House Financial Services and House Judiciary Committee’s Chairmen Frank and Conyers sent a letter to Susan Schwab, the U.S. Trade Representative, and was signed by six other lawmakers, that was critical of the tactics taken to withdraw trade in services for cross-border trading in the WTO.

“Your agency has chosen not to consult with Congress, but instead to take what we view as a drastic step which could have significant consequences for the whole WTO system”, was part of the text of the letter.

The lawmakers suggest that the Bush Administration should roll back a U.S. ban on Internet gambling instead of paying compensation to the European Union and other countries that have filed for compensation.

The United States, after losing its case in the WTO and subsequent appeals, decided that it never intended to allow cross-border Internet gambling as part of it’s trade agreement, and began the process to withdraw this commitment, which is causing much frustration throughout the world and has sparked massive claims from member countries that may exceed $100 million in compensation.

The US has been in negotiations with the EU, India, Japan, Costa Rica, Macau, Canada and Australia and has a deadline of mid-December to reach a deal.

Antigua & Barbuda, the country that brought the suit to the WTO, is seeking permission to withdraw several of its commitments in retaliation for the loss of revenue it has encounter. This form of retaliation will come as a suspension of copyrights, patents, and trademarks on American Music, Movies, and Software.

The lawmakers said that U.S. credibility is at stake, and within the letter state that they feared compensation would be ‘expensive to the U.S. economy’, but they are more concerned with what the ‘withdrawal says about U.S. credibility as a trading partner.’

If the U.S. continues on the path it has taken, it may open the door to other members of the WTO to withdraw some of their commitments that were made and now deemed ‘inconvenient or politically difficult.’

“We are writing to express our interest in considering possible legislative solutions that might restore U.S. compliance withe the GATS agreement without renouncing any of our commitments under that agreement,” said the lawmakers.

Barney Frank in April introduced a bill(HR 2046) that would effectively roll back the UIGEA and open up trade to foreign business.

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