This past weekend I was emailed an article written by Yvonne Woldeab who is a law student at American University in Washington, DC. The title of the Article is:
“Americans: We Love You, But We Can’t Afford You: How the Costly U.S.-Canada FATCA Agreement Permits Discrimination of Americans in Violation of International Law”
Fascinating title. What’s more fascinating is the premise that Canada (not the U.S.) is the country violating international human rights agreements.
The article concludes with:
Canada has the highest number of U.S. citizens living in its jurisdiction outside of the United States. In Canada more than anywhere else, an anti-discrimination clause is necessary to protect U.S. persons who are vulnerable to discrimination under FATCA.
Despite the presence of applicable laws that provide general protections against discrimination, the lack of an anti-discrimination clause in Canada’s FATCA agreement creates ambiguity as to how financial institutions are permitted to treat U.S. persons under the law. Although an anti-discrimination provision would impose FATCA’s costly compliance expenses on Canadian financial institutions, the solution is not to simply circumvent FATCA. If a country is going to pass FATCA into law, the law should properly place the burden of the legislation in the right place. The burden belongs not with the compliant U.S. persons living abroad who have a fundamental right to be free from discrimination, but with the government that believes easy access to information will help find noncompliant taxpayers. Even in the context of international tax compliance and tax treaties, it is necessary that human rights, including the right to be free from discrimination on the basis of one’s national origin, be properly balanced with the needs of a growing, complex economy.
Why this article in interesting:
The gist of this article is that Canada has not taken the appropriate steps to protect Americans abroad in Canada from FATCA induced discrimination. As I understand, Ms. Woldeab’s argument:
The absence of a provision preventing the denial of banking services to “U.S. persons” in Canada puts Canada in violation of Article 26 of the International Covenant on Civil and Political Rights which reads as follows:
All persons are equal before the law and are entitled without any discrimination to the equal protection of the law. In this respect, the law shall prohibit any discrimination and guarantee to all persons equal and effective protection against discrimination on any ground such as race, colour, sex, language, religion, political or other opinion, national or social origin, property, birth or other status.
The article makes mention of the ADCS-ADSC.ca lawsuit in this context.
It is significant that the article links aspects of FATCA to possible human rights violations. FATCA is to enforce U.S. citizenship taxation. U.S. citizenship taxation has also been the subject of a complaint to the United Nations.
But, most notable in its absence …
The article suggests that Canada may be in violation of human rights rules by NOT providing adequate FATCA protection to
Canadian citizens Americans living in Canada. Yet, there is NO suggestion in the article that the U.S. is in violation of any provision of law or morality by attempting to impose FATCA on the world.
Interestingly, the law school of American University in Washington, DC …
The law school at American University has a combined U.S. Canada law degree program in partnership with the University of Ottawa. The program is described by the University of Ottawa here. The program is described by American University here.