Chinese Use Failed US Internet Gambling Argument in WTO Dispute
China has invoked an argument created by the US to justify its limitations on trade involving US movies, music, and other media, telling the World Trade Organization that public morality makes the trade infringement necessary. The US is the only other country ever to try to squirm out of its commitment to free trade by applying the "public morals" excuse, an attempt to legitimize its block of Internet gambling sites.The US lost its case in 2006, as the WTO found no imperative to limit trade to prevent harm to the morality of US residents, to whom many forms of gambling were readily available. Now, the US faces turnabout, as China requires all US media to be released through state-operated distributors.
Although the current dispute is part of an escalation of trade conflicts between the two superpowers, both nations are likely to find that the WTO will still hold them to commitments made to open trade, despite political discomfort at home.
The WTO has allowed that public morals may differ from place to place, but requires a nation using such reasoning to demonstrate that trade blocks are the only method for preventing public corruption. In the US case, the country could not show how impeding online gambling would change circumstances for US citizens, who have options to bet in person, by phone, and even on the Internet with US companies.
The Chinese are appealing an August ruling by the WTO that said US production companies should be able to sell their products online and through distributors of their choice.
While both countries would argue they are very different, the need to control trade and the Internet has made the two the leading supporters of limiting free trade as a means of controlling the choices of their citizenry for its supposed own good.
