The United States faces a token $21 million in annual trade sanctions as a result of its online betting ban, the World Trade Organization said Friday in awarding Antigua and Barbuda the right to target U.S. services, copyrights and trademarks.

The decision is a setback for the Caribbean island nation, which sought the right to impose $3.4 billion in retaliatory measures against U.S. commercial services and intellectual property.

Washington acknowledged its Internet gambling restrictions were ruled illegal by the WTO, but argued that Antigua should only be compensated for about $500,000 for lost annual revenue.

The case has drawn the attention of a number of U.S. industries, partly because of the ways Antigua has proposed retaliating against the much larger U.S. economy. Washington’s attempt to escape its legal loss by proposing a revision of the WTO’s key treaty on trade in services has also fueled interest.

The office of the U.S. Trade Representative noted that Antigua was seeking sanctions worth more than three times the size of its entire economy.

“Antigua’s claim was patently excessive,” it said in a statement. “The United States is pleased that the figure arrived at by the arbitrator is over 100 times lower than Antigua’s claim.”

However, the U.S. said it was concerned that Antigua could now violate some American intellectual property rights — which could range from CDs and DVDs to computer software, industrial designs and designer clothing.

The ruling could “establish a harmful precedent for a WTO member to affirmatively authorize what would otherwise be considered acts of piracy, counterfeiting or other forms of … infringement,” the U.S. said.

The U.S. and Antigua cannot appeal Friday’s decision.

Realistically, it would have been very difficult for a country the size of Antigua’s to implement hundreds of millions of dollars worth of trade sanctions on the U.S. without harming its own economy and the welfare of its citizens. Ecuador was awarded similar retaliation rights in a bananas dispute with the European Union in 2000, but failed to come up with an effective way to introduce countermeasures.

The WTO arbitration panel said it had to adopt its own approach to come up with a fair retaliation figure in view of the wide difference in how the U.S. and Antigua estimated the economic effect of the gambling ban.

“In doing so, we feel we are on shaky grounds,” the panel said in an 88-page decision.

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Author Contact Info: Bradley Klapper, Associated Press