The Internet, cross-border trade in services, and the GATS: lessons from US–Gambling

The rapid development of the Internet has led to a growing electronic cross-border delivery of services. While the WTO negotiations have not caught up to the reality of such service trade, the first GATS case dealing with the Internet, namely ‘United States – Measures Affecting the Cross-Border Supply of Gambling and Betting Services’, has advanced matters. This paper distils the substantive conclusions of the case and remaining questions in relation to Internet-supplied services and certain core concepts of the GATS. Moreover, it sheds light on the case's implications for the services negotiations under the ongoing Doha Development Agenda. It concludes that the second ever GATS case has provided an encouraging set of answers to the unresolved questions of the WTO's Work Programme on E-Commerce, mainly confirming the applicability of GATS commitments to electronically supplied services and shaping the concept of technological neutrality. While more work or dispute settlement cases are necessary to clarify the remaining questions, the rulings have paved the way for the GATS to be a more effective discipline for cross-border (electronic) trade. The paper also explains that a ‘chilling effect’ of the rulings on the Doha services negotiations is not warranted.