U.S. warns Antigua against 'government-authorized piracy'

WASHINGTON (Reuters) - The United States on Monday warned the tiny Caribbean nation of Antigua and Barbuda not to retaliate against U.S. restrictions on Internet gambling by authorizing the "theft" of U.S. intellectual property.

"Government-authorized piracy would undermine chances for a settlement" in the Internet gambling case, said Nkenge Harmon, a spokeswoman for the U.S. Trade Representative's office.

"It also would serve as a major impediment to foreign investment in the Antiguan economy, particularly in high-tech industries," Harmon said.

The World Trade Organization authorized Antigua in 2007 to suspend copyright protection on about $21 million of U.S. intellectual property annually after Washington failed to comply with a ruling against a U.S. ban on Internet gambling.

The Caribbean nation on Monday put the United States on notice that it intended to proceed with that action unless the two sides soon reach a negotiated settlement.

"The economy of Antigua and Barbuda has been devastated by the United States Government's long campaign to prevent American consumers from gambling online with offshore gaming operators," Antiguan Finance Minister Harold Lovell said in a statement.

At its height, the remote gaming industry in Antigua was the country's second largest employer, and leading international gaming economists estimated that the industry was worth more than $3.4 billion to the Antiguan economy, the country estimated.

Currently, less than 500 people are employed in the gaming sector, compared to more than 4,000 at its height.

"This economic devastation has been caused by the direct actions of the United States," the government statement said.

(Reporting By Doug Palmer; Editing by Bill Trott)