WORLD TRADE  
ORGANIZATION  WT/DS285/RW 
30 March 2007 
 (07-1209) 
 Original:   English 
  
 
     
 
UNITED STATES – MEAS URES AFFECTING THE  
CROSS-BORDER SUPPLY OF GAMBLING  
AND BETTING SERVICES 
 
Recourse to Article 21.5 of the DSU by Antigua and Barbuda  
 
  
 
Report of the Panel  WT/DS285/RW 
 Page i 
 
 
  TABLE OF CONTENTS 
 
Page  
I. PROCEDURAL BACKGROUND ..........................................................................................1  
II. FINDINGS REQUESTED BY  THE PARTIES .....................................................................3  
III. ARGUMENTS OF THE PARTIES ........................................................................................3  
IV. ARGUMENTS OF THE THIRD PARTIES ..........................................................................4  
V. INTERIM REVIEW................................................................................................................. 4 
VI. FINDINGS....................................................................................................................... ..........9  
A. ORDER OF ANALYSIS ..................................................................................................................9  
B. DISAGREEMENT AS TO THE EXISTENCE OF MEASURES TAKEN TO COMPLY ............................10  
1. Recommendation of the DSB in  the original proceeding ....................................................10  
(a) Main arguments of the parties.................................................................................................. .10 
(b) Main arguments of third parties................................................................................................ 10 
(c) Assessment by the Panel........................................................................................................ ...11 
2. Specific findings and conclusions in the original proceeding..............................................16  
(a) Main arguments of the parties.................................................................................................. .16 
(b) Main arguments of third parties................................................................................................ 17 
(c) Assessment by the Panel........................................................................................................ ...17 
3. Statements made during the arbitration pursuant to Article 21.3(c) of the DSU .............27  
C. DISAGREEMENT AS TO THE CONSISTENCY WITH A COVERED AGREEMENT OF 
MEASURES TAKEN TO COMPLY ................................................................................................28  
1. Nature of the Panel's assessment ...........................................................................................28  
(a) Main arguments of the parties.................................................................................................. .28 
(b) Assessment by the Panel........................................................................................................ ...29 
2. United States' submissions ..................................................................................................... 30 
(a) Interstate Horseracing Act, as amended....................................................................................30  
3. Antigua's s ubmissions.......................................................................................................... ...34 
(a) Interstate Horseracing Act, as amended....................................................................................34  
(b) Intrastate commerce............................................................................................................ ......36  
4. Developments since the original proceeding.........................................................................38  
(a) April 2006 DOJ Statement and prosecutions............................................................................38  
(b) Unlawful Internet Gambling Enforcement Act.........................................................................39  
VII. CONCLUSION ..................................................................................................................... ..41 
 WT/DS285/RW 
Page ii  
 
  LIST OF ANNEXES 
 
 
ANNEX A 
 
FIRST WRITTEN SUBMISSIONS FROM THE PARTIES 
 
Contents Page 
Annex A-1  First Written Submission by Anti gua and Barbuda (25 September 
2006) – Executive Summary A-2 
Annex A-2 First Written Submission by the United States (16 October 2006) – 
Executive Summary A-9 
 
 
ANNEX B 
 
THIRD PARTY WRITTEN SUBMISSIONS 
 
Contents Page 
Annex B-1 Third Party Submission by the European Communities (23 October 
2006) – Executive Summary B-2 
Annex B-2 Third Party Submission by Japan (23 October 2006) –  
Executive Summary B-8 
 
 
ANNEX C 
 
REBUTTALS FROM THE PARTIES 
 
Contents Page 
Annex C-1  Rebuttal by Antigua and Ba rbuda (30 October 2006) –  
Executive Summary C-2 
Annex C-2 Rebuttal by the United States (13 November 2006) –  
Executive Summary C-9 
 
 
ANNEX D 
 
ORAL STATEMENTS OF THE PARTIES AT THE 
SUBSTANTIVE MEETING OF THE PANEL 
 
Contents Page 
Annex D-1  Opening Statement by Antigua and Barbuda (27 November 2006) – 
Executive Summary D-2 
Annex D-2 Opening Statement by the United States (27 November 2006) – 
Executive Summary D-6 
Annex D-3 Closing Statement by Antigua  and Barbuda (28 November 2006) D-10 
 
  WT/DS285/RW 
 Page iii 
 
 
  ANNEX E 
 
ORAL STATEMENTS OF THIRD PARTIES AT THE 
SUBSTANTIVE MEETING OF THE PANEL  
 
Contents Page 
Annex E-1  Oral Statement by China (28 November 2006) E-2  
Annex E-2 Oral Statement by the European Communities (28 November 2006) 
– Executive Summary E-4 
Annex E-3 Oral Statement by Japan (28 November 2006) –  
Executive Summary E-7 
 
 
ANNEX F 
 
REPLIES BY THE PARTIES AND THIRD PARTIES 
TO QUESTIONS POSED BY THE PANEL 
 
Contents Page 
Annex F-1  Replies by Antigua and Barbuda to questions posed by the Panel 
(8 December 2006) F-2 
Annex F-2  Replies by the United States to questions posed by the Panel 
(8 December 2006)   F-15  
Annex F-3 Replies by China to questions posed by the Panel 
(8 December 2006)   F-38 
Annex F-4 Replies by the European Communities to questions posed by the 
Panel (8 December 2006)   F-42 
Annex F-5 Replies by Japan to questions posed by the Panel 
(8 December 2006)   F-55 
 
 
ANNEX G 
 
COMMENTS BY THE PARTIES ON REPLIES  
TO QUESTIONS POSED BY THE PANEL 
 
Contents Page 
Annex G-1  Comments by Antigua and Barbuda on replies to questions posed 
by the Panel (14 December 2006) G-2 
Annex G-2 Comments by the United States on replies to questions posed by the 
Panel (14 December 2006)    G-31 
 
ANNEX H 
 
REQUEST FOR THE ESTABLISHMENT OF A PANEL  
 
 
ANNEX I 
 
WORKING PROCEDURES OF THE PANEL  
 
 WT/DS285/RW 
Page iv  
 
  ANNEX J 
 
LISTS OF EXHIBITS SUBMITTED BY THE PARTIES 
 
Contents Page 
Annex J-1  List of Schedules and Exhibits s ubmitted by Antigua and Barbuda J-2  
Annex J-2 List of Exhibits submitted by the United States J-7  WT/DS285/RW 
 Page v 
 
 
  ABBREVIATIONS USED FOR DISPUTE SETTLEMENT CASES  
REFERRED TO IN THIS REPORT 
 
Short Title Full Case Title and Citations 
Brazil – Aircraft Appellate Body Report, Brazil – Export Financing Programme for Aircraft , 
WT/DS46/AB/R, adopted 20 August 1999, DSR 1999:III, 1161. 
Brazil – Aircraft  (Article 21.5 
– Canada) Appellate Body Report, Brazil – Export Financing Programme for Aircraft – 
Recourse by Canada to Article 21.5 of the DSU , WT/DS46/AB/RW, adopted 
4 August 2000, DSR 2000:VIII, 4067. 
Canada – Aircraft (Article 21.5 
– Brazil)  Appellate Body Report, Canada – Measures Affecting the Export of Civilian 
Aircraft – Recourse by Brazil to Article 21.5 of the DSU , WT/DS70/AB/RW, 
adopted 4 August 2000, DSR 2000:IX, 4299 
Canada – Autos  Appellate Body Report, Canada – Certain Measures Affecting the Automotive 
Industry , WT/DS139/AB/R, WT/DS142/AB/R, adopted 19 June 2000, 
DSR 2000:VI, 2985. 
Canada – Dairy  (Article 21.5 
– New Zealand and US) Appellate Body Report, Canada – Measures Affecting the Importation of Milk 
and the Exportation of Dairy Products – Recourse to Article 21.5 of the DSU by 
New Zealand and the United States , WT/DS103/AB/RW, WT/DS113/AB/RW, 
adopted 18 December 2001, DSR 2001:XIII, 6829. 
Canada – Dairy  (Article 21.5 – New Zealand and US II) Appellate Body Report, Canada – Measures Affecting the Importation of Milk 
and the Exportation of Dairy Products – Se cond Recourse to Article 21.5 of the 
DSU by New Zealand and the United States , WT/DS103/AB/RW2, 
WT/DS113/AB/RW2, adopted 17 January 2003, DSR 2003:I, 213. 
Canada – Patent Term  Appellate Body Report, Canada – Term of Patent Protection , WT/DS170/AB/R, 
adopted 12 October 2000, DSR 2000:X, 5093. 
Dominican Republic – Import 
and Sale of Cigarettes Panel Report, Dominican Republic – Measures Affecting the Importation and 
Internal Sale of Cigarettes , WT/DS302/R, adopted 19 May 2005, modified by 
Appellate Body Report, WT/DS302/AB/R. 
EC – Tariff Preferences Appellate Body Report, European Communities – Conditions for the Granting 
of Tariff Preferences to Developing Countries , WT/DS246/AB/R, adopted 
20 April 2004, DSR 2004:III, 925. 
EC – Tariff Preferences Panel Report, European Communities – Conditions for the Granting of Tariff 
Preferences to Developing Countries , WT/DS246/R, adopted 20 April 2004, 
modified by Appellate Body Report, WT/DS/246/AB/R, DSR 2004:III, 1009 
EC – Trademarks and 
Geographical Indications 
(Australia) Panel Report,  European Communities – Protection of Trademarks and 
Geographical Indications for Agricultural Products and Foodstuffs, Complaint 
by Australia , WT/DS290/R, adopted 20 April 2005. 
EC – Trademarks and 
Geographical Indications 
(US)  Panel Report,  European Communities – Protection of Trademarks and 
Geographical Indications for Agricultural Products and Foodstuffs, Complaint 
by the United States , WT/DS174/R, adopted 20 April 2005. 
EC – Bed Linen (Article 21.5 – 
India ) Appellate Body Report, European Communities – Anti-Dumping Duties on 
Imports of Cotton-Type Bed Linen from I ndia – Recourse to Article 21.5 of the 
DSU by India , WT/DS141/AB/RW, adopted 24 April 2003, DSR 2003:III, 965. 
India – Patents (US) Appellate Body Report, India – Patent Protection for Pharmaceutical and 
Agricultural Chemical Products , WT/DS50/AB/R, adopted 16 January 1998, 
DSR 1998:I, 9. 
Turkey – Textiles Appellate Body Report, Turkey – Restrictions on Imports of Textile and Clothing 
Products , WT/DS34/AB/R, adopted 19 November 1999, DSR 1999:VI, 2345. WT/DS285/RW 
Page vi  
 
  Short Title Full Case Title and Citations 
US – FSC  Appellate Body Report, United States – Tax Treatment for "Foreign Sales 
Corporations" , WT/DS108/AB/R, adopted 20 March 2000, 
DSR 2000:III, 1619. 
US – FSC (Article 21.5 –EC II) Appellate Body Report, United States – Tax Treatment for "Foreign Sales 
Corporations" – Second Recourse to Arti cle 21.5 of the DSU by the European 
Communities , WT/DS108/AB/RW2, adopted 14 March 2006. 
US – Section 211 
Appropriations Act  Appellate Body Report, United States – Section 211 Omnibus Appropriations 
Act of 1998 , WT/DS176/AB/R, adopted 1 February 2002, DSR 2002:II, 589. 
US – Shrimp  Appellate Body Report, United States – Import Prohibition of Certain Shrimp and 
Shrimp Products , WT/DS58/AB/R, adopted 6 November 1998, 
DSR 1998:VII, 2755. 
US – Shrimp (Article 21.5 – 
Malaysia) Appellate Body Report, United States – Import Prohibition of Certain Shrimp and 
Shrimp Products – Recourse to Article 21.5 of the DSU by Malaysia , 
WT/DS58/AB/RW, adopted 21 November 2001, DSR 2001:XIII, 6481. 
US – Shrimp (Article 21.5 – Malaysia) Panel Report, United States – Import Prohibition of Certain Shrimp and Shrimp 
Products, Recourse to Article 21.5 of the DSU by Malaysia , WT/DS58/RW, 
adopted 21 November 2001, upheld by Appellate Body Report, 
WT/DS58/AB/RW, DSR 2001:XIII, 6529. 
US – Softwood Lumber IV (Article 21.5 – Canada) Appellate Body Report, United States – Final Countervailing Duty Determination 
with Respect to Certain Softwood Lumber from Canada – Recourse by Canada to 
Article 21.5 of the DSU , WT/DS257/AB/RW, adopted 20 December 2005. 
US – Softwood Lumber V  Appellate Body Report, United States – Final Dumping Determination on 
Softwood Lumber from Canada , WT/DS264/AB/R, adopted 31 August 2004, 
DSR 2004:V, 1875.  WT/DS285/RW 
 Page vii 
 
 
  LIST OF ABBREVIATIONS 
 
 DOJ United States Department of Justice 
 
DSB Dispute Settlement Body 
 
DSU Dispute Settlement Understanding 
 
GATS General Agreement on Trade in Services 
 
GATT 1994 General Agreement on Tariffs and Trade 1994 
 
H.R. 4411 H.R. 4411, 109
th Cong 2nd Sess., "The Internet Gambling Prohibition 
and Enforcement Act" (12 July 2006) 
 
IGBA Illegal Gambling Business Act, 18 U.S.C. § 1955 
 
IHA Interstate Horseracing Act, 15 U.S.C. §§ 3001 to 3007 
 
RICO Racketeer Influenced and Corrupt Organizations Statute, 18 U.S.C. 
§§ 1961-1968 
 
Travel Act Travel Act, 18 U.S.C. § 1952 
 
UIGEA Unlawful Internet Gambling Enforcement Act of 2006, Pub. L. No. 
109-347, 120 Stat. 1884, 1952- 1962 (2006) (to be codified at 31 U.S.C. 
§§ 5361 to 5367)  
USTR United States Trade Representative 
 
Wire Act Wire Act, 18 U.S.C. § 1084 
 
WTO Agreement  Marrakesh Agreement Es tablishing the World Trade Organization 
 
   WT/DS285/RW 
 Page 1 
 
 
  I. PROCEDURAL BACKGROUND 
1.1 On 20 April 2005, the Dispute Settlement Body ("DSB") adopted the Appellate Body Report 
(WT/DS285/AB/R) and the Panel Report (WT/DS285/R)  as modified by the Appellate Body Report 
in the dispute on United States – Measures Affecting the Cross-Border Supply of Gambling and 
Betting Services .1  In its recommendations and rulings, the DSB requested the United States to bring 
its measures, that were found, in the Appellate Body Report and in the Panel Report as modified by 
that Report, to be inconsistent with its obligati ons under the General Agreem ent on Trade in Services 
(GATS), into conformity with its obligations under that Agreement. 
1.2 On 19 May 2005, the United States informed the DSB that it intended to implement the 
DSB's recommendations and rulings in this dispute in a manner that respected the United States' WTO 
obligations, and that it had begun to evaluate options  for doing so.  The United States indicated that it 
would need a reasonable period of time in which to do  this and that it stood ready to discuss this 
matter with the Government of Antigua and Barbuda  ("Antigua"), in accordance with Article 21.3(b) 
of the DSU.2 
1.3 On 6 June 2005, Antigua informed the DSB that Antigua and the United States had been 
unable to agree on a reasonable period of time.  C onsequently, Antigua requested that the reasonable 
period of time be determined through binding ar bitration pursuant to Article 21.3(c) of the 
Understanding on Rules and Procedures Govern ing the Settlement of Disputes ("DSU").3  On 30 June 
2005, the Director-General appointed Dr. Claus- Dieter Ehlermann to act as Arbitrator under 
Article 21.3(c).4 
1.4 In the Arbitration Award, which was circulated  on 19 August 2005, the Arbitrator determined 
that the "reasonable period of time" for the Un ited States to implement the recommendations and 
rulings of the DSB was 11 months and 2 weeks fro m 20 April 2005, which was the date on which the 
DSB adopted the Panel and Appellate Body Reports.  The reasonable period of time was therefore to 
expire on 3 April 2006.5 
1.5 In a first Status Report dated 6 March 2006, the United States informed the DSB that the "US 
Administration, in consultation with the US Congress, has been working on appropriate steps to 
resolve this matter".6  In its second Status Report, dated 10 April 2006, the United States informed the 
DSB that:   
"On 5 April 2006, the US Department of Justice confirmed the position of the US 
Government regarding remote gambling on  horse racing in testimony before a 
subcommittee of the US House of Representativ es.  The Department of Justice stated 
that:  
                                                      
1 Appellate Body Report and Panel Report – Action by the Dispute Settlement Body , WT/DS285/10;  
Dispute Settlement Body, Minutes of Meeting , WT/DSB/M/188, para. 75. 
2 Dispute Settlement Body, Minutes of Meeting , WT/DSB/M/189, para. 47. 
3 Request from Antigua and Barbuda for Arbitration under Article 21.3(c) of the DSU , WT/DS285/11, 
9 June 2005. 
4 Appointment of Arbitrator by the Director-General under Article 21.3(c) of the Understanding on 
Rules and Procedures Governing the Settlement of Disputes , Note by the Secretariat, WT/DS285/12, 
5 July 2005. 
5 Arbitration under Article 21.3(c) of the Understanding on Rules and Procedures Governing the 
Settlement of Disputes , Award of the Arbitrator Claus-Dieter Ehlermann, WT/DS285/13, 19 August 2005;  
provided to the Chairman of the DSB, WT/DS285/14, 23 August 2005. 
6 Status Report by the United States , WT/D285/15, 7 March 2006. WT/DS285/RW 
Page 2  
 
  The Department of Justice views the existing criminal statutes as 
prohibiting the interstate transmis sion of bets or wagers, including 
wagers on horse races.  The Depart ment is currently undertaking a 
civil investigation relating to a pot ential violation of law regarding 
this activity.  We have previously stated that we do not believe that 
the Interstate Horse Racing Act, 15 U.S.C.  §§ 3001-3007, amended 
the existing criminal statutes.   
In view of these circumstances, the Un ited States is in compliance with the 
recommendations and rulings of the DSB in this dispute."
7 
1.6 At the DSB meeting of 21 April 2006, the United States, referring, inter alia , to the 
aforementioned DOJ statement, informed Members th at it "was now able to show that relevant US 
law did not discriminate against foreign suppliers of remote gambling on horse racing" and concluded 
that it "was in compliance with the recommendations  and rulings of the DSB in this dispute".8  At the 
same meeting, Antigua disagreed with that interpretation.9   
1.7 On 24 May 2006, Antigua and the United States notified an Agreement Regarding Procedures 
under Articles 21 and 22 of the DSU (the "Agreed Procedures") to the DSB.10  In a communication 
dated 8 June 2006, Antigua requested consultations with the United St ates pursuant to paragraph 1 of 
the Agreed Procedures.11  Consultations between the par ties were held on 26 June 2006 in 
Washington D.C., but did not result in a settlement of the dispute.  In a communication dated 6 July 
2006, Antigua requested the DSB to establish a panel pursuant to Article 21.5 of the DSU.12   
1.8 At its meeting on 19 July 2006, following the request made by Antigua, the DSB agreed to 
refer to the original Panel, if possible, the ma tter raised by Antigua in document WT/DS285/18 and 
decided that the Panel would have standard terms of reference.  The terms of reference are, therefore, 
the following: 
"To examine, in the light of the relevant provisions of the covered agreements cited 
by Antigua and Barbuda in document WT/D S285/18, the matter referred to the DSB 
by Antigua and Barbuda in that document, and to make such findings as will assist 
the DSB in making the recommendations or in giving the rulings provided for in those agreements."
13 
1.9 Article 21.5 of the DSU provides that a dispute under that provision shall be decided through 
recourse to the DSU, including, "wherever possible, r esort to the original panel".  In this case, the 
Chairperson of the original panel and one of the panellists were unavailable to serve.  The parties 
agreed on their replacements, and as a result the Panel was composed as follows: 
                                                      
7 Status Report by the United States , Addendum, WT/D285/15/Add.1, 11 April 2006. 
8 Dispute Settlement Body, Minutes of Meeting , WT/DSB/M/210, 30 May 2006, paras. 33-35. 
9 Ibid., paras. 36-39. 
10 Agreement between Antigua and Barbuda and the United States Regarding Procedures under 
Articles 21 and 22 of the DSU , WT/DS285/16, 26 May 2006. 
11 Recourse to Article 21.5 of the DSU by Antigua and Barbuda , Request for Consultations , 
WT/DS285/17, 12 June 2006.  Paragraph 1 of the Agreed Procedures stipulates:  "If Antigua and Barbuda 
deems it appropriate to invoke Article 21.5 of the DSU, Antigua and Barbuda will request consultations, which 
the Parties agree to hold within 15 days from  the date of circulation of the request". 
12 Recourse to Article 21.5 of the DSU by Antigua an d Barbuda, Request for the Establishment of a 
Panel , WT/DS285/18, 7 July 2006. 
13 Recourse to Article 21.5 of the DSU by Antigua and Barbuda, Constitution of the Panel , Note by the 
Secretariat, WT/DS285/19, 16 August 2006;  Dispute Settlement Body, Minutes of Meeting , WT/DSB/M/217, 
12 September 2006, para. 71.  WT/DS285/RW 
 Page 3 
 
 
   Chairperson: Mr Lars Anell 
  Members: Mr Mathias Francke    Mr Virachai Plasai
14 
 
1.10 The representatives of China, the European Co mmunities and Japan reserved their third-party 
rights to participate in the Panel's proceedings.15 
1.11 The Panel established its Working Procedur es and Timetable on, respectively, 4 and 
14 September 2006, and communicated these to the parties and third parties. 
1.12 After receiving the parties' written submissions, the Panel noted that there appeared to be 
disagreement as to what had been submitted to the Ar bitrator appointed pursuant to Article 21.3(c) of 
the DSU, and was hence of the view that the record of the Arbitrator might assist the Panel in carrying 
out its work.  After consulting with the parti es, the Panel requested access, in a letter dated 
21 November 2006 addressed to the Director of the Appellate Body Secretariat, to the Arbitrator's 
record in the Article 21.3(c) proceeding.  This reco rd was transmitted to the Panel the same day.  It 
contained the parties' respective submissions a nd oral statements, as well as a transcript of the 
Arbitrator's oral hearing.  The third parties received copies of the parties' submissions and oral statements directly from the parties. 
1.13 The Panel met with the parties on 27 and 28 November 2006.  It met with the third parties on 
28 November 2006. 
II. FINDINGS REQUESTED BY THE PARTIES 
2.1 Antigua  requests that the Panel:  
(a) find that the United States has not taken measures to comply with the DSB rulings;   
(b) find that the Wire Act, the Travel Act and the IGBA remain in violation of the United 
States' obligations to Antigua under, inter alia , Article XVI of the GATS without 
meeting the requirements of Article XIV of the GATS; and  
(c) recommend that the DSB request the United St ates to bring the Wire Act, the Travel 
Act and the IGBA into conformity with th e obligations of the United States under the 
GATS. 
2.2 The United States  requests that the Panel reject Antigua 's claims in their entirety, and find 
that the US measures taken to comply are not inconsistent with the GATS. 
III. ARGUMENTS OF THE PARTIES 
3.1 The arguments of the Parties are set out in their respective submissions to the Panel.  
Executive summaries from the parties,  including the first written submissions, rebuttals and written 
versions of their oral statements, as well as rep lies to questions and comments on replies to questions, 
are attached as annexes to this report. 
                                                     
 
14 Recourse to Article 21.5 of the DSU by Antigua and Barbuda, Constitution of the Panel , Note by the 
Secretariat, WT/DS285/19, 16 August 2006. 
15 Recourse to Article 21.5 of the DSU by Antigua and Barbuda, Constitution of the Panel , Note by the 
Secretariat, WT/DS285/19, 16 August 2006; Dispute Settlement Body, Minutes of Meeting , WT/DSB/M/217, 
12 September 2006, para. 72. WT/DS285/RW 
Page 4  
 
  IV. ARGUMENTS OF THE THIRD PARTIES 
4.1 Arguments of the third parties that presented written submissions to the Panel, i.e. the 
European Communities and Japan, ar e attached as annexes to this report in the form of executive 
summaries from those third parties.  Likewise, th e oral statement by Chin a, executive summaries of 
the oral statements presented by the European Co mmunities and Japan, as well as third parties' replies 
to the Panel's questions, are attached as annexes to this report. 
V. INTERIM REVIEW 
5.1 On 25 January 2007, the Panel submitted its inte rim report to the parties.  On 1 February 
2007, the parties submitted written requests for review of precise aspects of the interim report.  On 
8 February 2007, the parties submitted written comme nts on each other's requests for interim review.  
In accordance with Article 15.3 of th e DSU, this section of the Panel's report sets out a discussion of 
the arguments made at the interim review stage. 
(i) Public comment on the confidential interim report 
5.2 When transmitting the interim report to the par ties, the Panel explicitly indicated that the 
interim report was strictly confidential
.  The Panel also explicitly emph asized at its meeting with the 
parties that the Panel's proceedings were confidentia l, as provided for in Article 18 of the DSU.  This 
was accepted by the parties, as well as reflected in the Panel's Working Procedures and in all relevant 
correspondence with the parties. 
5.3 Therefore, the Panel notes with concern that the confidentiality requirement was breached on 
the occasion of the transmission of the interim repor t to the parties.  The Panel is all the more 
concerned given that breaches of confidentiality had occurred in the original proceeding and were 
deplored by the original Panel.16 
5.4 Within hours of the transmission of the interim re port to the parties, the press reported on the 
result of the "confidential" interim report.17  Press reports referred in particular by name to a 
spokesperson from the USTR "confirm[ ing] reports that the ruling we nt against the United States" and 
commenting on the content of the interim report. 
5.5 On 26 January 2007, Antigua refe rred the Panel to the press report and noted, in particular, 
that Antigua had "strictly observe d the confidentiality obligation". 
5.6 On 29 January 2007, the Panel communicated to the parties as follows: 
"The Panel notes with concern that the conf identiality of the Interim Report has been 
breached, in spite of the fact that the c onfidentiality requirement was accepted by the 
Parties (as reflected in the Working Pr ocedures).  The Panel wishes to remind 
the Parties that the Interim Report is stri ctly confidential, and that breaches of the 
confidentiality requirement are unacceptable because they affect the credibility and 
integrity of the WTO dispute settlement process." 
5.7 Antigua, in its comments on interim review, expressed its deep disappointment with the 
decision of the United States to publicly comment on the interim report despite its express agreement 
not to do so.  Antigua informed the Panel that it ha d scrupulously maintained the confidentiality of the 
                                                      
16 See the original Panel report, paras. 5.3 to 5.13. 
17 See, for instance, US confirms loss in Internet Gambling trade case , Reuters, 25 January 2007.  WT/DS285/RW 
 Page 5 
 
 
  interim report, and commented that the statements  of the USTR were not only contrary to the 
agreements and obligations of the Unite d States but materially misleading.   
5.8 The United States informed the Panel, when submitting its comments on the interim review, 
that it shared the Panel's concerns regarding the breach of confidentiality of the interim report and 
assured the Panel that "the United States was not the source of the leaked results".  The United States 
asserted that it had "received several press inquiries re garding these results that indicated that the 
source was in Geneva.  The U.S. comments came only in response to the reports of the leak." 
5.9 First, the Panel notes that the insinuations by the United States are serious since they may 
imply that the Panel or the WTO Secretariat breached  the confidentiality requirement with respect to 
the interim report.  The Panel wishes to assert forceful ly that neither the Panel nor the Secretariat has 
done so.  Third parties cannot be blamed since they  do not receive a copy of the interim report.  
Second, with respect to the United States' assertion that its comments came "only in response to the 
reports of the leak", the Panel notes that, even in such circumstances, the comments would still be 
inappropriate in light of the confidentialit y requirement concerning the interim report. 
5.10 The Panel wishes to reiterate its concerns  and stress again that disregard for the 
confidentiality requirement affects the credibilit y and integrity of the WTO dispute settlement 
process, of the WTO and of WTO Members and is, therefore, unacceptable.  
(ii) Timing of the measure taken to comply 
5.11 The United States requested a footnote to one sentence in paragraph 6.22, clarifying that 
compliance need not necessarily occur subsequent  to the DSB recommendation and rulings, as a 
WTO Member might modify or remove measures at issue after establishment of a panel but prior to 
adoption of the panel or Appellate Body report. 
5.12 Antigua had no objection to the proposed clarification but considers that, in such an unusual 
circumstance, the implementing party should anno unce its compliance no later than the time of 
adoption of the DSB recommendation to avoid the situation that arose in this dispute. 
5.13 The Panel referred throughout its report to  matters occurring "since the original 
proceeding" for the reason given by the United St ates and has modified the sentence to which the 
United States referred. 
(iii) Article 17.14 of the DSU  
5.14 The United States noted that the discussion of Ar ticle 17.14 of the DSU did not appear to be 
necessary to the result reached by the Panel but onl y confirmed the Panel's earlier conclusion.  The 
United States raised three concerns with the system ic implications of the discussion of Article 17.14 
of the DSU:  (i) in its view, Article 17.14, on its  face, was not limited to a compliance proceeding and 
applied to the "parties to the dispute" in any cont ext.  The Panel's interpretation would foreclose a 
disputing party from re-arguing a legal or factual i ssue addressed by an Appellate Body report in any 
future proceeding under the DSU or perhaps even out side the DSU.  This was a result that no Member 
intended.  The United States understood that Article 17.14 was simply meant to indicate that no 
further appeals were available from Appellate Body re ports, unlike final panel reports;  (ii) the Panel's 
interpretation would create a major distinction betw een adopted panel reports  and adopted Appellate 
Body reports because Article 17.14 of the DSU only a pplies to adopted Appellate Body reports;  and 
(iii) the interim report resorts to the undefin ed concept of a "claim" to distinguish the Canada – Dairy  
dispute.  In Canada – Dairy , the complainants' claim effectively failed for lack of a prima facie case, 
although the Appellate Body did not use that term.  The Panel's interpretation would require future WT/DS285/RW 
Page 6  
 
  panels to struggle with what is, and what is not, the same "claim" for the purposes of Article 17.14, to 
distinguish between Canada – Dairy and US – Gambling . 
5.15 Antigua replied that the United States had taken the potential effect of the interim report much 
farther than warranted.  The discussion of the effect of Article 17.14 of the DSU is very helpful in the 
context of this dispute, particularly given the primary argument of the United States that it was 
entitled to a second chance to meet its burden of pr oof.  As regards the United States' concerns:  
(i) the interim report sets out certain limitations applicable to a determ ination of unconditional 
acceptance under Article 17.14.  The reasoning in the interim report does not prevent Members 
introducing new evidence or arguments but excludes an  attempt to meet a failed burden of proof.  
Article 17.14 was intended to result in finality and not simply recite a procedural rule;  (ii) the 
problem identified by the United States was resolved in EC – Bed Linen (Article 21.5 – India) ;  and 
(iii) it is the proper role for a panel to determine wh at is the same "claim" rather than for a party to 
determine unilaterally.  
5.16 The Panel recalls that the United States relied heavily in its submissions on the specific 
findings and conclusions of the Appe llate Body in this dispute.  Therefore, the Panel considers it 
important to review those specific findings and conclusions and Article 17.14 of the DSU as an 
applicable provision in the covered agreements.  As regards the United States' specific concerns: 
(i) the Panel has clarified paragraphs 6.51 to 6.53 so  that its findings should not be taken to imply a 
view on whether Article 17.14 applies to the "parties to  the dispute" in any and every context;  (ii) the 
Panel has not created a distinction regarding adopte d panel reports.  The Appellate Body in its report 
on EC – Bed Linen (Article 21.5 – India)  (at paragraph 93) considered that, even though Article 17.14 
did not refer to panel reports, a finding in an adop ted panel report must be accepted by the parties as a 
final resolution to the dispute between them "in th e same way and with the same finality" as a finding 
included in an adopted Appellate Body report;  and (iii) the Panel has not created a new distinction 
regarding the outcome of claims, as compliance pa nels must already distinguish between a claim 
which led to a conclusion of no "prima facie case", as in the Panel report on EC – Bed Linen , and an 
issue on which there was no ruling, as in the A ppellate Body report on the first recourse to 
Article 21.5 in Canada – Dairy .  The present dispute can further be distinguished from Canada – 
Dairy (Article 21.5 – New Zealand and US) because in that proceeding the Panel record did not 
include the data necessary for the Appellate Body to complete the analysis of the claims, whereas in the present dispute, as explained in paragraphs 6.70 to 6.83 of this report, the United States' defence 
failed due to the underlying facts. 
(iv) Antigua's submissions 
5.17 Antigua considered that the Panel should expa nd its factual assessment beyond the issue of 
the relationship between the IHA and the three fede ral statutes, particularly in the context of 
"permissible remote gambling in the United States in ge neral".  Antigua clarified in its interim review 
comments one argument concerning State laws and regulations as well as its response to a question 
from the Panel concerning the activities of  suppliers in the United States.   
5.18 The United States disagreed with Antigua's requ est.  The issue of compliance was determined 
by the specific recommendation and rulings of the DSB, which made clear that the issue to be 
considered was whether the United States had shown "in the light of the [IHA], that the prohibitions 
in [the three federal gambling statutes] are applie d to both foreign and domestic service suppliers of 
remote betting services for horse racing".  The United States did not consider that any change was 
required to the interim report in light of Antigua's clarifications. 
5.19 The Panel confirms that it limited Section VI:C.3(a) to the IHA but notes that its factual 
assessment in Section VI:C.3(b) also included in trastate commerce.  These were the two issues in 
relation to which Antigua presented evidence of remo te gambling in the United States.  As Antigua  WT/DS285/RW 
 Page 7 
 
 
  did not clearly formulate a separate argument as to how the measures at issue were applied in a way 
that allowed remote gambling in general in the Un ited States, the Panel did not address this evidence 
further.  However, in light of Antigua's clarif ications, the Panel has revised paragraph 6.97 and 
paragraphs 6.111 to 6.116. 
(v) Intrastate commerce 
5.20 Antigua confirmed its view that the Appellate Body findings referenced in footnote 184 are 
clearly erroneous.  Antigua recalled that, in the orig inal proceeding, it made clear its belief that the 
measures at issue – including in particular the Wire Act – were facially discriminatory by allowing States to do whatever they wanted in the context of remote gambling while effectively prohibiting the 
cross-border supply of these services from Antigua.  Antigua argued at interim review in this 
compliance proceeding that, because the federal statut es are facially discriminatory, the United States 
could not possibly justify them under the chapeau of  Article XIV of the GATS, regardless of how 
they are actually applied.  The same holds true  for the IHA because, in Antigua's view, it was 
undisputed that intrastate wagering under the IHA was permissible. 
5.21 The United States replied that even if it were tr ue that, in the original proceeding, Antigua 
made clear its belief that the federal laws were facially discriminatory (which the United States did 
not accept), this only reinforced the point that An tigua was requesting a second chance to re-argue an 
issue, while opposing any attempt by the United Stat es to obtain a so-called second chance to meet its 
burden on the IHA/Wire Act issue.  Further, the IHA simply does not address what is or is not "permissible" with respect to intrastate wagers. 
5.22 The Panel noted in its interim report that Anti gua raised the issue of intrastate commerce in 
the original proceeding.  The Panel assesses Antigua 's arguments on that issue on the same proviso as 
that on which it re-assesses the United States' arguments on the IHA. 
5.23 The United States suggested that the Panel not include the section on intrastate commerce in 
its final report as this aspect of the interim report wa s not within the scope of this proceeding.  In its 
view, the DSB recommendation and rulings in this di spute relate only to the issue of discrimination 
under the GATS Article XIV chapeau with respect to  remote gambling on horse racing, due to the 
Appellate Body's conclusion on the chapeau of Article XIV in its entirety.  Given that the measures at 
issue in this dispute are unchanged, the United States was not obliged by the DSB recommendation 
and rulings to bring into compliance any aspect of  the measure that was not addressed by the DSB 
recommendation and rulings.  In accordance with EC – Bed Linen (Article 21.5 – India) , Antigua may 
not re-argue a failed claim in a compliance proceed ing.  The United States argues that the discussion 
of intrastate commerce is dicta that does not belong in the final report. 
5.24 Antigua disagreed in the strongest possible term s with the United States' request.  The scope 
of review under Article 21.5 is  broad in order to assess compliance with DSB recommendations and 
rulings and in light of the overriding objective of  the DSU to achieve the "prompt  settlement" of 
disputes.  In the original proceeding, the United States bore the burden of proof of its defence under 
Article XIV of the GATS.  As its defence under th e chapeau was constructed around the assertion that 
it prohibited all remote gambling, that assertion should be the benchmark for assessing its 
compliance.  The discussion of intrastate commerc e provides important context for the extensive 
domestic remote gambling industry operating in the United States today. 
5.25 The Panel observes that the primary issue in th is proceeding is whether any "measures taken 
to comply" exist.  The Panel has found that none exis t.  Accordingly, the assessment of the conformity 
of the measures at issue with US obligations unde r the GATS is included only for the reasons set out 
in Section VI:C.1 of this report.  This applies not only to the assessment of intrastate commerce, but WT/DS285/RW 
Page 8  
 
  also to the assessment of the other matters in Section VI:C, which the United States does not request 
the Panel to remove.  
5.26 The Panel recalls that at the outset of this compliance proceeding, the United States presented 
the issue before the Panel as follows:   
"That issue is whether the United States can show that three facially non-
discriminatory U.S. federal criminal statutes , as a matter of statutory interpretation, 
do not constitute a means of arbitrary or  unjustifiable discrimination between 
countries, within the meaning of the chap eau to Article XIV of the [GATS], as the 
result of interaction with a civil statute, the [IHA]."
18  (emphasis added) 
5.27 The fact that the Wire Act (and the Travel Ac t) discriminate on their face between services 
supplied within the United States and those supplied from outside the United States, insofar as they do 
not apply to services not supplied in interstate or fo reign commerce, is relevant to the first premise of 
the issue before the Panel, as initially presented by the United States itself.   
5.28 Subsequently, in its comments on interim review, the United States described the issue before 
the Panel more concisely, as follows:  
"Thus, any aspect of alleged discrimin ation under the existing measure involving 
matters other than horse racing  are not covered within the DSB recommendations and 
rulings."19 (emphasis in original) 
5.29 Intrastate remote wagering, to the extent that it is permitted, covers wagering on horse racing.  
Therefore, intrastate commerce is relevant to th e issue before the Panel, even as subsequently 
presented by the United States itself.  The Panel had already noted that relevant State laws applied to 
remote wagering on horse racing, but has noted this in paragraphs 6.121 and 6.122 as well. 
5.30 Further, Antigua's arguments on intrastate comme rce are not a "failed claim".  The original 
Panel did not rule on these arguments.  It is equally appropriate to assess Antigua's arguments than it 
is to re-assess the United States' argument in support of this defence, on which the original Panel and 
the Appellate Body have already ruled. 
5.31 The Panel is aware that the United States' de scription of the measures at issue as "three 
facially non-discriminatory U.S. federal criminal st atutes" was consistent with the Appellate Body 
findings referenced at footnote 184 of this report and the United States' arguments in the original 
proceeding referenced at footnote 133.  However, there was no finding on this point in the original 
Panel report and the issue was contested by Antigua, as referenced at footnote 176.   
5.32 Lastly, the United States considered that the discussion of intrastate commerce was confusing 
and misleading, as it might imply that the Panel w as definitively finding an inconsistency with the 
Article XIV chapeau with respect to this issue.  The United States also recalled that a finding of 
discrimination is not in itself definitive under the Ar ticle XIV chapeau, which refers to "arbitrary or 
unjustifiable" discrimination between countries where "the same conditions prevail", and that these 
matters were not before the Panel.  Antigua replie d that the lack of assessment of these issues was by 
choice of the United States itself.  The Panel has clarified its findings in the section on intrastate 
commerce further to address these particular concerns  of the United States.  The Panel had already 
referred to the second of these concer ns in paragraph 6.100.    
                                                      
18 United States first written submission, para. 1. 
19 United States comments on interim review, para. 6.  WT/DS285/RW 
 Page 9 
 
 
  (vi) Developments since the original proceeding 
5.33 Antigua saw no reason for the Panel to limit its e nquiry in Section VI:C of the report to an 
assessment as to whether the measures at issue satisfied the requirements of the chapeau of 
Article XIV of the GATS, particularly in the contex t of completely new evidence such as the UIGEA.  
Although Antigua had chosen not to contest the UIGEA as a measure, the UIGEA should be taken 
further into account in any assessment of the Un ited States' compliance with the recommendation and 
rulings of the DSB.  In particular, Antigua ar gued that (i) the UIGEA made it impossible for the 
United States to discharge its burden of proof under the chapeau of Article XIV of the GATS with respect to the IHA;  (ii) the intrastate exempti on in the UIGEA provided the Panel with a sound basis 
on which to reassess the discrimination inherent in the Wire Act vis-à-vis intrastate commerce, 
notwithstanding the Appellate Body's conclusions; and (iii) the UIGEA confirms that there is no 
prohibition of all remote gambling in the United States and that  therefore the measures at issue are not 
"necessary" within the meaning of Article XIV(a)  of the GATS.  Further, the UIGEA expressly 
accepts the concept of state regulation of remote ga mbling which demonstrates that the United States 
does not consider prohibition "necessary". 
5.34 The United States replied that the scope of this  proceeding is determined by Article 21.5 and 
the DSB recommendation and rulings and not by what evidence is, or is not, available.  The United 
States also disagreed with Antigua's assertions rega rding the meaning and relevance of the UIGEA.  
The "intrastate" provisions in the UIGEA appl y only under that Act and only affect the new 
enforcement mechanisms set out in it.  For the same  reason, they do not mean that US prohibitions on 
remote gambling are not "necessary".  Rather, by creating more effective enforcement tools to address 
illegal remote gambling, the UIGEA confirms that  the United States believes that remote gambling 
creates serious problems that must be addressed. 
5.35 The Panel referred to the UIGEA in Section VI:C .4(b) of its report to the extent that it 
considered that the UIGEA had evidentiary value to the assessment of the matter before it.  The Panel 
does not consider it appropriate to expand the refe rences to the UIGEA as (i) it remains possible for 
the United States to address the ambiguity relating to the IHA through "measures taken to comply";  
(ii) whilst the definition of "unlawful Internet gambli ng" in general in the UIGEA refers to applicable 
Federal or State law, the definition of "intrast ate transactions" in the UIGEA applies only under the 
UIGEA.  As such, this intrastate exemption does not  provide a basis to assess the conformity of the 
Wire Act with US obligations under the GATS in this  proceeding; and (iii) the Panel already noted in 
footnote 195 that the UIGEA represents a change sin ce the United States' submissions to the original 
Panel on the availability of regulation as an altern ative to prohibition.  However, the Appellate Body 
considered in its report that the measures at issue were "necessary" within the meaning of 
Article XIV(a) of the GATS and the Appellate Body re port, having been adopted by the DSB, must be 
unconditionally accepted by the parties to the dispute in accordance with Article 17.14 of the DSU. 
5.36 The Panel has also made certain editing changes to its interim report. 
VI. FINDINGS 
A. O
RDER OF ANALYSIS  
6.1 The DSB referred to this Panel, pursuant to Article 21.5 of the DSU, the matter raised by 
Antigua in document WT/DS285/18, w ith standard terms of reference.20  Article 21.5 of the DSU 
applies "[w]here there is disagreement as to the ex istence or consistency with a covered agreement of 
measures taken to comply with the recomme ndations and rulings [of the DSB]".   
                                                      
20 See para. 1.8 above. WT/DS285/RW 
Page 10  
 
  6.2 The matter raised by Antigua in document  WT/DS285/18 comprises two disagreements.  
Firstly, there is a disagreement as to the existence  of measures taken to comply.  Secondly, there is a 
disagreement as to the consistency of the measures at issue with th e United States' obligations under 
the GATS which, depending on the resolution of the first disagreement, may be a disagreement as to 
the consistency with a covered agreement of "m easures taken to comply" with the recommendations 
and rulings of the DSB.  The Panel will consider  these two disagreements in the above order.   
B. D
ISAGREEMENT AS TO THE EXISTENCE OF MEASURES TAKEN TO COMPLY  
1. Recommendation of the DSB in the original proceeding 
(a) Main arguments of the parties 
6.3 Antigua submits that the United States has not taken measures to comply with the 
recommendations and rulings of the DSB in this dispute.21  Antigua argues that the United States has 
taken no action towards compliance because the measures at issue in the original proceeding have not 
been amended, supplemented or otherwise changed.22 
6.4 The United States submits that the "measures take n to comply" in this dispute are the same 
measures that were at issue in the original pro ceeding because those measures are consistent with its 
WTO obligations, only the United States did not meet its burden of showing that they satisfied the 
requirements of an affirmative defence in the original proceeding.23  The United States submits that it 
has complied with the DSB recommendations and ru lings by presenting new evidence and arguments 
during this compliance proceeding that do meet the burden of showing that the measures at issue satisfy the criteria of the chapeau of Article XIV of the GATS.
24 
(b) Main arguments of third parties 
6.5 China argues that, according to the plain language of Article 21.5 of the DSU, there should be 
a time sequence between the "measures taken to comp ly" and the recommendations and rulings of the 
DSB.25 
6.6 The European Communities has major difficulties with  the notion that a party to a dispute that 
needs to bring inconsistent measures into conform ity could simply present the same "old" measures 
again in a compliance proceeding, without showing any relevant change in these measures or any 
modification of any aspect of these measures.  In its view, an implementing party that is not bringing any new measures before a compliance panel must provi de cogent reasons consis tent with the dispute 
settlement system to support such a move.
26 
6.7 Japan argues that the ordinary meaning and structure of Article 21.5 of the DSU indicate that 
the "measures taken to comply" cannot be the same measures that were the subject of the original 
dispute.27 
                                                      
21 Request for Establishment of a Panel, WT/DS285/18, page 5. 
22 Antigua first written submission, para. 44;  second written submission, para. 17. 
23 United States first written submission, para. 43;  second written submission, para. 25. 
24 United States reply to Panel question No. 1. 
25 China third party oral statement, para. 4. 
26 European Communities third party written submission, para. 25. 
27 Japan third party written submission, para. 3.  WT/DS285/RW 
 Page 11 
 
 
  (c) Assessment by the Panel 
6.8 The parties agree that the United States has not  taken any new measures.  Nevertheless, the 
parties disagree as to the existence of "measur es taken to comply" with the recommendations and 
rulings of the DSB in this dispute.  Antigua submits that there are no measures taken to comply 
because the United States has done nothing.   The United States responds that there are "measures 
taken to comply" because the same measures that were at issue in the original proceeding can also be 
"measures taken to comply".   
6.9 The Panel will examine whether the same measures at issue in the original proceeding can be 
"measures taken to comply" for the purpose of th is compliance proceeding under Article 21.5 of the 
DSU.   
6.10 The text of Article 21.5 provides that the "measu res taken to comply" within the scope of this 
compliance Panel's jurisdiction are those taken to comply "with the recommendations and rulings" [of 
the DSB].28  The recommendation adopted by the DSB in this dispute was as follows:  
"The Appellate Body  recommends   that the Dispute Settlement Body request the 
United States to bring its measures, found in  this Report and in the Panel Report as 
modified by this Report to be inconsistent with the  General Agreement on Trade in 
Services , into conformity with its ob ligations under that Agreement."29 
6.11 This recommendation, made in accordance with  Article 19.1 of the DSU, applies to the 
measures at issue in the original proceeding that we re "found ... to be inconsistent" with the GATS.  It 
appears to follow that, where those measures are unc hanged (and where the Unit ed States' obligations 
under the GATS are unchanged) the measures remain  inconsistent with that agreement.   
6.12 The operative part of the recommendation is that  the United States "bring its measures ... into 
conformity with its obligations" under the GATS.30  The ordinary meaning of the word "conformity" 
may be defined as:  
"1. Correspondence in form or manner (to, with) ; agreement in character; likeness; 
congruity.  2. Action in accordance with some standard; compliance ( with, to ); 
acquiescence; an instance of this."31   
6.13 On the other hand, at the risk of stating the obvious, the ordinary meaning of "inconsistent" 
may be defined as "[n]ot in keeping,  discordant, at variance.  Foll. by with."32  In other words, a 
measure "inconsistent with" a cove red agreement is not in "conformity with" that agreement.  The 
same is true of the terms used in the French a nd Spanish versions of the DSU, that are equally 
authentic, and that use the terms " conforme " and " incompatible ", and " en conformidad " and 
"incompatible ", respectively.  
                                                      
28 See also on the "express link" between the measures taken to comply and the recommendations and 
rulings of the DSB: Appellate Body reports on US – FSC (Article 21.5 – EC II) , at para. 61, and in US – 
Softwood Lumber IV (Article 21.5 – Canada) , at para. 68. 
29 Recommendation as set out in para. 374 of the Appellate Body report on this dispute 
(WT/DS285/AB/R) adopted by the DSB on 20 April 2005;  see note 1 above. 
30 The wording of the recommendation under Article 19.1 of the DSU is cross-referenced in 
Articles 22.1, 22.2 and 22.8, although it can be noted that  the text of Article 22.2 uses the word "compliance" 
rather than "conformity".   
31 New Shorter Oxford English Dictionary , (5th edition, 2002) Oxford University Press. 
32 Ibid. WT/DS285/RW 
Page 12  
 
  6.14 These two terms, in context, indicate that, in order to bring a measure that has been found 
"inconsistent" with an agreement into "conformity  with" the same agreement, some change must 
come about.   
6.15 The original Panel has already made an objectiv e assessment of the matter before it, including 
the measures at issue and the facts of the case as at the time of the original proceeding.  It has also 
made an assessment of the applicability of the GATS and the conformity of the measures at issue with 
the United States' obligations under that agreemen t.  The recommendation of the DSB was that the 
United States bring its measures into conformity, not to bring the assessment of the conformity of 
those measures into conformity.  Therefore, the recommendation requires a change that eliminates the 
inconsistency of those measures with the covered agreements.   
6.16 The context within Article 21 of the DSU confirms this interpretation.  As part of Article 21, a 
proceeding under Article 21.5 is a procedure for surveillance of the implementation of 
recommendations and rulings.
33  It is not an opportunity to reasse ss claims and defences that led to 
those recommendations and rulings.  Article 21 as a whole deals with events subsequent to the DSB's 
adoption of recommendations and ru lings in a particular dispute.34  The Panel considers this is true not 
just of the timing of the proceeding under Article 21 , but also of the matter that an Article 21.5 panel 
is mandated to assess.   
6.17 The wider context in the DSU confirms this in terpretation.  Article 3.7 of the DSU provides 
that if measures are found to be inconsistent with the provisions of any of the covered agreements, in 
the absence of a mutually agreed so lution, the first objective of th e dispute settlement mechanism is 
usually to secure "the withdrawal of the measures" concerned.  In a similar vein, Article 22.8 of the 
DSU provides that the suspension of concessions or other obligations shall be temporary and shall 
only be applied until such time as the measure found to  be inconsistent with a covered agreement "has 
been removed".  Both of these provisions contemplate that compliance with the standard recommendation applicable in a so-called "viola tion" case will require a change regarding the 
measure found inconsistent with a covered agreement.
35     
6.18 This reading is also consistent with the obj ect and purpose of the DSU insofar as it includes 
the "prompt settlement" of disputes, as set out in Article 3.3 of the DSU.  The DSU expressly provides an opportunity for review of a panel report at  the appellate review stage under Article 17, prior to the 
recommendations and rulings of the DSB.  Thereafte r, Article 21.1 requires prompt compliance with 
those recommendations or rulings.  A reassessment of  the same claims or defences with respect to a 
measure that had already been f ound inconsistent in the original proceeding, without a change 
relevant to that measure in the intervening peri od, would run counter to the prompt settlement of 
disputes. 
6.19 Turning to the form  of "measures taken to comply", the Panel recalls the view of the 
Appellate Body in Canada – Aircraft (Article 21.5 – Brazil)  where it envisaged that "measures taken 
to comply" would, in principle, be new measures:  
"In our view, the phrase 'measures taken to comply' refers to measures which have 
been, or which should be, adopted by a Memb er to bring about compliance with the 
recommendations and rulings of the DSB.  In principle, a measure which has been 
                                                     
 
33 Appellate Body report on US – Shrimp (Article 21.5 – Malaysia) , para. 97. 
34 Appellate Body report on US – Softwood Lumber IV (Article 21.5 – Canada) , para. 70. 
35 This can be contrasted with a recommendation that the Member concerned make a "mutually 
satisfactory adjustment", applicable in so-called "non-vi olation" cases under Article 26.1(b) of the DSU.  In 
such cases, there is no obligation to make any change to  bring the measure at issue into conformity with the 
Member's obligations because the measure is already in conformity, or consistent, with those obligations.  WT/DS285/RW 
 Page 13 
 
 
  'taken to comply with the recommendations and rulings' of the DSB will  not be the 
same measure as the measure which was the subj ect of the original dispute, so that, in 
principle, there would be two separate and distinct measures34:  the original measure 
which  gave rise to  the recommendations and rulings of the DSB, and the 'measures 
taken to comply' which are – or should be – adopted to  implement  those 
recommendations and rulings.36   
"Original footnote: 34 We recognize that, where it is alleged that there exist  no 
'measures taken to comply', a panel may find that there is  no new measure." 
6.20 New measures, including amended measures, are certainly the most common form of 
measures taken to comply with a recommendation of  the DSB.  Nevertheless, in accordance with 
Article 19.1 of the DSU, the recommendation made in this dispute was not to adopt "new" legislation, 
nor was it to "amend" the existing legislation, although those are both possible means of implementation.  Rather, the recommendation was to "bring [the] measures into conformity".  
6.21 The possible form of measures taken to comply with a recommendation under Article 19.1 of 
the DSU will depend on the rulings of the DSB in a pa rticular dispute.  For example, if a measure has 
been found inconsistent with a covered agreemen t, or unjustified under an otherwise available 
exception, due to the way in which the measure is applied , compliance with the recommendation 
could presumably be achieved by a change in th e application of the measure, without necessarily a 
change to the text of the measure itself or that of any written implementing measures.  The present dispute illustrates this point. 
6.22 Moreover, compliance with a recommendati on under Article 19.1 of the DSU could 
conceivably be achieved through changes to the fact ual or legal background to a measure at issue, 
without a change to the text of the measure itself.   For example, a measure may lapse, or satisfy a 
requirement in a covered agreement, due to the subs equent occurrence of a relevant circumstance.  If 
changes to the measure's factual or legal background modified the effects of that measure sufficiently 
to bring about a situation in which it complied with the relevant covered agreement, there seems to be 
no reason why this should not fulfil the aim of the recommendation of the DSB, which is to achieve a 
satisfactory settlement of the matt er in accordance with the  right s and obligations under the DSU and 
the covered agreements, as provide d in Article 3.4 of the DSU.
37  The essential point is that there 
needs to be compliance.  However, even in these cases, compliance would entail a change relevant to 
the measure since the original proceeding.38  This dispute does not present any such changes.   
6.23 In view of the circumstances of this case, it is  not necessary for this Panel to determine what 
exactly would constitute the "measures taken to comp ly" in such a situation and whether they could 
be the same measures at issue in the original pro ceeding.  The Panel only emphasizes that it does not 
exclude any potential "measures taken to comply" due to their form. 
                                                      
36 Appellate Body report on Canada – Aircraft (Article 21.5 – Brazil) , para. 36, cited in US – Shrimp 
(Article 21.5 – Malaysia) , para. 86;  and EC – Bed Linen (Article 21.5 – India) , para. 81. 
37 The Panel also sees support for this view in the Appellate Body report on US – Softwood Lumber IV 
(Article 21.5 – Canada) : 
"[The word 'existence'] also sugg ests that, as part of its assessment of whether a measure taken 
to comply  exists , a panel may need to take account of f acts and circumstances that impact or 
affect such existence."  (at para. 67.  See also para. 69)  
38 The United States provides examples of circum stances where a measure could be brought into 
compliance with another covered agreement without any change to the measure itself, including a change in the 
underlying basis for the measure or the adoption of a relevant international standard:  see United States reply to Panel question No. 2.  The Panel observes that in all th ese examples, there is a cha nge in the factual or legal 
context and not simply an improvement in the parties' submissions based on the same available facts. WT/DS285/RW 
Page 14  
 
  6.24 Nor does the Panel exclude any potential "measures taken to comply" due to the purpose  for 
which they may have been taken.  In this regard, the Panel recalls the following view of the Appellate 
Body in US – Softwood Lumber IV (Article 21.5 – Canada) :  
"The fact that Article 21.5 mandates a panel to assess 'existence' and 'consistency' 
tends to weigh against an interpretation of  Article 21.5 that would confine the scope 
of a panel's jurisdiction to measures that move in the direction of ,  or  have the 
objective of achieving ,  compliance."
39  (emphasis in original) 
6.25 Turning to the facts at hand, the United States al leges that the "measures taken to comply" are 
three US federal criminal statutes, known as the Wi re Act, the Travel Act and the Illegal Gambling 
Business Act.40  The first two were enacted in 1961 and the third in 1970.  All three were measures at 
issue in the original proceeding and were the subj ect of the recommendations and rulings of the DSB 
in this dispute.   
6.26 The original Panel found that, by maintaini ng these three measures, the United States was 
acting inconsistently with its ob ligations under Article XVI:1 and sub-paragraphs (a) and (c) of 
Article XVI:2 of the GATS.  The A ppellate Body upheld this finding.41  Neither the original Panel nor 
the Appellate Body found that the United St ates was entitled to maintain these measures under 
Article XIV of the GATS or any other article in the covered agreements. 
6.27 There has been no change to any of these three measures since the original proceeding.  There 
has been no change in the application of these three measures, or even their interpretation, since the 
original proceeding.  There is no evidence of any changes in the factual or legal background bearing 
on these measures or their effects since the original  proceeding that might have brought them into 
compliance.  This indicates that they remain incons istent with the United States' obligations under the 
GATS.   
6.28 The novel element on which the United States seeks to rely to demonstrate its compliance are 
its submissions to this compliance Panel.  The United States' position depends on the view that all 
along, both during and since the original proceedi ng, its measures have been consistent with its 
obligations under the GATS by virtue of the general exception provision in Article XIV, and that it is 
entitled to another opportunity to demonstrate before this compliance Panel that  the measures in fact 
do meet the requirements of the chapeau of Article XIV.42  However, there was no finding in the 
original proceeding that the measures at issue in this dispute were c onsistent with the United States' 
obligations under the GATS, notwithstanding an invo cation of Article XIV.  Instead, there was a 
finding that maintaining these measures was in consistent with the United States' obligations, which 
was the basis for the recommendation of the DSB. 
6.29 It is true that the Appellate Body found th at the United States had demonstrated that the 
measures at issue were "justified" under pa ragraph (a) of Article XIV of the GATS.43  However, this 
was not a finding on Article XIV in its entirety.  The Appellate Body expressly confirmed that 
Article XIV contemplates a "two-tier analysis" – fi rst, under one of the paragraphs of Article XIV, 
and then under the chapeau.44  There was no finding that the measures were consistent with the 
chapeau or with Article XIV in its  entirety nor, hence, with the Un ited States' obligations under the 
                                                      
39 Appellate Body report on US – Softwood Lumber IV (Article 21.5 – Canada) , para. 67.   
40 United States first written submission, para. 43;  second written submission, para. 25. 
41 Original Panel report, paras. 6.421 and 7.2(b)(i);  Appellate Body report, para.  373(C)(ii). 
42 United States first written submission, paras. 49 -50; second written submission, paras. 25, 40; 
opening oral statement, paras. 27, 42; replies to Panel questions Nos. 1, 8, 10 and 17.   
43 Appellate Body report, para. 326. 
44 Appellate Body report, paras. 291-292.  WT/DS285/RW 
 Page 15 
 
 
  GATS, and there is no concept recognized under the DSU of provisional or transitional consistency 
with a recommendation of the DSB. 
6.30 Therefore, the Panel rejects the United States' submission that the same measures at issue in 
the original proceeding in this dispute constitute "measures taken to comply".   
6.31 The United States' position in this compliance proceeding is also at odds with its earlier 
decision to seek a reasonable period of time in which to comply with the recommendations and 
rulings of the DSB.  Article 21.3 of the DSU provid es that a Member shall have a reasonable period of 
time in which to comply "[i]f it is impracticable to comply immediately with the recommendations 
and rulings".  Had the measures the subject of th e recommendations and rulings of the DSB already 
been in compliance, it would not have been impracticable to comply immediately.45   
6.32 The Panel notes that the parties have referred to facts that have arisen, and a new statute that 
has been enacted, since the original proceeding, but neither party alleges that these bring the measures 
at issue into conformity with the GATS or ar e otherwise "measures taken to comply".   
6.33 First, the United States referred in its April 200 6 status report regarding implementation of the 
DSB recommendations and rulings in this dispute46 to testimony before a subcommittee of the US 
House of Representatives by a Department of Ju stice official (the "April 2006 DOJ Statement").47  
The United States does not assert that the April 2006 DOJ Statement is a separate measure, nor does it 
rely solely on the April 2006 DOJ Statement to demonstrate compliance with the DSB recommendation and rulings.
48   
6.34 The United States explained in its status repor t to the DSB that the April 2006 DOJ Statement 
"confirmed" the position of the US Government re garding remote gambling on horse racing.  The 
United States does not assert that the April 2006 DOJ Statement implies any change to the application 
or interpretation of the measures at issue, in fact , quite the opposite.  Indeed, the Panel observes that, 
by its own terms, the April 2006 DOJ Statement reitera tes the view that the De partment of Justice had 
previously stated, which was included in a Presi dential signing statement and considered by the 
original Panel.49  In view of these considerations, the Pane l does not consider this statement a measure 
taken to comply.  However, the Panel may refer to th e statement, to the extent  that the statement has 
evidentiary value, in the course of  assessment of the matter before it. 
6.35 Second, the United States enacted the Unla wful Internet Gambling Enforcement Act 
("UIGEA") in October 2006.50  Antigua does not ask the Panel to address this Act within its terms of 
reference as a measure taken to comply, but cons iders that the Act is perhaps best suited to 
demonstrate certain other matters alle gedly at issue in this proceeding.51 
6.36 The United States submits that the UIGEA is not within the Panel' s terms of reference 
because it was enacted after the date of referral of this matter to the Panel under Article 21.5 and is 
                                                      
45 As to statements made during the arbitration pursuant to Article 21.3(c) of the DSU, see further 
paras. 6.86 to 6.90 below. 
46 Status Report by the United States , Addendum, WT/D285/15/Add.1, 11 April 2006. 
47 Statement of Testimony of Bruce G. Ohr, Ch ief, Organized Crime and Racketeering Section, 
Criminal Division, United States Department of Justice, before the Committee on the Judiciary Subcommittee 
on Crime, Terrorism, and Homeland Security, United States House of Representatives, concerning H.R. 4777, 
the "Internet Gambling Prohibition Act" presented on April 5, 2006, set out in Exhibit AB-32. 
48 United States first written submission, paras. 48-50. 
49 United States original first written submission, para. 34; repeated in reply to original Panel question 
No. 21, and set out in original Exhibit US-17.  See the original Panel report, para. 6.597, fn. 1060. 
50 Antigua second written submission, paras. 46-60 and Exhibit AB-113. 
51 Antigua second written submission, para. 47. WT/DS285/RW 
Page 16  
 
  not mentioned in Antigua's request for establishment of a panel.
52  The United States does not contest 
that the Panel may consider evidence that come s into existence after the initiation of panel 
proceedings but it does not consider that the UI GEA sheds light on the issues in this dispute.53 
6.37 The Panel notes that neither party asks it to treat the UIGEA as a measure taken to comply.54  
Further, the UIGEA does not amend or alter any statutes at issue nor affect which activities are 
unlawful under those statutes.  Accordingly, ther e is no reason to consider the UIGEA as a measure 
taken to comply.  However, the Panel may refer to  the UIGEA, to the exte nt that the UIGEA has 
evidentiary value, in the course of its assessment of the matter before it. 
6.38 For the reasons set out above, the Panel's preliminary conclusion is that there are no measures 
taken to comply with the recommendations and rulings  of the DSB in this di spute and, accordingly, 
that the United States has failed to comply with those recommendations and rulings.  The Panel will 
now consider the specific findings and conclusions in  the original proceeding in order to determine 
whether, as the United States argues, they compel or allow a different conclusion. 
2. Specific findings and conclusions in the original proceeding 
(a) Main arguments of the parties 
6.39 Antigua submits that panel a nd Appellate Body findings adopted by the DSB constitute a 
final resolution of the dispute between the parties.  This is true whether a party failed to make a 
prima facie case or whether it did manage to make a prima facie case but its argument failed on substantive grounds.  According to  the Appellate Body report on EC – Bed Linen (Article 21.5 – 
India) a party should not be given a "second chance" in an Article 21.5 proceeding.
55  There is no 
distinction between the burden of proof on a comp lainant to establish its claim and the burden of 
proof on a responding party to establish an affirma tive defence.  The United States failed to meet its 
burden to prove the affirmative defence in the origin al proceeding.  Its defence therefore failed and it 
is not entitled to a "second chance" to re-argue the sa me defence in the complia nce proceeding.  To do 
so would run counter to the language and the structure of the DSU.56 
6.40 The United States emphasizes that compliance with the DSB recommendations and rulings 
must depend on the specific findings of the Appellate B ody in this dispute.  It recalls that, in the 
original dispute, there was no explicit finding that  its measures did not satisfy the requirements of 
Article XIV of the GATS.  Rather, it was found th at the United States had "not shown", had "not 
demonstrated" or "did not establish" that its me asures were entitled to th is affirmative defence.57  This 
case involves an affirmative defence a nd is therefore entirely different from EC – Bed Linen 
(Article 21.5 – India)  where a complaining party failed to make its case on a particular issue.  
Furthermore, the Appellate Body made an explic it finding that neither the Panel nor the Appellate 
Body itself had found that the affirmative defence di d not apply, and repeatedly made use of language 
indicating that compliance with the recommendations  and rulings could be achieved by showing or 
demonstrating that the affirmative defence applied.58  The Appellate Body also emphasized that there 
was no finding of fact by the original Panel or itself as to whether the prohibition embodied in the 
measures at issue was applied to both foreign and domestic service suppliers of remote betting 
services for horse racing.  Therefore, the only subs tantive issue in the compliance proceeding is 
                                                      
52 United States second written submission, para. 43. 
53 United States reply to Panel question No. 31(a). 
54 The Panel recalls the view of the Appellate Body in US – Softwood Lumber IV (Article 21.5 - 
Canada) that "[i]t is rather for the Panel itself to dete rmine the ambit of its jurisdiction" (at para.73). 
55 Antigua first written submission, para. 32. 
56 Antigua second written submission, paras. 19-27.  
57 United States first written submission, para. 42. 
58 United States first written submission, para. 54.  WT/DS285/RW 
 Page 17 
 
 
  whether the United States can demonstrate that point now.59  The United States argues that it is not 
asking the Panel to revisit the findings of the Panel and the Appellate Body in this case, but that it is 
requesting the Panel to examine the issues under th e chapeau of Article XI V based on new evidence 
and arguments not previously available to the Panel or the Appellate Body.60  
(b) Main arguments of third parties 
6.41 China does not consider that Article 17.14 of th e DSU permits either party to the dispute a 
second chance to re-argue a claim or a defence that  has already been settled by the Appellate Body.  
The Appellate Body report on EC – Bed Linen (Article 21.5 – India) confirms this  view.61 
6.42 The European Communities recalls the findings in the original proceeding that the United 
States had not demonstrated that its measures we re applied consistently with the chapeau of 
Article XIV of the GATS and that ambiguity ex isted in the relationship between the various 
legislative measures.  Neither party should be entitl ed to reopen in Article 21.5 proceedings issues 
settled by final adjudication in view of Article 17.14 of the DSU and the principle of res judicata  as 
interpreted by the Appellate Body.62   
6.43 Japan argues that the Appellate Body's legal ruli ng with respect to the chapeau of Article XIV 
of the GATS is unambiguous and final and cannot be  reopened under Article 17.14 of the DSU.  The 
Appellate Body found that the US statutory scheme is inconsistent with the GATS and, therefore, the 
United States needs to take some type of measu re to implement the specific recommendations and 
rulings of the DSB.63 
(c) Assessment by the Panel 
6.44 The Panel has examined the specific findings a nd conclusions in the original Panel Report 
and Appellate Body Report on this dispute that re lated to the United States' affirmative defence under 
Article XIV of the GATS.  The Appellate Body found and concluded, as regards the chapeau of 
Article XIV: 
"that the United States has not demonstrated that—in the light of the existence of the 
Interstate Horseracing Act—the Wire Act, the Travel Act, and the Illegal Gambling 
Business Act are applied consistently with the requirements of the chapeau";64 
and, as regards Article XIV in its entirety: 
 
"that the United States has demonstrated that the Wire Act, the Travel Act, and the Illegal Gambling Business Act are measures "necessary to protect public morals or 
maintain public order", in accordance with pa ragraph (a) of Article XIV, but that the 
United States has not shown, in the light of  the Interstate Horseracing Act, that the 
prohibitions embodied in those measures are applied to both foreign and domestic service suppliers of remote betting services for horse racing and, therefore, has not established that these measures satisfy the requirements of the chapeau"
65 
                                                      
59 United States second written submission, paras. 7-8. 
60 United States reply to Panel question No. 6. 
61 China third party oral statement, para. 6. 
62 European Communities third party written submission, paras. 9-14 and 30-34. 
63 Japan third party written submission, paras. 9 and 11. 
64 Appellate Body report, para. 373(D)(v)(c). 
65 Appellate Body report, para. 373(D)(vi). WT/DS285/RW 
Page 18  
 
  6.45 The parties disagree on the effect of these findings and conclusions.  For Antigua, these  
findings mean that the measures at issue in the orig inal proceeding are not justified by Article XIV of 
the GATS. For the United States, these findings simp ly mean that it has not established its defence 
under Article XIV of the GATS on the basis of the facts and arguments presented in the original 
proceeding.  Therefore, in the United States' view, there is no finding that prevents it from attempting 
to establish that same defence in  the compliance proceeding.   
6.46 The Panel recalls that Article 17. 14 of the DSU provides as follows: 
"An Appellate Body report sh all be adopted by the DSB and unconditionally accepted 
by the parties to the dispute unless the DS B decides by consensus not to adopt the 
Appellate Body report within 30 days followi ng its circulation to the Members. This 
adoption procedure is without prejudice to the right of Members to express their 
views on an Appellate Body report."  (footnote omitted) 
6.47 Neither party disputes that, in accordance with Ar ticle 17.14 of the DSU, the Appellate Body 
report is final and must be unconditionally accepted by them.
66  However, they disagree on what 
unconditional acceptance entails.   
6.48 The text of Article 17.14 uses the words "be ...  accepted" which is the passive form of the 
verb "accept".  There are several ordinary mean ings of this verb, including the following:  
"1. Take or receive with consenting mi nd; receive with favour or approval.  
2. Receive as adequate or valid;  ad mit;  believe;  tolerate;  submit to."67     
6.49 Article 17.14 expressly provides that Members retain the right to express their views on an 
Appellate Body report.  "Members" include the parti es to the dispute, which indicates that the parties 
are not required to receive an adopted Appellate Body  report with favour or approval but may state 
that they disagree with it.  Therefore, the second of these two meanings is apposite (other than the 
denotation "believe"), rather than the first, indicati ng that the parties to the dispute receive the adopted 
Appellate Body report as adequate or  valid, and submit to it.  This is confirmed by the French and 
Spanish versions of the DSU, that are e qually authentic, and that use the terms " sera accepté " and 
"serán aceptados ", respectively.   
6.50 The verb "accept" is used with the modal verb  "shall" which indicates that, in this context, 
acceptance is an obligation.  The phrase "shall accept" is used in the same sense in Article 22.7 of the 
DSU.  The phrase "shall be accepted" is also used in  Article XII:5(e) of the GATS, as is "shall accept" 
in Article XV:2 of GATT 1994, in the same sense, al though in a different context.  This phrase can be 
contrasted with the words "mutually acceptable" in Articles 3.7 and 22.2 of the DSU, where parties do 
not have an obligation to accept a particular solution or compensation.  This obligation can also be 
contrasted with the prior GATT practice according to  which Members were able to block adoption of 
panel reports.68   
                                                      
66 Antigua first written submission, para. 32; oral statement, para. 11; reply to Panel question No. 6; 
United States reply to Panel question No. 6;  comment on Antigua's reply to Panel question No. 20. 
67 New Shorter Oxford English Dictionary , (5th edition, 2002) Oxford University Press. 
68 The previous GATT practice was to adopt panel reports by consensus, without prejudice to the 
GATT provisions on decision-making: see the Decision of 12 April 1989 on improvements to the GATT dispute settlement rules and procedures, para. G.3 (BISD 36S/61-67 ).  This practice remains applicable to so-called 
"situation complaints" under Article 26.2 of the DSU.  WT/DS285/RW 
 Page 19 
 
 
  6.51 However, unlike all these other provisions, Article 17.14 qualifies the phrase "shall be 
accepted" with the adverb "unconditionally".69  This indicates that Members are not simply obliged to 
receive an Appellate Body report as adequate or valid and submit to it, but that they must do so 
"unconditionally".  The word "unconditionally" is  formed from the adjective "unconditional", the 
ordinary meaning of which may be defined as "[n] ot limited by or subject to conditions; absolute, 
complete".70  This is consistent with the French and Spanish versions, that use the terms " sans 
condition " and " sin condiciones " respectively.  The phrase "shall be ... unconditionally accepted" 
includes the notion of finality but it does not simply indicate that a report is final in the sense that 
there is no opportunity to appeal further, nor that a re port is the final step at the appellate review stage 
of a proceeding.  Rather, it indicates that the parties may not place any conditions on their acceptance 
of an adopted Appellate Body report.   
6.52 There are specific limits on the scope of this  obligation.  The text of Article 17.14 specifies 
that the obligation only applies to the "parties to  the dispute".  Moreover, the parties only owe the 
obligation with respect to the report , which by its own terms is limite d to the measures in dispute and 
the claims, defences and issues ruled upon therein.   The text of Article 17.14 also establishes a 
procedural limit, in that it makes the parties' unconditional accepta nce contingent upon adoption of 
the Appellate Body report by the DSB and expressl y acknowledges that the DSB may decide not to 
adopt it.  Therefore, Appellate Body reports are not  final until they are adopted, and an Appellate 
Body report that the DSB decides by consensus not to adopt is not final, or binding, at all.71   
However, an Appellate Body report that has b een adopted by the DSB shall be unconditionally 
accepted by the parties to the dispute which indicates that, from that point on, the report is a final 
resolution, within the context of that dispute, of  the claims, defences and issues ruled upon therein.  
Whether or not the report resolves matters in dispute between those parties in any other context is an 
issue on which the Panel need not, and does not, ru le.  Article 19.2 of the DSU also confirms a 
substantive limit on the effect of panel and Appella te Body reports, by confirming that "in their 
findings and recommendations, the panel and Appellate Body cannot add to or diminish the rights and 
obligations provided in the covered agreements".   
6.53 This reading of Article 17.14 is consistent w ith the object and purpose of the DSU insofar as 
it includes the "prompt settlement" of disputes, as se t out in Article 3.3 of the DSU.  As the Panel 
noted at paragraph 6.18 above, the DSU expressly provides an opportunity for review of a panel 
report at the appellate review stage under Article 17, prior to the recommendations and rulings of the 
DSB.  Thereafter, Article 21.1 requires prompt compliance with those recommendations or rulings.  A 
reassessment in a compliance proceeding of an issue that had already been ruled upon in an original 
proceeding in an adopted report, even with better arguments by the respondent but without a change 
relevant to the underlying facts in the intervening period, would run counter to the prompt settlement 
of disputes.   
6.54 This reading is also confirmed by the drafting history of the DSU.  During the Uruguay 
Round, consideration of the concept of appellate  review generally proceeded on the understanding 
that the parties to a dispute would agree in advan ce that they would accept the results of an appellate 
review unconditionally.72 All drafting options for the precursor of Article 17.14 provided that 
                                                      
69 The word "unconditionally" is only used in the covered agreements in relation to adopted Appellate 
Body reports (see Article 17.14 of the DSU and Articles 4.9 and 7.7 of the SCM Agreement), and in the MFN obligations (see Article I:1 of GATT 1994, Article II:1 of  the GATS and Article 4 of the TRIPS Agreement).     
70 New Shorter Oxford English Dictionary , (5th edition, 2002) Oxford University Press. 
71 Contrast Article 22.7 of the DSU that does use the word "final" where it provides that "[t]he parties 
shall accept an arbitrator's d ecision as final and the parties concerned shall not seek a sec ond arbitration".  
However, Arbitrator's decisions are final immediately, wi thout the possibility of an appeal or the requirement of 
adoption by the DSB.  
72 See "Profile on the Status of th e Work in the Group – Report by the Chairman", dated 18 July 1990, 
GATT document MTN.GNG/NG13/W/43, para. 5. WT/DS285/RW 
Page 20  
 
  appellate decisions would be "t he final disposition of the case" or "final and unconditionally 
accepted".
73  The Chairman of the Negotiating Group on Dispute Settlement, Ambassador Lacarte-
Muró, drafted a single text for the precursor of Ar ticle 17.14 based on the latter option but replacing 
the word "final" with the provision that reports shall be "adopted by the Council" and adding the 
proviso "unless the Council decides not to adopt the appellate report ..."74  This was negotiated further 
and circulated in the so-called "Brussels Draft" s ubstantially in the form of Article 17.14 today.75 
6.55 This reading is further confirmed by the Appellate Body report on US – Shrimp (Article 21.5 
– Malaysia), followed in EC – Bed Linen (Article 21.5 – India) , which stated as follows:  
"Thus, Appellate Body Reports that are a dopted by the DSB are, as Article 17.14 
provides, '… unconditionally accepted by the parties to the dispute', and, therefore, 
must be treated by the parties to a particular dispute as a final resolution to that 
dispute .  In this regard, we recall, too, that Article 3.3 of the DSU states that the 
'prompt settlement' of disputes 'is essentia l to the effective functioning of the 
WTO'."76 (emphasis added) 
6.56 The Panel agrees, subject to a suitable definition of "dispute" that is limited to the claims, 
defences and issues ruled upon in a report.77  As a "final resolution" of a dispute, the adopted 
Appellate Body report entails more than a final ru ling on the evidence presente d.  It entails a final 
decision on the claims and defences ruled upon with r espect to the measures at issue as they existed at 
the time of the original proceeding.  A compliance panel does not make a reassessment of that same 
matter but rather assesses the consistency with a covered agreement of "measures taken to comply" (unless it assesses only the existence  of "measures taken to comply").  This constitutes a separate 
enquiry and, accordingly, is consistent with the fi nality of the Appellate Body report adopted at the 
conclusion of the original proceeding.   
6.57 In the present compliance proceeding, th e United States seeks an assessment of the 
consistency of its measures with its obligations under the GATS in relation to an issue on which the 
Appellate Body ruled in its report on the same dis pute in relation to the same measure in the same 
factual and legal context.  The express purpose of  such a reassessment would be to reach a new 
conclusion – that the United States has established that these measures satisfy the requirements of the 
chapeau of Article XIV of the GATS – without any "measures taken to comply" but only the presentation of new and allegedly be tter arguments.  Such a conclusion would mean that the original 
conclusion, quoted at paragraph 6.44 above, was not fi nal.  Yet, in the Panel's view, Article 17.14 of 
the DSU applies to all conclusions in an Appellate Body re port.  The United States' position can be 
characterized as an acceptance of the original ruling on condition that  it retains the right to seek a 
more favourable conclusion in a further proceeding.  That type of acceptance is not unconditional.  
Therefore, in the circumstances, in accordance with Article 17.14, the Panel cannot accede to the 
United States' request to reach a conclusion different from that reached by the original Panel as upheld 
by the Appellate Body and adopted by the DSB, without any change relevant to the measures at issue.   
6.58 The United States agrees that a complainant who fails to discharge its burden of proof may 
not re-argue a claim in a compliance proceeding, bu t it does not consider that the same applies to a 
                                                     
 
73 See "Draft Text on Dispute Settlement", dated 21 September 1990, GATT document 
MTN.GNG/NG13/W/45. 
74 "Chairman's Text on Dispute Settlement", dated 19 October 1990. 
75 "Draft Final Act embodying the results of the Uruguay Round of Multilateral Trade Negotiations – 
Revision", dated 3 December 1990, GA TT document MTN.TNC/W/35/Rev.1. 
76 Appellate Body report on US – Shrimp (Article 21.5 – Malaysia) , para. 97, quoted in EC – Bed Linen 
(Article 21.5 – India) , para. 90. 
77 See further para. 6.61 below.  WT/DS285/RW 
 Page 21 
 
 
  respondent. It argues that a respondent has a "speci al status", as complaining and responding parties 
are in fundamentally different positions  under Articles 21 and 22 of the DSU.78 
6.59 The Panel agrees that the respondent is in  a unique position under Article 21 of the DSU 
because it is the only Member to whom the DSB r ecommendation is addressed and, as such, it is the 
only Member that must comply with the recommendation.  Nevertheless, the respondent, as a party to 
the dispute, is obliged by Article 17.14 of th e DSU unconditionally to accept an adopted Appellate 
Body report.  For the reasons given above, the Pa nel considers that that obligation precludes re-
argument of the same defence in relation to the same measure without any change relevant to the 
measure. 
6.60 The United States also refers to Canada – Dairy (Article 21.5 – New Zealand and US II)  as an 
illustration that a Member can presen t new evidence when it has previ ously failed to establish a claim 
due to a lack of evidence.  It asserts that there is no general bar in the DSU that prevents a party from 
meeting its burden of proof in a second proceeding.79 
6.61 The Panel notes that the example to which the Un ited States refers consis ted of two recourses 
under Article 21.5 of the DSU, both of which assess ed the consistency of measures actually adopted 
by the respondent to comply with a DSB recomme ndation, unlike the present dispute.  In the first 
recourse, the Appellate Body concluded that the Pa nel's findings were vitiated by error of law and did 
not rule on the relevant claim.  There was no fi nding or conclusion that the complainant failed to 
make a prima facie  case.80  Accordingly, the second recourse by the complainants under Article 21.5 
did not imply a rejection or conditional acceptance of  the findings or conclusions in the Appellate 
Body report adopted in the first recourse under Article 21.5.  
6.62 The United States argues that the Panel and Appellate Body reports in the present dispute 
cannot be said to result in a "final settlement" becau se, as the Appellate Body noted, it was not able to 
determine whether or not the measures met the requirements of the Article XIV chapeau.81  T h e  
Appellate Body did not state that the measures at  issue were inconsistent with the chapeau of 
Article XIV of the GATS but rather, variously, that  the United States "has not demonstrated", "has not 
shown" and "has not established", essentially, that the measures satisfy the requirements of the 
chapeau.   
6.63 The Panel recalls that, as the party asserting an  affirmative defence under Article XIV of the 
GATS, the United States bore the initial burden of pr oof that its measures did satisfy the requirements 
of Article XIV, including the chapeau.  A burden of  proof is a responsibility to put forward evidence 
and arguments that show or demonstrate certain matters of fact and law sufficient to establish a 
particular claim or defence.82  The Panel notes that it is standard practice for the Appellate Body and 
panels to use a phrase such as "has not demonstrated " in order to indicate that a party fails to 
discharge the burden of proof of an affirmative defence.83  The Panel also notes that the terms "show", 
                                                      
78 United States second written submission, paras. 28-31. 
79 United States reply to Panel question No. 12; comment on Antigua's reply to Panel question No. 7. 
80 Appellate Body reports on Canada – Dairy (Article 21.5 – New Zealand and US) , paras. 103-104; 
Canada – Dairy (Article 21.5 – New Zealand and US II) , para. 6.   
81 United States reply to Panel question No. 12. 
82 As explained, for example, in the Appellate Body report on this dispute at para. 282. 
83 See, for example, the Panel reports on EC – Tariff Preferences , paras. 7.235, 7.236 and 8.1(d); and 
Dominican Republic – Import and Sale of Cigarettes , para. 7.155; and the Appellate Body reports on Brazil – 
Aircraft , para. 186; Brazil – Aircraft (Article 21.5 – Canada) para. 80; and Turkey – Textiles , para. 63. WT/DS285/RW 
Page 22  
 
  "demonstrate" and "establish" are used throughout the Appellate Body report in this dispute, including 
in contexts that explicitly address the burden of proof.
84   
6.64 The Appellate Body's findings in this dispute,  which use the terms "show", "demonstrate" and 
"establish", indicate that the United States failed to discharge its burden of proof.  This was a ruling 
on the defence in relation to the measures at issue.  It was not equivalent to a statement that the 
Appellate Body "does not rule" or an exercise of  judicial economy.  Instead, it indicates that the 
United States' affirmative defence failed.  Th e Appellate Body then made the recommendation 
required under Article 19.1 of the DSU with resp ect to the measures found inconsistent with the 
United States' obligations under the GATS.85   
6.65 For the same reason, the original Panel used the terms "has not demonstrated", "has not been 
able to demonstrate" or "has failed to demonstrate" in its conclusions, not only with respect to the US 
affirmative defence under Article XIV86 but also with respect to Anti gua's claims under Article VI of 
the GATS.87  In each instance the term simply indicated th at a particular defence or claim failed due 
to failure to discharge the relevant  burden of proof.  This is abundantly clear in relation to the findings 
on the Interstate Horseracing Act ("IHA") in particul ar, as the original Panel expressly used the word 
"demonstrate[d]" twice in the final sentence of this section to link the allocation of the burden of proof 
to its conclusion.88 
6.66 The Panel can detect no suggestion in the Appe llate Body's use of these terms that the 
United States could bring its measures into comp liance simply through further submissions or 
presentation of additional evidence to show or demonstr ate what it did not show or demonstrate in the 
original proceeding. 
6.67 The United States also draws attention to the following clarification in the Appellate Body's 
overall conclusion on Article XIV:  
"In this respect, we wish to clarify that the Panel did not, and we do not, make a 
finding as to whether the IHA does, in fact , permit domestic s uppliers to provide 
certain remote betting services that would otherwise be prohibited by the Wire Act, 
the Travel Act, and/or the IGBA."89 
6.68 The United States interprets this clarification, read in the context of the findings that the 
United States had "not shown", ha d "not demonstrated" and "did not establish" certain matters, as 
amounting to an invitation to the United States to de monstrate to a compliance panel that its measures 
do in fact meet the requirements of the Article XIV exception of the GATS.90   
                                                      
84 Appellate Body Report, paras. 4, 9, 10, 35, 44, 55, 57, 103, 104, 114D(iii) , 114(D)(iv), 114(D)(v), 
116, 133, 139, 151, 153, 183, 226, 253, 254, 279, 298, 300, 302, 309, 311, 313, 315, 326, 329, 336, 351, 352, 
353, 355, 365, 360, 369, 371, 372, 373(D)(v)(a) and 373(D)(vi)(a). 
85 Appellate Body report, para. 374. 
86 Original Panel report, paras. 6.600, 6.607, 6.608 and 7.2(d).  The original Panel also used the term 
"has demonstrated" to indicate wher e the United States did succeed in disc harging its burden of proof:  see 
original Panel report, paras. 6.594 and 6.603.   
87 Original Panel report, paras. 6.437 and 7.2(c). 
88 Original Panel report, para. 6.600.  The burden of proof was also recalled in para. 6.596. 
89 Appellate Body report, para. 371. 
90 United States first written submission, para. 44.  Wh ile the United States originally submitted that it 
had received an "explicit invitation" to do so from the A ppellate Body, it later clarified that it used the term 
"invitation" as shorthand for the type of reasoning commonly found in Article 21.5 proceedings, that is where the Appellate Body (or a panel) finds a particular aspect of a measure to be inconsistent with a covered 
agreement, the other side of such a finding may provide specific guidance on how the responding Member may  WT/DS285/RW 
 Page 23 
 
 
  6.69 In the Panel's view, the Appellate Body's cl arification was due to the unusual, but not 
unprecedented, circumstance of the Appellate Body declining to accept a Member's interpretation of its own domestic law.
91  The clarification provided greater certainty that, whilst the original Panel and 
the Appellate Body had not accepted the US interpretation that the IHA does not permit activities 
prohibited by the measures at issue, this did not m ean that the original Panel and the Appellate Body 
had found that the IHA did permit such activities.  The Panel no tes that it is not uncommon for the 
Appellate Body to clarify what it has not decided in a report.92  The Panel also notes that none of the 
third parties in this proceeding, nor Antigua, cons idered that this clarification was open to the 
interpretation which the United States places upon it.93 
6.70 In any case, the Appellate Body di d not simply clarify what it had not decided, and find that 
the United States had "not shown", had "not demonstr ated" and "did not establish" certain matters.  In 
reaching its conclusions, the Appellate Body reviewed  and upheld a specific finding by the original 
Panel on the interpretation of the US measures.  Sp ecifically, the Appellate Body was not persuaded 
that the original Panel had failed to make an objective assessment of the facts as regards the 
relationship between the IHA, on the one hand, and th e measures at issue, on the other, and upheld the 
original Panel's finding.  It later summarized that finding in the following terms:   
"The second instance found by the Panel was based on "the ambiguity relating to" the 
scope of application of the IHA and its relati onship to the measures at issue.  We have 
upheld this finding." (footnotes omitted)94 
6.71 Here, the Appellate Body cross-referenced the following finding of the original Panel: 
"In summary, on the basis of evidence provide d to the Panel relating to the domestic 
enforcement of the US prohibition on the remote supply of wagering services for 
horse racing against TVG, Capital OTB and Xpressbet.com and in light of the 
ambiguity relating to the Interstate Horsera cing Act, which pertains to wagering 
services for horse racing , we believe that the United States has not demonstrated that 
it applies its prohibition on the remote s upply of these services in a consistent manner 
as between those supplied domestically a nd those that are supplied from other 
Members.  Accordingly, we believe that the United States has not demonstrated that it does not apply its prohibition on the remote supply of wagering services for horse racing in a manner that does not constitute 'arbitrary and unjustifiable discrimination 
between countries where like conditions prev ail' and/or a 'disguised restriction on 
trade' in accordance with the requireme nts of the chapeau of Article XIV."
95  
(emphasis added) 
                                                                                                                                                                     
bring its measure into compliance.  The United States referred to the Appellate Body report on US – Shrimp 
(Article 21.5 – Malaysia) as an "instructive example", but it appeared  to acknowledge that in that dispute 
compliance depended on some change, at  least to the facts, sin ce the original proceeding:  see United States reply 
to Panel question No. 16. 
91 See the Appellate Body report on India – Patents (US) , para. 70.  See also the Panel reports on EC – 
Trademarks and Geographical Indications (US) , para. 7.96, and (Australia) , para. 7.146. 
92 See the Appellate Body reports on US – Shrimp , para. 185; Brazil – Aircraft , para. 187; US – FSC , 
para. 179; Canada – Autos , para. 183; Canada – Patent Term , paras. 100-101; Canada – Dairy (Article 21.5 – 
New Zealand and US) , para. 103; US – Section 211 Appropriations Act , para. 362; and US – Softwood Lumber 
V, para. 181. 
93 China, European Communities and Japan respective replies to Panel third party question No. 10; 
Antigua second written submission, para. 14; reply to Panel question No. 16. 
94 Appellate Body report, para. 368. 
95 Original Panel report, para. 6.607. WT/DS285/RW 
Page 24  
 
  6.72 The ambiguity relating to the IHA to which th e original Panel referred is discussed in a 
previous section of the original Panel report.
96  That section includes the following finding:  
"In our view, even if the IHA did not rep eal the Wire Act, the Travel Act and the 
Illegal Gambling Business Act as has b een submitted by the United States, there is 
ambiguity as to the relationship between, on the one hand, the amendment to the IHA 
and, on the other, the Wire Act, the Travel Act and the Illegal Gambling Business Act .  
We consider this relationship to be criti cal in determining whether, in fact, the 
amendment to the IHA permits wagering on horse racing by means of electronic 
communication."97   (emphasis added) 
6.73 Clearly, this is a finding on the interpretation of US domestic law.  However, it is not a 
finding on the proper interpretation of US law for US citizens.  It is an interpretation solely for the 
purpose of assessing the United States' compliance w ith its international obligations under the 
GATS.98    
6.74 The finding is that the relationship between th e IHA and the measures at issue is ambiguous.  
This was the key to the conclusion that the United States did not establish that the measures at issue 
satisfied the requirements of the chapeau of Article  XIV of the GATS as set out in the original Panel 
report, upheld in the Appellate B ody report, and adopted by the DSB.  Therefore, in accordance with 
Article 17.14 of the DSU, this finding on the rela tionship between the IHA and the measures at issue 
"shall be … unconditionall y accepted by the parties to the dispute".   
6.75 The United States argues that it did not have the opportunity to present complete evidence on 
the interaction among these statutes in the original proceeding.  It asks this compliance Panel to 
consider evidence allegedly not presented to the orig inal Panel and to reach the conclusion that the 
IHA does not provide an exemption from the measures at issue.99  Antigua replies that the failure of 
the United States to meet its burden of proof in th e original proceeding rests squarely on its own 
shoulders.100 
6.76 The Panel recalls the Appellate Body's observation that, on this issue, "[t]he [original] Panel 
had limited evidence before it, as submitted by th e parties, on which to base its conclusion."101  
However, this reference to the limitations of the ev idence does not alter the effect of the finding.  The 
Appellate Body did not consider the evidence inadequate for the original Panel to reach its finding.  
On the contrary, the Appellate Body upheld the finding.  As the Panel pointed out at paragraph 6.57 above, the United States' position can be characteri zed as an acceptance of the original finding on 
condition that it retains the right to seek a more favour able finding in a further proceeding.  That type 
of acceptance is not unconditional.  Therefore, in these circumstances,  in accordance with 
Article 17.14, the Panel cannot accede to the United St ates' request to make a different finding, that 
the IHA in no way limits the application of federal criminal statutes
102, without any change relevant to 
the measures. 
6.77 In any event, the record of the original Panel proceeding indicates that the United States 
indeed had the opportunity to present complete evidence on the interaction among these statutes.103  
                                                      
96 Original Panel report, paras. 6.595 to 6.600. 
97 Original Panel report, para. 6.599. 
98 This is consistent with the approach of the Appellate Body report on India – Patents (US) , para. 65. 
99 United States first written submission, paras. 3, 52-53. 
100 Antigua second written submission, para. 23. 
101 Appellate Body report, para. 364. 
102 United States first written submission, para. 3. 
103 The Panel does not have access to the record of  the appellate review stage of the original 
proceeding.  WT/DS285/RW 
 Page 25 
 
 
  Whilst the United States did not raise its affirma tive defence under Article XIV of the GATS until its 
second written submission in the original proceeding, it addressed the effect of the IHA amendment and its relationship with the measures now at issue in its first written submission in that proceeding.  It 
provided the view of the Department of Justice on the specific issue, as expressed in a Presidential 
statement on signing of the IHA amendment, a view which the Department of Justice had "repeatedly 
affirmed".
104  Antigua also addressed this issue in its submissions to the original Panel.105  In response 
to questions from the original Panel after the firs t substantive meeting, the United States referred 
again to the Department of Justice view expressed in the Presidential signing statement, as well as 
information on the US principle of statutory construction that repeals by implication are not favoured, with a citation to a US Supreme Court opinion of 1939.
106  The United States returned to the issue to 
reiterate its view in its or iginal second written submission107 and also addressed the prosecution of 
illegal wagering on horse racing in its opening oral  statement at the original Panel's second 
substantive meeting.108  The US evidence showed that the Depa rtment of Justice was fully aware from 
the time of the IHA amendment in 2000 of the stat e of US domestic law on the precise issue under 
consideration, and a representative of the Department  of Justice was part of the US delegation at both 
of the original Panel's substantive meetings with th e parties.  In its detailed comments on the original 
interim review, the United States simply restated the arguments that it had already made.109   
6.78 The United States argues that a respondent Member should not be precluded from presenting 
facts in a compliance proceeding in order to show that WTO-consistent measures are, in fact, WTO-
consistent.  The United States emphasizes that a finding that means that a measure may or may not  fall 
within Article XIV of the GATS cannot require a Memb er to abolish or amend a measure, in view of 
Article 19.2 of the DSU,110 which reads as follows: 
"In accordance with paragraph 2 of Article  3, in their findings and recommendations, 
the panel and Appellate Body cannot add to  or diminish the rights and obligations 
provided in the covered agreements." 
6.79 The Panel notes once again that this argument depends on the view that the measures at issue 
have been consistent with the United States' ob ligations under the GATS all along, both during and 
since the original proceeding (see para. 6.28 above).  As a matter of principle, the Panel does not 
consider that a recommendation that a Member br ing its measures into conformity with a covered 
agreement could possibly add to or diminish the rights or obligations of any Member provided in the covered agreements.  The recommendation, by its ow n terms, does not require the Member concerned 
to take measures to comply with any obligations  beyond those set out in the relevant covered 
agreement. 
6.80 The United States' argument also depends on th e view that the finding in the original 
proceeding was due to poor briefing on its own part as if, in allegedly confused circumstances in the 
original proceeding, it had failed to gather and pr esent otherwise available information that would 
have been sufficient for the original Panel or the Appellate Body to conclude that the measures at 
issue were actually consistent with the United States ' obligations.  However, the Panel notes that the 
                                                     
 
104 United States original first written submission, paras. 34-35 and original Exhibit US-17. and 
referred to in original Exhibit AB-39, as pointed out in  United States original first written submission, para. 35 
fn 54.  See the summary of arguments of the parties in the original Panel report, paras. 3.22-3.23 and 3.228. 
105 Antigua original first written submission, para. 116; original opening second oral statement, 
para. 94; original second written submission, para. 21; original replies to Panel questions 19 and 32; original 
Exhibits AB-17, AB-39, AB-54, AB-81 and AB-122. 
106 United States replies to original Panel questions Nos. 21 and 22. 
107 United States original second written submission, para. 63. 
108 United States original second open ing oral statement, paras. 66-67. 
109 United States comments on original interim review, paras. 38-40. 
110 United States second written submission, para. 26;  reply to Panel question No. 2(b). WT/DS285/RW 
Page 26  
 
  source of the ambiguity between the IHA, on the one hand, and the Wire Act, on the other, lies in "the 
text of the revised statute ... on its face"
111 or, in other words, "the plain language of the IHA".112  
Aware of the view of the Department of Justice,  included in a Presidential signing statement, and 
aware of the US principle of statutory construction that repeals by implication are not favoured, the original Panel made an objective assessment that, when interpreting US domestic law, it could not 
ignore the plain language of a statute enacted by the United States Congress.
113   
6.81 Perhaps the original Panel could have reached a different conclusion had the parties submitted 
a US Supreme Court opinion or other authoritative judicial opinion on the relationship between the 
amended IHA and the measures at issue.  The Depart ment of Justice would not have been unaware of 
the existence of any such authoritativ e opinion.  Whilst the United States did submit examples of 
reported court cases in which the Department of Jus tice had used federal gambling laws challenged by 
Antigua to prosecute illegal wagering on horse racing,  all those examples pre-dated the amendment of 
the IHA and all but one pre-dated the IHA itself.114   
6.82 The absence of US judicial opinion on point was further exacerbated by a lack of prosecutions 
under the measures at issue of persons who complied only with the provisions of the IHA but not with 
the measures at issue; this could have indicated how the civil provisions of the IHA were to be 
construed in cases of conduct considered criminal under the measures at issue.115  Instead, the United 
States was only able to assert that its law enforcem ent officials did not agree with wagering suppliers 
in the United States who cited the amendment to th e IHA as the statutory basi s for Internet gambling 
on horse racing, notwithstanding the fact that su ch officials had never prosecuted any of these 
wagering suppliers.116  The United States did point to a disclosure in the annual report of one supplier 
that referred to unspecified action by the Departme nt of Justice for unspecified companies that the 
Department of Justice deemed to be operating with out proper licensing and re gulatory approval.  The 
United States agreed that this supplier "face[d] th e risk" of criminal proceedings and penalties brought 
by the government.117  The United States also provided statistics on caseload data extracted from the 
United States Attorneys' Case Management System that included data on any and all criminal 
cases/defendants where the Wire Act or the Travel Act was brought as any charge against a defendant 
for the fiscal years 1992-2003.118  Yet there was no clear evidence of a single actual criminal 
prosecution under the Wire Act or the Travel Act of a person who operated in accordance with the 
IHA, which would have shown whether the appli cation of those measures was affected by the 
existence of the IHA. 
                                                      
111 Original Panel report, para. 6.599.   
112 Appellate Body report, para. 364. 
113 Original Panel report, para. 6.59 9.  The original Panel also had a copy of a December 2002 report 
prepared by the United States General Accounting Office for Congressional requesters titled "Internet Gambling – An Overview of the Issues" which found that "[t]he language of the [IHA] appears to allow the electronic 
transmission of interstate bets as long as the appropriate consent is obtained", see original Exhibit AB-17, p. 16.  
The United States considered that characterization as incorrect:  original first written submission, para. 33. 
114 United States original second open ing oral statement, para. 45.   
115 The Panel here refers to prosecutions to the extent they could shed light on the relationship of the 
IHA to the measures at issue and not to  enforcement of the measures at issu e more generally as addressed in the 
Appellate Body report, paras. 352-357. 
116 United States original second open ing oral statement, para. 46.   
117 United States original second opening oral statement, para. 47, see original Panel report, para. 6.587.  
Earlier, the United States had provided a careful legal e xplanation as to why certain services supplied by such 
suppliers would not be liable to prosecution, if they fell within the "safe harbor" provision of the Wire Act:  
United States reply to original Panel question No. 22. 
118 United States original second opening oral statem ent, para. 42-44; original Exhibit US-41, see 
original Panel report, para. 3.236.  WT/DS285/RW 
 Page 27 
 
 
  6.83 In sum, the original Panel had "limited evid ence" before it on the relationship between the 
IHA and the Wire Act because the underlying facts that might otherwise have given risen to more substantial factual submissions were  limited.  The ambiguity of this relationship was not a matter of 
poor briefing; rather, it was merely a reflecti on of the ambiguous state of US domestic law.
119  This 
ambiguity in US domestic law prevented the Unite d States from demonstrating in the original 
proceeding that its measures satisfy the requirements of the chapeau of Article XIV of the GATS.  
Whilst there may be a right and a wrong interpretation of  this point in US domestic law, it is currently 
a matter open to disagreement.  As long as this ambi guity remains, the measures at issue are not in 
compliance with the United Stat es' obligations under the GATS.120  
6.84 Therefore, the Panel concludes that, both as a matter of principle and also in the specific 
circumstances of this dispute, its interpretation of  the recommendation that the United States bring its 
measures into conformity with its obligations under the GATS does not diminish the United States' 
rights or increase its obligations inconsis tently with Article 19.2 of the DSU. 
6.85 For the reasons set out above, the Panel sees nothi ng in the specific findings and conclusions 
in the original proceeding that would disturb its pr eliminary conclusion at paragraph 6.38.  Therefore, 
the Panel concludes that the United States has not complied with the recommendations and rulings of 
the DSB.   
3. Statements made during the arbitration pursuant to Article 21.3(c) of the DSU 
6.86 Both parties and the European Communities referred to statements made by the United States 
on the means of implementation of the DSB recommendation and rulings during the course of the arbitration to determine a reasonable period of time pursuant to Article 21.3(c) of the DSU in this 
dispute.
121  Essentially, they disagreed as to whethe r the United States itself had, during the 
arbitration, submitted that legislation was the only possible means to bring its measures into 
compliance with the recommendations and rulings of the DSB. 
6.87 The Panel considers that parties' statements ma de in the course of an arbitration pursuant to 
Article 21.3(c) can be helpful in addressing the existence of measures taken to comply in an 
Article 21.5 proceeding because, as a practical ma tter, they will address the specific recommendation 
and rulings of the DSB in the dispute at hand and also  what is required in order for the respondent to 
comply.122  In this way, they may confirm a compliance panel's own objective assessment of whether 
the respondent has complied, based on the specific recommendations and rulings of the DSB in the 
dispute.   
6.88 The Panel notes that the United States, in its written submission and oral statement to the 
Arbitrator, sought a period of time to adopt legislation without stating that legislation was the only 
                                                      
119 The Panel reiterates that this interpretation of US domestic law is solely for the purpose of assessing 
the United States' compliance with its international obligations under the GATS. 
120 See the additional clarification with respect to the IGBA, set out at note 139 below.  The Panel's 
findings are without prejudice to any other possible inconsistencies between the measures at issue and the 
United States' obligations under the GATS. 
121 Antigua first written submission, paras. 17-18;  United States first written submission, para. 55; 
European Communities third party submission, para. 58.  
122 See also the following statement in the Appellate Body report on US – Softwood Lumber IV 
(Article 21.5 – Canada) : 
"Thus, within Article 21 as a whole, the decl arations of the implementing Member form an 
integral part of the surveillance of implementation, but they do not stand alone.  Rather, they are complemented by, and subject to, multilatera l review within the World Trade Organization 
(the 'WTO')." (at para. 70). WT/DS285/RW 
Page 28  
 
  option to ensure compliance.
123  Nevertheless, the Panel observes that the Award of the Arbitrator 
stated that: 
"For this reason, the United States emphasizes that the only means of implementation 
that will achieve the necessary clar ification is legislative means."124   
6.89 The United States respectfully disagrees with the Arbitrator's characterization of its views, 
including after its perusal of the unverified transcript of the Arbitrator's oral hearing.125  Antigua 
considers the Arbitrator's conclusion to be a corr ect interpretation of the US argument put before 
him.126 
6.90 The Panel can see that the United States submitted  to the Arbitrator that it intended to seek 
legislation and, in this context, stated orally that it needed legislation or that legislation was required.  
However, the Panel cannot conclude with certainty that the United States emphasized  that legislation 
was the only means of implementation, especially since a question on that point was never posed to 
the United States.  The Panel, for its part, does not consider that legislation is the only possible means 
of implementation in this dispute.  Even though th e key finding on the chapeau of Article XIV of the 
GATS in the original proceeding concerned the rela tionship between different statutes, the chapeau 
relates to the application of the measures at issue, which does not simply relate to their wording.  The 
original Panel was not pers uaded by the Department of  Justice's view of that relationship but that does 
not exclude other forms of administrative action, or judicial action, to bring the measures into conformity.  For this reason, the Panel does not consider that the lack of new legislation amending the 
measures at issue or amending the IHA is determin ative of the existence of any "measures taken to 
comply" in this dispute. 
C. D
ISAGREEMENT AS TO THE CONSISTENCY WITH A COVERED AGREEMENT OF MEASURES 
TAKEN TO COMPLY  
1. Nature of the Panel's assessment  
(a) Main arguments of the parties 
6.91 Antigua believes that it is not necessary for the Panel to go much further than find that the 
United States has done nothing to come into comp liance but, if the Panel does go further, Antigua 
submits that the United States has again failed to  meet its burden of proof under the chapeau of 
Article XIV of the GATS.127 
6.92 The United States argues that the compliance Panel has before it a much more complete 
factual record concerning the relationship between th e IHA and the Wire Act than the original Panel  
and asks the Panel to find that US "measures take n to comply" are not inconsistent with the GATS.128   
                                                      
123 See United States written submission to the Arbitr ator, paras. 2, 3, 9-12, 17 and 36; and oral 
statement to the Arbitrator, paras. 3, 4, 13-14 a nd 18; summarized in the Award of the Arbitrator 
(WT/DS285/13), at paras. 7-10 and 16. 
124 Award of the Arbitrator (WT/DS285/13), at para. 37. 
125 United States reply to Panel question No. 24.  The Panel obtained the Ar bitrator's record as 
described at para. 1.12 above. 
126 Antigua comment on US reply to Panel question No. 24. 
127 Antigua second written submission, paras. 3-5. 
128 United States first written submission, para. 3; second written submission, paras. 32, 33 and 50; 
replies to Panel questions Nos. 1, 6 and 14.  WT/DS285/RW 
 Page 29 
 
 
  (b) Assessment by the Panel 
6.93 The Panel has already concluded at paragra ph 6.85 that the United States has not complied 
with the recommendations and rulings of the DSB.  Having reached that conclusion, the Panel need 
not continue its assessment of the matter before it.   Indeed, the Panel cannot assess a disagreement as 
to the consistency with a covered agreement of "measures taken to comply" with the 
recommendations and rulings of the DSB because it has found that no such measures exist.   
6.94 Nevertheless, it is quite clear what the United States alleged to be the "measures taken to 
comply".  These are the same measures the subject of the recommendations and rulings of the DSB in this dispute, namely, the Wire Act, the Travel Act and the IGBA.  As the sole trier of fact in this 
compliance proceeding, the Panel considers it appr opriate to make certain factual findings beyond 
those that are strictly necessary to  resolve the dispute, which may assist the Appellate Body should it 
later be called upon to complete the analysis.  Ind eed, the original Panel made such a decision, which 
was upheld on appeal.
129   
6.95 The United States submits that it can demonstrat e in this compliance proceeding what it failed 
to demonstrate in the original proceeding.  This submission depends on the premise that the facts and 
arguments that it has presented in this compliance pr oceeding are different from, and more persuasive 
than, those it submitted in the original proceeding.  Therefore, in the circumst ances, and in accordance 
with the function of panels under Article 11 of the DSU, the Panel considers it useful and appropriate 
to make a factual assessment of that premise.  In so doing, the Panel will also make an assessment of 
facts and arguments presented by Anti gua in this compliance proceeding. 
6.96 Further, the original Panel's assessment of the matter before it, as reviewed by the Appellate 
Body, was based on the facts as they existed at th e time of the original proceeding.  The Panel will 
also make a factual assessment of certain new deve lopments that have arisen since the time of the 
original proceeding. 
6.97 The Panel sees no reason to limit its factual assessment to the single issue of the legal 
interpretation of the relationship between the IHA, on the one hand, and the measures at issue, on the 
other, on which the original Panel ruled, as upheld by the Appellate Body.  The language used by the 
Appellate Body in its report with respect to that  issue did not amount to an invitation to the United 
States to make a demonstration to a compliance pane l of this one specific point, for the reasons given 
at paragraphs 6.62 to 6.69 above.  Instead, to the extent that the Panel revisits the United States' 
defence that the measures at issue satisfy the re quirements of the chapeau of Article XIV of the 
GATS, the Panel considers it equall y appropriate to assess an issue th at was raised in the original 
proceeding but upon which the original Panel did not rule, namely whether the measures at issue are 
discriminatory "on their face".  This was an issue to which both parties referred in their submissions 
to this Panel.  The Panel assesses this issue in terms of the treatment of intrastate commerce.  
However, the Panel emphasizes that it makes this  assessment solely for the purposes set out at 
paragraph 6.94 above and without prejudice to its finding that the Appellate Body's conclusion 
regarding the United States' de fence under Article XIV of th e GATS must be unconditionally 
accepted by the parties in accordance with Article 17.14 of the DSU. 
6.98 The chapeau of Article XIV of the GATS sets out the following requirement: 
"Subject to the requirement that such me asures are not applied in a manner which 
would constitute a means of arbitrary or unjustifiable discrimination between 
countries where like conditions prevail, or  a disguised restriction on trade in 
services". 
                                                      
129 Appellate Body report, para. 344.   WT/DS285/RW 
Page 30  
 
  6.99 The Panel recalls the Appellate Body's interpre tation of this provision in this dispute: 
"The focus of the chapeau, by its express terms, is on the  application  of a measure 
already found by the Panel to be inconsiste nt with one of the obligations under the 
GATS but falling within one of the paragraphs  of Article XIV.  By requiring that the 
measure be  applied  in a manner that does not to [ sic] constitute 'arbitrary' or 
'unjustifiable' discrimination, or a 'disguised restriction on trade in services', the 
chapeau serves to ensure that Members' ri ghts to avail themselves of exceptions are 
exercised reasonably, so as not to frustrate  the rights accorded other Members by the 
substantive rules of the GATS."
130 (footnotes omitted) 
2. United States' submissions 
(a) Interstate Horseracing Act, as amended 
6.100  In this compliance proceeding, as in the origin al proceeding, the United States asserts that its 
measures satisfy the requirements of the chapeau of Article XIV because they do not discriminate 
at all .  The United States has not put forward an additional argument that even if such discrimination 
exists, it does not rise to the level of "arbitrary" or "unjustifiable" discrimination. 
6.101  The United States submits that the prohibition embodied in the three measures at issue is 
applied consistently with the requirements of th e chapeau of Article XIV of the GATS because the 
measures do not discriminate between countries on their face, and because the IHA does not provide an exemption from those measures.  The United States re fers to the plain text of the IHA, legislative 
history and the US principle of statutory construction which disfavours repeals of earlier statutes by implication.
131 
6.102  The Panel observes that there is repetition in key respects between the evidence submitted by 
the United States in this compliance proceeding with the evidence submitted in the original 
proceeding, notably with that mentioned at pa ragraph 6.77 of this report with regard to: 
(a) the text of the measures at issue;132   
(b) an assertion that the measures at issue "on their face" meet the requirements of the 
chapeau of Article XIV of the GATS because their text allegedly does not 
discriminate between countries;133   
(c) a description of the "safe harbor" provision in the Wire Act which applies to 
information assisting in the placing of bets  and wagers, but not to bets and wagers 
themselves;134  
                                                      
130 Appellate Body report, para. 339. 
131 United States first written submission, paras. 10-40. 
132 United States first written submission, paras. 6- 8, citing Exhibit AB-1; first written submission, 
para. 19, citing the Appellate Body report, paras. 260 and 26 2.  The texts of the measures at issue were set out in 
original Exhibit AB-82 and summarized in United States original second written submission, paras. 78, 80 and 
83.  See the original Panel report, paras. 3.264-3.267; 6.199, 6.216, 6.221-6.222, 6.360, 6.366 and 6.374; and 
Appellate Body report, paras. 147, 258, 260 and 262. 
133 United States first written submission, para. 17;  reply to Panel question No. 38(c).  This was 
asserted in United States original second written submission, para. 116.  See the original Panel report, paras. 3.228 and 3.282.  United States original second  written submission, para. 118, also referred to non-
discrimination in terms of nationality.  See the original Panel report, para. 3.283.  WT/DS285/RW 
 Page 31 
 
 
  (d) the legislative history of the Wire Act;135  
(e) the text of the IHA and assertions that it does not expressly state that it provides an 
exemption to the criminal statutes, or is otherwise consistent with those statutes;136  
(f) the view of the Department of Justice on the relationship between the IHA 
amendment and the measures at issue;137 and 
(g) statements that, under the US principles of statutory construction, repeals by 
implication are not favoured.138 
6.103  It is indisputable that this evidence, presented in the original proceeding (and re-presented in 
this compliance proceeding), failed to demonstrate that the measures at issue satisfy the requirements of the chapeau of Article XIV of the GATS.  The original Panel's finding on this point was upheld in 
the Appellate Body report, which was adopted by th e DSB.  Neither party disputes that that finding 
still stands as regards that evidence. 
6.104  Without prejudice to the Panel's findings regarding Article 17.14 of the DSU at 
paragraphs 6.46 to 6.57 above, the Panel will now proceed to make a factual assessment of the other 
evidence in the United States' subm issions, for the reasons set out at  paragraphs 6.94 and 6.95.  The 
Panel will refer to this other evidence as "supplementary" evidence.
139 
                                                                                                                                                                     
134 United States first written submission, paras. 7-8;  second written submission, paras. 11 and 19.  In 
response to a question from the Panel, the United States confirmed the apparent relationship between the "safe harbor" provision and the plain language of the IHA amendment, which indicated that the former does not 
resolve the ambiguity in the relationshi p between the IHA and the measures at issue:  see reply to Panel question 
No. 27.  This provision was explained in United States original second written submission, para. 78.  See the original Panel report, paras. 3.140, 3.141 and 3.264.     
135 United States first written submission, para. 9; oral  statement, para. 20; and Exhibit US-1.  This was 
discussed extensively in United States original second wr itten submission, paras. 74-79 and included in original 
Exhibits US-24 and US-30.  See the original Panel report, paras. 3.262-3.264, 6.482, 6.486, 6.490 and fn. 321;  
Appellate Body report, para. 296. 
136 United States first written submission, paras. 12, 22, 25 and 33;  second written submission, paras. 
11 and 14.  The text was set out in original Exhibit AB -82 and discussed in United States original first written 
submission, paras. 34-35; reply to original Panel questio n No. 21; original second written submission, para. 63.  
See the original Panel report, paras. 3.22, 3.23, 3.228, 6.597;  Appellate Body report, paras. 38, 361 and 362. 
137 United States first written submission, paras. 49-50; reply to Panel question No. 37.  The 
Department of Justice's view as co ntained in the December 2 000 Presidential signing statement was provided in 
original Exhibit US-17 and quoted in full in United States original first written submission, para. 35, and again 
in reply to original Panel question No. 21.  See the original Panel report, paras. 3.22-3.23, 3.228, 6.597, and 
Appellate Body report, para. 362, fn 464.  The Panel has noted that the April 2006 DOJ Statement refers expressly to the Wire Act rather than to all existing crim inal statutes but this was in the context of Bill H.R. 
4777, that would have expressly amended the Wire Act. 
138 United States first written submission, paras. 26 and 37; oral statement, para. 18.  This was set out in 
reply to original Panel question No. 21;  comments on original interim revi ew, para. 38; and taken into account 
in the original Panel report at para. 6.599.  The United States' view of repeals by implication was also referred to 
in the Appellate Body report, para. 362. 
139 The Panel sought, and obtained, one clarification from the parties that could be useful in the 
implementation of the recommendations and rulings of the DSB with respect to one of  the measures at issue, 
namely the IGBA.  Both parties had initially understood that the focus of Antigua's allegation of discrimination under the IHA was on the Wire Act (United States first written submission, para. 19; confirmed by Antigua in 
its second written submission, fn. 9).  However, in respon se to a question from the Panel, both parties agreed 
that offences under the IGBA are not pr edicated on a violation of federal laws, such as the Wire Act, but on a 
violation of State laws, whereas the IHA applies to activit y that is lawful in each St ate where it takes place.  The 
United States added that, for this reason, in its view, the original Panel's findings with respect to the Wire Act WT/DS285/RW 
Page 32  
 
  6.105  First, the Panel considers that the United Stat es' submission is erroneous insofar as it asserts 
that no language of "permission" exists in the IHA.
140  Clearly such language does exist.  Section 5 of 
the IHA, which was quoted in the Appellate Body repor t, provides that "[a]n interstate off-track wager 
may be accepted by an off-track betting system" if certain consent is obtained, followed by extensive 
conditions and provisos concerni ng the revenue-sharing arrangement with the horse track (emphasis 
added).  Insofar as the United States' submission on this point asserts otherwise, it boils down to the 
observation that the IHA does not contain an express carve-out from criminal laws, which was already 
plain from the text of the IHA in the or iginal proceeding and is not disputed.141   
6.106  Second, some of this supplementary eviden ce, whilst it presents interesting background 
information, provides little that is useful in reso lving the ambiguity in the relationship between the 
IHA and the Wire Act, notably:   
(a) the original version of the IHA before it wa s amended in 2000, its legislative history, 
and an interpretation that there was no repugnancy between the statutes before the 
IHA was amended.  This does not address the material difference in the IHA since 2000 which is key to the potential repugnancy with the Wire Act;
142   
(b) an explanation that the IHA, and the IHA as amended, can preserve civil enforcement 
rights without any repugnancy vis-à-vis the criminal prohibition in the Wire Act.  This does not address the key issue as to how the IHA, as amended, on its face can authorize activity that otherwise violates the Wire Act without any repugnancy;
143  
(c) confirmation that the definitions used in the IHA do not amend definitions used in 
any other federal statute.  This is not disputed;144 and 
(d) confirmations that the IHA, and the IHA as amended, do not cover the entire field 
occupied by the Wire Act.  This is not di sputed, as the parties agree that it is not the 
only way in which a repugnancy can arise between two statutes.145  
6.107  Third, some of the supplementary evidence provi des more detail on issues that were raised in 
the original proceeding: 
(a) the full text of a US Supreme Court opinion from which the United States had cited 
the principle of statutory construction that repeals by implication are not favoured.146  
The United States has also provided the full te xt and descriptions of four federal court 
                                                                                                                                                                     
and the Travel Act, as upheld by the Appellate Body, cannot apply to the IGBA (Antigua reply to Panel question 
No. 23 and the United States' comment th ereon).  The Panel notes that this argument, raised very late indeed, 
appears to be at odds with the United States' position in the original proceeding, as reflected in the view of the 
Department of Justice expressed in the December 2000 Presidential signing statement.  Nevertheless, in view of 
the wording of the IHA, which is not entirely clear on this point, and of the IGBA, it may be possible for the Department of Justice to clarify the specific issue of the applicability of the IGBA to interstate wagering on 
horseracing, where legal in the various States involved. 
140 United States first written submission, para. 33, see also para. 20. 
141 United States first written submission, paras. 23-24; reply to Panel question No. 28.  
142 United States first written submission, paras. 10, 29, 35; Exhibit US-2; second written submission, 
paras. 12-13, 16-17, 19.    
143 United States first written submission, paras. 11  and 35;  second written submission, paras. 17 and 
19;  oral statement, paras. 20-21;  reply to Panel question No. 29. 
144 United States second written submission, para. 15;  oral statement, para. 17. 
145 United States first written submission, paras. 30 and 36 and Exhibit US-6. 
146 United States first written submission, para. 26 and Exhibit US-5.  See note 138 above.  WT/DS285/RW 
 Page 33 
 
 
  cases that illustrate how US courts consid er claims of repeal by implication147 and 
which indicate that this principle applies with even greater fo rce when the claimed 
repeal rests solely in an appropriations Act;148 and 
(b) in response to a question from the Panel, c onfirmation that the Department of Justice 
is not aware of any public pending prosecuti on of the suppliers in the United States 
mentioned in the original proceeding.149   
6.108  Fourth, the supplementary eviden ce also includes the following: 
(a) the US principles of statutory construction that one begins with the plain language of 
the statute and only resorts to the legislative history where there is ambiguity;150   
(b) the doctrine that an agency's interpretation of the statute that it administers constitutes 
a body of experience and informed judgeme nt to which courts and litigants may 
properly resort for guidance, but which is not controlling upon the courts by reason of its authority;
151 and 
(c) sections of the legislative history of the IHA amendment that describe only the textual 
change effected in the IHA; and an expl anation of the interpretative value of a 
statement made by an individual Congressman who opposed adoption of the 2000 
amendment to the IHA.152  
6.109  The original Panel, which did not have the supplementary evidence before it, made an 
objective assessment that, when interpreting US domest ic law, it could not ignore the plain language 
of a statute enacted by the US Congress.  None of the supplementary evidence alters or addresses the 
essential point that, on its face, the text of Section 5 of the IHA, read in conjunction with the 
definition of "interstate off-track wager" as amended in 2000, appears to authorize something that the 
Wire Act prohibits.  The supplementary evidence actually confirms that, under US domestic law, 
whilst repeals by implication are not favoured, th ey are possible where there is a positive repugnancy 
between two Acts.  Whilst the US court opinions submitted for the first time in this compliance 
proceeding confirm that two statutes can independe ntly prohibit the same conduct, none of them 
indicate or even imply that a US court would ignore an authorization in the plain language of a US 
statute in light of an older statute that addresses the same conduct in less specific terms.153    
6.110  Therefore, the United States' submissions in this compliance proceeding do not provide any 
facts and arguments concerning the relationship between the IHA, on the one hand, and the Wire Act, 
on the other, that would justify a different finding fro m that made by the original Panel on this issue.  
                                                      
147 United States first written submission, para. 27, Anne x I; Exhibits US-10 to US-13; oral statement, 
paras. 18-19;  reply to Panel question No. 30. 
148 United States first written submission, para. 37; Exhibit US-7;  oral statement, para. 22.  The 
original Panel noted that the 2000 amendment to the IHA was contained in an appropriation Act;  see fn 1060 in 
the original Panel report. 
149 United States reply to Panel question No. 35(e), referring inter alia  to the evidence of action against 
the supplier in the United States set out in para. 6.82 above. 
150 United States first written submission, paras. 13-15 and 20;  Exhibits US-3 and US-4; oral 
statement, para. 15.  See note 112 above. 
151 United States first written submission, paras. 16 an d 48, referring to Exhibit AB-16; reply to Panel 
question No. 37(e).   
152 United States first written submission, para s. 38-40; Exhibits US-8, US-9 and US-14. 
153 The measures at issue were enacted at an earlie r time than the IHA and the United States has not 
argued that they are more  specific than the IHA. WT/DS285/RW 
Page 34  
 
  3. Antigua's submissions 
(a) Interstate Horseracing Act, as amended 
6.111  Antigua argues that the measures at issue in th e original proceeding remain out of compliance 
with Article XIV of the GATS.
154  Although it considers that the issu e was resolved in the original 
proceeding, it submits that the IHA authorizes re mote pari-mutuel account wagering in the United 
States and that this is not prohibited by the Wire Act.  It refers inter alia  to the IHA on its face, US 
domestic law including principles of statutory construction, State account wagering laws, the 
activities of suppliers of remote gambling and bettin g services operating in the United States, and the 
UIGEA.155  Much of this evidence was presented for th e first time in the compliance proceeding but 
some of it only provides more detail on inform ation presented in the original proceeding. 
6.112  First, Antigua relies on the text of the IHA on its face, which is actually quoted in the original 
Panel and Appellate  Body reports.156  Antigua does not take a position on whether there is a direct 
conflict between the IHA and the Wire Act but subm its opinions of the US Supreme Court and the US 
Court of Appeals that were not presented in the original proceeding to explain principles of statutory construction.  Like the United States' own evid ence, these opinions confirm that, under US domestic 
law, repeals by implication are not favoured but  are possible where there is a positive repugnancy 
between two Acts.
157  This principle had already been presente d in the original proceeding, in less 
detail, by the United States.  One supplementary element provided by Antigua consists of the US 
court opinions in the Burrillville case dating from 1992 and 1993, which is apparently the only 
reported court case that refers to both the Wire Act and the IHA.158  However, that case relates to the 
old version of the IHA before the 2000 amendment an d does not discuss the activity engaged in by the 
defendant in a way that would clearly address the issu e that the Panel is assessing.  The lack of clarity 
on this point is highlighted by the fact that both parties to this dispute see in it support for their 
opposing respective views of the re lationship between the two Acts.159  
6.113  Second, Antigua has submitted laws and regula tions of California, Connecticut, Idaho, 
Kentucky, Louisiana, Maryland, Massachusetts, Ne vada, New Hampshire, New Jersey, New York, 
North Dakota, Ohio, Oregon, Pennsylvania, Virg inia, Washington and Wyoming that authorize 
"account wagering".  These laws and regulations were not presented in the original proceeding.160  
Most of these State laws refer expressly to the IHA.161  Almost all these State laws expressly refer to 
                                                      
154 Antigua first written submission, para. 46;  second written submission, para. 5. 
155 Antigua first written submission, paras. 46-129 ;  second written submission, paras. 29-60.  
156 Antigua first written submission, para. 50;  seco nd written submission, para. 29.  Antigua draws 
attention to the fact that the definition covers remote wa gering on an intra- and interstate basis.  Indeed, the 
definition includes wagers placed or transmitted in one St ate and accepted by an off-tr ack betting system in the 
same or another State: see original Panel report, para. 6.598; Appellate Body report, para. 361; Exhibit AB-4. 
157 Antigua first written submission, paras. 58-59,  second written submission, paras. 36-39, and  
Exhibits AB-23 to AB-27.   
158 Exhibits AB-30 and AB-117. 
159 Antigua first written submission, para. 61;  second  written submission, paras. 40-45;  United States 
first written submission, fn. 15;  second written subm ission, paras. 20-23; oral statement, para. 15. 
160 Antigua only mentioned account wagering permi tted by States: original first written submission, 
para. 118. 
161 Antigua first written submission, para. 66, Exhib its AB-34 to AB-51.  Oregon law refers to 
compliance with the IHA, in cluding one provision that licensees may accept bets from persons outside the State 
provided that they comply with the IHA (Exhibit AB-60).  Virginia law expressly refers to pari-mutuel wagering 
"permissible under the IHA" (Exhibits AB-49 and AB-62).  Idaho, Kentucky and Washington laws provide that 
a hub or advance deposit wagering facility must comply with the IHA (Exhibits AB-55, AB-37, AB-56 and 
AB-50).  Maryland and Missouri laws provide that their inte nt is similar to the IHA or that the intent of the IHA 
is instructive (Exhibit AB-58 and AB-54).  Louisiana law provides that it is subject to applicable federal law, 
specifically both the IHA and the Wire Act (Exhibits AB-38 and AB-57).  However, seven State laws provide  WT/DS285/RW 
 Page 35 
 
 
  account wagering by telephone, Internet and/or other electronic means162 (referred to below as 
"remote account wagering").163 Some of these State laws purportedly authorize remote account 
wagering on an interstate basis.164  The United States does not contest what the State laws provide on 
their face but explains that State laws cannot override the Wire Act or other US federal law.165  The 
Panel notes that some of the State laws, on their face, regulate the acceptance of legal interstate off-
track wagers on horse races in acco rdance with the IHA.  However, some do not refer to the IHA and 
others do not refer to the IHA in relation to the acceptance of wagers.166  Further, whilst all the State 
laws refer to wagering on horse races, so me apply to wagering on other sports167 and four purport to 
allow wagers placed from foreign jurisdictions168, which are matters outside the scope of the IHA.  All 
allow remote wagers wholly within the State in qu estion which, to the extent that it does not involve 
the transmission of bets or wagers in interstate or  foreign commerce, is a matter outside the scope of 
the Wire Act169 (discussed at paragraphs 6.118 to 6.123 below) .  In any event, even to the extent that 
these State laws are contemplated by the IHA, they  do not remove the ambiguity in the relationship 
between the IHA itself and the Wire Act. 
6.114  Third, Antigua has submitted evidence relating to wagering suppliers operating in the United 
States, many of whom expressly indicate on their we bsites that they provide telephone or Internet 
(i.e. remote) wagering services on horse racing.170  Less detailed information on four of these 
operators was submitted in the original proceeding and addressed in the original Panel report in 
relation to an allegation of non-enforcement of th e measures at issue against local suppliers in 
general.171  The Panel addresses them now, in this secti on, in relation to the specific, and distinct, 
question of what the IHA authorizes.   
6.115  The suppliers in relation to which Antigua submits evidence in the compliance proceeding 
hold licences granted by State governments under the State laws and regulations referred to in 
paragraph 6.113 above to conduct remote account wagering, or  are public benefit corporations 
established for this purpose.172  Some of these licences are expressly limited to remote wagering in the 
                                                                                                                                                                     
that simulcasts (as opposed to wagers) shall comply with  the IHA.  The United States chose not to address the 
substance of Antigua's evidence on these matters in its submissions.  It considers that there is no basis for 
allowing Antigua to bring up in a compliance procee ding claims that were not reflected in the DSB's  
recommendation and rulings:  United States second written submission, para. 9.   
162 New Hampshire's law do es not (Exhibit AB-42). 
163 The Panel uses the word "remote" as defined by the original Panel at paras. 6.32-6.33 of its report.   
164 California, Idaho, Kentucky, Louisiana, Maryland (allows telephone betting from account holders 
with a principal residence outside the State), Nevada, Oregon, Virginia, Washington and Wyoming.    
165 United States reply to Panel question No. 32(c). 
166 See note 161 above. 
167 Connecticut, Massachusetts, New Hampshire, Oregon and Wyoming laws also apply to wagering on 
greyhound racing, dog racing and/or jai alai.   
168 Idaho, Kentucky, Nevada and Washington.  Oregon, Virginia and Wyoming also refer to "other 
jurisdictions". 
169 United States reply to Panel question No. 32(d). 
170 Antigua first written submission, paras. 71-88, and Exhibits AB-65 to AB-73.  The United States 
chose not to address th e substance of Antigua's evidence on these matters in its submissions.  It considers that 
there is no basis for allowing Antigua to bring up in a compliance proceeding claims that were not reflected in 
the DSB's recommendation and rulings:  United States second written submission, para. 9.   
171 Antigua original first written submission, para. 118 ;  original Exhibits AB-42, AB-43 and AB-44; 
response to original Panel question No. 19.  A page fr om the website of another supplier was also provided in 
original Exhibit AB-123.  See original Panel report, paras. 6.585-6.589, 6.607; Appellate Body report, paras. 352-357 and  373(D)(v)(a).   
172 The evidence relates to nine suppliers who compri se all the advance deposit wagering licensees in 
California (Exhibit AB-101), Idaho (Exhibit AB-96, except for one), Oregon (Exhibit AB-95, except for one), Virginia (Exhibit AB-98) and possibly Washington (Exhibit AB-99 - it is not clear if the licensee information is 
exhaustive for that State) as well as two public benefit corporations in New York (Exhibits AB-71 and AB-72).  WT/DS285/RW 
Page 36  
 
  State "that is permissible under the Interstate Horseracing Act".
173  Some of the suppliers and industry 
associations also confirm that they operate under the IHA.174  Most of these suppliers state that they 
accept wagers placed in other States.175  These suppliers are substantial and even prominent 
businesses with, collectively, thousands  of employees and apparently tens of thousands of clients, 
paying taxes or generating revenue for government owners, having traded openly for up to 30 years 
and in some cases even operating television channe ls.  Three are publicly listed corporations making 
filings with the United States Securities and Exchange Commission or subsidiaries of such corporations.   
6.116  The evidence regarding these suppliers demonstr ates the existence of a flourishing remote 
account wagering industry on horse racing in the Un ited States operating in ostensible legality.  
However, it is not clear whether these suppliers actua lly transmit bets and wagers in interstate or 
foreign commerce in violation of the Wire Act or only information in relation to the formation of a 
wagering pool or other information that may fall w ithin the "safe harbor" provision of that Act.  
Therefore, the Panel is unable to determine to wh at extent the evidence of these suppliers' operations 
sheds light on the operation of the IHA in a way th at would demonstrate that the IHA authorizes pari-
mutuel account wagering that would otherwise violate the Wire Act.   
6.117  Therefore, whilst the Panel notes the differenc es between Antigua's submissions in this 
compliance proceeding and those it made in the origin al proceeding, they do not provide any facts and 
arguments concerning the relationship between the I HA, on the one hand, and the Wire Act, on the 
other, that would justify a different finding from that made by the original Panel on this issue. 
(b) Intrastate commerce 
6.118  Antigua's submissions in this compliance pr oceeding have provided facts and arguments 
concerning another aspect of the measures at issu e on which the original Panel did not rule.  
6.119  In the original proceeding, Antigua explained that the measures at issue did not prohibit all 
remote supply of gambling services within the dom estic market of the United States because the 
measures did not apply to intrastate commerce.
176  The text of the Wire Act and the Travel Act, on 
their face, showed that their scope was limited to "interstate or foreign" commerce (not "domestic or 
foreign" commerce) so that they did not include in trastate commerce.  Antigua did not clarify to the 
original Panel how this limitati on on scope was discriminatory in practice because, apart from one 
example177, Antigua did not provide evidence that re mote gambling was permitted in intrastate 
commerce.  Instead, Antigua chose to focus on differential treatment between non-remote gambling 
within the domestic market of the United States a nd remote gambling from outside the United States 
rather than on the existence of an authorizati on to supply remote gamb ling and wagering services 
                                                                                                                                                                     
The evidence does not cover licensees in Kentucky (Exhi bit AB-97, where only r acetracks and Kentucky off-
track betting parlors are licensed) or Ohio (Exhib it AB-94, where only racetracks are licensed).   
173 See the licence renewals ordered by the Virginia Racing Commission (Exhibit AB-98). 
174 Exhibits AB-65, AB-66, AB-118, AB-119 and AB-120. 
175 One supplier, in New Jersey, states that it does not (Exhibit AB-73).   
176 Antigua original first opening oral statement, para. 92; original second written submission, 
paras. 33-34; and see original Panel report at paras. 3.105-3.106, 3.110-3.111, 3.135, 3.224, 3.227 and 3.232.   
177 This was a special exemption in Nevada law: Antigua reply to original Panel question No. 19, 
fn 117; see also the United States' reply to original Panel question No. 36.  Antigua also mentioned the existence 
of State horse racing laws and account wagering, and quoted an IHA definition in a footnote in its original first 
written submission, paras. 116 and 118, but in its original  second written submission, paras. 33-34, it set out the 
limitation on the scope of federal laws without pursuing the State authorizations that existed beyond that 
limitation.  WT/DS285/RW 
 Page 37 
 
 
  within the United States.  Consequently, the orig inal Panel refrained from making a finding on this 
aspect of the Wire Act and the Travel Act.178   
6.120  In this compliance proceeding, the United Stat es asserts that the measures at issue "on their 
face" meet the requirements of the chapeau of Article XIV of the GATS because their text does not discriminate between countries.
179  Antigua disputes this assertion, referring to the operative language 
of the Wire Act, that prohibits only bets or wa gers in "interstate or foreign commerce", but not 
intrastate commerce.180  In response to questions from the Panel,  the United States indicated that this 
was a jurisdictional requirement imposed by the Un ited States Constitution.  The United States did not 
dispute that the Wire Act, which is a federal st atute, does not prohibit intrastate remote wagering 
where it has no effect on interstate or foreign comme rce but cautioned that this does not indicate that 
State gambling statutes are discriminatory.181   
6.121  It is not disputed that the Wire Act prohibits  remote wagering from jurisdictions outside the 
United States, such as Antigua.  It is also undis puted that the Wire Act does not prohibit remote 
wagering within the United States to the extent that  it is not in interstate or foreign commerce.  
Antigua's submissions in this compliance proceeding show that there are at least 18 State laws (laws 
outside the Panel's terms of reference) that expr essly authorize wagering by wire within the United 
States, including on a wholly intrastate basis.  Most of these State laws authorize remote wagering on horse racing, some of them expressly in accordance with the IHA.
182  The simultaneous prohibition of 
cross-border supply of remote wagering services, on the one hand, and the lack of a prohibition of 
some domestic supply of remote wagering services, on the other hand, afford different treatment.183   
6.122  The text of the Wire Act, together with  the State laws presented in the compliance 
proceeding, provide the Panel with a factual record that was not available in the original proceeding 
concerning the treatment of intrastate commerce, including with respect to remote wagering on horse racing.  This factual record would enable the Pane l to make findings as to whether the United States 
has demonstrated that the Wire Act meets the re quirements of the chapeau of Article XIV of the 
GATS on grounds in addition to those regarding the ambiguity in the relationship between the IHA 
and the Wire Act.   
6.123  A finding that the Wire Act "on its face" meets the requirements of the chapeau of 
Article XIV because its text does not discriminate between countries would overlook the fact that the 
                                                     
 
178 The original Panel expressly noted that both the Wire Act and the Travel Act applied only to 
"interstate or foreign commerce": see original Panel report, paras. 6.362 and 6.367, cross-referenced in the 
Appellate Body report, fn 424. The original Pane l also discussed the fact that the measures prohibit remote 
gambling and betting services and other activities in the cont ext of the "necessity" test but it did not find that the 
measures prohibit all remote su pply within the United States  or that they were non-di scriminatory on their face, 
which was raised extensively in the arguments of the parties section of the report:  see note 176 above. 
179 See para. 6.102(b) above.  The United States a dds that the limitation to "interstate or foreign 
commerce" does not discriminate in terms of nationality  either: see its reply to Panel question No. 38(c). 
180 Antigua second written submission, para. 9.  S ee also its first written submission, para. 116. 
181 United States replies to Panel questions Nos. 32(c) and 38(c).  The United States did not otherwise 
explain how the discrimination might not be "arbitrary or unjustifiable" or not inconsistent with the 
requirements of the chapeau of Article XIV of the GATS.  The United States considers that there is no basis for 
allowing Antigua to bring up in a compliance procee ding claims that were not reflected in the DSB's  
recommendation and rulings:  United States second written submission, para. 9.   
182 This includes the State laws an d regulations that authorize remote wagering on horseracing and, in 
some cases, other sports, referred to at para. 6.113, as well as Nevada laws and regulations that authorize interactive gaming, and lotteries in other States that allow the sale of tickets by telephone: see Antigua first 
written submission, paras. 116-129;  comment on US reply to Panel question No. 38(c). 
183 The Panel notes that this issue is unrelated to the United States' argument that the Wire Act "safe 
harbor" provision, by virtue of the additional requirements of the IHA, discriminates in favour of suppliers from 
outside the United States, raised in United Stat es original second written submission, para. 64. WT/DS285/RW 
Page 38  
 
  prohibition in the Wire Act does not apply to remote  wagering within the United States to the extent 
that it is not in interstate or foreign commerce.  A finding that the text of the Wire Act does not 
discriminate between United States and foreign supplie rs in terms of nationality would require some 
explanation of the relevance of nationality to the chapeau of Article XIV.
184  However, in view of the 
Panel's interpretation of Article 17.14 of the DS U at paragraphs 6.46 to  6.57 above, the Panel 
considers that it is not entitled to make any further findings on this issue as the United States' defence 
has been finally resolved w ith respect to the measures at  issue in this dispute.  
4. Developments since the original proceeding 
(a) April 2006 DOJ Statement and prosecutions 
6.124  Since the original proceeding, in April 2006, an o fficial of the Department of Justice stated in 
testimony before a Committee of the US House of Representatives the Department of Justice's view 
of the relationship between the IHA, on the one hand, and federal criminal statutes, on the other.185  
That view reiterated the view expressed in the Pr esidential statement on the signing of the amendment 
of the IHA in 2000, which the United States had presented to the original Panel.  It is notable that in 
that testimony, as in the Presidential signing stat ement, the Department of Justice lacked an 
authoritative court opinion to support its view. 
6.125  In its statement, the Department of Justice offici al referred to a "civil investigation" relating to 
a potential violation of an unspecified law, which the Panel understands is not one of the measures at 
issue.  The United States informed the Panel that th at investigation is "still pending" and no further 
details are publicly available.186   
6.126  It is striking that the Department of Justice has not, apparently, ever initiated a criminal 
prosecution under the measures at issue of a pari -mutuel wagering supplier in the United States who 
transmits bets and wagers in viola tion of the Wire Act but who, at the same time, has obtained consent 
from the horse racing associations and shares its re venue with the racetrack s in accordance with the 
IHA.187  Such a prosecution could lead to a court op inion that would prove – or disprove – the 
Department of Justice's view, as a court could d ecide whether the IHA authorized such activity 
despite the terms of the Wire Act.   
6.127  Since the original proceeding, the United St ates has, under various measures at issue, 
prosecuted gambling business operators trading as WorldWide Telesports, based in Antigua, and 
BETONSPORTS PLC, also based outside the Unite d States, and prosecuted US-based operators, 
named Gianelli, Meyers and others, who employed  the services of foreign gambling businesses.  
During that time the United States has also pro secuted US bookmakers who transmitted illegal wagers 
                                                      
184 The Panel has taken due account of the Appellate Body's findings that "[t]he statutes at issue make 
no distinction on their face as to gambli ng services from different origins", that the language of the Wire Act is 
"neutral" and that "[t]hese measures, on their face, do not discriminate between United States and foreign 
suppliers of remote gambling services" (emphasis in original): see Appellate Body report at paras. 332, 354 and 357; as well as the Appellate Body's  findings regarding the IHA, an Act that does not discriminate on its face 
between United States and foreign suppliers in terms of  nationality either:  see Exhibit AB-4; United States 
reply to Panel question No. 33; and Antigua's comment on the US reply.   
185 Status Report by the United States , Addendum, WT/D285/15/Add.1, 11 April 2006; also set out in 
Exhibit AB-32, discussed in Antigua first written submission, paras. 34-35;  second written submission, para. 67; 
and United States first written submission, paras. 48-50.  
186 United States reply to Panel question No. 37(b) and (c). 
187 United States replies to Panel questions Nos. 34, 35, 36 and 37(d).    WT/DS285/RW 
 Page 39 
 
 
  on horse races interstate without "conforming their c onduct to the provisions of the IHA", i.e. without 
obtaining consent from the horse racing associations and sharing their revenue with the racetracks.188     
6.128  However, the Department of Justice is not aw are of any public pending prosecution of the 
suppliers in the United States of online pari-mutue l wagering on horse racing who were referred to in 
the original Panel report189, including the supplier whom the United States advised the original Panel 
"face[d] the risk" of criminal proceedin gs and penalties brought by the government.190  The evidence 
referred to at paragraph 6.114 above shows that these  and other suppliers confirm that they operate in 
accordance with the IHA.  Whilst it is not clear whether these suppliers actually violate the Wire Act, 
it is clear that none of them are being prosecuted.191   
6.129  The Panel accepts that there are many factors that  affect decisions to prosecute, including the 
availability of resources and prosecutorial priorities.192  However, the evidence set  out above is at least 
consistent with the view that remote wageri ng services supplied in accordance with the IHA are 
tolerated, even if not authorized under federal la w.  Criminal prosecutions of appropriate cases under 
the measures at issue could change their applicati on from that which prevailed at the time of the 
original proceeding and also resolve the ambiguity in the relationship between the IHA, on the one 
hand, and the Wire Act, on the other, for the purpose of assessing the United States' compliance with 
its international obligations under the GATS.  
(b) Unlawful Internet Gambling Enforcement Act  
6.130  Since the original proceeding, in October 2006, during the course of this compliance 
proceeding, the United St ates enacted the UIGEA.193  The Panel agrees with Antigua that the UIGEA 
is particularly relevant to the question of the re lationship between the IHA, on the one hand, and the 
measures at issue, on the other, because (i) it specifica lly refers to that issue; and (ii) as a statute 
enacted by the United States Congress, it is authoritative on matters of US domestic law. 
6.131  The UIGEA does not amend or alter any statutes at issue nor affect which activities are 
unlawful under those statutes.194  The UIGEA applies to activities falling within its definition of 
"unlawful Internet gambling".  That definitio n excludes certain activities, among them certain 
intrastate transactions195, certain intratribal transactions196, and also the following regarding interstate 
horse racing:  
                                                      
188 Antigua first written submission, paras. 106-107, Exhibit AB-75 (indictment before the original 
Panel circulated its report), Exhibits AB-76 and AB-77;  United States reply to Panel question No. 36. 
189 Antigua original first written subm ission, para. 118;  United States reply to original Panel question 
No. 22; United States comments on original interim review, para. 35. 
190 United States reply to Panel question No. 35(e), referring to the mention of action against suppliers 
set out in para. 6.82 above. 
191 Antigua first written submission, para. 104; United States replies to Panel questions Nos. 34 and 
37(d).  See paras. 6.114 and 6.116 above. 
192 United States reply to Panel question No. 34; comment on reply to Panel question No. 35(d). 
193 Exhibit AB-113, discussed in Antigua second written submission, paras. 46-60. 
194 31 U.S.C. §5363 pr ohibits acceptance of any financial instru ment for 'unlawful In ternet gambling';  
§5364 provides for policies and procedures to identify and prevent restricted transactions; §§5365 and 5366 provide for civil and criminal remedies, respectively; and §5367 prohibits circumvention.   
195 The exclusion of intrastate transactions is subject to conditions, among them that the State laws or 
regulations include age and locati on verification requirement s reasonably designed to block access to minors 
and persons located out of a State jurisdiction and appropr iate data security standards to prevent unauthorized 
access.  This represents a change since the United States submitted to the original Pane l, with respect  to identity 
verification and prevention of online gambling by children, as follows:   
"In fact, such regulation is infeasible.  Chil dren have ready access to payment instruments, 
and no technology has yet been developed to enable constraints on Internet gambling even WT/DS285/RW 
Page 40  
 
  "The term 'unlawful Internet gambling' sha ll not include any activity that is allowed 
under the Interstate Horseracing Act of 1978 (15 U.S.C. 3001 et seq.)."
197   
6.132  The definition of "unlawful Internet gambling" a pplies to the UIGEA only.  It does not define 
or alter what type of Internet gambling is un lawful under US domestic law, including under the 
measures at issue.198  At the same time, in enacting this exclusion from that definition, the United 
States Congress appears to have contemplated that some activity may be "allowed" under the IHA that 
might otherwise be considered "unlawful Internet gambling".199 However, the Panel does not leap to 
the conclusion that this provision  means that the IHA allows activities prohibited by the Wire Act, in 
light of another provision in its immediate cont ext within the UIGEA that expresses the sense of 
Congress as follows:  
 "(iii) Sense of Congress 
"It is the sense of Congress that this subc hapter shall not change which activities 
related to horse racing may or may not be allowed under Federal law.  This 
subparagraph is intended to address concerns  that this sub-chapter could have the 
effect of changing the existing relationship between the Interstate Horseracing Act 
and other Federal statutes in effect on the da te of the enactment of this subchapter.  
This subchapter is not intended to change that relationship.  This subchapter is not 
intended to resolve any existing disagreements  over how to interpret the relationship 
between the IHA and other Federal statutes ."200   (emphasis added) 
6.133  The United States confirmed to the Panel that th e disagreement referred to concerns whether 
the IHA repealed by implication pre-existing crim inal statutes, thereby allowing the interstate 
transmission of bets on horse races.201  This is the precise factual issue that the United States 
delegation, throughout its submi ssions, asked the Panel to assess.202  However, the United States 
points out that in the "Sense of Congress" provisi on of the UIGEA "[t]he language simply notes the 
                                                                                                                                                                     
approaching those that are possible in other settings where gambling can be confined and 
access to it strictly controlled."  (United States  original first written submission, para. 39)  
See also the original Panel re port at paras. 6.515-6.518. 
196 The exclusion for intratribal transactions is subject to conditions that include those set out at note 
195 above. 
197 31 U.S.C. 5362(10)(D)(i). 
198 The definitions in §5362 apply "[i]n this subchapter".   See also the rule of construction in §5361 (b). 
199 The Department of Justice expressed a similar vi ew on a provision in Bill H.R. 4777:  see Exhibit 
AB-32, p.4.  A statement which forms part of the legislative history of the UIGEA explains that this provision "addresses transactions complying w ith the IHA which will not be considered unla wful because the IHA only 
regulates legal transactions that are lawful in each St ate involved":  see Statement of Representative Leach, 
Congressional Record, pages H8029-H8030 in Exhibit US-15, submitted with United States reply to Panel question No. 31(b).  This statement does not indicate whether transactions under the IHA comply with pre-
existing federal criminal statutes.  The US National Thoroughbred Racing Association considers that "[t]he 
legislation contained language that recognizes the ability of the horse racing industry to offer account wagering 
under the Interstate Horseracing Act of 1978 as amended"  and "[t]his is a very significant landmark recognition 
by the U.S. government of our industry's legal right to conduct wagering under the IHA and of our industry's 
important position as an agribusiness that supports 500,000 jobs": see Exhibit AB-118.  The United States does not agree with this view: see United States reply to Panel question No. 31(e).   
200 31 U.S.C. 5362(10)(D)(iii). 
201 United States reply to Panel question No. 31(c). 
202 See, for example, "the IHA in no way limits the application of federal criminal statutes" in the 
United States first written submission, para. 3.  WT/DS285/RW 
 Page 41 
 
 
  disagreement [but the language] does not take a pos ition as to how a court would in fact construe the 
relationship between federal cr iminal laws and the IHA."203 
6.134  The Panel agrees.  In this way, the Unite d States Congress has provided confirmation that, 
under US domestic law, the original Panel's finding was correct, that is: 
"[T]here is ambiguity as to the relations hip between, on the one hand, the amendment 
to the IHA and, on the other, the Wire Ac t, the Travel Act and the Illegal Gambling 
Business Act."204    
6.135  This provision also shows that since the or iginal proceeding the United States had an 
opportunity to remove the ambiguity and thereby co mply with the recommendations and rulings of 
the DSB.205  Instead, rather than take that opportunity , the United States enacted legislation that 
confirmed that the ambiguity at the heart of this di spute remains and, therefore, that the United States 
has not complied.  
VII. CONCLUSION 
7.1 For the reasons set out in this Report, the Pane l concludes that the United States has failed to 
comply with the recommendations and rulings of the DSB in this dispute. 
 
_______________ 
 
 
 
 
 
                                                      
203 United States reply to Panel question No. 31(c). 
204 Original Panel report, para. 6.599, dated 10 November 2004, quoted above at para. 6.72. 
205 Nevertheless, the parties do not dispute that no legislation was ever pending in the United States 
Congress that would have complied with the recommendations and rulings of the DSB in this dispute.