#FATCA and Erosion of Privacy (Cockfield)

Queen’s University Professor Arthur Cockfield’s provided a comprehemsive report to the Privacy Commissioner in April on FATCA and the Erosion  of Canadian Taxpayer Privacy.

In his 36 page report, Professor Cockfield reviews numerous laws, practices and policies. He says:

FATCA and the IGA unduly harm the privacy interests and rights of Canadians in part because detailed financial information concerning hundreds of thousands of Canadians would be transferred to a foreign government for the first time…The Canadian government should not implement the IGA until these privacy concerns are addressed.

Professor Cockfield looks at various laws and practices. He briefly addresses some Charter issues:

The  IGA may violate section 15 of the  Charter that prohibits discrimination  on  the  grounds  of  national  origin  (including  citizenship).  As  discussed  in  this report,  the  IGA  discriminates  against  US  citizens  (and  others)  residing  in  Canada  by  offering  unequal  treatment  of  these  individuals  (see  Part  VI.G.).    A  criminal  investigation  calls  for constitutional law protections afforded by the  Charter of Rights and Freedoms including section 8, which restricts unreasonable searches and seizures.75 A demand for tax information may also  violate an individual’s right to remain silent under section 7 of the Charter.76 If the United States.

Professor Cockfield concludes:

Accordingly,  the  IGA  and  the  Implementing  Act  do  not  protect  the  privacy  rights  and interests of Canadians. Bill C-31, the proposed law to implement FATCA  that at this writing is before Parliament, needs to be amended to account for these privacy concerns. Until the privacy and  other  concerns  are  studied  and  addressed  by  Canadian  lawmakers,Canada  should  only  transfer FATCA required data associated with U.S. persons who are not Canadian residents. This approach   accords   with   longstanding   practice   and   emerging   global   information   exchange standards. The government should take immediate steps to ensure this standard is codified in Bill C-31.  This  move  would  safeguard  the  privacy  rights  of  Canadians  while  enabling  Canada  to work  cooperatively  on  a  global  scale  to  ensure  that  tax  evaders—American,  Canadian,  or otherwise—do not have a safe haven anywhere.

Professor Cockfield is on the panel with me next week, along with a Candian-American tax lawyer based in New York.
Many thanks to Badger for this great find.  I did a quick speed read. If Badger would like to do one of her thorough and thoughtful analyses, that would be greatly welcome.

5 thoughts on “#FATCA and Erosion of Privacy (Cockfield)

  1. I am very happy to see Professor Cockfield involved in these submissions. His previous paper with Allison Christians was extremely well done. Furthermore, I think it was Professor Cockfield who submitted a petition to Ted Hsu here in Kingstson long before Sandboxers and Brockers did our similar petition. So he has been working on this for some time and I’m very glad of it.

  2. Here is a biography of Professor Cockfield.
    Note the following:

    Professor Cockfield has served as a legal and policy consultant to the Organization for Economic Cooperation and Development, the United Nations, the Department of Justice, the Department of Finance, the Advisory Panel on Canada’s System of International Taxation, the National Judicial Institute and the Office of the Privacy Commissioner.


  3. Those are solid and sober comments by the Professor!! His solution is also spot on “Until the privacy and other concerns are studied and addressed by Canadian lawmakers,Canada should only transfer FATCA required data associated with U.S. persons who are not Canadian residents.”
    I ask myself, “What should a Canadian Bank whose customer is resident in the USA with US Citizenship but in this case clinging Canadian Citizenship. Think Sen. Ted Cruz.”
    It is clear that persons information could rightfully be handed over, master nationality rule applied means the Canadian Citizenship is meaningless.

  4. Since the 1995 USA Canada tax treaty allows collection from non Canadian citizen at the time of tax it should also be amended or fixed (court challenge)
    Did the conservative say they will only collect USA taxes from permanent residents for USA direct income?
    Can we get a guaranty from other parties to that effect?

  5. I am sure that if Obama had his way, dual US/Canadian citizens resident in Canada would be handed over to him personally. After all, didn’t Obama want US law enforcement to be able to operate in Canada and at the same time be immune from Canadian law?
    Given Obama’s preference for “Executive Orders”, we should be on the lookout for such an order.

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