, the first statement of the United States to the DSB 
regarding the "total prohibition" was made by the United States Ambassador to the WTO, Mrs. Linnet 
F. Deily at the 24 June 2003 meeting of the DSB.  It was read aloud to the DSB membership at that 
meeting and was unequivocal.  The same statemen t was repeated virtually verbatim by the 
United States representative at the DSB meeting of  23 July 2003.  And at the Panel meeting of 
                                                      
235 See , e.g, Letter from the United States Department of Justice to the National Association of 
Broadcasters entitled "Advertising for Internet Gambling and Offshore Sportsbooks Operations"; Statement of 
John G. Malcolm before the Subcommittee on Crime,  Terrorism, and Homeland Security Committee on the 
Judiciary United States House of Repres entatives (29 April 2003); Statement of John G. Malcolm at the Special 
Briefing: Money Laundering and Payment Systems in Online Gambling Sponsored by World Online Gambling 
Law Report (20 November 2002).   
236 In the final Panel meeting of the session, the United States explained its apparent reversal of 
position by claiming that not all gambling and betting services were prohibited, going on to reference odds-
making services and other activities only tangentially related to gambling and betting as permissible, but 
reaffirming that all cross-border wagering—placing and ta king of bets—was illegal under United States law.  
While it is unclear why the United States at this late juncture chose to modify its original statements regarding 
the "total prohibition" of cross-border gambling and betting services, it is Antigua's belief that this change in tactics is an attempt by the United States to avoid th e snare of GATS Article XVI.  See Second Submission of 
Antigua and Barbuda, WT/DS285, para. 38. 
237 Panel Report on US – Section 301 Trade Act, para. 7.115. 
238 Ibid., at para. 7.118. 
239 Ibid., at para. 7.122. 
240 Ibid., at para. 7.123. WT/DS285/R 
Page C-30  
 
11 December 2003, the United States head of dele gation, while ostensibly narrowing the scope of 
earlier United States declarations on the subject, still clearly stated that the placing and taking of bets—"gambling and betting"—on a cross-border b asis was illegal under United States law.  Under 
the reasoning adopted by the panel in US – Section 301 Trade Act , the Panel is entitled to rely on 
these statements by the United States.
241  Given these clear declarations by the United States of "its 
legal position (…) as regards its domestic law"242 at the heart of this dispute, it is untenable for the 
United States to assert that Antigua has argued the "total prohibition" based upon a "mere assertion" 
or that, indeed, Antigua has not made its prima facie  case regarding the measures of the United States 
at issue in this proceeding.  
 The panel in US – Section 301 Trade Act  referred to the judgment of the ICJ in the Nuclear 
Test case (Australia v. France).
243  In that case the ICJ found that France had imposed on itself an 
obligation of international law by making repeat ed public statements that it would cease the conduct 
of atmospheric nuclear tests.  The panel in US – Section 301 Trade Act  pointed out that the legal 
effect of the United States statement at issue un US – Section 301 Trade Act  did not go as far as 
creating a new legal obligation but it nonetheless applied the same a nd perhaps even more stringent 
conditions that the ones unused by the ICJ in the Nuclear Test case.244  In the Nuclear Test  case the 
ICJ based its finding primarily on statements by the French President and the French Defence 
Minister at two press conferences.245  The statements by the United St ates at issue in this case were 
not made at press conferences but, as in US – Section 301 Trade Act, were made in the context of a 
specific dispute settlement procedure.  Furthermore th e statements at issue in this case do not create a 
new legal obligation for the United States but only describe the effect of extant United States' 
domestic legislation.  This results in a statemen t of fact upon which not only the Panel, but also 
Antigua and the third parties, are entitled to re ly.  With reference to the panel report in US – Section 
301 Trade Act,  Antigua submits that the dispute settlement system would not function if a 
complainant could not rely on such statement when  bringing and formulating its case under the WTO 
dispute settlement procedures.  At the very least  a defendant should only be allowed to "withdraw" 
such a statement if it submits comp elling evidence that its earlier st atement about the effects of its 
domestic laws is incorrect—which the United States has not attempted to do.  Otherwise a defendant 
would be encouraged to make incorrect statements about its own domestic laws simply to complicate 
the complainant's case and the panel's work.  
 Although this dispute settlement procedure is not governed by United States law, Antigua 
believes that United States law on the effect of stat ements such as those made by the United States 
regarding the total prohibition is helpful in assessi ng, to the extent relevant, the intention or mens  of 
the United States in making its statements before th e DSB and the Panel.  If this matter were pending 
in a United States court, the United States represen tatives' statements would, standing alone, be 
sufficient evidence upon which a court could make a final determination on the issue of whether 
Antiguan operators face a total prohibition agai nst providing cross-border gambling and betting 
services.  In other words, the United States' ow n words before the DSB and the Panel would be 
sufficient, without the offer of any other evidence whatsoever, for a United States court to conclude 
that Antigua had carried the burden to prove the existence of a measure which interferes with the 
provision of betting and gambling services in contravention of the GATS. 
 
 Under United States law, the United States statements would be considered a stipulation as to the existence of a total prohibition of remote cr oss-border gambling services.  A "stipulation" in a 
United States legal proceeding is defined as:  
                                                      
241 Ibid., at paras. 7.123 and 7.124. 
242 Ibid., at para. 7.123. 
243 I.C.J. Reports 1974 at p. 253. 
244 Panel Report on US – Section 301 Trade Act  at footnote 692. 
245 See para. 40 of the judgment reported at I.C.J. Reports 1974 at p. 253. WT/DS285/R 
Page C-31 
 
 
"[A]n agreement, admission, or other concession  made in a judicial proceeding by the 
parties or their attorneys.  The essence of a stipulation is an agreement between the 
parties or between counsel with respect to business before a court (…).  A stipulation 
is a time-saving device used to admit necessary, but foundational or peripheral 
evidence which both parties to the litigation concede the truth of and which is not a 
point of contention between the parties. A stipulation is a confessory pleading 
negating the need to offer evidence to prove the fact, and the party is not permitted to 
later attempt to disprove the fact.246   
 The circumstances surrounding the United States' statement strongly suggests that it would be 
considered a stipulation under United States law.  During consultations, Antigua proposed its position 
that the lengthy measures cited in its Annex, either singularly or in combination, were best described 
as a total prohibition of remote cross-border betti ng and gambling services by the United States.  
Antigua's proposal reflected its belief that the "tot al prohibition" concept was not in dispute and, 
further, would serve to expedite the review of th is matter by allowing the Panel and parties to avoid 
expending the time and resources necessary to descr ibe and define the numerous federal and state 
laws which constitute the total prohibition.   In response to a letter from Antigua247 raising the merits 
of proceeding under this theory, the United States re sponded in writing by confirming its position that 
the cross-border gambling services offered by Antigua n operators were prohibited by United States 
law.248  The United States then proceeded to repeat the "total prohibition" concept in statements to the 
DSB and to the Panel.   Under circumstances in which the United States knowingly and willingly 
propounded its position that there is a total prohibiti on after the concept was raised by Antigua as an 
efficiency measure, and then when the United St ates repeated and clarified the total prohibition 
concept before the DSB and this Panel, it is cl ear and unambiguous that the United States concedes 
that one or more its measures serve to prohib it remote betting and gambling services offered by 
Antiguan operators.249  This concession qualifies as a stipulation under United States law.250  The 
effect of this stipulation would be  to put an end to the United States' contention that Antigua has failed 
to meet its burden with regard to explaining or d escribing the complained of measures.  As a general 
rule under United States law, stipul ations are conclusive as to a ll matters properly contained, and 
necessarily included within them, and to all matter s which are an essential part of the stipulation.251  
Ordinarily a party will not be perm itted to contradict a stipulation,252 even though it is contrary to fact, 
and even though the stipulation affects the statutor y and constitutional rights of the parties thereto.253 
                                                      
246 83 Corpus Juris Secundum ("C.J.S.") Stipulations §2 (emphasis supplied) (internal citations 
omitted). 
247 Letter from Antigua and Barbuda to United States (8 May 2003).  See  Antigua's comments on the 
United States' request for preliminary rulings, para. 7. 
248 Letter from United States to Antigua and Barbuda (5 June 2003).  See  Antigua's comments on the 
United States' request for preliminary rulings, footnote 4. 
249 Under United States law, a stipulation need not follow any particular form other than having terms 
which are definite and certain, with it being essential that  the stipulation be assented to by the parties or their 
representatives.  C.J.S Stipulations ., §13 (internal citations omitted). 
250 Under United States law, the issue of whether the statement constitutes a stipulation would be a 
matter for a court to decide.  In doing so, the court would give the stipulation a liberal construction, or one 
which will render it reasonable and just to both parties. C. J.S.  Stipulations, § 47.  A stipulation admitting, or 
agreeing on the existence of, designated facts for the purpose of trial is to be  fairly and reasonably construed as a 
whole in order to effectuate the parties' intention, and in the light of the whole record and the surrounding 
circumstances.  Ibid., § 84.  A primary rule of construction is to ascertain and give effect to the intention of the 
parties. Ibid. § 46 (internal citations omitted). 
251 Ibid., § 6 (internal citations omitted). 
252 A stipulation cannot be disregarded or set aside at will, however, a stipulation can be set aside by a 
court.  The question whether a stipulati on shall be set aside rests in the disc retion of the court, and requires an 
extraordinary exercise of its powers , which can be allowable and proper only when it is made clear that it is 
necessary to prevent injustice. This discretion generally  will not be exercised to set aside a stipulation unless 
good cause be shown for doing so, and unless such action may be taken without prejudice to either party. 
253 C.J.S. Stipulations, § 6 (internal citations omitted). WT/DS285/R 
Page C-32  
 
  Under United States law, the United States' st atements to the DSB that United States law 
prohibits the services in question would represent compelling evidence of the existence of matter 
asserted — that United States law prohibits Antiguan operators from providing remote cross-border 
betting and gambling services to consumers in the Un ited States.  This significant piece of evidence 
by itself would be sufficient to support a finding in a United States court that the United States totally 
prohibits cross-border gambling and betting servi ces.  Although Antigua does not believe the United 
States denies the existence of its total prohibition, if the United States sought to do so a United States court would consider the formal statements of th e United States before the DSB an "admission by a 
party opponent."  Relevant admissions of a party, whether consisting of oral or written assertions or 
nonverbal conduct,
254 are admissible in evidence in United States courts when offered by an 
opponent.255   Admissions in the form of an opinion are competent evidence, even if the opinion is a 
conclusion of law.256  As such, the statements made by the United States before the DSB would be 
allowed into evidence by a United States c ourt as an admission by the United States. 
 
 It is a general principle under United States law that a party who has knowingly and 
deliberately assumed a particular position in a pr oceeding is generally not allowed to assume a 
position inconsistent therewith to the prejudice of the adverse party.  As a simple illustration, a party 
who breaches a contract for reasons specified at th e time will not be permitted afterwards, when sued 
for damages, to offer other and different reasons for breaching the contract.257  In United States legal 
parlance, the breaching party in this exampl e would be "estopped" from changing its position.258 
 
                                                      
254 Wright and Miller, 30B Federal Practice and Procedure §7015, Exhibit AB-109, citing  United States 
v. Nakaladski , 481 F.2d 289 (5th Cir.1973), cert. denied,  414 U.S. 1064 (1973) (a smile found to constitute an 
admission) and 4 Weinstein's Evidence ¶ 801(d)(2)(A)[01] at 801-239 (1990) (Rule 801(d)(2) "makes no 
attempt to categorize the myriad ways in which a part y * * * may make an admission. Admissions can be made 
expressly or may be inferred from conduct.").  
255 This doctrine is based upon Federal Rule of Civil Procedure 801(d)(2), which states:   
 
(d) Statements Which Are Not Hearsay. A statement is not hearsay if  [...] 
  (2) Admission by Party-Opponent. The statement is offered against a party and is (A) the party's own 
statement in either an individual or a representative capacity or (B) a statement of which the party has 
manifested an adoption or belief in its truth, or (C) a statement by a person authorized by the party to make a statement concerning the subject, or (D) a statement by th e party's agent or servant concerning a matter within 
the scope of the agency or employment made during the existence of the relationship,  or (E) a statement by a 
coconspirator of a party during the course and in furthe rance of the conspiracy. The contents of the statement 
shall be considered but are not alone sufficient to establish the declarant' s authority under subdivision (C), the 
agency or employment relationship and scope thereof under subdivision (D), or the existence of the conspiracy 
and the participation therein of the declarant and th e party against whom the statement is offered under 
subdivision (E). 
 
256 Wright and Miller, 30B Federal Practice and Procedure § 7015, citing Owens v. Atchison, Topeka & 
Santa Fe Ry. Co ., 393 F.2d 77, 79 (5th Cir.1968), cert. denied 393 U.S. 855, 89 S.Ct. 129, 21 L.Ed.2d 124 
(1968) ("It is well settled that the opinion rule does no t apply to party's admissions.");  see also McCormick, 
Evidence § 256 at 141-42 (5th ed. 1999). 
257 David J. Joseph Co. v. United States, 82 F.Supp. 345 (Ct.Cl. 1949), (holding that where the United 
States cancelled a contract to receive  scrap iron from a company for a si ngle stated reason, it was barred by 
estoppel from claiming as a defence to  breach of contract at trial that it cancelled the contract for another 
reason). 
258 See,  e.g., United States v. Smith, 781 F.2d 184 (10th Cir. 1986).  ("[N]otwithstanding the position 
previously taken by the United States Attorney, the government now seeks to contend that it is immaterial 
whether [a government official complied with certain procedures].  It is this belated and dramatic shift of 
position we decline to permit.").  Ibid., at 185. WT/DS285/R 
Page C-33 
 
 
 Because the United States made the statements regarding the total prohibition in the course of 
this proceeding, were this matter pending in a United States court, the United States would be "judicially estopped" from contending now that there is  no total prohibition.   The doctrine of "judicial 
estoppel" arises under United States jurisprudence when  a party attempts to assert, in a judicial or 
quasi-judicial proceeding, a position contrary to a pos ition taken by that party in a prior judicial or 
quasi-judicial proceeding.
259  United States courts have recognized that it is wrong to allow a person 
to abuse the judicial process by advocating one positi on, then later advocating a different position at a 
time when the changed position becomes beneficial.260  If the doctrine is applied, the court in the 
subsequent proceeding will "estop," or prevent, the party from asserting a factual or legal position 
contrary to that asserted in the earlier action.261  The United States government is, like any other 
litigant, subject to judicial estoppel whenev er that doctrine is properly invoked.262  
 
United States 
 
 At the June 24, 2003, DSB meeting, the United States stated that it had "made it clear that 
cross-border gambling and betting services are prohib ited under US law" and that such services "are 
prohibited from domestic and foreign service supp liers alike."  The United States stands by these 
statements.  Two clarifications may be helpful.  Firs t, the United States did not say at the time that this 
prohibition was "total," and has repeatedly clarified that it is not.  At the time of the DSB meeting, such a clarification was unnecessary because we were sp eaking in the context of claims that we then 
understood to relate to transmission of bets by Internet or telephone from Antigua n suppliers – actions 
which are indeed prohibited under US law.  Second, our remark about the applicability of this 
prohibition to domestic service suppliers should ha ve made it clear that the prohibition we were 
referring to was not a restriction on cross-border supply per se ; rather, we were referring to laws of 
general application that apply equally to cross- border supply and supply of the like services (i.e., 
remote supply) within the United States. 
 
 Both of these points were implicit in our remarks at the DSB meeting.  Antigua is incorrect to 
read these remarks as a "concession" of, or even as support for, the existence of its alleged "total 
prohibition" on cross border supply of all gambling servi ces.  As we have repeatedly stated, there is 
no such "total prohibition" in US domestic law.  More importantly, since the concept of a "total prohibition" is devoid of any le gal meaning or consequences under either US law or the GATS, 
Antigua's assertions about it contribute nothing to its prima facie case. 
 
For Antigua and Barbuda: 
 
10. Is Antigua and Barbuda challenging:  (i) specific legislative and regulatory provisions  
that are claimed to amount to a prohibition on the cross-border supply of gambling and 
betting services as such ;  and/or (ii) the specific application  of such provisions;  and/or 
(iii) the US practice  vis-a-vis  the foreign cross-border supply of gambling and betting 
services?  Please identify all relevant legislative and regulatory provisions.   
                                                      
259 T. Scott Belden, "Judicial Estoppel in Civil Actio n Arising from Representation or Conduct in Prior 
Administrative Proceeding," 99 American Law Reports 5th 65 (2002).  See also 31 C.J.S. Estoppel and Waiver, 
§140 (stating that "[g]enerally, a party is estopped to as sume inconsistent positions in the course of the same 
judicial proceeding."). 
260 99 A.L.R. 5th, 65, § 2. 
261 Ibid. 
262 United States v Levasseur,  699 F Supp 965 (D. Mass, 1988).  (stating  "[a]t its essence, this doctrine 
forbids a party from asserting inconsistent positions in judicial proceedings. The doctrine is borne of "a 
universal judicial reluctance to permit litigants to 'play fast and loose' wi th courts of jus tice according to the 
vicissitudes of self-interest" as well as a desire "to protect  ... the judicial process from  abuse." 1B J. Moore & J. 
Lucas, Moore's Federal Practi ce ¶ 0.405[8] (2d ed. 1984) ( citing Scarano v. Central R. Co. of New Jersey , 203 
F.2d 510, 513 [3d Cir.1953] [Hastie, J.] )"). WT/DS285/R 
Page C-34  
 
Antigua 
 
 Antigua is challenging all three aspects which are intrinsically linked and are all elements of 
the total ban that Antigua seeks to challenge in this case.  Legislative and regulatory provisions  are 
given a practical effect by their application  to specific cases.  If, for example, the United States 
maintained its prohibition but did not enforce it, then the impairment of Antigua's GATS benefits 
would be much less substantial and Antigua would probably not have started this proceeding.  The 
United States practice  vis-à-vis the foreign cross-border supply of gambling and betting services is 
also based on or at least purported to be based on legislative a nd regulatory provisions.263  In 
Antigua's view it would not be logical or effective to challenge some of these elements and not others. 
 
 In Antigua's Panel request, it is said that:  "[T]he total prohibition of gambling and betting 
services offered from outside the United States appears to conflict with the United States' obligations 
under GATS and its Schedule of Specific Commitmen ts annexed to the GA TS (and in particular 
Sector 10.D thereof) (…)."  The objective of this st atement was to bring the "total prohibition" itself 
before the Panel. While not denying the total prohib ition, the United States insists that Antigua must 
explain to the United States and the Panel exactly  how the total prohibition is constructed under 
United States law.  Antigua has consistently taken the position that to force it to do so – in the words 
of the United States "an impossible task in our view"264 – is wasteful and would deflect the efforts of 
the Panel to an exercise in understanding the minute details of the American legal system when such 
details should not affect the outcome of this proceeding. 
 
 Antigua believes that it is logical and effi cient to challenge the United States' total 
prohibition, as a measure in and of itself, composed of specific legislative and regulatory provisions, applications and practices that both separately a nd jointly impair Antigua's GATS benefits.  The 
Appellate Body's recent report in US – Corrosion-Resistant Steel Sunset Review
 265 confirms that is 
legally possible to challenge such a total ban, and that while the Pa nel must, as a matter of substance, 
establish the impairment of Antigua's GATS bene fits by the total ban it is not obliged, as a 
preliminary jurisdictional matter, to examine all dom estic laws, regulations, ap plications and practices 
that may contribute to the impairment of those benefits.   The purpose of this dispute settlement proceedi ng is to address the impairment of Antigua's 
GATS benefits.  In this respect Antigua is in essence challenging every legislative provision that 
could be construed to form a piece of the United St ates' total prohibition on the cross-border supply of 
gambling and betting services.  The statutory provisions that the United States appears to rely on most 
heavily in its law enforcement actions, or are most like ly to form part of the total ban, were listed in 
the Annex to Antigua's Panel request and also ha ve been submitted to the Panel, together with 
summaries.  The fact that the total prohibition is comprised of a large number of different statutory 
provisions does not mean that the United States would have to abolish or amend all of these individual 
legislative provisions in order to bring its laws in conformity with its obligations under the GATS.  As 
noted in Antigua's opening statement at the first Pa nel meeting, the United States federal government 
possesses the power to legislate in the area of in ternational commerce in a manner that would pre-
empt all contradictory st ate laws and regulations.
266  Furthermore a considerable number of the laws 
that can currently be applied against Antiguan gambling and betting services because these services 
are currently considered "illegal" would no longe r be applicable because, once "authorized," the 
Antiguan services would be "legal."  In any event,  what matters to Antigua, and what matters for 
WTO dispute settlement, is that the United States ce ases the impairment of its treaty obligations by 
                                                      
263 See,  e.g.,. the "Assurance of Discontinuance" entered in to in August 2002 between the Attorney 
General of the State of New York and Pa ypal, Inc. and the discussion of that document in Antigua's response to 
Panel's question 29.   
264 See Section III.B.3 of this Report.   
265 See Appellate Body Report on US – Corrosion-Resistant Steel Sunset Review.  
266 See Section III.B.3 of this Report.   WT/DS285/R 
Page C-35 
 
 
providing market access for cross-border gambling and betting services from Antigua in accordance 
with its GATS obligations.  How this is formally structured under United States law does not matter. 
 
United States 
 
 Setting aside issues concerning Antigua's failure to make a prima facie  case, as to which the 
United States has already commented, the Panel's qu estion points to a distinct issue concerning the 
scope of Antigua's Panel request.  The United States c onsiders that the only claims within the scope of 
Antigua's Panel request (and, therefore, the Panel' s terms of reference) would be "as such" claims 
against specific legislative and regulatory provisions and/or the collective effect of two or more such 
provisions.  The Panel request does not articulate any claim against particular applications of these 
measures, and Antigua's clarification, as accepted by the Panel, would appear to confirm that no such 
claim is within the scope of the Panel request.267  To the extent that Antigua raised the application of 
laws or regulations in its Panel re quest, it pointed to instances of such application only in an attempt 
to illustrate the existence of a "general prohi bition against cross-border supply of gambling and 
betting services in the United States" as such.268 
 
11. What "authorisation to supply" is Antigua and Barbuda referring to in paragraph 88 of 
its first oral statement?  Please identify and provide details of instances when "authorisation to supply" in the United States was refused. 
Antigua 
 
 In its opening statement to the Panel at the fi rst substantive meeting of the parties, Antigua 
stated that "it is not possible for Antiguan supplie rs to obtain an authorization to supply gambling 
services on a cross-border basis."  What was meant here was not that Antigua n operators had applied 
to supply gambling and betting services into the Unit ed States and were refused — the point was that 
under United States law, it is impossible for Antiguan suppliers to meet any authorisation criteria.  
There are two reasons for this.  First is the obvi ous, that the United States government considers the 
provision of cross-border gambling and betting ser vices illegal, and thus it would be illegal under 
United States law as it currently exis ts for Antiguan suppliers to gain au thorisation.  At the first Panel 
meeting Antigua asked the United States to explai n how Antiguan service providers could lawfully 
provide gambling and betting services into the United States.  In response, the United States 
confirmed that this was not possible. 
  Second, under the laws or practice of every state that provides for state-sanctioned gambling in one form or another, the conditions attached to obtaining the right to supply gambling services in 
the state by definition preclude Antiguan operato rs from qualifying on a cross-border basis.  Thus, 
even if the United States did not maintain its total prohibition, Antiguan operators could still not 
lawfully offer their services under the aut horization schemes of the various states.
269  
 
12. In paragraph 3 of its first oral statement,  Antigua and Barbuda illustrates its allegation 
that it is illegal for Antigua and Barbuda  operators to provide gambling and betting 
services in the United States by noting th at the United States has imprisoned the 
operator of an Antiguan company.  Could Antigua and Barbuda provide more details 
with respect to its example.  Are there other instances that illustrate Antigua and Barbuda's point?  If so, please provide details? 
                                                      
267 See Communication from the Panel, 29 October 2 003, para. 31, reproduced in Annex B of this 
Report. 
268 Ibid. 
269 See examples of state authorization schemes contained in the Second Submission of Antigua and 
Barbuda, WT/DS285, paras. 26 - 29. WT/DS285/R 
Page C-36  
 
Antigua 
 
 The case referred to is the United States v. Jay Cohen  case.270  The Cohen  case involves the 
prosecution under the Wire Act271 of an American citizen who had moved to and established a 
company in Antigua to offer gambling and betting se rvices into, among other places, the United States 
on a cross-border basis.  In 1996, Mr. Cohen, then a 29 year old options trader on the Pacific Stock 
Exchange with a degree in nuclear engineering from the University of California at Berkeley, moved 
to Antigua with a number of colleagues and formed  an Antiguan company, World Sports Exchange 
Limited ("WSE"), to operate an Internet sports book.  WSE was initially licensed by the government 
of Antigua to provide those services in 1996 and ha s been licensed and operating continuously since 
then.  In 1998 Mr. Cohen was among approximately 20 operators of Antiguan and other foreign 
companies engaged in the cross-border supply of  gambling and betting services charged by the 
United States government for violating the Wire Act simply by providing these services to consumers in the State of New York.  
 Although most of the individuals charged eith er entered into some kind of plea arrangements 
with the United States or have simply remained outside of the United States and beyond prosecution, 
Mr. Cohen returned to the United States from Anti gua solely for purposes of contesting the charges 
against him.  Mr. Cohen was convinced that he co uld not be found guilty of violating the Wire Act 
because he had expressly modelled WSE's business on th at of Capital OTB, a United States domestic 
company that has been offering interstate betting by telephone for more than 20 years—as well as 
more recently by the Internet—without prosecution under the Wire Act.
272  When Mr. Cohen 
attempted to assert in his defence his belief in the legality of WSE's busin ess under United States law 
and his efforts to comply with United States law in the organisation and operation of WSE, the 
presiding judge deemed those beliefs and efforts irrele vant.  In this respect it is, to say the least, 
remarkable that during Mr. Cohen's trial the United States Department of Justice represented to the 
trial court that the comparison with Capital OTB was irrelevant because Capital OTB's interstate 
operations were not prohibited by the Wire Act, whereas the operations of WSE were.273  This 
representation to the court in the Cohen case about th e legality of Capital OTB's activities is expressly 
contrary to what the United Stat es has told the Panel in this case.274  Mr. Cohen was ultimately 
convicted and his sentence upheld by the United Stat es Court of Appeals for the Second Circuit.  The 
presiding judge sentenced Mr. Cohen to 21 months in federal prison and two additional years of 
supervised probation.  As of the date of these res ponses, Mr. Cohen is incarcerated in a federal prison 
facility located, with not an insignificant amount of irony, in Las Vegas, Nevada.   The United States also undertakes law enforcemen t action against financial intermediaries and 
media companies carrying advertising for foreign gambling and betting services.  Such action is 
considered a more effective impediment for foreign cross-border gambling than the prosecution of 
individuals that are not physically present in the United States.
275  Examples of these kinds of actions 
can be found in various exhibits submitted by An tigua.  Other examples of  actions taken by United 
States federal and state authorities to prevent the provision of cross-border gambling and betting 
                                                      
270 United States v. Jay Cohen, 260 F.3d 68 (2nd Cir. 2001), cert. denied  122 S.Ct. 2587 (2002). 
271 18 U.S.C. §1084. 
272 One of Mr. Cohen's statements in his defence was that he had modelled the business of WSE on the 
Capital OTB model described in the first submission of Antigua.  See Cohen Trial Transcript, pp. 838, 859 – 
869 (testimony of Mr. Cohen dated 22 February 2000 at his trial in New York). 
273 Cohen Trial Transcript, at p. 857 (statement by Ms. Pesce representing the United States 
Department of Justice).   
274 At the meeting of the Panel and the parties of 10 December 2003, the Unite d States representative 
stated that the operations of companies such as  Capital OTB were cont rary to federal law. 
275 See Unlawful Internet Gambling Funding Prohibition Act and the Internet Gambling Licensing and 
Regulation Commission Act, Hearing before the Subcommittee on Crime, Terrorism, and Homeland Security of 
the Committee on the Judiciary, 108th Congress 10 (2003), p. 70. WT/DS285/R 
Page C-37 
 
 
services include the proceeding brought by the Ne w York Attorney General under state criminal 
statutes, the Wire Act and the Travel Act in the World Interactive Gaming Corp. case276 and the 
unsuccessful prosecution in the case of United States v. Truesdale277 of an Internet gambling service 
provider based in the Dominican Republic under the "Illegal Gambling Business Act."278  In addition, 
state authorities continue to take action to prohib it or impede the offering of cross-border betting and 
gambling services.   Like the United States' recent letter advising national advertisers not to allow 
advertising for offshore Internet gambling services,279 states have followed suit and taken similar 
action.  An example of such state action was recently reported in Alabama.280   
  In Alabama, state law provides that a person commits the state crime of "promoting 
gambling" if he knowingly advances or profits fro m unlawful gambling activity otherwise than as a 
player.
281  In November 2003, the Alabama state attorn ey general's office instructed WJOX-AM in 
Birmingham, Alabama, a sports-talk radio stati on, to cease broadcasting commercials for Internet 
gambling operations or risk criminal prosecution.   The warning was issued in a letter by Richard 
Allen, chief deputy to Alabama Attorney General Bill Pryor.  In the letter, Allen informed the radio 
station that the Alabama Attorney General's office  had reviewed advertisem ents broadcast by the 
radio station for Internet and telephone gamb ling operations.  "If the ads are discontinued 
immediately, this office contemplates no further ac tion.  This is, however, the second time we have 
communicated with you about these kinds of activities," Allen wrote.  Promoting gambling is a misdemeanour that carries a maximum penalty of a year  in jail and a fine of $2,000.  Allen warned 
that each airing of a commercial would be considered  a separate crime.  As a result of the Attorney 
General's letter, radio hosts on WJOX-AM have info rmed listeners they can no longer call in and 
discuss gambling or betting lines - a frequent topic during college football season.
282  
 
United States 
 
 Antigua appears to be referring to the case of Jay Cohen, a US citizen who ran an Internet 
gambling operation from Antigua.  Cohen was arrest ed in March 1998 and convicted after a ten-day 
trial in February 2000.  The facts of  the case are described on appeal in United States v. Cohen , 260 
F.3d 68 (2nd Cir. 2001) (affirming Cohen's conviction).283 
 
                                                      
276 Vacco ex rel. People v. World Interactive Gaming Corp ., 714 N.Y.S.2d 844, 854 (N.Y. Sup. Ct. 
1999.  While the Vacco  case involved elements  not present in the Cohen  case, such as allegations of fraud 
against investors, the New York Attorney General in the Vacco case did assert the Wire Act as prohibiting the 
cross-border provision of gambling and betting services from Antigua into the United States 
277 152 F.2d 443 (5th Cir. 1998).  Contrary to the determination of the court in the Cohen  case, the 
Truesdale court held that the gambling and betting services were provided from and occurred outside of the 
United States and thus were not illegal under United States law.   
278 18 U.S.C. §1955. 
279 Letter from the United States Department of Justice to the National Association of Broadcasters 
entitled "advertising for Internet Gambling and Offs hore Sportsbooks Operations" (11 June 2003) 
280 Several states in addition to Alabama have warned advertisers not to accept business from foreign-
based gambling operators.  In 1997, the Florida Attorney General advised advertisers that they were unlawfully promoting illegal gambling under Florida law by promoting offshore gambling enterprises.  Florida Attorney 
General, Press Release: Western Union Cuts off Sp orts Betting Accounts (23 December 1997).  See also 
statement of John Malcolm (20 November 2002).  (Noting that, in 2001, the Colorado Attorney General warned 
advertisers not to advertise for foreign Internet gambling operators and, in 2000, the California Horse Racing 
Board sent notices to all California radio stations to stop running advertisements for foreign gambling operators.) 
281 Ala. Code §13A-12-22. 
282 "State Warns All Sports Station About Gambling Ads," Gadsden Times (Alabama) (8 Nov. 2003), 
(http://www.gadsdentimes.com/apps/pbcs.dll/article?AID=/20031107/APN/311071052 
&cachetime=5). 
283 United States v. Cohen , 260 F.3d 68 (2nd Cir. 2001), cert denied , 122 S. Ct. 2587. WT/DS285/R 
Page C-38  
 
For the United States: 
 
13. How does the United States reconcile its statement in paragraph 46 of its first oral 
statement that "there is no across-the-b oard prohibition on cross-border supply of 
gambling services in US law" with its statements in paragraphs 47 of WT/DSB/M/151 
and WT/DSB/M/153 respectively that the supply of cross-border gambling and betting 
services is prohibited under US law?  Please pr ovide a list of the transactions that would 
be included in "gambling and betting services"? 
United States 
 
 The United States has addressed the first part of the Panel's question in its response to 
question 9 above.  As to a list of the transactions  that would be included in "gambling and betting 
services," as the United States has previously note d, "gambling and betting services" appears neither 
in the US Schedule nor in W/120.  And the provisional CPC (the only document that refers to this term) does not include such a list.  The United St ates can conceive of no basis, however, on which 
Antigua could possibly assert that "gambling and betting services" excludes services that involve the 
organization and/or facilitation of gambling, but do not involve the actual transmission of bets or 
wagers.
284 
 
14. What is the legal status of the Internet Gambling Prohibition Act (referred to in 
Exhibit US-4), the Unlawful Internet Gamb ling Funding Prohibition Act (referred to in 
Exhibit US-5) and the Internet Gambling Licensing and Regulation Commission Act 
(referred to in Exhibit US-5)?  Pl ease provide copies of these documents. 
United States 
 
 These are bills (i.e. , proposed measures) that were debated in Congress.  None of them have 
been enacted.285  The United States has provided the Panel with key elements of the testimony 
presented to Congress during its consideration of these bills as evidence of various contemporary 
issues and concerns surrounding Internet gambling.  Copies of the unadopted bills are attached.  C. A
RTICLE XVI  
For the United States: 
 
15. Where a Member has made full market acc ess commitments on the cross border supply 
of  gambling and betting services, could a pr ohibition on the remote supply of gambling 
and betting services within that Member allo w the same Member to contend that there 
is no violation of Article XVI of the GATS?  Please comment. 
United States 
 
 Yes.  As discussed in the US second submission, a "prohibition" is not ipso facto  inconsistent 
with Article XVI of the GATS.  A panel must ex amine whether the alleged prohibition constitutes a 
limitation that matches the precise criteria in Artic le XVI:2.  Those criteria relate both to the subject 
matter of the limitation and its precise form and/ or manner of expression.  Any limitation that does 
not correspond to these criteria does not violate Article XVI:2. 
 
                                                      
284 Examples of such services are listed in Section III.B.3. 
285 The use of the word "Act" in the titles of the proposals reflects a U.S. legislative convention for 
naming proposed bills; it does not signify enactment. WT/DS285/R 
Page C-39 
 
 
Antigua 
 
 Article XVI is not a non-discrimination or national treatment clause. Whether or not a 
measure that violates Article XVI (in this case a prohibition on cross-borde r supply) also applies 
within a Member has no relevance for the applic ation of Article XVI Paragraph 6 of the 1993 
Scheduling Guidelines lists four examples of limita tions on market access caught by Article XVI:2(a):  
(i) license for a new restaurant based on an economic  needs test;  (ii) annually established quotas for 
foreign medical practitioners;  Government or privately owned monopoly fo r labour exchange; and 
nationality requirements for suppliers of services (equivalent to zero quota).  These clearly include 
examples of measures applying to foreign and domes tic services and services suppliers alike.  These 
measures are nevertheless caught by Article XVI:2(a).  The last example, the nationality requirement, 
further confirms that, contrary to what is argued by  the United States, a total ban that is not expressed 
in numerical terms is caught by Article XVI:2(a) as being equivalent to a zero quota (despite the fact 
that, nominally, a nationality requirement also app lies to service suppliers of the Member concerned). 
Likewise, a total prohibition on remote supply results in a total denial — equivalent to a zero quota — 
of market access in cross-border mode, as cross-bo rder supply is not possible if remote supply is 
unlawful.   In the response to question 1 above Antigua explained that the 1993 Scheduling Guidelines 
are highly relevant for the interpretation of th e US Schedule because the 1993 Scheduling Guidelines 
are part of the context of all GATS schedules.  The 1993 Scheduling Guidelines are also highly 
relevant for the interpretation of the GA TS itself and Article XVI in particular.  
  Article XVI can only be applied through speci fic commitments in schedules.  Consequently 
the approach taken by the Members when drafting Article XVI commitments in their Uruguay Round schedules is a good indicator of the common inten tion of the parties regarding the meaning of 
Article XVI.  That common intention is descr ibed in the 1993 Scheduling Guidelines (as was 
unanimously and explicitly confir med by all Members in the 2001 Scheduling Guidelines).  The 2001 
Scheduling Guidelines contain precisely the sam e examples as the 1993 Scheduling Guidelines.
286  
With regard to the specific point that a non-numer ical total ban is caught by Article XVI:2(a) as 
equivalent to a zero quota, the 2001 Schedulin g Guidelines therefore qualify as a subsequent 
agreement between the parties within the meaning of  Article 31(3)(a) of the Vienna Convention.  As 
mentioned in the response to question 1, the 2001 Scheduling Guidelines were  unanimously approved 
by the Members.  The Panel should further note th at the United States has itself recognised the value 
of the 2001 Scheduling Guidelines for the interpretation of Article XVI.287 
 
European Communities 
  No.  The European Communities understands the Pa nel's hypothetical to assume that, besides 
"a prohibition on the remote supply of gambling a nd betting services within [the] Member" that has 
committed market access, the Member  in question also maintains a measure falling within one of the 
items of Article XVI:2 of the GATS (such as, in the EC view, a prohibition on cross-border supply of 
gambling services).  Once it is concluded that a me asure (such as a prohibition on cross-border supply 
of gambling services) falls within one of the items of Article XVI:2, the fact that the same Member 
simultaneously maintains a prohib ition on remote supply domestically is irrelevant and does neither 
eliminate nor ipso facto  justify a violation of Article XVI. 
 
Mexico 
 
 To the extent and assuming that the term "remote supply" means the cross-border supply of gambling and betting services, it appears that under th e scenario described in the question, suppliers 
                                                      
286 2001 Scheduling Guidelines, para. 12. 
287 See Section III.B.2. of this Report. WT/DS285/R 
Page C-40  
 
of other WTO Members would, in fact, be denied  any market access under mode 1 (cross-border).  
Thus, service suppliers of other WTO Members coul d accord treatment less favourable than that 
provided for under the terms, limitations and condi tions agreed and specified in the Schedule of a 
Member that has made "full market access commitments".  
D. A
RTICLE XVII 
For both parties: 
 
16. If there is "total prohibition" in the United States on the cross-border supply of 
gambling and betting services, as claimed by Antigua and Barbuda, can there be a 
violation of Article XVII at all?   
Antigua 
 
 In Antigua's view the most appropriate interp retation of the relations hip between Articles XVI 
and XVII is that a determination that a total pr ohibition on cross-border supply violates Article XVI 
obviates the need to assess whether the prohib ition also violates Article XVII.  Antigua 
acknowledges, however, that the text of Articles XVI, XVII and XX:2 of the GATS also allows the 
conclusion that Articles XVI and XVII can apply si multaneously to a total prohibition on cross-border 
supply.  In this respect Antigua submits that th e resolution of the debate on the precise relationship 
between Articles XVI and XVII has no practical significance for the outcome of this case.  To Antigua it does not really matter whether the Unit ed States' total prohibition violates Article XVI 
without reaching Article XVII or whether it violates both Articles. 
  The question of the overlap between Articles XVI and XVII appears to be one of the most 
controversial legal questions surr ounding the application of the GATS. However, the overlap question 
only creates a practical problem if a Member has made different commitments for market access and 
national treatment with regard to the same sector.
288  That is not the case for the sub-sectors of the 
US Schedule at issue or possibly at issue in this case: sub-sector 10.D and sub-sector 10.A.  Consequently, in the specific context of this dispute,  the question of overlap is merely a technical one 
– irrespective of whether the United States' total pr ohibition violates Article XVI only or both Articles 
XVI and XVII, the United States is under an obligati on to remedy the breach of its GATS obligations 
by the total ban.  This is not an instance in which different aspect s of the United States measures are 
caught by Article XVI or XVII respectively.  It is simply a matter of "double usage" of Article XVI 
and XVII.  There are undoubtedly circumstances where Article XVI may apply to a situation and Article XVII not, and vice versa.  The fact that in this dispute the United States measures violate both provisions does not undermine the usefulness of eith er provision.  Antigua believes, however, that 
when looked at in isolation, the wording of Article  XVII is sufficiently broa d to capture almost all 
market access restrictions caught by Article  XVI, in particular because it covers de facto as well as 
de jure discrimination.
289  
  The broader problem of the overlap between Article XVI and XVII has been described as one 
of "Text versus Context."
290  The text of Article XVII allows for it to be applied to almost all market 
                                                      
288 See Informal Note by the Secretariat, "Technical Review of GATS Provisions," JOB(01)/17, dated 
16 February 2001;  see also Informal  Note by the Secretariat, "Proposa ls for a Technical Review of GATS 
Provisions – Article XX:2", JOB(02)/153, dated 24 October 2002. 
289 A Member may, for instance, maintain a quantita tive limitation of five suppliers in a certain sub-
sector that is equally applicable to foreign and domestic suppliers.  In many circumstances this will result in a de 
facto discrimination in favour of the, for instance, th ree suppliers already operating in that market.  
290 A. Mattoo, "National Treatment in the GATS," 31 Journal of World Trade  1997, 107-135, at p. 113.  
Mr. Mattoo is one of the most distinguished commentators  on the GATS and worked in the Trade in Services 
Division of the WTO Secretariat at the time he wrote the article. WT/DS285/R 
Page C-41 
 
 
access restrictions covered by Article XVI.  On the other hand the structure of the GATS ( i.e. the fact 
that Article XVI exists and is given an equall y prominent place as Article XVII in the GATS and in 
GATS schedules) indicates that there must be mean ingful distinction between the two.  Although 
Antigua has not been able to review the negotia ting history of these provisions, Antigua has come 
across what appears to be contradictory commentary  on the negotiating history.  Some suggest that 
negotiators worked on the basis of a dividing line between Article XVI and XVII;291 others suggest 
that negotiators were we ll aware of the overlap.292  In Antigua's view the most appropriate 
interpretation of the relationship between Articles XVI  and XVII is one of "practical hierarchy" in 
which:  (i) Article XVI concerns "the key to the door," i.e . regulation that affects an operator's ability 
to access a market; and Article XVII concerns regul ation that distorts competition in favour of 
domestic suppliers once an operator has gone "thr ough the door" and is operating on the market. 
  Under that approach the scope of Article XVII is negatively defined by the scope of 
Article XVI—if a measure is c overed by Article XVI it is not covered by Article XVII. This 
interpretation does not lead to an unacceptable r esult in a situation involving a Member that has no 
commitments in the market access column and a fu ll commitment in the national treatment column, a 
situation which is perceived to be the most impor tant practical problem posed by the overlap of 
Articles XVI and XVII.
293  In such a situation, Antigua's proposed interpretation would imply that to 
the extent that a Member does not maintain measures contrary to Article XVI (meaning that it allows 
market access even though it goes beyond the commitm ents in its schedule), it must grant national 
treatment.  Of course, the value of that national treatment commitment will be limited because traders 
will know that WTO law allows the Member to restri ct market access and ban them from the market.  
However, as long as they are allowed access to the market, they would have to be given national 
treatment.    Antigua submits that this "practical hierarchy"  interpretation is supported by:  (i) the structure 
of the GATS;  (ii) the equally prominent place th at Article XVI and XVII have in GATS schedules;  
(iii) the rule that an interpretation must give mean ing and effect to all terms of a treaty;  and the 
parallelism between GATT and GATS which was one of the working premises of the negotiators.  
The situation is complicated, however, by Article XX :2 of the GATS.  This appears to confirm that 
measures can be caught both by Articles XVI and XV II.  Simultaneously, however, it excludes the 
possibility that Article XVII can be used to u ndermine the effectiveness of restrictions on the 
application of Article XVI (as in the example described above of the Member that made no 
commitments for market access and a full commitment for national treatment).
294  In Antigua's view 
this confirms that, even if the text of Artic les XVI and XVII allows ove rlapping application or 
"double usage," it was the common intention of the par ties that this would not be the case and that the 
provisions would be applied separately.  On the other hand Article XX:2 c ould be interpreted as 
supporting the text-based interpretation that Artic les XVI and XVII can be applied to the same 
measure.  In Antigua's view this is  not the most appropriate interpreta tion but it is not an inappropriate 
                                                      
291 Ibid., at pp. 115-116.  
292 Informal Note by the Secretariat, "Proposals  for a technical review of GATS provisions – 
Article XX:2," JOB(02)/89, dated 16 July 2002. 
293 An expansive, strictly text-based interpreta tion of Article XVII would be problematic in the 
situation of the example (no commitm ent to market access and a full commi tment to national treatment): if 
Article XVII would also cover measures caught by Article  XVI, the restriction on market access in the schedule 
would be without effect because the measure would violate Article XVII and could not be maintained. It cannot 
have been the common intention of the parties to nullify li mitations on market access specifically made by 
Members in their schedules.  
294 Article XX:2 does not deal with the situation where a Member makes a full commitment under 
Article XVI and no commitment under Article XVII.  In Antigua's view this situation is not problematic.  It simply means that a Member cannot maintain measures caught by Article XVI but it can still maintain measures 
which are beyond the scope of Article XVI and that would be prohibited by Article XVII had the Member made 
a commitment under that Article. WT/DS285/R 
Page C-42  
 
interpretation and the Panel may adopt it. Whatever the Panel decides, Antigua holds the strong view 
that the decision on this issue will have no material  effect on the practical outcome of this dispute. 
 
United States 
 
 In this dispute, where the restrictions at issue apply to both cross-border suppliers and 
domestic suppliers of the "like" service, the United States does not see how there could be a violation of Article XVII.  That said, the United States notes th at the analysis of an a lleged "prohibition" under 
Article XVI would appear to be important to answer ing the Panel's question.  Article XVI (in contrast 
to Article XI of the GATT) does not automatically bar any "prohibition."  The Panel should therefore 
examine whether the alleged prohibition meets the precise criteria articulated in Article XVI:2. 
 
17. In determining whether services are "like" is it relevant to have regard to differences in 
regulation between the place from which the se rvice is supplied and the place into which 
it is supplied?  To what extent, if at all,  is Antigua and Barbuda's regulatory regime for 
the supply of Internet gambling and betting services relevant in determining "likeness" 
with the supply of those services in the United States?   
Antigua 
 
 Article XVII of the GATS concerns likeness of services, not of "services regulation."  Thus differences in regulation cannot, as such, play a role in determining likeness for the purposes of 
Article XVII.  In particular, regulation in the importing Member cannot normally play a role in 
determining "likeness" because this regulation is en tirely within the control of that importing Member 
which could manipulate it in such a way that forei gn services are regulated differently, or not at all, 
which would then make them unlike.  In EC – Bananas  the Appellate Body explicitly ruled on this 
point when rejecting an argument by the European Communities that it did not discriminate in favour 
of bananas originating from the group of African , Caribbean and Pacific region countries known as 
"ACP" because it maintained two separate regulatory regimes for the importation of bananas: one for 
ACP bananas and one for bananas originating in  other Members, which allegedly removed the 
possibility of discrimination.  The Appellate Body found that:  
The issue here is not whether the European Communities is correct in stating that two 
separate import regimes exist for bananas, but whether the existence of two, or more, 
separate EC import regimes is of any relevance for the application of the non-discrimination provisions of th e GATT 1994 and the other Annex 1A 
agreements. The essence of the non-discrimina tion obligations is that like products 
should be treated equally, irrespective of thei r origin.  As no participant disputes that 
all bananas are like products, the non- discrimination provisions apply to all imports 
of bananas, irrespective of whether and how a Member categorizes or subdivides these imports for administrative or other reasons.  If, by choosing a different legal basis for imposing import restrictions, or by applying different tariff rates, a Member 
could avoid the application of the non-discrim ination provisions to the imports of like 
products from different Members, the object and purpose of the non-discrimination 
provisions would be defeated. It would be very easy for a Member to circumvent the 
non-discrimination provisions of th e GATT 1994 and the other Annex 1A 
agreements, if these provisions apply only within  regulatory regimes established by 
that Member.
295 
 Regulation in the exporting Member may play an  indirect role because it can determine one or 
more specific characteristics of the service, whic h may be important to determine likeness of the 
service itself.  This could be relevant in a dispute where an importing Member claims the imported 
                                                      
295 Appellate Body Report on EC – Bananas III ,  para. 190. WT/DS285/R 
Page C-43 
 
 
service is "unlike" because of one or more specifi c features determined by the regulation of the 
exporting Member.  In the current instance, however , this is not the case be cause the United States' 
prohibition does not relate to specific characteristics of Antiguan services determined by Antiguan regulation. Furthermore Antigua has pointed out on a number of occasions that it is willing to change 
its regulatory regime in order to address any specific concerns the Un ited States might have.  Thus, in 
the circumstances of this case, the regulatory regi mes of the importing and the exporting Member play 
no role, not even an indirect one, in the determination of likeness of the services.    As set out in Antigua's opening statement at the first Panel meeting, Antigua's view that 
regulation is not relevant for th e determination of likeness is confirmed by the view taken by the 
Appellate Body in EC - Asbestos  with regard to Article III:4 of GATT 1994.
296  In EC – Bananas III 
(US) , the panel interpreted Article II of the GATS (a n MFN provision) in the light of Article XVII of 
the GATS and Article III of the GATT (both nationa l treatment provisions).  The Appellate Body 
criticised this approach, pointing out that the a ppropriate comparison was between Article II of the 
GATS and MFN-type obligations in the GATT 1994.297  Thus the panel was criticised for not 
interpreting a provision of the GATS in the light of a corresponding provision in the GATT 1994.   
Neither the United States nor any of the Third Pa rties have convincingly explained why this Panel 
should adopt a different approach to the one set out by the Appellate Body in EC – Bananas III , and 
not draw an analogy between the national treatment  provisions of the GATT and the GATS.  In the 
absence of such an explanation the Panel should, mutatis mutandis , adopt the approach of the 
Appellate Body in EC – Asbestos  when applying Article XVII.  If follows from EC – Asbestos  that 
Antigua's regulatory regime for the supply of gambling and betting services could  be relevant for this 
dispute in the context of an Article XIV defenc e raised by the United States—for instance, to 
determine whether a total ban on cross-border, re mote-access gaming is necessary to protect the sort 
of public interest concerns outlined by th e United States in its first submission.  
 
 Contrary to the Appellate Body's approach in EC – Asbestos , the United States and Japan 
appear to suggest that such a public interest de bate should also take place in the context of 
Article XVII.  Under that approach a service coul d be declared "unlike" because it raises different 
public interest concerns, justifying different regulation.  In this respect Antigua submits, arguendo , 
that if public interest concerns could play a role in the likeness debate, other elements of the Article XIV debate, such as the necessity test, should also be taken into account.  Not every difference 
in public interest concerns raised by domestic a nd foreign services is capable of justifying radically 
different treatment.  That is not the case unde r Article XIV and it shoul d not be the case under 
Article XVII – difference in treatment is only justif ied to the extent that it is necessary to address 
different risks.  However, transplanting the conditions  for the application of Article XIV to the context 
of Article XVII inevitably results in a situation in wh ich an identical test is applied in two different 
contexts, once in the context of the debate on like ser vices and once in the context of Article XIV.  In 
Antigua's view this will only lead to confusion and Antigua therefore questions the need or even 
usefulness for the GATS legal system of replicati ng the regulatory debate of Article XIV in the 
context of Article XVII.  In EC – Asbestos  the Appellate Body clearly did not see the wisdom of such 
an approach either.   United States 
  In certain circumstances it may be important  to have regard to differences in regulation 
between the place from which the service is supplied, and the place into which it is supplied.   For 
                                                      
296 That is that the determination of "likeness" is "fundamentally, a determination about the nature and 
extent of a competitive relationship between and among products" (Appellate Body Report in EC – Asbestos , 
para. 99), and that regulatory concerns  of the authorities of a Member (as opposed to concerns of a consumer) 
have to be dealt with in the context of Article XX of the GATT 1994, not in the context of the likeness 
assessment. 
297 Appellate Body Report on EC – Bananas III , para. 231. WT/DS285/R 
Page C-44  
 
example, theoretically, if the United States permitte d domestic gambling by remote supply subject to 
particular regulatory requirements, there might  be "like services and service suppliers" issues 
regarding the extent to which services supplied from Antigua meet the same requirements.  However, 
that is not the case.  The more relevant likeness fact or in this dispute is therefore not differences in 
regulation per se,  but differences in the characteristics of services and suppliers that influence the 
manner in which they are regulated.  Specifically , the greater susceptibility of gambling by remote 
supply to various threats (organized crime, money la undering, health risks, child and youth gambling, 
etc.) makes it unlike other, non-remote forms of gambling.  
18. With respect to paragraph 63 of Antigua a nd Barbuda's first oral statement, which 
states in relevant part that the "'likeness of service providers has little functional 
relevance in this case": 
(a) Is there always a need to assess liken ess for both "services" and "service 
suppliers"  under Article XVII of the GATS?  
(b) Is there a difference in the relevance of the "likeness" of service suppliers for 
modes 1 and 2 as compared to for modes 3 and 4? In other words, should the 
likeness of service suppliers  as well as the likeness of services  be considered in the 
case of modes 1 and 2? 
Antigua 
 
[a]: In Antigua's view this is not the case.  In paragraph 95 of its first submission the United States 
suggests that Article XVII can only apply if like services are supplied by like service suppliers.  Thus 
the reference to "service suppliers" in Article XVII:1 would function as a limitation on the scope of 
Article XVII:1: less favourable treatment of like services would only be caught by Article XVII to the extent that the services are supplied by like service  suppliers.  However, the text of Article XVII:1 
does not support that conclusion at all.  The text of Article XVII provides that:  
 
each Member shall accord to  services and service suppliers of any other Member, 
(…), treatment no less favourable than th at it accords to its own like services and 
service suppliers. 
 Thus Article XVII mandates treatment "no less favourable" for "like services" and "like 
service suppliers," without limiting that obligation to situations in which both the services and the 
services suppliers are "like."  The text does not refer to "like services supplied by like service 
suppliers."  Indeed, it would be difficult to see wh y the drafters of the GATS would have wanted to 
limit the scope of Article XVII in such a way.  Presumably, in adding the "like service supplier" 
concept the drafters wanted to extend rather than li mit the scope of Article XVII.  This is because, in 
the area of trade in services, much more than in the area of trade in goods, the conditions of 
competition in the market place can be affected by m easures applicable to the service suppliers rather 
than to the services themselves.  This is partic ularly the case when services are supplied in mode 3 
or 4.  For instance a Member could impose di scriminatory taxes on a foreign service supplier 
"commercially present" on its territory.  In Antigua's  view the purpose of the extension of the national 
treatment obligation to service suppliers in Article XVII is to capture such measures.  It is not 
intended to somehow limit the scope of Article XVII. 
 
[b]: In modes 3 and 4, arguably the identity  of the service supplier might be more relevant, given 
that both modes involve the actual, physical presence of businesses or natural persons located in the 
territory of the Member.  In such circumstances it is perhaps more likely that denial of national 
treatment may occur on the basis of the identity of the service supplier without regard to the actual 
services being provided.  Further, the actual presence  of businesses or natural persons may invoke the 
many concerns that may arise in that context, such as immigration, use of public resources and WT/DS285/R 
Page C-45 
 
 
services and a host of other issues raised by actual phy sical presence.  But whether or not identity can 
or should be synonymous with "likeness" is questionable.  
United States 
 
[a]:  Yes.  Article XVII requires likeness of both services and service suppliers.  As the panel in 
Canada – Autos observed, "in the absence of ‘like' dom estic service suppliers, a measure by a 
Member cannot be found to be inconsistent with the national treatment obligation in Article XVII of 
the GATS."298  The same panel also emphasized that the burden of proving this element rested on the 
complaining party.299 
 
[b]:  Antigua bears the burden of proving likeness of service suppliers regardless of the mode of 
supply concerned.  The United States is unable to find any basis in Article XVII or elsewhere in the GATS for disregarding likeness in particular modes of supply.  European Communities 
 [a]: No, because it is e.g. sufficien t, for a violation of Article XVII to occur, that discrimination is 
made between foreign and domestic services.  Article XVII:1 requires Members to grant national treatment to both foreign services and foreign service providers.  
[b]: Given the answer to question (a) above, this question becomes moot.  This being said, there is 
nothing in the text of the Agreement that would suggest that a difference between modes should be 
made.   
Mexico 
 
[a]: The extent of the assessment required will de pend on the specific claims of violation in any 
given dispute and the facts and circumstances of each case. 
 [b]: See Mexico's response to question (a) above.    19. Is Internet/remote gambling and betting authorized between states within the United 
States?   
Antigua 
 
 Antigua has not been able, for the purposes of this question, to conduct an exhaustive review 
of all the circumstances in which interstate ga mbling and betting is authorised within the United 
States.  The examples which follow provide, however, the clearest possible indication that there is remote, state-sanctioned interstate gambling and betti ng within the United States: this, in turn, shows 
that the United States' statement th at such activities are illegal is contradicted by the practice.  
Because the Panel's question specifically refers to betting services between  states, Antigua does not 
include in this answer information ab out Internet/remote gambling authorized within  a state in the 
United States.
300 
  The United States has a longstanding polic y of permitting inters tate telephone account 
wagering on horse races which is authorized by state a nd local laws.  In 1973, the State of New York 
                                                      
298 Panel Report  in Canada – Autos , para. 10.289. 
299 Ibid. 
300 For example, Nevada has created a special exem ption under its state laws for intrastate account 
wagering on sporting events such as horse races and professional and amateur contests.  Nevada Revised 
Statutes §465.094. WT/DS285/R 
Page C-46  
 
legalised and began to operate its own pari-m utuel account wagering system, New York Capital 
OTB.
301  Over the next 15 years, three other states sanctioned account wagering on horse races: 
Connecticut in 1976, Maryland in  1984 and Pennsylvania in 1987.302  By the 1990s, sanctioned 
operators were offering remote account wagering from the 12 states303 that enacted licensing schemes 
for such wagering.  The operators in the 12 states that permit remote wagering, in turn, accept cross-
border wagers by means of electronic communications from residents of 37 other states.304  T h e  
proliferation of betting from anywhere resulted in an  increase in total wagers in the pari-mutuel 
industry, despite a modest decline in racetrack  attendance and the number of races run during the 
same period.  By 1999, almost one-half of all wage rs placed on horse races in the United States are by 
off-track or telephone wager305 and, as of 2003, 85 per cent of the US$15 billion in annual wagers on 
horse races in the United States is generated away fro m the track where the race is actually being run 
by means of remote gambling.306 
  United States operators which offer cross- border account wagering do so under United States 
legal precedents which hold that states retain the disc retion to determine the legal effect of in-coming 
communications into the state.
307  These court opinions found gambling takes place at the location 
where the money changes hands, not necessarily where the person placing the bet is located.308  This 
concept is codified in Oregon's remote gambling regu lation, which states that "any wager that is made 
from an account maintained by an Oregon operator in Oregon is considered to have been made in the 
State of Oregon" is legally valid.309  While there is debate about the exact status of cross-border 
gambling in the United States,310 it is undisputed that state sanctioned remote gambling services like 
                                                      
301 2003 North American Gaming Almanac , p. 558. 
302 Ibid. 
303 Antigua referenced eight states which permit ope rators to accept remote wa gers from within the 
state or from outside the state.  Up on further review, there are at least 12 states which offer account wagering on 
horse racing, with additional states to come.  A leadin g Nevada gaming law firm, Lion el Sawyer & Co., reports 
that, as of 2002, 12 states - Connecticut, Ohio, Kentucky, Maryland, New York, Oregon, California, Louisiana, 
Massachusetts, New Hampshire, North Dakota and Pennsylv ania - have adopted state legislation authorizing the 
acceptance of account wagering in interstate off- tr ack pari-mutuel racing.  See Nevada Pari-Mutuel 
Association, Las Vegas Dissemination Co. and Lionel Sawy er & Collins, An Overview of Off-Track Wagering 
(25 July 2002), p. 27 (presented to the Nevada Gaming Commission and State Gaming Control Board).  Bear 
Stearns & Co. reports that, as of 2 003, 14 states permit gambling operator s to accept remote wagers on horse 
races.  2003 North American Gaming Almanac , p. 558. 
304 See,  e.g., www.Youbet.com and www.CapitalOTB.com.  
305 2003 North American Gaming Almanac , p. 560, (chart entitled "Exhibit 3: The Numbers Don't Lie," 
indicating that 46.3 percent of all pari-mutuel wagers – the largest component of the pari-mutuel handle – was 
placed by using an off-track or telephone account). 
306  See also the chart "US Horseracing Statistics". 
307 Antonia Z. Cowan, The Global Gambling Village: Interstate and Transnational Gambling , 
7 Gambling Law Review 251 (August 2003), pp. 259 – 260, citing  Lescallet v. Commonwealth , 89 Va. 878, 17 
S.E. 546, 547-48 (Va. 1893) and United States v. Truesdale , 152 F. 3d 443 (5th Cir. 1998). 
308 Cowan, The Global Gambling Village , p. 260, citing  Jeffrey A. Modisett, A Brief Look at The Past, 
Present and Future through The Eyes of A Former Attorney General , 6 Gaming Law Review 198 (2002), p. 203 
and  Memorandum from Gregory C. Avioli, National Thoroughbred Horseracing Association (on the issue: 
"Whether Account Wagering may be lawfully conducted by a state-licensed pari-mutuel facility with account 
holders located in a state other than the state where the account is located") (August 3, 1999), pp. 2-8. 
309 See Oregon Administrative Rule 462-220-0060. 
310 As an illustration of this extreme uncertainty, during February 2000, the United States Department 
of Justice itself made contradictory statements as to whether cross-border pari-mutuel wagering services such as Capital OTB were regulated by the Wire Act.  At Jay Cohen's trial, on 22 February 2000, the Department of 
Justice attorneys convinced the trial judge that Capital OTB was not regulated by the Wire Act.  Cohen Trial 
Transcript, p. 839 – 859.  Three weeks earlier, however,  a Department of Justice re presentative instructed the 
New York State Racing and Wagering Board that wagering services such as Capital OTB were probably 
regulated by the Wire Act and, therefore, unlawful un der United States law.  Letter of Kevin DiGregory, 
Assistant Attorney General, United St ates Department of Justice to Nico le Thuillez of the New York State WT/DS285/R 
Page C-47 
 
 
Youbet.com and Capital OTB have been accepted for over 30 years in the United States without any 
known federal prosecution of major service provi ders.  The United States National Thoroughbred 
Racing Association has been reported as stating th at state-licensed and regulated entities in over 30 
states have been conducting interstate pari-mutue l wagering for more than 20 years with the full 
knowledge of the United States Department of Justice.311   
 
 While some of the state-sanctioned pari-m utuel wagering services, such as Youbet.com and 
Capital OTB currently accept both Internet and te lephone wagers, there are other state-sanctioned 
services which accept only telephone wagers.  Autotote Enterprises, Inc., for in stance, is a licensed 
pari-mutuel operator in Connecticut which provides 12 off-track venues for patrons to watch and bet 
on horse racing.312  The company maintains a telephone account wagering system called "On the 
Wire," which is accessible to residents of 27 states.313  The longstanding and uninterrupted policy of 
acceptance by the United States of remote wagering by off-track and telephone accounts was codified 
into law in December 2000, when the United St ates Congress amended the Interstate Horseracing Act 
(the "IHA")314 and specifically expanded the definition of "i nterstate off-track wager" to include pari-
mutuel wagers transmitted between states by way of telephone or other electronic media.  The added 
statutory language reads as follows:  
[T]he term –. . . 'interstate off-track wager' mean s a legal wager placed or accepted in 
one State with respect to the outcome of a horserace taking place in another State and includes pari-mutuel wagers, where lawful in each State involved, placed or 
transmitted by an individual in one State via telephone or other electronic media and 
accepted by an off-track betting system in the same or another State, as well as the combination of any pari-mutuel wagering pools;
315  
 The plain language of the revised statute clear ly appears on its face to permit interstate pari-
mutuel wagering over the telephone or other modes of electronic communication, including the 
Internet, so long as such wagering is legal in both states.  The legislative history of the amendment 
supports this conclusion.  As part of the underlyi ng legislative debate surrounding the passage of the 
amendment, Representative Frank R. Wolf of the St ate of Virginia expressed his understanding of the 
effect of this new language:  
I want Members of this body to be aware that section 629 ... would legalize interstate 
pari-mutuel gambling over the Internet. Under the current interpretation of the 
Interstate Horse Racing Act in 1978, this type of gambling is illegal, although the 
Justice Department has not taken steps to  enforce it. This provision would codify 
legality of placing wagers over the telephone or other electronic media like the Internet.
316 
 As a result of this legislative amendment to  the IHA, account wagering has begun to spread 
into additional states.  In 2003, Nevada approve d account wagering on horse racing but the account 
wagering system has not commenced operations un til its regulation system is being finalized.317  In 
                                                                                                                                                                     
Racing and Wagering Board (1 February 2000).  The states which ha ve reviewed this issue have reached 
contradictory conclusions as well. 
311 Letter by Greg Avioli, counsel for the National Thoroughbred Racing Association to Congressman 
W.J. Tauzin. 
312 See http://www.autobet.com/.  
313 See www.ctotb.com/wire.asp and www.ctotb.com/open.asp.   Autotote Enterprises is a subsidiary of 
Scientific Games Corporation, a United States-based p ublicly traded company which is a global technology 
leader in the pari-mutuel and lottery industries.  See www.scigames.com/sgcorp/index.asp. 
314 See DC Appropriations, Pub. L. No. 106-553, § 629, 114 Stat. 2762A-108 (2000). 
315 15 U.S.C. § 3002(3). 
316 146 Cong. Rec. H 11230, 11232, 106th Cong. 2nd Sess. (2000). 
317 Cowan, The Global Gambling Village , p. 259, footnote 61. WT/DS285/R 
Page C-48  
 
addition, during 2003 Virginia ame nded its pari-mutuel wagering laws  to grant the Virginia Racing 
Commission the authority to regulate account wagering, by "which an individual may establish an account with an entity, approved by the Commissi on, to place pari-mutuel wagers in person or 
electronically."
318  
 
 Under the Indian Gaming Regulatory Act (the  "IGRA"), gamblers at Native American 
gaming establishments are permitted to gamble against each other by using remote electronic player 
stations.319  In two separate rulings issued in 2000, United States v. 162 MegaMania Gambling 
Devices320 and United States v. 103 Electronic Gambling Devices ,321 federal appellate courts affirmed 
the sanctioned use of electronic player stations that allowed players at various Indian locations to play 
bingo-type gambling games against each other.  Bo th of these cases involved the legality of a bingo-
style gambling game called MegaMania, which is pl ayed on a machine called an "electronic player 
station."322  These player stations are located on Native American lands in Oklahoma, California and 
elsewhere.323  A person playing MegaMania begins the ga me by electronically selecting up to four 
cards with randomly generated numbers.  The player must pay US$0.25 per card to begin the game.  
A game will commence once at least 12 players nationwide purchase at least 48 cards.  A random 
selection machine located on Native American land in Oklahoma selects three numbered balls, and a 
human operator transmits the numbers on the balls by  computer to Multimedia's headquarters, where 
they are sent through a computer network to each player station.  The player then touches the corresponding space or spaces on the player's card a ppearing on the MegaMania station screen.  To 
continue playing the game, a player must pay an  additional US$0.25 per card in exchange for the 
numbers on the next three balls.  These numbers ar e transmitted in roughly ten second intervals.  
Consequently, the player must continue to pay US$0.25 to US$1.00 every ten seconds to stay in the game.  A player wins by being the first player among all those who are playing throughout the country to obtain a set of numbers which match a certain arrangement on his electronic card.  On average, 
Multimedia and the participating Native American tr ibes retain 15 percent of the amount taken in by 
the machines and the winning players receive 85 per cent.
324 
  In both the 162MegaMania Gambling Devices  and 103 Electronic Gambling Devices  cases, 
the federal courts held that the cross border el ectronic MegaMania gambli ng game was lawful under 
the IGRA.  The analysis applied in these cases sugg ests that IGRA allows the use of technology, 
including the Internet, to expand player particip ation in a common game if the game and all the 
players are participating from terminals located on Native American land.
325 
  United States lotteries are played across stat e lines in the cases of the Powerball and Mega 
Millions lottery games.  Powerball is a multi-state, me ga-jackpot lotto game that is played in 24 states, 
the District of Columbia and the United States Virgin  Islands. The game is administered by the Multi-
State Lottery Association (the "MUSL"), a multi government-benefit association owned and operated 
by its member lotteries.326  For each drawing, five white balls are picked out of a drum containing 53 
balls and one red ball out of anot her drum containing 42 red balls.327  Mega Millions is a multi-state 
lottery game played in 11 states, including Geor gia, Illinois, Maryland, Massachusetts, Michigan, 
New Jersey, New York, Ohio, Texas, Virginia and Washington.328  Mega Millions drawings are held 
                                                      
318 James R. Kibler, Jr., "Annual Survey of Virgin ia Law: Administrative Law, 38 University of 
Richmond Law Review 39 (2003), p. 44-45, citing  Va. Code Ann. § 59.1-369(5) (Cum. Supp. 2003). 
319 Cowan, The Global Gambling Village , p. 258 (internal citations omitted). 
320 231 F.3d 713 (10th Cir. 2000). 
321 223 F.3d 1091 (9th Cir. 2000). 
322 U.S. v. 162 MegaMa nia Gambling Devices,  231 F.3d at 716 – 717. 
323 Ibid.  
324 Ibid. 
325 Cowan, The Global Gambling Village , p. 258 (internal citations omitted). 
326 See www.powerball.com/pb_about.asp. 
327 See www.nmlottery.com/Power Ball/AboutPowerball.htm. 
328 See www.megamillions.com/aboutus/lottery_faq.asp. WT/DS285/R 
Page C-49 
 
 
Tuesday and Friday nights.  The drawings are conducted by the Georgia Lottery in Atlanta, 
Georgia.329  In both of these multi-state gambling games, players in participating states purchase 
lottery tickets from retail terminals which are linke d to the Powerball or Mega Millions multi-state 
computer network.    United States 
  The gambling services described in paragr aph 20 of the United States' second written 
submission may be transmitted between US states or on a cross-border basis.  Other forms of Internet/remote gambling services are not authorized between US states or on a cross-border basis. 
 
For Antigua and Barbuda: 
 
20. Could Antigua and Barbuda please elaborate on its comment in paragraph 43 of its first 
oral statement that "We agree that in certain specific circumstances  a service could be 
considered unlike only because it is supplied on a cross-border basis"? (emphasis added)  
Antigua 
 
 The debate in this proceeding may have suffe red from a possibly confusing use of the terms 
"cross-border" and "remote supply."  Antigua  has used these terms as follows:  (i) c ross-border  is 
defined by Article I(2)(a) of the GATS:  "from the te rritory of one Member into the territory of any 
other Member."  This implies that "the service supplier is not present within the territory of the 
Member where the service is delivered," a nd includes "the supply of the service through 
telecommunications or mail"330 (but only when service supplier an d consumer are physically located 
on the territory of different Members);  and (ii) r emote supply  includes the supply of services through 
telecommunications or mail or any other mean s when service supplier and consumer are not 
physically together irrespective of whether they are located within the same or within different 
countries.     Thus cross-border supply is necessarily remote  supply but remote suppl y is only cross-border 
supply when service supplier and consumer are physically located in different Members.  In its statement Antigua compared foreign ser vices supplied on a cross-border basis ( i.e. remote), with 
domestic services supplied via physical presence ( i.e. non-remote)
331.  Antigua was not comparing 
cross-border remote supply with domestic remote supp ly.  A more accurate wording is the following: 
 
Antigua and Barbuda submits therefore that , in the context of a commitment by a 
Member to national treatment of cross-border supply, there must at least be a 
presumption that the fact that the services are provided remotely cannot, standing 
alone, make a service "unlike" a service provided via physical presence. We agree that in certain specific circumstances a service could  be considered "unlike" only 
because it is supplied remotely.  However, in line with our reasoning discussed above, and the position expressed by Japan in its third party submission, Antigua and 
Barbuda believes that it is for the Unite d States to rebut what should be an 
assumption of prima facie  "likeness" of services supplied remotely. 
United States 
 
 The United States wishes to clarify that it is not alleging that services supplied from Antigua are unlike because they are supplied on a cross-border basis.  In principle, remote supply can occur 
                                                      
329 See www.megamillions.com/aboutus/lottery_faq.asp. 
330 1993 Scheduling Guidelines, para. 19. 
331 See Section III.B.5 of this Report. WT/DS285/R 
Page C-50  
 
either on a cross-border basis or on a purely domestic basis.  US restrictions on remote supply apply 
equally regardless of national origin.  
For the United States: 
 
21. Exhibit AB-42332 indicates that Youbet.com provides its subscribers the ability to wager 
"in most states" on horse races.  US legal residents above 21 years old can become a 
member and place bets online or on the tele phone once they have opened an account. 
Youbet.com states that it "is in full complia nce with all applicable state and federal 
laws".  Could the United States comment on th is case, especially in view of its statement 
(in paragraph 33 of its first written submission) that the Interstate Horseracing Act  "does 
not provide legal authority for any form of Internet gambling"?   
United States 
 
 While Youbet.com states that they are in "full compliance with all applicable state and federal 
law," the US Department of Justice (the nation's chief law enforcement agen cy) does not agree with 
this statement.  The Interstate Horseracing Act of 1978 is a civil statute in which the federal 
government has no enforcement role.  In December 2000, the definition of the term "interstate off-
track wager" in the IHA was amended.  Congr ess, however, did not amend preexisting criminal 
statutes.  When President William J. Clinton signe d the bill containing the amendment to the IHA 
after the bill was passed by Congress, the Preside ntial Statement on Signing stated as follows: 
 
Finally, section 629 of the Act amends th e Interstate Horseracing Act of 1978 to 
include within the definition of the term "interstate off-track wager," pari-mutuel wagers on horse races that are placed or tr ansmitted from individuals in one State via 
the telephone or other electronic media and accepted by an off-track betting system in 
the same or another State.  The Department of Justice, however, does not view this 
provision as codifying the legality of co mmon pool wagering and interstate account 
wagering even where such wagering is legal in the various States involved for horseracing, nor does the Department view the provision as repealing or amending existing criminal statutes that may be applicab le to such activity, in particular sections 
1084, 1952, and 1955, of Title 18, United States Code.
333 
 
 After hearings on Internet gambling in 2003, the Department of Justice reiterated its view that 
current federal law prohibits all types of Intern et gambling, including gambling on horse races, dog 
racing, or lotteries.  The Department of Justi ce maintains this view because the 2000 amendment to 
the IHA did not repeal the preexisting federal laws making such activity illegal.  Under the principles 
of statutory interpretation applicable in United States courts, "[i]t is a cardinal principle of 
construction that repeals by implication are not favoured ... .  The intention of the legislature to repeal 
must be clear and manifest."334 
 
                                                      
332 Extract from the website of Youbet.com, at www.youbet.com/faq/, submitted by Antigua as exhibit.  
333 Statement on Signing the Departments of Commerce,  Justice, State, the Judiciary, and Related 
Agencies Appropriations Act, 20 01, 36 Weekly Comp. Pres. Doc. 3153 ,3155-3156 (25 December 2000). 
334 United States v. Borden Co.,  308 U.S. 188, 188 (1939). WT/DS285/R 
Page C-51 
 
 
22. How does the United States treat Internet  services provided by Youbet.com, TVG, 
Capital OTB and Xpressbet.com, referred to by  Antigua and Barbuda in paragraph 118 
of its first written submission?  
United States 
 
 Antigua discussed account wagering on horse races via the Internet and telephone.335  T h e  
United States does not agree that the 2000 amendment to the IHA permits the interstate transmission 
of bets or wagers on horse races because pre-ex isting criminal statutes prohibit such activity.336  It 
should be noted, however, that these Internet services provide additional services beyond just 
accepting wagers on horse races.  They provide acce ss to information about the horses, the odds on 
the horse races, simulcasting of horse races, etc.  While US law does not permit interstate 
transmission by a wire communication facility of be ts or wagers on horse races, the interstate 
transmission by a wire communication facility of in formation assisting in the placing of bets or 
wagers on horse races would not be prohibited, pu rsuant to 18 U.S.C. § 1084(b), as long as the 
information is being transmitted from a place where betting on that event is legal to a place where 
betting on the same event is legal. 
 
23. Could the United States comment on a statem ent made in the Gaming Industry Report 
by Bear Stearns (Exhibit AB-36337) that a number of operators in Nevada have 
established Internet gambling websites? 
United States 
 
 The Bear Stearns report discussed proposals for In ternet gambling in the State of Nevada.   
The report indicated that Nevada's plans for Intern et gambling are on hold, and that Nevada has been 
informed by the Department of Justice that US fe deral law does not permit Internet transmission of a 
bet or wager.  Nevada officials have assured federa l officials that no operation licensed in Nevada has 
been approved or authorized to use any wagering system that operates over the Internet.  In the 
discussion on Internet gambling businesses located in Alde rney and the Isle of Man, the report stated 
on page 18 that Venetian Casino Resort Athens LLC , a subsidiary of Las Vegas Sands, Inc., had 
applied for an e-gaming license from Alderney.  On page 19, the report stated that MGM Mirage had 
been awarded a license from the Isle of Man.  The United States understands that MGM Mirage 
formerly operated an Internet gambling website from  the Isle of Man, but has ceased operation.  
Further, when this website was operating, our information indicated it did not accept wagers from 
individuals located in the United States.  The Un ited States does not have specific information on 
whether or when the Venetian Casino Resort bega n operating its Internet gambling website.  While 
the United States is not in a position to provide an analysis of the operation of any specific website 
from the Isle of Man or Alderney, we can categor ically state that as long as such websites do not 
accept bets or wagers from individuals located in  the United States and do not provide information 
assisting in the placing of bets or wagers to indi viduals located in the Un ited States where such 
wagering is illegal, then the operation of such websites from Alderney or the Isle of Man by 
"operators from Nevada" does not vi olate US federal gambling laws. 
 
                                                      
335 The United States submits that Antigua incorrectly  states that "[i]n order to accommodate this new 
form of account wagering, in 2000, the United States ex panded the IHA [Interstate Horseracing Act of 1978] to 
permit betting on horse races over the Internet.  Today, United States resi dents can lawfully gamble on horse 
races by telephone or online with seve ral United States-based companies."  S ee Section III.B.5. of this Report. 
336 See US response to Panel's question 21. 
337 Michael Tew and Jason Ader, Bear St earns & Co. Inc., Equity Research, Gaming Industry: 
E-Gaming: A Giant Be yond Our Borders, submitted by Antigua as exhibit. WT/DS285/R 
Page C-52  
 
24. What is the status of the New Jersey bill ref erred to in the Gaming Industry Report by 
Bear Stearns (Exhibit AB-36) that would a llow existing land-based casino facilities in 
New Jersey to operate Internet gaming sites from their own casino floors? 
United States 
 
 On page 35 of Exhibit AB-36, a bill introduced in 2001 in the State of New Jersey legislature 
is discussed.  That bill was not passed by the State of New Jersey legislature.  Another bill, AB 568, is 
discussed on page 36.  That bill was introduced in the 2002-2003 session but it was not passed during that session.  We have no information on whether that bill or any similar legislation has been or will 
be reintroduced in the New Jersey legislature. 
 
25. With respect to Exhibit AB-18
338, could the United States indicate how it treats the 
services provided by Alliance Gaming Corp?  
United States 
 
 Exhibit AB-18 is an article from the Las Vegas Review-Journal  about a progressive slot 
system in casinos in Moscow that is monitored by operators in a control room in Las Vegas.  This 
article appears to concern a progressive slot mach ine system that involves physical slot machines 
located in casinos, and does not concern on-line slot machines.  The article does not contain sufficient 
factual allegations on the operation of this system to allow the United States to draw any conclusions about the legality of this system.  Generally, progr essive slot machines are slot machines that are 
linked together in the same or multiple casinos in  order to increase the jackpot.  The United States 
understands that the player must travel to a par ticipating casino where the progressive slot machine is 
located, physically deposit the wager in the slot machine, and play the slot machine inside the 
participating casino.  Under this scenario, the bet is  placed in the casino where the player is located.  
Thus, the wager is not placed remotely. 
 
26. Could the United States comment on the fo llowing excerpt from WT/GC/16 (referred to 
in paragraph 42 of Antigua and Barbuda's first oral statement) and the relevance, if any, of the comments contained therein to the present dispute: 
"there should be no question that where a market access and national treatment 
commitments exist, they encompass the de livery of the service through electronic 
means, in keeping with the principle of technological neutrality". 
United States 
 
 The United States concurs with the view that electronic delivery, in and of itself, does not 
cause a service to be excluded from a Member's co mmitments.  The United States is not arguing for 
such an exclusion in this dispute.  The quoted statement does not say, and should not be taken to 
mean, that delivery of a service by electronic means, or other means of remote supply, for that matter, 
automatically makes that service "like" any domestic  service that is subject to the same commitment 
for purposes of the Article XVII likeness analysis.  Re mote supply does not mean that the service thus 
supplied (or its supplier) gets a "free pass" on liken ess.  As the United States points out in its second 
written submission, Antigua has failed to prove th at its remotely supplied gambling services are like 
non-remote US gambling services. 
 
                                                      
338 Rod Smith, "Casino Industry Technology: Open Wide, New Progressive slot System Lets Las 
Vegas Company Serve Russian Gamblers," Las Vegas Review Journal  (2 September 2003), submitted by 
Antigua as exhibits. WT/DS285/R 
Page C-53 
 
 
E. ARTICLE VI 
For Antigua and Barbuda: 
 
27. Could Antigua and Barbuda specify what "autho rization procedures" it is referring to 
in its claim of violation of Articles VI:1 and VI:3 of the GATS Agreement? 
Antigua 
 
 The answer to this question is the same as qu estion 11.  It is not possible for Antiguan service 
suppliers to obtain authorisation to provide gambling and betting services into the United States.  This 
violates Article VI:1 of the GATS because the "author isation procedures" by their very terms exclude 
Antiguan suppliers and thus cannot be considered  "administered in a reasonable, objective and 
impartial manner."  This violates Article VI:3 becau se the inability to apply for authorisation makes it 
impossible for the United States to comply with the requirements of Article VI:3. 
28. In respect of its claim of violation of Article VI:1, could Antigua and Barbuda indicate 
what "measures of general application" are not being "administered in a reasonable, 
objective and impartial manner" and why? 
Antigua 
  The general approach to gambling law in the United States is that all gambling and betting is 
prohibited unless a specific authorisation has been gi ven.  Thus, the United States first maintains its 
"measures of general application"—the state and fede ral measures that act to prohibit the provision of 
gambling and betting services in the United States.  Overlaying the general prohibitions are the state 
and federal measures that authorise certain persons  to provide certain gambling and betting services 
under a wide and disparate variety of situations.
339  By not providing a method by which Antiguan 
suppliers can obtain authorisation to offer their servi ces into the United States, the United States is in 
violation of Article VI:1. 
F. ARTICLE XI 
For Antigua and Barbuda: 
 
29. In paragraph 108 of its first oral statem ent, Antigua and Barbuda refers to "legal 
provisions" that formed the basis of the New York Attorney General's action against 
Paypal.   
(a) Which legal provisions is Antigua and Barbuda referring to?  
(b) Is Antigua and Barbuda challenging these legal provisions and/or the 
application of these provisions? 
Antigua 
 
[a]: Paragraphs 14-18 of the "Assurance of Discon tinuance" entered into in August 2002 between 
the Attorney General of the State of New York and PayPal, Inc,340 refer to the two legal provisions 
and two cases (each of which was included in the Anne x to Antigua's Panel request). In his discussion 
                                                      
339 See Section III.B.7. of this Report.   
340 Attorney General of the State of New York, Internet Bureau, In the Matter of Paypal, Inc. , 
Assurance of Discontinuance (16 August 2002). WT/DS285/R 
Page C-54  
 
of the two cases the New York Attorney General furt her refers to two other legal provisions that are 
also included in the Annex to the Panel request. Antigua refers to all these legal provisions. The 
provisions and cases at issue are:  – N.Y. General Obligation Law §§ 5-401 and 5-411 (McKinney 2001).  Section 5-401, 
makes all wagers on races and games of chance unlawful.  Section 5-411 renders void all 
contracts based on wagers or bets. 
– N.Y. Const.  art. I, §9.  Article I, section 9 of the New York Constitution states, in its 
pertinent part: 
"except as hereinafter provided, no lottery or the sale of lottery tickets, pool-selling, 
bookmaking, or any other kind of gambling, except lotteries operated by the state and 
the sale of lottery tickets in connection th erewith as may be authorized and prescribed 
by the legislature, the net proceeds of which shall be applied exclusively to or in aid 
or support of education in this state as th e legislature may prescribe, and except pari-
mutuel betting on horse races as may be prescribed by the legislature and from which 
the state shall derive a reasonable reve nue for the support of government, shall 
hereafter be authorized or allowed within this state; and the legislature shall pass 
appropriate laws to prevent offences agains t any of the provisions of this section."  
– U.S. v. Cohen , 260 F.3d 68 (2
nd Cir. 2001), cert. denied , 536 U.S. 922 (2002).    This case 
involves the United States' prosecution of Ja y Cohen discussed in Antigua's answer to 
question 12.  The New York Attorney General cited Mr. Cohen's case as evidence that federal 
law – the Wire Act341 – prohibits "offshore sports betting ope rations used by persons located 
in New York State."342 
– The People of the State of New York  v. World Interactive Gaming Corp. , 185 Misc. 2d 852 
(Sup. Ctr. N.Y. Co. 1999).  343   The New York Attorney Ge neral cited this case for the 
proposition that New York's criminal  laws regarding unlawful gambling344 allow the State of 
New York to enjoin a licensed  Antiguan gaming enterprise from providing gambling services 
to Internet users in New York. 
[b]: As was the case in Antigua's answer to qu estion 10, Antigua is challenging the statutes ( and 
their application as demonstrated by the cited cases) to  the extent they are used  by the United States to 
prevent Antiguan service suppliers from providing ga mbling and betting services to consumers in the 
United States.  
                                                      
341 18 U.S.C. §1084. 
342 "Assurance of discontinuance" signed between the New York Attorney General and Paypal Inc., 
dated 16 August 2002, para. 16. 
343 Antigua cites to this same case in Section III of  the Annex to its Panel request.  Antigua's citation, 
although to the same case, is to  a different reporting service. 
344 N.Y. Penal Law §225 (general gambling prohibition laws, included in the Annex to Antigua's Panel 
request). WT/DS285/R 
Page C-55 
 
 
II. PANEL'S QUESTIONS AT THE SECOND SUBSTANTIVE MEETING 
B. US SCHEDULE  
For the United States: 
 
30. In its reply to Panel question No. 3 to thir d parties, the European Communities refers to 
the last revision of the Revised Final Sche dule of the United States Concerning Initial 
Commitments, circulated as MTN.GNS/W/ 112/Rev4 on 15 December 1993.  The 
European Communities notes that this revis ion contained a cover-note that read as 
follows: 
Except where specifically noted, the scope of the sectoral commitments of the 
United States corresponds to the sectoral coverage in the Secretariat's Services 
Sectoral Classification List (MTN.GNS/W/120, dated 10 July 1991). 
The European Communities notes that the only further activity to be 
undertaken following circulation of this  document by the United States was a 
process of "'technical verification of schedules' which did not modify at all the 
scope of the results of negotiations" (as provided for in GATT/AIR/3544 , which, 
in turn, refers to a decision of the GNS dated 11 December 1993 providing the same).  
(a) Could the United States comment on the European Communities' reply?   
(b) How does the United States define the term "scope" in this cover-note? 
United States 
 
[a]: The document MTN.GNS/W/112/Rev.4 cited by the European Communities includes a sentence, substantially identical to that which appeared in MTN.GNS/W/112/Rev.3, stating that 
"[e]xcept where specifically noted, the scope of the sectoral commitments of the United States 
corresponds to the sectoral coverage in the Secretar iat's revised Services Sectoral Classification List 
(MTN.GNS/W/120, dated 10 July 1991)." The EC h as incorrectly described the cover note to draft 
versions of the US Schedule as indicating a US positi on "that the scope of [US] commitments is based 
on the 1991 Sectoral Classification (W/120) and the CPC."
345  The addition of the words "and the 
CPC" at the end of that sentence misrepresents th e content of the cover note.  The United States did 
not refer to the CPC in that note.  Also, the United States has previously explained that the ordering of 
a schedule according to W/120 and the use of the CP C were distinct issues.  Using W/120 did not 
bind a Member to the CPC, and this is confirmed by the fact that Members wishing to refer to the 
CPC inscribed CPC numbers in their schedules.   Regarding the discussions taking place in late 1993 and early 1994, those discussions provided ample opportunity for other participants in  the GATS negotiations to request that the United 
States place CPC references in its schedule.  A statement by the chairman of the Group of 
Negotiations on Services at an informal meeting on October 29, 1993 confirms this.  The Chairman 
stated that:  
I also intend to organise consultations, po ssibly on a fairly large scale and probably 
on 16 November, on drafting of schedules of commitments.  I should stress that it 
would not be the purpose of this exercise to  consider the economic content or value of 
offers, but rather, in the interest of all participants, to identify possible improvements 
                                                      
345 European Communities' reply to Panel question No. 3.  WT/DS285/R 
Page C-56  
 
in the presentation of offers, based on act ual examples.  The organisation of this 
discussion would be greatly assisted if participants informed the secretariat in advance of any common errors in scheduling wh ich in their view affect the clarity or 
the legal security of commitments.  This would enable the secretariat to prepare a 
working document for the discussion.
346 
 The Chairman's instructions strongly imply that  any participant that desired the insertion of 
CPC references in the US schedule was fr ee to raise the issue at that time. 
  The GATT Secretariat subsequently asked that  parties to the GATS negotiations submit their 
questions on others' schedules of commitments and MFN exemptions by 27 January 1994.  Meetings 
were scheduled in early February 1994 at which in terested parties were invited to discuss the draft 
schedules of individual participants as part of a "r ectification" process, with final schedules requested 
by early March, 1994.  While this period was ma inly intended to address technical matters, a number 
of substantive issues remained outstanding as well.
347  Thus the United States would not agree with 
the assertion that the "scope of the results of th e negotiations" was fully settled by December 1993. 
 
[b]:  The note relates the "scope" of US commitm ents to the "sectoral coverage" in W/120, from 
which one may infer that "scope of commitments " and "sectoral coverage" were being used as 
roughly synonymous terms.  Contrary to the EC's as sertions, participants in the negotiations could not 
reasonably have read this note as an endorsement of the CPC classification.  The United States was 
already on record as not wishing to be bound by any particular nomenclature.  Moreover, as the 
United States noted in response to part (a) of this  question, W/120 and the CPC were recognized to be 
distinct issues.  While many favoured the CPC, others  did not wish to refer to it.  The texts of the 
schedules reflect that Members wishing to refer to the CPC so indicated by the inscription of 
numerical CPC references.  31. In the European Communities' reply to Panel question No. 2 to the parties, the 
European Communities stated that "the relevance of unilateral practice has to be evaluated in the light of the obligation to be implemented."  Could the United States comment on the European Communities' view of the relevance of unilateral practice of a 
Member in interpreting that Member's GATS Schedule. 
United States 
 
 This statement was made in the context of the USITC Document.  In view of the limitations of that document already described at length by the United States,
348 the United States fails to see how 
it could constitute a "practice" in the ap plication of GATS – even a unilateral one. 
 
 The United States disagrees with the argument a dvanced by the EC that unilateral practice is 
relevant to the interpretation of the US schedule in this dispute.  The EC cites no customary rule of 
interpretation of public international law that gives weight to unilateral practice.  The EC refers to EC 
- Computer Equipment , but ignores key aspects of that report that demonstrate that it supports the US 
view, including the following: (i) The Appellate Body in that dispute criticized the panel for looking 
at the classification practice of one Member while failing to look at that of another.349 (ii) The 
                                                      
346 Informal GNS Meeting – 29 October 1993 : Chairman's Statement, MTN.GNS/48 
(29 October 1993).  
347 For example, participants continued to debate the scope of the GATS and the need to schedule 
certain types of measures.  Participants were also gi ven until June 1994 to complete the scheduling of certain 
sub-central measures.  See Statement by the Chairman:  Scheduling of Subsidies and Taxes at the Sub-Central Level, MTN.GNS/50 (13 December 1993).  
348 See Section III.B.2. of this Repo rt; response to Panel question No. 2.  
349 Appellate Body Report on EC – Computer Equipment , para. 93  WT/DS285/R 
Page C-57 
 
 
Appellate body in EC - Computer Equipment  found that "classification practice" was only a 
supplementary means of interpretation within the meaning of Article 32 of the Vienna Convention, 
not context within the meaning of Article 31.3(b).350  In that respect, EC - Computer Equipment  once 
again directly contradicts the arguments of the EC and Antigua. (iii) EC - Computer Equipment  dealt 
exclusively with "classification practice" – i.e., the practical application of customs classifications to 
goods.351  The USITC Document, by contrast, does not represent the practical application of 
classifications under the GATS; its purpose is only to "facilitate comparison."  It therefore does not reflect substantive implementation of US GATS commitments in the way that classification practice reflects implementation of goods commitments.  
 The United States further notes that, notwithsta nding the fact that the USITC Document does 
not represent the implementation, interpretation, or  application of any US commitment, the EC's 
comments on "unilateral practice" contain a num ber of surprising, and ultimately untenable, 
propositions.  
 First, the EC appears to suggest that implementation of a commitment is "particularly 
relevant" to the interpretation of a commitment.  This  is somewhat startling.  In the first place, the EC 
cites no basis for this proposition in the customary rul es of treaty interpretation.  Indeed, it is hard to 
reconcile that position with the basic principle codified  in Article 31(1) of the Vienna Convention:  "A 
treaty shall be interpreted in good faith in accordan ce with the ordinary meaning to be given to the 
terms of the treaty in their context and in the light  of its object and purpose."  Furthermore, the EC 
appears to ignore completely the fact that many specific commitments were the subject of request-
offer or other bi- or plurilatera l negotiations.  The EC's approa ch would no doubt surprise many 
Members who thought that other Members' GATS sc hedules record the results of their negotiations, 
and not just a set of words that the scheduling Member can "implement" and thereby interpret.  
 
 Second, the EC appears to suggest that the ab sence of an objection by other Members to the 
way one Member applies a specific commitment can be determinative of the meaning of that commitment.  It is not entirely clear what the c onsequences of the EC's approach would be, whether 
for the schedule of the United States or that of any other Member.  (The suggestion that the GATS 
had led to that sort of outcome would no doubt al so startle many Members who participated in the 
negotiations but lack the resources to monitor impl ementation of other Members' every commitment.)  
In any case, the EC's position fundamentally rests on a principle that was rejected under the GATT 
1947.  As a GATT 1947 panel rejecting a similar ar gument by the European Communities made clear, 
"... it would be erroneous to interpret the fact that  a measure had not been subject to Article XXIII 
over a number of years, as tantamount to its tacit acceptance by contracting parties."
352 
 
                                                      
350 Ibid., para. 92. 
351 Ibid., paras. 92-93.  
352 Panel Report on EEC – Import Restrictions , para. 28.  Another panel pointed out that "[t]he decision 
of a contracting party not to invoke a right vis-à-vis another contracting party at a particular point in time can 
therefore, by itself, not r easonably be assumed to be a decision to release that other contracting party from its 
obligations under the General Ag reement."  Panel Report on EEC (Member States) – Bananas I,  para. 3.62.  WT/DS285/R 
Page C-58  
 
C. T
HE MEASURE (S) AT ISSUE  
For Antigua and Barbuda: 
 
32. In its first oral statement (para. 21), in arguing that a prohibition on the cross-border 
supply of gambling and betting services exists , Antigua points to three federal laws, 
namely the Wire Act (18 USC § 1084), the Travel Act (18 USC § 1952) and the Illegal 
Gambling Business Act (18 USC § 1955).  In its first oral statement (para. 20), Antigua also refers, through Exhibit AB-84, to five st ate laws that prohibit Internet gambling.  
Could Antigua indicate whether or not these a re the only specific laws it seeks to rely on 
in substantiating its allegation that a pr ohibition on the cross-border supply of gambling 
and betting services exists.  If not, could An tigua identify and explain the other laws or 
measures upon which it seeks to rely in this regard?   
Antigua 
 
 All the specific laws contained in Antigua's Pa nel request form part of the total prohibition 
that effectively exists in the United States (a nd is recognized by the United States).  Through 
paragraph 25 of our oral statement of 10 Decemb er 2003 and Exhibits AB-81 and –88, Antigua has 
provided further explanation of all these specific la ws, the texts of which can be found in Exhibits 
AB-82, -89, -90, -91 and -99.  All this material  concerning specific laws further substantiates the 
existence of a total prohibition. It is important to  note, however, that Antigua has cited all these laws 
in its Panel request in order to be as comprehensive as possible, not because it believes that each law 
is an essential part of a "puzzle" without which ther e would be no total prohibition.  Most of the laws 
cited in the Panel request are prohibition laws that  could be applied independently of each other to 
prohibit cross-border supply from Antigua.    Antigua submits its response to this question in  advance of the deadline of 2 February because 
this question could also be interpreted as an inv itation to submit more deta iled explanation about the 
federal and state laws that were not discussed in paragraph 20-21 of the oral statement of 
10 December and Exhibit AB-84.  In Antigua's view  this is probably not the purpose of question 32 
because the documents submitted as Exhibits AB-81 and -88 already contain an explanation of all the 
federal and state laws listed in the Panel request that  is similar to the explanation given for the three 
federal laws in our oral statemen t of 10 December 2003 and for the laws of the five states summarized 
in Exhibit AB-84.  Antigua is of course prepared to  submit further explanation of the laws at issue if 
that is what the Panel is seeking, but we do not wa nt to burden the Panel with further written material 
if that is not what the Panel is looking for.   If we have understood question 32 wrongly, we 
respectfully request the Panel to clarify it so that  we may respond in the most helpful manner before 
the deadline of 2 February. 
 
United States 
 
 The United States wishes to reserve its right to  respond to any new arguments and/or evidence 
put forward by Antigua in response to the Panel's additional questions.  Consistent with the views 
expressed in the US request for preliminary rulings , the United States would request that the Panel 
permit the United States a minimum of four weeks to respond to any new arguments or comment on 
any new evidence advanced by Antigua concerning me asures that it has not addressed in its previous 
submissions and statements.  WT/DS285/R 
Page C-59 
 
 
33. Could Antigua provide a list of the gambling and betting services they seek to supply 
cross-border to the United States and that th ey claim are subject to a prohibition? 
Antigua 
 
 Antigua seeks to supply all types of services that involve the making of a bet or wager to 
consumers in the United States, subject to services th at are prohibited by Antiguan law, such as those 
involving the use of pornographic, indecent or offe nsive material.  It is difficult to cover every 
possible permutation in a list, but the product offerings encompassed by the gambling and betting services that Antigua seeks to offer include:  (i) Random selection games (in whatever form and 
including games that are traditionally described as "l otteries" or "casino-type games" in their probably 
endless permutations).  (ii) Event-based gambling.   (iii)  Card games and other games of skill 
involving monetary stakes.  (iv)  Person-to-p erson gambling (so-called "betting exchanges"). 
 
For the United States: 
 34. How is paragraph 20 of the United States' second written submission relevant to Panel 
question No. 19?  Is Internet/remote gamb ling and betting authorized between US 
states? 
United States 
 
 In response to Panel question 19, the United St ates stated that gambling services described in 
paragraph 20 of the US second written submission could be transmitted between US states or on a 
cross-border basis, but other forms of Internet/remote gambling services were not authorized between US states or on a cross-border basis.  The refere nce to "paragraph 20" in that response was erroneous; 
the United States intended to refer to paragraph 26 of  the US second written submission, in which the 
United States stated that US restrictions do not preclude cross-border supply of all gambling services, 
and listed several examples.  The Internet/remot e gambling services described in paragraph 26 are 
permitted between US states and on a cross-border basi s, but other forms of Internet/remote gambling 
service (i.e., those involving transmission a bet or wager using a wire communications facility) are not.  The United States thanks the Panel fo r bringing this error to its attention. 
  The United States wishes to note that paragraph 20 of the US second written submission does, 
however, bear a relationship to question 19.  The tabl e provided in paragraph 20 clarifies that in order 
to violate Article XVI:2(a), on which Antigua now bases its Article XVI:2 arguments, a limitation must restrict the "number of service suppliers," and must be "in the form of numerical quotas," etc.  Under US law, whether a service is permissibl e between states and cross-border depends on the 
character of the activity involved.  This type of  restriction does not limit the number of suppliers 
(indeed, there can be an indefinite number of suppliers of permissible cross-border gambling 
services), and it does not take the "form" of "numerical quotas."   
35. In paragraph 17 of its second oral statement,  the United States submits that "We have 
very forthrightly told both the DSB and this Panel that the United States does not 
permit certain services, such as Internet betting, either domestically or on a cross-
border basis."  Could the United States identi fy the "certain services" for which supply 
is prohibited both domestica lly and on a cross-border basis? 
United States 
 
 Yes.  The United States is referring principally to services involving the transmission of a bet 
or wager by a wire communication facility across state or US borders, such as Internet and telephone 
betting.  Other gambling services that are simila rly restricted both domestically and cross-border WT/DS285/R 
Page C-60  
 
include the mailing of lottery tickets between stat es, the interstate transportation of wagering 
paraphernalia, and wage ring on sporting events. 
 
36. With respect to the reference to the "very few exceptions limited to licensed sports book 
operations in Nevada" in the second paragraph of Exhibit AB-73
353, could the United 
States identify these exceptions, even on an illustrative basis? 
United States 
 
 Exhibit AB-73 is a letter from Deputy Assist ant Attorney General John Malcolm to the 
National Association of Broadcasters.  The sentence in  that letter referred to by the Panel states that 
"[w]ith very few exceptions limited to licensed sports book operation in Ne vada, state and federal 
laws prohibit the operation of sports books and Inte rnet gambling within the United States, whether or 
not such operations are based offs hore."  Nevada is the only state where sports book services are legal 
in the United States.  This exception results from the historical fact that Nevada had already 
authorized such services at the tim e when the US federal government decided to prohibit the further 
authorization of sports gambling by US states.354  Sports book services are limited to Nevada, and 
sports books in Nevada cannot accept wagers from individuals located in other states. 
 
Antigua 
  Antigua would like to point out that the statem ent made on behalf of the United States in the 
letter attached as Exhibit AB 73 is not completely accurate when it says "[w]ith very few exceptions 
limited to licensed sport book operations in Nevada, state and federal laws prohibit the operation of 
sports books and Internet gambling within the Unite d States (…)."  Under the legislation known as the 
"PASPA,"
355 the United States federal government expressl y exempted four states, Nevada, Oregon, 
Delaware and Montana, from its general prohib ition on sports betting other than horse racing, 
greyhound racing and jai alai.  Presently, only Nevada  has full-scale sports betting, although Oregon 
has a number of sports betting opportunities through the state-owned lottery.356  There is nothing in 
the PASPA or other federal laws restricting the ab ility of these states to engage in the full range of 
sports betting services on a commercial or state-owned basis.  Further, while the United States appears 
to distinguish in several ways between horse r acing and other forms of sports betting, Antigua 
believes that there is really no logical basis for the distinction.  Horse race betting is sports betting and 
is widely sanctioned throughout the United States,  whether delivered "in person", over the telephone 
or via the Internet.  
                                                      
353 Letter from the United States Department of Justice to the National Association of Broadcasters 
entitled "Advertising for Internet Gamb ling and Offshore Sportsbooks Opera tions," (11 June 2003), Submitted 
by Antigua as exhibit. 
354 28 U.S.C. §§ 3701-3704.  This law was enacted in 1991 to "stop the spread of State-sponsored 
sports gambling and to maintain the integrity of our na tional pastime."  Senate Report 102-248, reprinted in 
1992 U.S.C.C.A.N. 3553, 3555.  Congress believed that "[s]ports gambling threatens to change the nature of sporting events from wholesome entertainment for all ages to devices for gambling.  It undermines public 
confidence in the character of prof essional and amateur sports."  Ibid . Nevada was the only state that had 
authorized sports books at the time of  the enactment of this federal statut e (or within a year thereafter), thus 
under the terms of the statute it became the only state permitted to continue doing so. 
355 28 U.S.C. §§ 3701-3704. 
356 www.oregonlottery.com.  WT/DS285/R 
Page C-61 
 
 
D. ARTICLE XVI 
For the United States: 
 
37. Assuming, arguendo, that the United States has made a commitment in its GATS 
Schedule in relation to gambling and betting services, what is the purpose of evaluating 
consistency with paragraph 2 of Article XVI in  addition to making that evaluation with 
respect to paragraph 1 given that the United States has inscribed a "none" in its Schedule in relation to market access commitments? 
United States 
 
 The word "none" appears under the heading of "limitations on market access."  In order to 
determine whether a Member has violated the co mmitment reflected by inscription of the word 
"none," one must therefore determine what it means to have a "limitation on market access."  Article 
XVI:2 provides the closed list of carefully-described quantitative restrictions and other limitations that 
are considered "limitations on market access" under th e GATS.  Thus one is logically bound to look 
to Article XVI:2 to determine whether a Member h as maintained or adopted a measure inconsistent 
with Article XVI.  
38. What is the United States' reaction to Antigua's arguments in paragraph 31 of Antigua's 
second oral statement regarding the significance of the word "whether" in Article XVI:2(a)? 
United States 
 
 Antigua relies on the word "whether" to assert that  Article XVI:2(a) is, internally speaking, an 
open list rather than a closed one.  The word "wheth er" does not automatically imply an open list.  In 
fact, the WTO agreements are replete with contrary  examples where the drafters understood this, and 
therefore added some catch-all term such as "any ot her form."  The particular example using that 
phrase is Article XXVIII(a) of the GATS, which st ates that "'measure' means any measure by a 
Member, whether in the form of a law, regulation, rule, procedure, decision, administrative action, or 
any other form" (emphasis added).  Another exampl e more functionally analogous to Article XVI of 
the GATS is Article XI of the GATT, which describes an open list by reference to "prohibitions or 
restriction ... whether made effective through quotas, import or export licenses or other measures".  
Indeed, that example further confirms the prev ious US arguments on the important differences 
between Article XI of the GATT and Article XVI of the GATS.   There is another example in the GATS Anne x on Financial Services, which uses the phrase 
"whether on an exchange, in an over-the-counter market or otherwi se".  Indeed, the WTO Agreements 
contain a number of other examples.  Together they confirm that since Article XVI:2(a) includes no 
catch-all phrase, it is properly read as a closed list.  
Antigua 
 
 Antigua would like to emphasise that the word "whether" must have some  meaning.  If 
Article XVI:2(a) were to be interpreted as the Un ited States desires—an express recital of the only 
"forms" that denial of market access can take in order to result in a violation of Article XVI—the 
word "whether" is meaningless.  If "whether" is take n out of the text, then the text reads as the United 
States summarised in paragraph 20 of its second written submission.  Yet, the United States would 
have the actual  text of Article XVI:2(a) read exactly the same way, despite the inclusion of the word 
"whether."  In this respect the Panel should note that in EC – Hormones , the Appellate Body stated WT/DS285/R 
Page C-62  
 
that:  "[T]he fundamental rule of treaty interpretati on requires a treaty interpreter to read and interpret 
the words actually used by the agreement under examination (…)."
357 
  The United States' argument that the broad purposes expressed in Article XVI:1 are then 
negated by a formalistic reading of  Article XVI:2 is patently illogical and violates the basic rule of 
treaty interpretation described by the first paragraph of Article 31 of the Vienna Convention, i.e. that: 
"A treaty shall be interpreted in good faith in accord ance with the ordinary meaning to be given to the 
terms of the treaty in their context and in the light of its object and purpose." According to its 
preamble the object and purpose of GATS is the "progressive liberalization" of trade in services "as a means of promoting the economic growth of all trad ing partners and the development of developing 
countries."  Market access commitments are obviou sly one of the main mechanisms through which 
this "progressive liberalisation" is put into effect .  To allow a country to evade full commitments to 
market access expressed in its schedule simply by adop ting a barrier in the "form" of a total, outright 
prohibition would render those commitments ineffectiv e.  This clearly cannot have been the intention 
of the drafters of the GATS. 
 
39. Could the United States comment on Antigua's arguments in paragraph 32 of Antigua's 
second oral statement regarding the sign ificance of the 1993 and 2001 Scheduling 
Guidelines insofar as they state that a nationality requirement for service suppliers 
would be caught by Article XVI:2(a) of the GATS?  Could the 2001 Scheduling  Guidelines constitute a "subsequent agreemen t" under Article 31(3)(a) of the Vienna 
Convention or "subsequent practice" under Ar ticle 31(3)(b) of the Vienna Convention? 
United States 
 
 In paragraph 32 of its second oral statem ent, Antigua asserts that the 1993 and 2001 
scheduling guidelines "state unequivocally that a nationality requirement for service suppliers would 
be caught by Article XVI:2(a) as equivalent to a zer o quota despite the fact that it does not have the 
form of a numerical quota."  Antigua bases this assertion on a list of examples of limitations on market access provided in the scheduling guidelines.   That list includes, under "[l]imitations on the 
number of service suppliers," the entry "[n]ati onality requirements for suppliers of services 
(equivalent to zero quota)."  
 The United States disagrees with Antigua's broad assertions based on this line in the 
scheduling guidelines for the following reasons:  (i) nothing in the text of Article XVI supports the theory of an implied "zero quota."  The text of Article XVI:2(a) relied upon by Antigua refers in 
relevant part to "limitations on the number of servi ce suppliers ... in the form of numerical quotas."  
Under the ordinary meaning of this text, the "form" of  the limitation is the legally relevant fact, not its 
alleged implication or effect.  The quoted language  requires that this form be "numerical" (which 
means "of, pertaining to, or characteristic of a  nu mber or numbers") and a "quota" (which means a  
"quantity  which under official regulations must be  imported").
358  US restrictions on remote 
supply of gambling do not take the form of numeric al quotas on service suppliers;  (ii) the scheduling 
guidelines themselves state elsewhere that "[n]um erical ceilings should be expressed in defined 
quantities in either absolute numbers or percentages."359  This statement is more consistent with the 
text of Article XVI;  (iii) the scheduling guidelin es state on their face that they "should not be 
considered as an authoritative legal interpretation of the GATS"360;  (iv) the example of a nationality 
requirement is inapposite because such a requirement  theoretically precludes all cross-border supply, 
whereas – as the United States has re peatedly stressed – US restrictions on remote supply of gambling 
                                                      
357 Appellate Body Report on EC – Hormones , para. 181. 
358 The New Shorter Oxford English Dictionary , pp. 1955, 2454 (4th ed. 1993).  
359 Addendum to 1993 Scheduling Guidelines; response to question 3; 2001 Scheduling Guidelines, 
para. 9. 
360 1993 Scheduling Guidelines, para. 1; 2001 Scheduling Guidelines, para. 1.  WT/DS285/R 
Page C-63 
 
 
do not prohibit all cross-border supply of gambling serv ices, and they apply regardless of nationality;  
(v) unlike nationality requirements, US restrictions  on remote supply of gambling are restrictions on 
the attributes of a service, not limitations on market access.  In a 1997 paper discussing (among other things) the "zero quota" line in the Scheduling Guidelines, the WTO Secretariat observed that 
although a nationality requirement might be considered a zero quota ( quod non ), "[a] restriction on the 
composition of management of a commercial presence cannot be construed as a direct restriction on 
market access for a foreign services supplier."
361  The Secretariat thus distinguished between 
restrictions on the "attributes" of a service, whic h belonged in the national treatment column, and 
restrictions on "natural persons actually supplying  the service," which belonged in the market access 
column.362  Consistent with this analysis, US restri ctions on the attributes of a service are not 
limitations on market access. 
  The Panel asks whether the 2001 Scheduling Gu idelines constitute a "subsequent agreement" 
under Article 31(3)(a) of the Vienna Convention.  Th ey do not.  The United States has already pointed 
out that the text of the document states that it shoul d not be considered as a legal interpretation of the 
GATS.  It would therefore be inconsistent with the terms of the document itself to construe it as a 
"subsequent agreement between the parties regarding th e interpretation of the treaty or the application 
of its provisions."  Also, the General Council an d the Ministerial Conference have the "exclusive 
authority" to adopt legal interp retations of the WTO agreements
.363  Finally, the 2001 Scheduling 
Guidelines do not relate to the "interpretation" or  "application" of the GATS; rather, they represent 
preparatory work for the negotiation of new co mmitments.  For all of these reasons, the 2001 
Scheduling Guidelines do not constitute a "subseque nt agreement" under Article 31(3)(a) of the 
Vienna Convention.   The Panel asks whether the 2001 Scheduling Guidelines constitute "subsequent practice" 
under Article 31(3)(b) of the Vienna Convention.  They do not.  Article 31(3)(b) of the Vienna 
Convention refers to "subsequent practice in th e application of the treaty which establishes the 
agreement of the parties regarding its interpre tation."  The 2001 Scheduling Guidelines constitute 
non-binding guidance for the negotiation of treaty pr ovisions, and as such represent preparatory work 
for future commitments, not practice "in the ap plication of the treaty."  Moreover, the 2001 
Scheduling Guidelines do not "establish[] the agreement of the parties regarding" the interpretation of 
the GATS.  On the contrary, these "guidelines" expressl y state that they are not an interpretation, and 
were drafted with great care to suggest or recomm end, rather than require, particular approaches, 
nomenclatures, or interpretations.  Therefore one cannot conclude that the 2001 Guidelines represent a 
practice of Members reflecting a common understanding by Members on the interpretation of any provisions of the GATS.  
 The positions expressed in the two preceding para graphs are further confirmed by the text of 
the Decision by which the Council for Trade in Se rvices adopted the 2001 scheduling guidelines.  The 
Council decided:  
1. To adopt the Guidelines for the Sc heduling of Specific Commitments under 
the General Agreement on Trade in Services contained in document S/CSC/W/30 as 
a non-binding set of guidelines . 
2. Members are invited to follow these guidelines on a voluntary basis  in the 
future scheduling of their specific commitmen ts, in order to promote their precision 
and clarity. 
                                                      
361 Revision of Scheduling Guidelines – Note by the Secretariat, S/CSC/W/19, para. 20 
(5 March 1999).  
362 Ibid.  
363 Article IX:1 of the Marrakesh Agreement Es tablishing the World Trade Organization.  WT/DS285/R 
Page C-64  
 
3. These guidelines shall not modify any rights or obligations  of the Members 
under the GATS.
364 
 The italicized language demonstrates that the 2001 Scheduling Guidelines were intended 
neither to bind Members nor to alter the extent of  any right or obligation under the GATS (including 
the extent of commitments).  Moreover, it was understood that the revised guidelines did not 
constitute an authoritative interpretation of GATS pr ovisions, since such an interpretation would have 
to be based on Article IX of the WTO Agreement.   Rather, they constituted preparatory work for 
"future scheduling" of specific commitments.  E. A
RTICLE XVII  
For Antigua and Barbuda: 
 
40. Does Antigua have any market-based/econo mic evidence to support its assertion in 
paragraph 36 of its second oral statement that "Internet-based" and "land-based" gambling and betting services compete and th at consumers switch from one to the 
other? 
Antigua 
 
 In 2001, a survey was undertaken by some i ndustry participants in order to determine the 
"consumer market" among gamblers world-wide.  A summary of the report on their findings365 
contains some interesting material re garding the demographics of gamblers.366  The River City Study 
found considerable overlap in the use of gambli ng services by regular gamblers.  In particular, it 
found that "[l]and-based and pay-online players, those who gamble for real money both online and 
offline, are the market's true gambling enthusiasts.  (…).  [T]hey are the greatest gambling spenders in 
the market."367  The study also found that gamblers who only play for real money on-line but do not 
gamble at land-based facilities "are a unique s liver of the total e-gaming consumer market."368 
 
 A number of academic studies in the United States and the United Kingdom have found a 
high degree of substitutability between different fo rms of gambling.  To Antigua's knowledge there 
are no such studies that specifically investigate subs titutability of "Internet-based" gambling vis-à-vis 
"land-based gambling."  However, Antigua has asked  the opinion with respect  to substitutability in 
the gambling markets of two leading economists in this field (Professor Donald Siegel of the Rensselaer Polytechnic Institute of Troy, New York and Professor Leighton Vaughan Williams from 
Nottingham Trent University).  Both conclude that "Internet based" gambling is a strong substitute for 
"land-based" gambling.369  
 
                                                      
364 Decision on the Guidelines for the Schedulin g of Specific Commitments Under the General 
Agreement on Trade in Services (GATS) – Adopted by the Council for Trade in Se rvices on 23 March 2001, 
S/L/91 (29 March 2001) (emphasis added).  
365 "The River City Gambler Monitor ," The River City Group, Re ymer & Associates (2001). 
366 "Internet Gambling Report, Sixth Edition," River City  Group, LLC (2003) (the "River City Study").   
367 Ibid., p. 57. 
368 Ibid. 
369 The statement by Professor Donald Siegel a nd Professor Leighton Vaughan Williams and the 
additional statement by Professor Leighton Vaughan Williams submitted by Antigua as exhibits.  Some of the 
literature to which the first opinion refers is also subm itted as evidence: D. Siegel and G. Anders, "The Impact 
of Indian Casinos on State Lotteries:  A Case Study of Arizona," Public Finance Review , Vol. 29, No. 2, March 
2001, pp. 139-147; D.S. Elliott and J.C. Navin, "Has  Riverboat Gambling Reduced State Lottery Revenue?" 
Public Finance Review , Vol. 30, No. 3, May 2002, pp. 235-247.   WT/DS285/R 
Page C-65 
 
 
 With its first submission, Antigua also pr ovided the Panel with anecdotal evidence of 
competition between Internet-based and domestic  gambling services in the United States.370  There is 
considerable further anecdotal evidence of co mpetition between Internet and other gambling.371   
 
 With regard to the general proposition that "Internet-based" commerce competes with "land-
based" commerce Antigua refers to the initiative of the United States' Federal Trade Commission 
("the FTC") to promote competition over the Internet.372 The FTC has found, however, "that many 
state regulations favor local suppliers over out-of -state competitors and that others ban online 
competition for particular goods and services altogether."   In relation to an investigation of Internet 
wine sales the FTC found that: "E-commerce can o ffer consumers lower prices, greater choices, and 
increased convenience. In wine and other market s, however, anticompetitive barriers to e-commerce 
are depriving consumers of those benefits." The FTC further found that: "Sta te bans on interstate 
direct shipping represent the single largest regulatory barrier to expanded e-commerce in wine." In 
relation to the states' concern of underage drinking  the FTC concluded that "states can limit sales to 
minors through less-restrictive means than an outright ban." 
 
41. With respect to Antigua's arguments in paragraph 38 of its second oral statement, is 
Antigua now arguing that all gambling and betting activities that involve the experience 
of winning and losing money are necessarily " like" and that this would constitute the 
main criterion in deciding "likeness" under Article XVII? 
Antigua 
 
 From the beginning of this dispute, Antigua  has maintained that all gambling and betting 
services involving the placing of a wager are "like" for purposes of Article VXII of the GATS.  Due to 
the lack of WTO jurisprudence on "likeness" unde r the GATS, as was discussed at some length in 
Antigua's oral statement of 10 December, Antigua believes that an appropriate context for assessing 
"likeness" is found in the leading GATT 1994 case on the topic, that of EC – Asbestos .373   
 
 In EC – Asbestos,  the Appellate Body found that the two most important criteria for the 
determination of "likeness" were:  (i) the extent to  which the products are capable of serving the same 
or similar end-uses;  and (ii) the extent to wh ich consumers perceive and treat the products as 
alternative means of performing partic ular functions in order to satisfy a particular want or demand.  
In this respect Antigua submitted in paragraph 38 of its opening stat ement of 26 January 2004 that the 
experience of winning or losing money is the sine quo non  of gambling and betting services which 
could equally well be delivered lo cally or "remotely."  This is not the case with a comparison the 
                                                      
370 This evidence can be found in "The Handle: Thursday Roundup," The Spokesman Review (Spokane 
Washington) (2 February 2001); David Bennett, "Lottery's pot for schools ends up short," Crain's Cleveland 
Business (23 July 2001); Jim Saunders, "Video-gambling debate spins in soft economy," The Florida Times-
Union (29 December 2002); and Michael Kaplan, "G ambling in America: A Special Report," Cigar Aficionado, 
(October 2002). 
371 See, e.g., Rod Smith, "Online Betting Growth Called Threat to Nevada," Las Vegas Review-Journal  
(24 January 2003), D1 (http://www.reviewjournal .com/lvrj_home/2004/Jan-24-Sat-2004/business/ 
23006933.html) (Nevada gambling industry experts view on-line betting growth as a threat to the Nevada 
gambling industry's standing as the centre of the world gaming industry) Ed DeRosa, "NYRA, Magna Withhold 
Simulcast Signal From Attheraces," Thoroughbred Times.com, 13 January 2004 
(http://www.thoroughbredtimes.com/todaysnews/newsview. asp?recno=41340&subsec=) (Internet betting sites 
adversely impacting horse race betting).  In its 2 002 Equity Research paper on the Gaming Industry, 
"E-Gaming: a giant beyond our borders," (September 2002)  the investment banking firm of Bear Stearns & Co., 
Inc. cites a number of competitive concerns of the Un ited States domestic gaming industry over Internet-based 
gambling.  See Michael Tew and Jason Ader, Bear Stearns & Co, Inc., Equity Research, Gaming Industry: 
E-Gaming: A Giant Be yond Our Borders , pp. 32-39. 
372 FTC, "E-commerce lowers prices, increases choices in wine market". 
373 Appellate Body Report on EC – Asbestos.  WT/DS285/R 
Page C-66  
 
United States tries to make in paragraph 39 of its second written submission in which it seeks to draw 
an analogy with the difference between partic ipation in actual horseback riding compared to 
participation in "virtual reality" horseback riding—a situation in which the main feature of the two 
activities is clearly different (physical as opposed to non-physical activity).  
 In view of the criteria put forward by the Appellate Body in EC – Asbestos , Antigua believes 
that the most important criterion for the determination of "likeness" in WTO law is product (or service) substitutability.  There are, of course, va rious levels of substitutability.  For instance, 
economic evidence existing in the United States show s that, at one level, gambling activities serve as 
a broad substitute for other "enter tainment and recreation services."
374  Antigua does not suggest, 
however, that any level of substitutability necessarily makes two services "like."  On the other hand 
the level of substitutability required for two services to be viewed as "like" should not be set at a level 
which is unduly high and should be c onsidered in the context of the other "competition component" of 
Article XVII: the requirement of "conditions of co mpetition" that are not less favourable.  In other 
words, services with a low substitutability will bear a considerable level of di fferent treatment without 
effect on the "conditions of competition" and withou t violation of Article XVII.  In the case of two 
services with a high substitutability, a low level of  different treatment will modify conditions of 
competition and, consequently, violate Article XVII.375  The available economic evidence suggests 
that there is a high or relatively high degree of s ubstitutability between the various traditional forms of 
gambling services as well as substitutability between the various methods of distribution of gambling services.
376  In this respect Antigua submits that a ra dically different treatment of one form of 
gambling, or one distribution method, compared to another necessarily violates Article XVII.  
 
For the United States: 
 
42. In its submissions, the United States has introduced a distinction between, on the one 
hand, remote supply of gambling and betting services and, on the other, the non-remote 
supply of such services.  Could the United States clarify how it defines "remote" and 
"non-remote" supply of such services, making  reference to the specific application of 
this distinction in the United States.  For instance, if a lottery ticket for a New York State lottery is purchased through a licensed  vendor in Florida, does this amount to 
remote supply, given the definition of this term referred to by the United States in 
paragraph 7 of its first written submission? 
United States 
 
 By remote supply, the United States means s ituations in which the gambling service supplier 
(whether foreign or domestic) and the service consum er are not physically together.  In other words, 
the consumer of a remotely supplied service does not have to go to any type of outlet, be it a retail 
facility, a casino, a vending machine, etc.  Instead , the remote supplier has no point of presence but 
offers the service directly to the consumer th rough some means of distance communication.  Non-
remote supply means that the consumer presents him self or herself at a supplier's point of presence, 
thus facilitating identification of the individual, age verification, etc.  The United States wishes to add 
                                                      
374 D. Siegel and G. Anders, op. cit., pp. 140. 
375 See also, A. Mattoo, "MFN and the GATS," in T. Cottier and Petros C. Mavroidis, Regulatory 
Barriers and the Principle of Non-Discrimination in Worl d Trade Law, (The University Of Michigan Press, 
2000), 51-99, at p.73-75. 
376 Statement by Professor Donald Siegel and Profes sor Leighton Vaughan Williams in response to the 
question:"does Antigua have any market-based/economic evidence to support its assertion that "Internet-based" 
and "land-based" gambling and betting services compete and the consumers switch from one to the other?" 
submitted to the Panel by Antigua;  D. Siegel and G. Ande rs, "The Impact of Indian Casinos on State Lotteries: 
A Case Study of Arizona," Public Finance Review, Vol. 29, No. 2 (March 2001); D.S. Elliott and J.C. Navin, 
"Has Riverboat Gambling Reduced State Lottery Revenue?" Public Finance Review, Vol. 30, No. 3 
(May 2001).   WT/DS285/R 
Page C-67 
 
 
a brief comment on the New York/Florida example.   In practice, that example would not occur 
because the state lotteries operate on an exclusive territorial basis.377  Setting that aside for the sake of 
discussion, the United States considers that if th e consumer must go to a local vendor point of 
presence to purchase the gambling service, it is non-remo te.  In the Panel's example, the New York 
supplier needs to contract with a vendor in Florida, rather than supplying the service directly by 
means of distance communication.   
 
43. What is the United States' reaction to statements made by the representative of Antigua 
during the Panel's second substantive meetin g that there has been no communication 
between Antiguan and US authorities regarding the concerns that the United States has 
pointed to as justifying the drawing of a regulatory distinction between remote gambling 
and non-remote gambling? 
United States 
 
 The United States fails to see how Antigua's assertions bear on a likeness analysis under Article XVII.  Nothing in Article XVII i ndicates that likeness depends on the degree of 
communication between Members' authorities concerning differences between services.  The United States has already observed that it has had significan t interactions with An tigua and Barbuda on law 
enforcement issues.  To the extent that the Panel' s question refers to Antigua's assertions concerning 
requests for law enforcement assistan ce, the United States refers the Panel to paragraphs 7 through 10 
of the US second closing statement.  Regarding other forms of regulatory cooperation, the United 
States welcomes inquiries and fact-finding missions from governments wishing to learn about US 
regulation of gambling services.  The United States is not aware of any effort by the government of Antigua to pursue such cooperation.  As expl ained in the US second submission and second opening 
statement, the absence of any US domestic regul atory regime that permits the remote supply of 
gambling services makes it unreasonable for Antigua to expect the United States to engage in 
international negotiations toward th e establishment of such a regime for its cross-border suppliers.  
Moreover, Antigua's positions in this dispute make it clear that Antigua is unwilling to recognize the 
existence of specific US regulatory concerns surrounding remote supply of gambling.  F. 
ARTICLE XIV  
For the United States: 
 
44. Is the United States formally invoking Article XIV and expecting a determination on the 
same, if necessary? 
United States 
 
 The United States maintains its strongly-held view  that it is not necessary to reach the issue.  
There is no requirement that a measure be inconsis tent with the GATS in order for Article XIV to 
apply (although the US would recognize that a pane l would normally not want to reach Article XIV 
unless it had found an inconsistency).  Article XIV t hus applies in this dispute with or without a 
finding of an inconsistency with the GATS.  Be cause the measures discussed in the US second 
submission serve important policy objectives that fa ll within Article XIV, the United States invokes 
Article XIV in this dispute and would expect a dete rmination on the same, if necessary.  However, in 
                                                      
377 U.S. states could in theory permit businesses to procure for a person in one state a ticket, chance, 
share or interest in a lottery conduct ed by another state (without actually transmitting the ticket out of the state 
where it was purchased) pursuant to an agreement betw een the two states authorizing such activity.  But the 
United States is not aware of any states that have entere d into the agreements that would be necessary to permit 
such activity.  Even if states did en ter into such agreements, local presen ce in the consumer's state would be 
required, as the tickets could not be mailed between states. WT/DS285/R 
Page C-68  
 
view of the express language of Article XIV ("nothing  in the agreement shall prevent..."), the United 
States views the primary role of Article XIV in th is dispute as further confirming the absence of any 
inconsistency.  
45. In the case of an affirmative answer to th e previous question, could the United States 
clearly and specifically identify the provisions of laws and regulations with which it says 
the challenged measures secure compliance under Article XIV(c)? 
United States 
 
 The United States would like to first note that a Member's laws and regulations are presumed 
to be consistent with WTO rules unless proven to be otherwise.  A defendi ng party's burden of proof 
regarding measures enforced under Article XIV(c)  therefore differs from the burden imposed on a 
party seeking to prove that laws or regulations ar e inconsistent with the GATS.  The defending party 
under Article XIV(c) need only show that such laws  exist and have not been found inconsistent with 
the GATS.  Such laws do exist in this case, a nd although Antigua challenges some of these laws 
(alleged state restrictions on gambling), Antigua has not shown that any (much less all) are 
inconsistent with the GATS.   Sections 1084, 1952, and 1955 secure compliance with state laws restricting gambling and 
like offences.  State laws restricting gambling include the laws by which a number of states prohibit some or all gambling.
378  With respect to this issue, Antigua  stated in paragraph 30 of its second 
submission that "[t]he existence of federal legi slation facilitates the prosecution of suppliers of 
'unauthorized' gambling" under state law."  Thus Antigua itself recognizes that US federal gambling 
laws serve as enforcement measures for state laws.   The United States argued in paragraphs 100-101 of its second submission that §§ 1084, 1952, 
and 1955 are measures against organized crime, and that  inherent in the concep t of "organized crime" 
are certain types of criminal activity in which or ganized crime groups typically engage.  Thus, the 
United States submits that as measures against or ganized crime,  §§ 1084, 1952, and 1955 secure 
compliance with the US laws and regulations that define and/or prohibit organized crime, as well as 
laws and regulations that prohibit the criminal activity that, when committed in certain ways, 
constitutes organized crime.  These laws a nd regulations include the following:   
 
(i) Racketeer Influenced and Corrupt Organizations statute:  Organized crime is a subset of the 
broader category of "racketeering."  The predominant US law defining and prohibiting racketeering is the Racketeer Influenced and Corrupt Organizations statute, or, more commonly, the "RICO" statute;
379   
 
(ii) Organized Crime Control Act of 1970 findings:  While the term "organized crime" has no 
legal definition as such under US law, the statutory findings of Congress in the Organized Crime Control Act of 1970 refer to "a highly sophisticated, diversified, and widespread 
activity" involving "unlawful c onduct and the illegal use of force, fraud, and corruption" and 
which "derives a major portion of its power  through money obtained from such illegal 
endeavours as syndicated gambling, loan sharking, the theft and fencing of property, the 
importation and distribution of narcotics and othe r dangerous drugs, and other forms of social 
exploitation";
380   
 (iii) Attorney General Order 1386-89:  "Organized  crime" is defined for operational purposes at 
the US federal level in the Appendix to A ttorney General Order 1386-89.  That document 
                                                      
378 See, e.g., Utah Code Ann. § 76-10-1102; Hawaii Rev. Statutes §§ 712-1221 through 712-1223. 
379 RICO Statute, 18 U.S.C. §§ 1961-1968.  
380 See Section III.B.5. of this Report.   WT/DS285/R 
Page C-69 
 
 
states that:  "[T]he definition of "organized crime"  refers to those self-perpetuating, 
structured and disciplined associations of indi viduals or groups, combined together for the 
purpose of obtaining monetary or commercial gains or profits, wholly or in part by illegal 
means, while protecting their activities through a pattern of graft and corruption."  According 
to this definition, organized crime groups po ssess certain characteristics which include but are 
not limited to the following: (i) Their illegal activitie s are conspiratorial; (ii) In at least part of 
their activities, they commit or threaten to commit acts of violence or other acts which are 
likely to intimidate; (iii) They conduct their activities in a methodical, systematic, or highly 
disciplined and secret fashion; (iv) They insula te their leadership from direct involvement in 
illegal activities by their intricate organizational st ructure; (v) They attempt to gain influence 
in government, politics, and commerce through co rruption, graft, and legitimate means; (vi) 
They have economic gain as their primary goal, not only from patently illegal enterprises such 
as drugs, gambling and loan sharking, but also from such activities as laundering illegal money through and investment in legitimate business;
381 
 (iv) Underlying criminal activities:  As the a bove descriptions make clear, organized crime 
ultimately consists of the commission in a given manner of a combination of underlying 
crimes.  A measure against organized crime is therefore also a measure against the commission of such underlying crimes.  Key examples of underlying crimes that are often 
committed as organized crime include the following:  (i) violent crimes.  US state laws forbid 
the illegal use of force.  For example, a ll of the states prohibit murder and assault.
382  Federal 
laws also apply to such acts when th ey occur within federal jurisdiction.383  State and federal 
laws also prohibit acts involving the threat of force, such as extortion;384  (ii) property crimes:  
US state laws also forbid acts of larceny and fraud,385 and other property crimes.  Federal laws 
also apply to such acts when they occur unde r certain circumstances, such as fraud schemes 
using the US mails or interstate wire transmis sions, or where stolen property is taken across 
state lines386;  (iii) corruption and conspiracy crimes:  US state and federal laws prohibit 
various forms of corruption and conspiracy.387  One such law, the federal RICO statute, is 
mentioned above.  Another is th e federal conspiracy statute;388  (iv) money laundering.  US 
federal and state law also prohibits money laundering.389 
 
                                                      
381 Order Directing Realignment of Organized Crime Program Resources, Attorney General Order 
1386-89, appendix (26 December 1989).   
382 Examples of such laws from two of the larger U.S. states are Cal. Penal Code §§ 187-89 (murder) 
and §§ 240-41 (assault); N.Y. Penal Code §§ 120.00-.15 (assault).   
383 See, e.g., 18 U.S.C. § 1111 (federal crime of murder).   
384 An example of such laws at the federal level is 18 U.S.C. § 875.  Examples from two of the larger 
U.S. states are Cal. Penal Code §§ 518-527 (extortion) and N.Y. Penal Law § 155.05(2)(e) (larceny by 
extortion).   
385 Examples from two of the larger U.S. states are Cal. Penal Code § 484 (theft) and N.Y. Penal Law 
§ 190.40-.83 (criminal usury, scheme to defraud, crimin al use of an access device, identity theft, and unlawful 
possession of personal identification information).   
386 18 U.S.C. § 1341 (mail fraud), 18 U.S.C. § 1343 (wire fraud), and 18 U.S.C. § 2314 (interstate 
transportation of stolen property).   
387 See, e.g., N.Y. Penal Law Arts. 180, 200 (bribery and bribery of public servants).   
388 18 U.S.C. § 371.   
389 18 U.S.C. §§ 1956-1957; N.Y. Penal Law Art. 470.   WT/DS285/R 
Page C-70  
 
III. COMMENTS BY THE PARTIES ON THE RE SPONSES PROVIDED IN SECTION II 
A.
  C OMMENTS BY ANTIGUA AND BARBUDA ON THE UNITED STATES ' RESPONSES TO PANEL 'S 
QUESTIONS AT THE SECOND SUBSTANTIVE MEETING  
Question 36 (for the United States) 
 
With respect to the reference to the "very fe w exceptions limited to licensed sportsbook 
operations in Nevada" in the second paragraph of Exhibit AB-73390, could the United States 
identify these exceptions, even on an illustrative basis? 
 
 In its response to this question, the United St ates answered that Nevada was the only state in 
which "sports book" services are legal in the United St ates.  This is not accurate.  As Antigua has 
pointed out previously, there are four states in th e United States that are exempt from the application 
of the 1992 federal legislation that restricted cer tain forms of sports-rela ted betting in the United 
States.391  Although effected somewhat cryptically, the exemptions are found in Section 3704 of the 
statute.392  Oregon maintains state-sponsored betting on cer tain sporting events on the basis of this 
exemption and Delaware has considered  adopting extensive sports betting. 
  A proper analysis of the market for sports betting in the United States should take into account the non-sanctioned, or "ille gal," sports betting industry, which comprises a huge segment of 
the United States gambling market and is, despite pr otests of the United States to the contrary, as 
stated by the United States NGISC, " not likely to be prosecuted ."
393 
 
Question 42 (for the United States) 
 
In its submissions, the United States has introd uced a distinction between, on the one hand, 
remote supply of gambling and betting services and, on the other, the non-remote supply of 
such services.  Could the United States clarify how it defines "remote" and "non-remote" 
supply of such services, making reference to the specific application of this distinction in the 
United States.  For instance, if a lottery ticket for a New York State lottery is purchased through 
a licensed vendor in Florida, does this amount to remote supply, given the definition of this term 
referred to by the United States in paragraph 7 of its first written submission? 
  In its response to this question, the United States for the first time presents a clear, concise 
definition of what it has called "remote supply" — wh at it considers to be the "unlike" gambling and 
betting service that it may prohibit from being s upplied on a cross-border basis without being in 
violation of its commitments under the GATS.
394  The response deserves to be set out in its entirety 
(emphasis added): 
 
By remote supply, the United States means situations in which the gambling service 
supplier (whether foreign or domestic) and the service consumer are not physically 
together.  In other words, the consumer of a remotely supplied service does not have 
to go to any type of outlet, be it a reta il facility, a casino, a vending machine, etc.  
Instead, the remote supplier has no point of presence but offers the service directly to 
the consumer through some means of distance communication.  Non-remote supply 
                                                      
390 See above footnote 353. 
391 28 U.S.C. §§ 3701-3704.   
392 Anthony  N. Cabot and Robert  D. Faiss, "Sports Gambli ng in the Cyberspace Era," 5 Chapman Law 
Review  1, Spring 2002, p.7, footnote 31. 
393 NGISC Final Report, pp. 2-4,   See generally the discussion and sources in Section III.B.2.of this 
Report. 
394 And which, apparently, it also believes is subj ect to exclusion under Ar ticle XIV of the GATS. WT/DS285/R 
Page C-71 
 
 
means that the consumer presents himself or  herself at a supplier's point of presence, 
thus facilitating identification of the individual, age verification , etc. 
 This statement is important in a number of respects.  First, it unambiguously establishes the 
United States' position that the only actual differe nce between "remote" a nd "non-remote" gambling 
and betting services is the ability of the consumer to make an actual physical appearance before (or in 
proximity to) another person or a vending machine.  It also implicitly clarifies that the only arguable 
societal concern that might be better addressed by the "non-remote" gambling and betting service is under age gambling.
395  Antigua is aware of no form of gamb ling in the United States that requires 
verification of identity to simply place a wager, whether at a casino, at a vending machine, at a retail outlet or otherwise.  Further, there is nothing inherent in a personal appearance before a gambling 
service provider or vendor that precludes organised cr ime participation or m oney laundering—at least 
nothing that the United States has pr oduced in this proceeding.  I ndeed, rather than unsubstantiated 
allegations, the United States has produced nothing in  this proceeding to either (i) challenge the 
efficacy of the Antiguan regulatory scheme with re spect to organised crime or money laundering or 
(ii) demonstrate that organised crime or money la undering exists at all in the Antiguan gambling and 
betting industry, much less at levels in excess of those pervading the gambling industry in the United 
States.   If under age gambling is then the primary co ncern of the United States, again the United 
States has produced nothing in this proceeding:  (i ) demonstrating that under age gambling has ever 
occurred in connection with the Antiguan gambling a nd betting industry, much less at levels in excess 
of those pervading the gambling industry in the United  States; (ii) demonstrating the insufficiency of 
the Antiguan regulatory schemes to prevent under age ga mbling; (iii) to explain why the United States 
Congress considers use of credit cards sufficient to prevent under age access to  the clear dangers of 
pornography and paedophilia on the Internet but not sufficient to prevent under age access to 
gambling and betting services on the Internet; or (i v) countering the assertions of Antigua that 
enhanced inter-governmental cooperation or use of  other means of age verification could further 
reduce the risk of under age gambling.   With respect to the statements made in the United States' response to this question, Antigua 
would refer the Panel to Antigua's answer to questi on 19 of the Panel, in which it was pointed out that 
there are multi-state lotteries currently operating in the United States.
396  The largest of these, the 
"Powerball" lottery, is played in 24 states. 
 
Question 43 (for the United States) 
 
What is the United States' reaction to statemen ts made by the representative of Antigua during 
the Panel's second substantive meeting that there has been no communication between 
Antiguan and US authorities regarding the concer ns that the United States has pointed to as 
justifying the drawing of a regulatory distin ction between remote gambling and non-remote 
gambling?  
 In its response to this question, the United States says that it "fails to see how Antigua's 
assertions bear on a likeness analysis under Article  XVII."  The United States misunderstands the 
point of Antigua's statement.  Antigua has made  clear its belief that regulatory schemes cannot be 
relevant for purposes of assessing "likeness" under Artic le XVII.  Rather the purpose of the statement 
was to indicate that although the United States would have this Panel believe that money laundering is 
                                                      
395 The United States has already conceded that "adu lts can be expected to exercise their own moral 
judgment (…)."  Further, the United States has adduced no evidence to establish that what it calls "remote" 
gambling provides greater "health" risks than "non-remote" gambling, while Antigua has produced reports of 
three noted experts to the contrary.   
396 Antigua's reply to Panel question No. 1.  WT/DS285/R 
Page C-72  
 
endemic in the Antiguan gambling and betting industry, the United States has not even once  contacted 
the Antiguan government in this regard.  Antig ua was therefore simply refuting the baseless 
allegations made by the United States.   Two additional points made by the United States in its response to this  question bear further 
comment.  The United States says (emphasis added): 
 
[T]he absence of any US domestic regulator y regime that permits the remote supply 
of gambling services makes it unreasonable for Antigua to expect the United States to 
engage in international negotiations  toward the establishment of such a regime for its 
cross-border suppliers.  Moreover, Antigua's positions in this dispute make it clear 
that Antigua is unwilling to recognize the existence of specific US regulatory 
concerns surrounding remote supply of gambling. 
 Antigua considers the first point made astonish ing for a number of reasons, but particularly in 
the context of the requirements of the "chapeau" of  Article XIV.  With respect to the second point 
made in the paragraph, it is patently untrue.  Antigua recognizes the regulatory concerns associated 
with gambling and betting services – that is why Anti gua has its own, thorough set of regulations.  
More to the point, however, Antigua believes that any remaining regulatory concerns that the United 
States may have can and should be the subject of di scussion and negotiations between the parties.  As 
was pointed out by Antigua, there may well be exis ting technologies and methods of cooperation that 
could obviate any concerns that the United States may have in respect of the provision of cross-border 
gambling and betting services.  Antigua has offered to consult with the United States in this respect on 
numerous occasions, but the United States has refused to do  so – as it makes clear in its answer to this 
question.   
Question 44 (for the United States) 
 
Is the United States formally invoking Article XI V and expecting a determination on the same, 
if necessary? 
 
 The United States position on this issue remain s unclear.  Its statements contained in its 
response to this question can be construed to mean  that the United States does not invoke Article XIV 
as a defence, but simply as a method of "further c onfirming the absence of any inconsistency" of its 
laws with the GATS, apparently.  Antigua disagrees  with the United States position that Article XIV 
can apply in the absence of a determination of in consistency of other dome stic measures with the 
GATS.  It is clear under WTO jurisprudence that de fences such as those contained in Article XIV are 
"exceptions to substantive obligations" of the parties.
397  In the absence of a "substantive obligation," 
the "exceptions" of Article XIV have no application. 
 
Question 45 (for the United States) 
 
In the case of an affirmative answer to the prev ious question, could the United States clearly 
and specifically identify the provisions of laws a nd regulations with which it says the challenged 
measures secure compliance under Article XIV(c)? 
 
 The part of Article XIV(c) on which the Un ited States relies in its response to question 45 
refers to measures "necessary to secure compliance with laws or regulations which are not inconsistent with the provisi ons of this Agreement (…)."  
 
 The Panel asked the United States to (emphasis added) " clearly and specifically  identify the 
provisions of laws and regulations with which it says the challenged measures secure compliance 
                                                      
397 Appellate Body Report on US – Shrimp , para. 121. WT/DS285/R 
Page C-73 
 
 
under Article XIV(c)."  In its response the United St ates recognizes that it is the task of a defending 
party that seeks to invoke Article XIV(c) to "sho w that such laws exist."  The United States then 
discusses two categories of laws: "state gambling la ws and regulations" and "organized crime laws 
and regulations."  
 With regard to the category of "State gamb ling laws and regulations," the United States 
submits the following:   
State laws restricting gambling include the laws by which a number of states prohibit some or all gambling.
20 
________________ 
 20 See, e.g., Utah Code Ann. § 76-10-1102; Hawaii Rev. Statutes §§ 712-1221 through 712-1223. 
  
 In doing so the United States clearly confirms that the states' gambling prohibition laws apply 
to gambling and betting services supplied on a cross- border basis from Antigua — if the state laws 
would not apply to such supply the United States co uld not argue that the three federal prohibition 
laws398 are necessary to secure compliance with these stat e laws.  The Panel should note that the two 
specific state laws cited in the United States' foot note 378 are listed in Antigua's Panel request.  Thus, 
the United States' response to question 45 confirms that the state prohibition laws identified by 
Antigua are part of and contribute to the United States total prohibition. Consequently they are 
themselves GATS-inconsistent and cannot form the basis of an Article XIV(c) defence. 
  With regard to the actual argument that the Un ited States seeks to run on the basis of the state 
gambling prohibitions, Antigua has the following observations.  The United States' argument 
apparently rests on a hypothetical situation in whic h the Panel were to find that three federal laws 
violate the GATS but that the state laws do not, pr esumably on the basis of the formalistic view that 
Antigua has submitted sufficient "provision specific"  information with regard to these three federal 
laws but not with regard to the state laws.  In Antig ua's view, this is in any event not the case, if only 
because the level of "provision specific" inform ation that Antigua has submitted for these three 
federal laws is the same as it has submitted regard ing other state and federa l laws — the actual texts 
of the statutes, summaries of each and discussion regarding how they operate.   In any event, if the Panel were neverthel ess to adopt such a position, the United States 
defence would fail regardless because, on any analysis , it suffers from a lack of "provision specific" 
information.  In Antigua's view the level of "m easure identification" a defending party that invokes 
the affirmative defence of Article XIV(c) must meet is at the very least similar to that of a complaining party who seeks to challenge a me asure in WTO dispute settlement: both have to 
establish that "measures" with the alleged effect exis t.  With regard to the category of "state gambling 
laws and regulations," the only "provision specific"  information that the United States submitted in 
response to the request of the Panel is one senten ce, accompanied by one footnote that merely cites, 
and only by way of example, statutory provisi ons of two states, i.e. Utah and Hawaii. 
  Antigua's Panel request alone already contai ns more information than the United States 
attempt to invoke Article XIV(c) because it lis ts the main gambling prohibition laws of all states and 
territories and not just two.  And of course, Antig ua has done more than me rely cite references, 
amongst others in response to question 10 from the Panel to Antigua which was coined in similar 
terms as question 45 to the United States: "please identify all relevant legislative and regulatory 
provisions."  
                                                      
398 18 U.S.C. § 1084, 18 U.S.C. §§ 1952, 1955 WT/DS285/R 
Page C-74  
 
 Antigua also disagrees with the United States ' argument that a defending party who seeks to 
invoke Article XIV(c) must not establish a prima facie  case that the law for whose compliance the 
inconsistency with GATS is necessary, is itself cons istent with GATS (particularly so if that law 
essentially has the same effect as the law that has already been found to be GATS-inconsistent).  
Article XIV is an affirmative defence and it is therefore up to the United States to make a prima facie  
case that the conditions of Article XIV(c) are fulfille d, including the presence of laws that are "not 
inconsistent" with GATS.   With respect to organized crime laws and regulations, the United States does not meet the 
high "measure identification" standard that it says ex ists in WTO dispute settlement.  It cites a number 
of specific laws by way of example
399 but does not even try to give a comprehensive overview of the 
main state and federal laws at issue.  To the exte nt that it explains these laws, it does so in a summary 
way that is less extensive than the explanation Antigua has given for all major gambling prohibition 
laws at both the federal and state level.  Furtherm ore the United States includes in its brief recital of 
"laws and regulations" an "Attorney General Order" and "statutory findings of Congress" which, in its 
own view, cannot be classified as "laws and regulations."400   
  That being said, Antigua does not suggest that the United States' level of "measure 
identification" of the "organized crime laws a nd regulations" is necessarily insufficient for the 
purposes of Article XIV(c) or WTO dispute settlement in general.  Antigua only submits that, if the 
standard of "measure identification" is as high as th e United States has argued that it is throughout this 
dispute, the United States' Article XIV(c) defen ce concerning organized crime laws and regulations 
does not meet that standard.    As a final point Antigua submits that nothing in  the United States' response to this question of 
the Panel or in the materials submitted with that  response establishes that the total prohibition of 
cross-border supply of gambling services from Antigua  is "necessary" to secure compliance with the 
GATS-consistent aspects of its laws against organised cr ime.  In fact, there is no evidence at all of any 
involvement of organised crime in  Antiguan suppliers of gambling a nd betting services, nor is there 
evidence of any of the other criminal activitie s mentioned in the United States' response to 
Question 45 in the Antiguan gambling and betting industry.  
B. C
OMMENTS BY THE UNITED STATES ON ANTIGUA AND BARBUDA 'S RESPONSES TO PANEL 'S 
QUESTIONS  AT THE SECOND SUBSTANTIVE MEETING  
Question 40 (for Antigua) 
 Does Antigua have any market-based/economic ev idence to support its assertion in paragraph 
36 of its second oral statement that 'Interne t-based' and 'land-based' gambling and betting 
services compete and that consumers switch from one to the other?  
 
 Antigua asserted that "there is competition between" Internet-based and land-based gambling 
services "because consumers switch from one to the ot her – just like a gambler can switch from one 
land based casino to another."  The Panel asked for market-based/economic "evidence" to support this 
                                                      
399 See, e.g., the Racketeer Influenced and Corrupt Organizations Statute ("RICO"), Cal. Penal Code §§ 
187-189 and §§ 240-241, NY Penal Code §§ 120.00-.15, 18 U.S.C. § 1111, 18 U.S.C. § 875, Cal. Penal Code 
§§ 518-527 and NY Penal law § 155.05 (2) (e) 
400 The Attorney General Order 1386-89 is used by the United States to illustrate its definition of 
"organized crime."  Similarly the Organized Crime Contro l Act 1970 findings are also used to explain what is 
meant by "organized crime" as this phrase "has no legal definition as such under U.S. law."  Of course, the 
United States has argued a number of times that a "measur e" must be in essence be a discrete law in and of 
itself.  See, e.g.,  Request for Preliminary Rulings by the United States of America, WT/DS285 
(17 October 2003), paras.  3-10. WT/DS285/R 
Page C-75 
 
 
assertion.  Antigua's response provides none.  Instead , Antigua offers a series of baseless assertions 
that assume, rather than prove, such competition. 
  In the first paragraph of its response to questi on 40, Antigua asserts that there is "considerable 
overlap in the use of gambling services by regular ga mblers."  In fact, Antigua has not provided any 
evidence approaching "considerable overlap" betwee n the users of Internet-based remote gambling 
services and users of non-remote gambling services.   Antigua cites a summary of a River City Group "study," but fails to provide the study itself.
401  
Moreover, the summary cited by Antigua actually  contradicts Antigua's "overlap" argument.  
Specifically, it states that only 28 per cent of all ga mblers gamble online for real money.  Another 
source, the Online Gambling Market Research Handbook , indicates that the overlap in customers is 
much smaller – possibly less than 5 per cent.402  
  In the second paragraph of its  response to question 40, Antigua asserts that "academic studies 
in the United States and the United Kingdom have found a high degree of substitutability between 
different forms of gambling."  Based on such lite rature, Antigua and its economic consultants assert 
the existence of substitution between  Internet gambling and land based gambling.  This reasoning is 
seriously flawed.   First of all, Antigua overstates the limited conclusions of its own consultants regarding 
substitutability of Internet and land-based gambling.  Antigua states that its consultants "conclude that 
'Internet based' gambling is a strong substitute for 'land-based' gambling."  By contrast, the 
consultants themselves actually conclude d that "there is strong substitutability among gaming 
choices " – a generalization that does not specifically compare Internet and land-based gambling. 
When trying to compare Internet and land-b ased gambling specifically, however, Antigua's 
consultants could only draw the weaker conclusion that there was "substantial evidence to support the 
assertion that 'land-based' gambling and betting servi ces compete and that consumers switch from one 
to the other."
403  Yet upon examination, the a lleged "substantial evidence" fo r this "assertion" appears 
to consist only of literature re lated to non-remote gambling.404 
  Antigua and its consultants are making an unsuppor ted leap of logic.  They cite no empirical 
studies actually addressing the relationship between Internet gambling and land-based gambling.  
Instead, they merely allege, without foundation, th at literature finding that the revenue of established 
                                                      
401 The summary cited by Antigua (and authored by th e chairman of the Inter active Gaming Council, a 
group dedicated to promoting Internet gambling) provides neither a full data set nor an explanation of its 
methodology, so its validity, if any, is impossible to discern. 
402 Online Gambling Market Research Handbook, p. 8 (2003) ("Many industry analysts estimate less 
then [sic] 5% of the players on the In ternet are 'real gamblers.'  This is attributed to the following reasons: 
· Online generation is younger · Different experience 
· From areas where land-based gaming is not legal 
· Consist of non-core gamblers, but who like a little flutter."   
403 Statement by Professor Donald Siegel and Professor Leighton Vaughan Williams submitted by 
Antigua to the Panel. 
404 Ibid .  The United States has examined as many of these sources as could be  located in the time 
available and found no empirical evidence co mparing Internet and land-based gambling. 
In addition, the separate statem ent by Professor Willia ms reaches an even weaker conclusion.  
Professor Williams relies on studies "looking at other sectors of the gambling industry" and "gambling products 
which in some respects mimic the Inte rnet gambling experience," not Internet gambling itself, to support "a 
conclusion that Internet gambling is likely to substitute in some degree  for land-based gambling" (emphasis 
added).  One need hardly point out that Professor W illiams is making an unsupported leap of logic from other 
sectors and products to Internet gambling, and that "some degree" is a carefully-chosen term that does not 
exclude a slight or minuscule degree. WT/DS285/R 
Page C-76  
 
land-based gambling options changed with the intr oduction of other new la nd-based gambling options 
somehow demonstrates that substitutability exis ts between Internet and land-based gambling.
405 
  Furthermore, the argument put forward by An tigua and its consultants rests on the implicit 
assumption that individuals budget a specific amount of money for gambling that must be 
redistributed with the introduction of a new gamb ling option.  Based on results discussed in the 
submitted studies, however, this does not appear to be the case.
406  The relatively rapid growth of the 
gambling industry is more consistent with the hypothesis that increasing the available forms of 
gambling increases total expenditures on gambling, rather than merely shifting expenditures among 
gambling options. 
 
 In short, Antigua and its consultants have not explained why they think Internet gambling 
would be highly substitutable with land based ga mbling.  Nor have they accounted for unique 
variables that would be likely to impact substituta bility in the case of Intern et gambling, such as 
availability of Internet access407 and the different nature of the Internet gambling environment.408 
 
 Tellingly, Antigua provides no direct economic  data on cross-price elasticities of demand 
between Internet and land-based gambling, in spite of the fact that one of Antigua's consultants 
acknowledges that it is "common practice to a ssess substitution through studies that estimate 
'cross-price elasticities of demand.'"409  Past panel reports reviewing an economic substitution 
argument have relied on high-quality st atistical evidence of the existence of cross-price elasticities of 
demand (in this case, it would be between Intern et and land-based gambling or remote and non-
                                                      
405 Not surprisingly, Antigua ignores aspects of this  literature that appear to contradict its own 
conclusions.  For example, Paton, Siegel and Williams  (2003a), cited by Antigua, found "no evidence of 
substitution from machines or casino gambling to betting," which would seem to disprove the hypothesis that all forms of gambling inherently display a high degree of substitutability.  Also, the studies show contradictory 
results for "substitution" between lotteries and Native American casinos.  Antigua's consultants rely heavily on 
the results from Siegel and Anders, wh o found that increased nu mbers of slots at Native American casinos in 
Arizona reduced state lottery revenues.  But they ignore the results of Ellio tt and Navin, who failed to find any 
impacts for Native American reservations in a much broade r sample than the Siegel an d Anders study.  Nor do 
they attempt to explain the apparent contradiction betw een Elliot and Navin's findings for riverboat casinos and 
their findings for Native American casinos. 
406 Elliot and Navin reported that Gulley and Scott (1 989) found that "[e]ach additional dollar bet on 
the state lottery is estimated to lead to a decline of three cents in thoroughbred racing handle."  David O. Gulley 
and Frank A. Scott Jr, "Lottery Effects On Pari-Mutuel Tax Revenues", National Tax Journal , vol. 42, 1989, 89-
93 as cited in Elliott and Navin..  Even Elliott and Navin's results on the impact of rive rboats found that for each 
$5 in additional gross outlays at the boats, state lottery revenues fell by only $1.38.  Thus, it appears that the 
greater impact of the addition of gambling options was to increase overall expenditures on gambling. 
A study by Kearney (2003) similarly indicates that  increasing gambling options results in increased 
gambling expenditures.  Kearney found that in the United States, total household expenditures on gambling 
increased after the introduction of a state lottery.  See Melissa Schettini Kearney, "State Lotteries and Consumer 
Behaviour" draft Sept. 2003, p. 30, available at http://www.wellesley.edu/Economics/ kearney/mskearney-lotteries-9-03.pdf ("Data from micro-level surveys of gambling behaviour corroborate the 
claim that household lottery gambling is financed by a reduction in non-gambling expenditures, not by 
substitution away from alternative forms of gambling."). 
407 Internet gambling requires access to a computer an d the Internet, whereas th e land-based forms of 
gambling analyzed in the literature cited by Antigua did not require the participant to own any special 
equipment.  As some studies have indicated, many lottery players tend to be from lower income households and 
may be less likely to own a computer. 
408 Other forms of gambling require much more active engagement on the part of the participant to 
reach, with specific intent to gamble, the point of sa le.  On the Internet, howe ver, pop-up ads and other 
inducements may cause the potential gambler to reach th e gambling opportunity without any specific intent to 
gamble, and then encourage gambling in an environment of unmatched ease and privacy.  This very different environment for gambling on the Internet is likely to result in individuals gambling through Internet use who 
would not otherwise be involved in gambling activity. 
409 Additional Statement by Professor Leighton Vaugha n Williams submitted by Antigua to the Panel. WT/DS285/R 
Page C-77 
 
 
remote gambling), not the unsupported speculation and "stylized facts" offered by Antigua and its 
consultants.410 
  Moreover, evidence from the United Kingdom, relied upon heavily by Antigua and its consultants, has little weight in an assessment of consumer behaviour in the United States.
411  
Nonetheless, it is noteworthy that An tigua's own consultant stated in that context that Internet betting 
exchanges were complementary to, rather than  substitutes for, existi ng betting on bookmakers.412  
Together with the foregoing analysis, this statemen t further confirms that Antigua's assertions of 
substitutability between Internet and land-based  gambling rest on questionable and unsupported 
assumptions, rather than on facts. 
 
 In the third paragraph of its response to  Question 40, Antigua asserts that there is 
"considerable further anecdotal evidence of comp etition between Internet and other gambling," but 
the sources it cites provide no support for this view.413  Indeed, in some cases the sources contradict 
                                                      
410 Panel Report on Japan – Alcoholic Beverages II,  para. 6.31 (noting that elasticity of substitution is 
measured through "[f]ormal statistical methods" and "b ased on actual observations," and criticizing a party's 
failure to examine particular variables).  See also  Panel Reportoin Chile – Alcoholic Beverages , paras. 7.63-64 
(treating studies regarding cross-price elasticity of demand with caution b ecause they lacked supply side data 
and used small statistical samples, and stating that "a hi gh estimated coefficient of elasticity would be important 
evidence to demonstrate that products are directly competitive or substitutable  proved that the quality of the 
statistical analysis is high. " (emphasis added)).  In this dispute, Antigua has provided no statistical analysis 
whatsoever comparing Internet  and land-based gambling. 
411 Appellate Body Report on Japan – Alcoholic Beverages II , p. 20 (quoting the observation in the 
Report of the Working Party on Border Tax Adjustments  that "consumers' tastes and habits ... change from 
country to country").  See also Minutes of Evidence Taken before Joint Committee on the Draft Gambling Bill, 
Thursday, 8 January 2004, Q250, available at http:/ /www.publications.parliament.uk/pa/jt200304/jtselect/ 
jtgamb/uc139-iii/uc13902.htm (response of Dr. Mark Grif fiths, Antigua's consultant in the present dispute, 
testifying that "[E]very country has a different culture of gambling. ... Every country I have looked at that has 
de-regulated in a big way has seen an increase in problem gambling, and I do not see why that should not occur here, but there will be a different culture in terms of  what people will enjoy gambling on."); David Paton, 
Donald S. Siegel, and Leighton Vaughan Williams, "A Policy Response to the E-Commerce Revolution: The 
Case of Betting Taxation in the U.K.,"  Economic Journal,  Vol. 111, Issue 480, F296-F314 (2002) ("It is clear, 
then, that there are major differences in the nature of gambling activity and how it is perceived and regulated in 
UK and the USA."). 
412 Minutes of Evidence Taken before Join t Committee on the Draft Gambling Bill, 
Tuesday, 13 January 2004, Q324, available at http ://www.publications.parliame nt.uk/pa/jt200304/jtselect/ 
jtgamb/uc139-iv/uc13902.htm (response of Professor Williams , stating that "the turnover that is going through 
betting exchanges is complementary not substitute for existing betting on bookmakers").  A gambling industry representative testifying before the same committee alon gside Professor Williams stated that "we are in the 
business of providing destination leisure opportunities th rough which gaming is delivered. That is a very, very 
different market from somebody betting at a betting exchange or on Internet gaming."  See  Ibid., Q326 
(response of Mr. John Kelly, Cross-Industry Group on Gaming Deregulation). 
In the same hearing, Professor Williams also qualif ied his own conclusions regarding substitutability of 
gambling generally by stating that "I have found onl y weak evidence, however, of  substitution between casino 
and gaming spend and betting and only weak evidence to date of a substitution effect between gaming activity 
and bingo activity."  Ibid . at Q315 (response of Professor Williams).  This statement confirms that any belief 
that substitutability may exist between land-based forms of gambling is by no mean s universal, and therefore 
substitutability cannot simply be assumed to exist between Internet and land-based gambling. 
413 The Article "Online Betting growth called threat to Nevada" cited in above footnote 371 of 
Antigua's response to question 40 reports on assertions that Nevada and Nevada-based casinos are losing 
moneymaking opportunities because U.S. law prevents them from taking their "fair share" of Internet gambling 
revenues.  Nowhere does this article state or imply that Internet gambling is competing for revenues with non-remote forms of gambling.  It merely confirms the U.S. position that Internet gambling is illegal for domestic 
operators as well as cross-border operators.  Similarly, the article "NYRA, Magna Withhold Simulcast Signal 
From Attheraces" cited in footnote 371 of Antigua's response explains that the concern in that case was not WT/DS285/R 
Page C-78  
 
this view by suggesting that Internet gambling is a complement to, rather than a substitute for, land-
based gambling.
414  
  Much stronger "anecdotal" evidence comes fro m industry leaders from both the Internet and 
land-based gambling industries who contradict Anti gua's assertions that these two different services 
are in competition with one another.  For example, American Gaming Association President Frank 
Fahrenkopf has testified before the US Congress that Internet gambling is not a competitive threat to 
US commercial casinos.
415 
  Prominent companies in the Internet gambli ng industry appear to share this view.  For 
example, Boss Media, one of a handful of major s uppliers of Internet gambling technology, states on 
its website that "Boss Media considers that Internet casinos do not compete with land-based casinos."
416  Similarly, a 2002 industry report funded by Microgaming, another major supplier of 
Internet gambling technology, concluded that Inte rnet gambling and land-based gambling are actually 
complementary products, rather than competitors.417 
 
 In its response to question 40, Antigua refers to "the general proposition that 'Internet-based' 
commerce competes with 'land-based' commerce" and cites a press release concerning a United States 
Federal Trade Commission staff report on sales of wi ne over the Internet.  The United States fails to 
see how this discussion of an unrelated industry is rele vant in any way to Antigua's specific burden of 
proof regarding gambling services.  As the United States pointed out, th e issue in this dispute is not 
whether remotely supplied services are always  like non-remote services.  Likeness is a case-by-case 
                                                                                                                                                                     
Internet competition; it was the failure by certain providers to direct betting data into the common pool used in 
all pari-mutuel wagering.  
414 For example, in footnote 371 of its response to question 40, Antigua cites the Bear Stearns report.  
Once again, an examination of that report shows that it su pports the U.S. position.  The cited pages of the report 
provide no evidence of direct  competition between Internet and land-bas ed gambling.  On the contrary, the Bear 
Stearns analysts theorize that Internet gambling is a complement to land-based gambling in that it allows land-
based operators to "cross-market to a different customer base."  Michael  Tew and Jason Ader, Bear Stearns & 
Co, Inc., Equity Research, Gaming Industry: E- Gaming: A Giant Beyond Our Borders , p. 33.  This is consistent 
with the same report's conclusion that "Internet gamers  are generally not the same customer as land-based 
gamers."  See  ibid., p. 55. 
415 Mr. Fahrenkopf stated that: 
There is simply no comparison between the social, gr oup-oriented entertainment experience of visiting 
a casino resort and the solitary experience of placing a be t or wager using a personal computer. Visiting a casino 
today is about much more than legal wagering opportunities.  Whether measured by how people spend their 
time or how they spend their dollars, guests of U.S. co mmercial casinos are increasing ly attracted as much or 
more by restaurants, shows, retail, recreation, and other non-gaming amenities. 
The view that Internet gambling is not a competitive threat to U.S. commercial casinos is shared by 
financial analysts at major Wall Street firms, whose job it is to analyze the competitive impact of market 
developments on the industries and firms they cover, including the major publicly traded gaming companies the AGA represents. 
Testimony of Frank J. Fahrenkopf, Jr., President and CEO, American Gaming Association, Before the 
Senate Banking Committee, March 18, 2003, available at  http://www.senate.gov/~banking/_files/ 
fahrenkopf.pdf.  See also  Net Gambling Bills Protect Established Gambling Interests, Tech Law Journal 
available at  http://www.techlawjournal.com/Internet/1 9991025b.htm (October 25, 1999) (quoting 
Mr. Fahrenkopf as stating that "We are not concerned about losing business to Internet gambling.  There is 
simply no comparison between playing at home on a co mputer and the broad entertainment experience our 
destination resorts offer.  Wall St reet analysts confirm that view.") 
416 http://www.bossmedia.se/about/risk_analysis.asp, Exhibit US-45. 
417 Internet Gaming: An Industry Survey, Internet Gaming & Wagering Business, p. 7, available at  
http://www.microgaming.com/themes/microgaming/brochure/survey.pdf  (August 2002) ("[C]ontrary to earlier fears from within the terrestrial ga ming industry, online gambling is not expected to detract from the total 
amount wagered offline.  In fact, pu ndits now believe that online gamblin g will help develop the land-based 
casino market by educating future gamblers virtually.") WT/DS285/R 
Page C-79 
 
 
analysis.  In the case of gambling, Antigua has failed to support its assertions of likeness with economic evidence or with any other credible evidence.  
Question 33 (For Antigua) 
 
Could Antigua provide a list of the gambling and betting services they seek to supply 
cross-border to the United States and that they claim are subject to a prohibition.  
 
 The United States is surprised by the list of services in Antigua's response to question 33.  
This new taxonomy of services is difficult to reconcil e with Antigua's previous statement identifying 
Internet "virtual casinos" and Internet and telephon e sports betting ("sports  book") operators as the 
types of services and suppliers it licenses.  If the items  in Antigua's response to question 33 are now to 
be considered as the services sought to be provided by Antigua, then the United States submits that in 
addition to its many other failures to make a prima facie case, Antigua has failed to relate its 
argumentation and evidence to this particular list of  services, or show how any specific US measure(s) 
affect the supply of the newly listed services. 
  The United States also finds it ironic that after consistently seeking to diminish or dismiss the serious regulatory concerns reflected in US law, Antigua now asserts its own right to prohibit services 
that it considers "offensive."  Antigua asserts such a right while at the same time attempting to deny 
the United States the authority to restrict services that the United States views (on firm evidence) as 
posing serious law enforcement, consumer protection,  and health risks – not to mention threats to 
public order and morals.  
Question 36 (For the United States) 
 
With respect to the reference to the 'very fe w exceptions limited to licensed sports book 
operations in Nevada' in the second paragraph of Exhibit AB-73, could the United States 
identify these exceptions, even on an illustrative basis? 
 
 Antigua's comments on question 36 incorrectly describe the Professional and Amateur Sports Protection Act, codified at 28 USC. §§ 3701-3704.  Antigua's comment on question 36 states that: 
 
Under the legislation known as the "PASPA," the United States federal government expressly exempted four states, Nevada, Oregon, Delaware, and Montana, from its 
general prohibition on sports betting other than horse racing, greyhound racing and jai 
alai. ...  There is nothing in the PASPA or other fe deral laws restricting the ability of 
these states to engage in the full range of sports betting services on a commercial or 
state-owned basis . (emphasis added) 
 Both of the quoted sentences are incorrect.   
  The purposes of the Professional and Amateur Sports Protection Act (PASPA) were described in the US response to question 36.  Essentially, th e PASPA halted all sub-federal authorization of 
sports-related gambling in the United States. 
  The PASPA permitted the continuation of certain previously authorized sports betting activity 
in some states (although, contrary to Antigua's d escription, such states are not "expressly" mentioned 
in the legislation).  However, the statute did not provide that those states had unlimited ability to add 
new forms of sports wagering. 
 WT/DS285/R 
Page C-80  
 
 As it happens, Nevada, Ore gon, Delaware and Montana
418 had authorized particular forms of 
sports-related gambling during the time periods specified  in the legislation, and these particular forms 
of gambling were therefore permitted to be authorized in the future under the terms of the statute.  Of 
these states, only Nevada allowed sports book servi ces.  The others allowed sports-related lottery 
games.419  
 
 The PASPA does not permit the future authori zation of sports betting in these states in any 
form beyond that which existed at the time of th e enactment of PASPA.  Thus, Oregon, Delaware and 
Montana may not now enact legislation authoriz ing sports book services, and Nevada may not now 
enact legislation authorizing sports-related lottery games.420  As a result, Nevada is the only place in 
the United States where sports book services may be authorized. 
  In the context of the present dispute, it is also important to note that nothing in the PASPA creates an exception for any domestic or foreign operator from the application of 18 U.S.C. § 1084.  Thus the PASPA does not permit the authorization in any state of Internet sports gambling in 
violation of 18 U.S.C. § 1084, or of any other inte rstate or cross-border tran smission of a bet or wager 
using a wire communications facility.  Moreover, Antigua has advanced no theory on which the PASPA could be found to violate any provision of the GATS.   On the issue of pari-mutuel betting on hor se races, Antigua's comment on question 36 that 
"[f]urther, while the United States appears to di stinguish in several ways between horse racing and 
other forms of sports betting, Antigua believes that th ere is really no logical basis for the distinction" 
is baseless.  Indeed, while Antigua has made a numb er of assertions concerning pari-mutuel betting on 
horse races, the fact remains that Antigua has o ffered no specific evidence demonstrating that any 
Antiguan gambling services and suppliers are "like" US pari-mutuel horse race betting services and their suppliers.  
                                                      
418 During the Congressional debate on the PASPA, "calcutta" wagering in Wyoming and pari-mutuel 
bicycle wagering in New Mexico were also mentioned at one point as previously authorized forms of gambling. 
419 No state enacted new legislation allowing covered sports betting before expiration of the time 
periods specified in the legislation, thus the scope of permissible activity remains as it was as of the enactment of the legislation. 
420 A Senate Committee report discussed how the PASPA would apply to those states that had 
authorized some form of sports wagering.  This report stated that: 
Under paragraph (1) of subsection (a), Oregon and Delaware may conduct sports lotteries on any sport, 
because sports lotteries were conducted by those States prior to August 31, 1990. Pa ragraph (1) is not intended 
to prevent Oregon or Delaware from expanding their sp orts betting schemes into other sports as long as it was 
authorized by State law prior to enactment of this Act. At the same time, paragraph (1) does not intend to allow 
the expansion of sports lotteries into head-to-head betting. ... 
Under paragraph (2), casino gambling on sports events may continue in Nevada, to the extent 
authorized by State law, because sports gambling actually was conducted in Nevada between September 1, 
1989, and August 31, 1990, pursuant to State law. Paragraph (2) is not intended to prevent Nevada from 
expanding its sports betting schemes into other sports as long as it was authorized by State law prior to 
enactment of this Act. Furthermore, sports gambling covered by paragraph (2) can be conducted in any part of 
the State in any facility in that State, whether such facility  currently is in existence. At the same time, paragraph 
(2) does not allow a State sports lottery to be estab lished in any State in which such a lottery was not in 
operation prior to August 31, 1990.  
The narrowness of subsection (a) reflects the committee's policy judgment that sports gambling should 
be strictly contained. 
Senate Report No. 102-248 (1992), reprinted in 1992 U.S.C.C.A.N. 3553,3561.  Thus, Nevada, 
Oregon, Delaware, and Montana do not possess unlim ited ability to add new forms of sports wagering. WT/DS285/R 
Page C-81 
 
 
Question 41 (For Antigua) 
 With respect to Antigua's arguments in paragrap h 38 of its second oral statement, is Antigua 
now arguing that all gambling and betting activi ties that involve the experience of winning and 
losing money are necessarily 'like' and that this would constitute the main criterion in deciding 
'likeness' under Article XVII?  
 Antigua states that "the experience of winning or losing money is the sine quo non  of 
gambling and betting services which could equally well be delivered locally or 'remotely.'" 
 
 Further to the arguments that the United Stat es has already made rebutting this argument, we 
note the recent testimony of Professor Griffiths, Antigua's consultant in this dispute, who stated before a Joint Committee of the British Parliament that:  
My guess is that for 99 per cent of the people who go to a destination to gamble, like 
myself when I go to Las Vegas or wherever, it is because I think I am going to have a 
fun time. I do not go there to win money. If I win, that is a bonus.  When I go to my local casino in Nottingham, I go there to have a meal, be with friends, have a talk or 
whatever and the gambling is incidental.  My guess is that for most people who go to destination resorts that would be their aim, just to have a fun time out.  Yes, they may win some, they may lose some, but the point is that this is not being done in 
isolation.
421 
IV. PANEL'S QUESTIONS FOR THE THIRD PARTIES ONLY 
For all Third Parties: 
B. ARTICLE XVI 
1. Do the third parties agree with the EC's submission in paragraph 84 of its written 
submission that a blanket prohibition on the provision of cross-border gambling and 
betting services amounts to a quantitative restriction within the meaning of Article XVI:2(a)?   
European Communities 
 
 The European Communities confirms its positi on.  It would like to add that the position 
expressed does not exclude such a blanket prohibition, if existing, may also be relevant under 
different items of Article XVI:2 of the GATS.  For example, depending on the way in which the 
prohibition is drafted, it might also be relevant under items (b) or (c).  Also, a blanket prohibition that 
only applied, de jure  or de facto , to services supplied cross-bor der could be relevant under 
Article XVII.  
 
Japan 
 
 Japan shares the point that a complete prohi bition on the provision in a service sector where 
specific commitments are undertaken amounts to a quantitative restriction within the meaning of 
Article XVI:2(a), when that complete prohibition is  provided in express terms by one or combination 
of domestic laws and regulations.  It reserves it s views on such cases where supplying services in a 
specific sector is not prohibited in express terms by one or combination of domestic laws and regulations, but is made in effect extremely diffi cult by one or combination of domestic laws and 
                                                      
421  Minutes of Evidence, Thursday, 8 January 2004, supra  footnote 11, Q257 (response of Dr. Mark 
Griffiths). WT/DS285/R 
Page C-82  
 
regulations which respectively do not constitute measures covered by Article XVI:2(a) to (f) and 
therefore are not reserved in a Members' schedule.  It  considers that the consistency of such situation 
with Article XVI  needs to be addressed on a case-by-case basis, while the situation could 
simultaneously might as well raise a ques tion of Article VI:5 consistency. 
 Mexico 
  Mexico's view is that where there is a blanket prohibition on the provision of a service through mode 1 (cross-border supply), the numbe r of service suppliers that can supply a service 
through that mode is zero.  Thus, a blanket prohi bition on the provision of a service through mode 1 
amounts to a quantitative restriction with in the meaning of Article XVI:2(a). 
 C. A
RTICLE XVII 
2. To what extent is the competitive relation ship between, on the one hand, services and 
service suppliers in the territory from which the service is being supplied and, on the 
other hand, services and service suppliers in the territory into which the service is being 
supplied relevant in assessing "likeness"? 
European Communities 
 
 At the outset, the European Co mmunities wishes to point out that to establish a violation of 
Article XVII of the GATS there is no need to c onsider the relationship between both services and 
service suppliers (see reply to question 9 below).  As clarified by the Appellate Body in Korea – 
Alcoholic Beverages ,422 "like" products are always a subset of "directly competitive" products.  
Therefore, to some extent the competitive relationship (actual or potential) will always be relevant in 
a "likeness" analysis.  The extent will depend on the pa rticular case.  In that context, the European 
Communities also notes that if the competitive relations hip is distorted (or absent) owing to a measure 
applied in the territory into which the service is  being supplied, the rele vant benchmark is the 
potential  competitive relationship that would exist if th e services supplied were not subject to that 
measure.  The European Communities would also re fer the Panel to its Third party submission and 
Oral statement where this matter is further addressed.   
Mexico 
 
 In Mexico's view, it is the nature and character istics of the services at issue that are directly 
relevant to the question of whether those services ar e "like".  With respect to service suppliers, where 
the services supplied are "like", the supplie rs of those services are also "like".423  Mexico further notes 
that paragraph 3 of Article XVII provides that forma lly identical or formally different treatment shall 
be considered to be less favourable if it modifies  the conditions of competition in favour of services or 
service suppliers of the Member (i.e., of the Member implementing the measure at issue) as compared to like services or service suppliers of any other Member.  Thus, the competitive relationship between 
services in the territory from whic h the service is being supplied and services in the territory into 
which the service is being supplied is highly relevant to the ques tion of whether services and service 
suppliers of another Member are treated in a manner "no less favourable" than services and service 
suppliers of the WTO Member implementing the contested measure. 
 
                                                      
422 Appellate Body Report on Korea – Alcoholic Beverages , para. 118.   
423 Panel Report on EC – Bananas III (US), para. 7.322. WT/DS285/R 
Page C-83 
 
 
3. Do the third parties consider that regulator y circumstances in the territory where the 
service is being supplied and/or in the territ ory from which the service is being supplied 
should be taken into consideration under Arti cle XVII in the "likeness" analysis and/or 
the "less favourable treatment" analysis?  If so, what are the parameters within which 
the regulatory circumstances should be considered? 
European Communities 
 
 The European Communities provides its answer  based on two different assumptions as to the 
meaning of the term "regulatory circumstances" .  If the Panel, by referring to "regulatory 
circumstances", means to refer to the applicable re gime, as explained in its Third party submission 
and its Oral statement, the European Communities takes the view that regulatory circumstances as 
such are not relevant in determining whether two ser vices are "like".  Specifically, the mere fact that 
different regulations apply to services provided fr om within and from outside the territory of a 
Member or even the particular enforcement problem s that the latter may create, cannot make foreign 
and domestic service "unlike".  It is the very objective of Article XVII to protect inter alia , services 
provided from outside the territory of a Member agains t regulations that are less favourable than those 
applicable to services provided from whiten that territory.  The place, if any, to address special 
regulatory circumstances of foreign services in Article XVII is the notion of "less favourable 
treatment", discussed below.    Alternatively, the Panel, by referring to "regul atory circumstances", may mean to refer to the 
factual circumstances that are the subject of regul ation.  The European Communities would also note 
that the "territory where the service is being supplie d" will in principle differ from the "territory from 
which the service is being supplied" only in case of supply through mode 1.  If differences in the 
factual circumstances had an impact e.g. on the ch aracteristics of the services themselves, as they are 
provided in the territory of the WTO Member whose m easure is at issue, they could have an impact 
on the "likeness" of the domestic and foreign servi ce.  The "less favourable treatment" standard has 
been the subject of numerous GATT and WTO pane l and Appellate Body reports, particularly in 
connection with Article III of the GATT.  Longsta nding GATT practice has clarified that "treatment 
no less favourable" requires effec tive equality of competitive opport unities for foreign and domestic 
goods.
424  This approach, developed for the goods sector, is now codified in Article XVII:2-3 of the 
GATS. 
 
 While the underlying objective of the "no less fa vourable treatment" standard is to guarantee 
equality of treatment, there may be cases in which a pplication of formally identical treatment would 
in practice result in according less favourable treatme nt to foreign goods or services.  This may be the 
case where the differences in regulatory circumstances in the territory from which the service is being 
supplied and the territory in whic h it is being supplied have an im pact on the provision of the service 
in the Member whose measure is under dispute.   Applying Article XVII of the GATS entails a 
comparison between two "treatments" granted by the same WTO Member in the territory of which the 
service is supplied – the treatment of domestic and the treatment of foreign services.  Attainment of 
the objective of the "no less favourable treatment" standard might thus require a WTO Member to apply a different regime to foreign goods or services so as to ensure that the treatment accorded is in 
fact no less favourable.  It may also allow formal ly different treatment where identical treatment 
would result in more favourable treatment of the foreign service, provided that the treatment of 
foreign services remains "no less favourable".  Of c ourse, this would not allow an outright prohibition 
on foreign services where domestic services are allowed.  Last, formally different treatment based on different circumstances in the Member from wh ich the service is provided, inasmuch as those 
circumstances had an impact on the market of the Me mber whose measure is at issue, might also be 
relevant under Article XIV of the GATS.   
                                                      
424 Panel Report on US – Section 337 , BISD 36S/345.  WT/DS285/R 
Page C-84  
 
Mexico 
 
 At the very least, the regulatory circumstan ces would be relevant to the "less favourable 
treatment" analysis.  See Mexico's response to question 6 above.  
4. With respect to paragraph 9 of Japan's wr itten submission, does the mere fact that 
services are supplied through different modes of supply (as defined in the GATS Agreement) mean that the regulatory circumstances are different and that, therefore, different treatment as between those modes of supply is justified?  Do the third parties 
agree with Japan's appraisal in paragraph 11 of its written submission of the possible 
consequences for coverage under the GATS Agreement if "likeness" across modes is 
permitted under Article XVII? 
European Communities 
 
 The European Communities does not share the view, expressed in paragraph 9 of Japan's 
Third party submission, that differences in regulatory circumstances may affect per se  the "likeness" 
of a domestic and a foreign service.  Inasmuch as  "differences in regulatory circumstances" means 
"differences in applicable regimes", this point is  already addressed in paragraph 96 of the EC Third 
party submission.  Inasmuch as it means "differe nces in factual circumstances which may be the 
subject of legal regulation", such differences might affect likeness only in case they made the 
characteristics of the two services different, as explained above in reply to question 3.  The European 
Communities also considers that the issue raised in paragraph 11 of Japan's written submission does 
not need to be addressed in order to solve th e present dispute, which is only concerned with 
Article XVII of the GATS.425 
 Japan
426 
  What Japan meant in this paragraph is that th ere should be some room for arguing for denying 
likeness of services, when the necess ity of differentiated treatment in light of regulatory requirements, 
the difference in regulatory circumstances, etc. are sufficiently proven on a particular case by a 
defending Member.  In some cases, the difference in regulatory circumstances are effectively represented in the difference of modes, but as is clear in its submission, Japan does not make a 
categorical statements that difference in modes alwa ys makes services unlike.  On the contrary, when 
it is found on specific cases that difference in regulatory circumstances does not suffice to establish 
the un-likeness of services in certain service sector s, or when that argument is not sufficiently 
substantiated by a Party concerned, difference in supplying mode itself would not decline the likeness 
of services.   
 
 Paragraph 11 of Japan's written submission is not in  fact Japan's appraisal.  It is meant to be a 
factual description of discussion in the Council for Trade in Services, which in Japan's view might have some relevance to the interpretation of liken ess of services. Therefore Japan introduced this 
discussion for a deliberation by this panel if appropriate.    
                                                      
425 Appellate Body Report on EC – Bananas III , para. 231, where the Appellate Body considered that 
provisions relating to national treatment are not necessa rily relevant to the interpretation of the GATS most-
favoured-nation clause.   
426 The Panel notes that, when commenting on the descriptive part of the Report, Japan requested the 
deletion of various elements contained in the initial response.   WT/DS285/R 
Page C-85 
 
 
Mexico 
 
 With respect to the first issue, pursuant to paragraph 3 of Article XVII, formally different 
treatment between modes of supply is possible under the GATS.  Such a difference in treatment will only violate Article XVII to the extent that it modifies the conditions of competition in favour of 
services or service suppliers of the Member (i.e. of the Member implementing the measure at issue) as 
compared to like services or service suppliers of an y other Member.  With resp ect to the second issue, 
see Mexico's response to question 3 above.  
Antigua 
 
Do the third parties agree with Japan's appraisal in  paragraph 11 of its written submission of the 
possible consequences for coverage under the GATS Agreement if "liken ess" across modes is 
permitted under Article XVII? 
  In paragraph 11 of its written submission Japan submits that, if likeness across modes is 
permitted, limitation on national treatment for a particular mode of supply will be rendered 
meaningless through the effect of Article II of the GATS.  In essence, this theory would oblige the 
Panel to choose between:  (i) making national treatment commitments on cross-border supply 
meaningless (because cross-border supply would by defin ition be "unlike");  or (ii) making limitations 
on cross-border supply meaningless (because the "likeness" provision of Article II of the GATS 
would undermine the effectiveness of such a limita tion in case a Member has made national treatment 
commitments for other modes of supply).  This, in it self, shows that this theory cannot be a correct 
interpretation of Articles II and XVII of the GATS because, whichever of the two options is chosen, 
an important part of a Member's sche dules of commitments is made redundant. 
 
 Furthermore the theory put forward by Japa n presupposes that "likeness" and "less favourable 
treatment" in Article II and Article XVII must always be interpreted in precisely the same way.  In 
EC – Bananas III , however, the Appellate Body has already stated that there is no such analogy 
between Articles II and XVII and that Article II of the GATS should be interpreted in the light of the 
MFN provisions of the GATT 1994, and not in the light of Article XVII of the GATS.
427  In view of 
the above Antigua and Barbuda submits that, in the si tuation described by Japan in paragraph 11 of its 
third party submission, Member A would not be ob liged to extend "treatment b" to cross-border 
services of Member C.  If Member A were obliged to  do that, it would be obliged to give the services 
of Member C better treatment than the services of Member B and the purpose of Article II is precisely to prohibit this, not to require it.  The Article XV II context is obviously completely different when a 
Member has made a specific commitment to give treatment "no less favourable" to services supplied 
on a cross-border basis.  
 
For Japan: 
 
5. In paragraph 9 of its written submission, Japan has stated that in some  service sectors 
and for certain  services, it could be argued that regulatory circumstances should be 
taken into account in assessing "likeness" of services.  Could Japan indicate what 
criteria should apply in determining for which sectors/ for which services regulatory 
circumstances should be taken into account? 
Japan 
 
 Japan as a third party is in no position to cat egorically identify specific service sectors 
requiring consideration of regulatory circumstances at  this juncture, where there is a view widely 
shared among Members that likeness of goods and ser vices needs to be identified on a case-by-case 
                                                      
427 Appellate Body Report on EC – Bananas III , para. 231. WT/DS285/R 
Page C-86  
 
basis.  It is not in a position to state either th at the service sector central to this particular case 
categorically requires consideration of regulatory circum stances.  It is of the view that differences in 
regulatory circumstances should not be categorica lly excluded as a factor to be taken into 
consideration in identifying likeness of services, but it is at the liberty of a Party to this and future 
panel to argue on that aspect, as necessitated. 
 
_______________