#FATCA and the Canadian Charter of Rights and Freedoms

The initial reaction of the Canadian government to FATCA can best be described by a letter then-Finance Minister, the late Jim Flaherty wrote, intended to be placed in major American newspapers.Virtually no one believed there would be any reason for the U.S. to impose this given Canada is a higher tax jurisdiction and owing annual income tax was rather unlikely. Back in 2012, in spite of all the scaremongering created by the IRS and foreign tax compliance practitioners, the underlying hope/belief of “US Persons” in Canada was that it would be impossible to get around the Canadian Charter of Rights and Freedoms. In spite of the fact that the first Model 1 IGA was released on 26 July 2012 by the US Treasury. The IGA was developed cooperatively with France, Germany, Italy, Spain and the United Kingdom.

The post below was written over a year before the Canadians signed the IGA agreement on Feb 5 2014. Interestingly enough, it was written on the same day as a letter written by Peter Hogg, perhaps THE most important constitutional lawyer in Canada. This letter was sent to the Department of Finance and was welcome news.

Note that the prohibited grounds of discrimination
include ‘national or ethnic origin’, and the Supreme Court has held that
citizenship is an ‘analogous ground’ also prohibited by s. 15(1).”
(Andrews v. Law Society of BC (1989) 1 S.C.R. 143)
“The point of this letter is to urge the
Government not to agree to an IGA which would call for foreign
legislation which would offend s. 15
of the Charter.”

Perhaps I just have a bad memory but it is curious to me now, that there is such a difference in the time some of our main allies signed and when we signed. I only recently (and surprisingly) learned that the U.K. and Germany do not have anything comparable to our Charter. Could that be a reason they were more willing to sign earlier on in the process? Does it mean the Canadian government at first considered the possibility that any action they took would not be able to withstand a Charter Challenge? And if so, what was it that made them change their minds? How did they come to believe they could get away with changing a law to break the law? Bill C-31 is the only of the clearly unconstitutional laws that the Trudeau government refuses to budge on (the others being C-23 C-24 & C-51).

While Canada clearly failed when it had the chance to stand up to the U.S. government, perhaps we can count on the Supreme Court of Canada, in the end, to demonstrate leadership by living up to the ideals enshrined in the Charter.


Reposted from renounceuscitizenship blog on December 21, 2012.

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Seeking a Few Additional Witnesses Willing to File Affidavit for Canadian FATCA IGA Lawsuit

The May 31 2017 Canada Federal Court Order gives us 60 days to comply by providing additional information to Government as part of our lawsuit.

This delay may give us time to provide to the Court additional evidence of harms caused by the Canadian FATCA IGA enabling legislation.

— If you are a Canadian citizen and resident who the U.S. deems a U.S. citizen, and you would like to renounce your U.S. citizenship and tax citizenship, but cannot because you would have to pay a U.S. “exit tax” because of the value of your assets (see link) — or you renounced and DID pay an exit tax; or

— If you are a Canadian citizen and resident and a U.S. citizen who had your bank account information turned over to CRA/IRS and the U.S. IRS has now contacted you about your account.

AND you are willing to provide a written, public (your name will be disclosed) affidavit to Canada Federal Court explaining your situation,

- please contact me at Stephen.Kish.Chair@adcs-adsc.ca

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May 31 2017 Canadian FATCA IGA lawsuit update: Plaintiffs ordered by Federal Court to turn over more detailed financial records to Government

As part of our FATCA IGA litigation in Canada’s Federal Court, Our three Plaintiffs previously provided financial information to the Government lawyers on their accounts. However, Government submitted a motion to compel Plaintiffs to provide additional very detailed financial information.

Our litigators felt that this request was unnecessary and unreasonable — and resisted the motion; however, the Case Management Judge sided with Government and ordered today, on May 31 2017, Plaintiffs to provide further documents.

Plaintiff Gwen responds to court order: “If the nosy-ass government hacks feel that they will find something that they didn’t know before, they will be sorely disappointed and this changes nothing other than to piss us off even more…”

Plaintiff Ginny comments: “I am disappointed with the decision that permits the government to invade our privacy in further minutia. This power play demonstrates to me that the government has no respect for privacy principles and will do everything possible to uphold their decision to support FATCA, and the importation of US law into our sovereign nation.

Their choice to ask for costs is another clear warning to discourage any citizens wishing to challenge unjust legislation. However, the three of us remain undeterred in seeking justice for all of us affected. Once again, I rely on my family motto: don’t let the bastards get you down.”

Plaintiff Kazia says: “Although I am disappointed with this outcome, I am hopeful that these next steps, however uncomfortable, will get us even closer to ultimately achieving a positive resolution in our favour. We will stand up for what is right.”

The documents that now must be turned over are:

Every document that reveals the nature and content of the following financial vehicles that the plaintiffs currently hold, or held after January 1, 2014 (domestically or otherwise):

o All bank accounts

o All mutual funds

o All brokerage and investment accounts, and

o All insurance accounts or plans that have cash value, such as life insurance contracts or annuities (including but not limited to whole and/or universal life coverage, etc.)

- With respect to the 2014 and 2015 taxation years:

o Filed T1 tax returns

o T2 tax returns in respect of any businesses that the plaintiffs own or control, and

o Any related documentation, slips or schedules

The Court also requested more “particulars” on the Claim.

These include:

Each type of physical harm the Plaintiffs allege as been suffered; or will for certain be suffered if the impugned provisions remain operational by any one of them or by anyone else, as a result of the impugned provisions;

All mental or psychological harm the Plaintiffs allege has been suffered; or will for certain be suffered if the impugned provisions remain operational; by any one of them or by anyone else, as a result of the impugned provisions;

All financial harm, loss, or damage that the Plaintiffs allege has been incurred; or will for certain be incurred; by any one of them or by anyone else, as a result of the impugned provisions.

In addition, Court ordered Plaintiffs to pay $2500 in costs for the motion.

Plaintiffs do not have to pay these costs if we ultimately win the court challenge; however this order emphasizes again the personal financial risks Plaintiffs have undertaken on behalf of Canada and Canadians.

The Court has given Plaintiffs 60 days to provide the information and ordered that Government complete examinations for discovery within 45 days of the latter.

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Lynne Away from Maple Sandbox

Lynne (Blaze) has asked me to let you all know that she will be away from Maple Sandbox for a while. Unfortunately, she is in the ICU at the University Hospital in London, Ontario.

I, for one, will be eagerly awaiting her to rejoin us with her insightful, thoughtful and clever comments and posts.

Hang in there, Lynne, and  please do remember there are a lot of people who will miss you and who I know will join me in sending good (and healing) thoughts your way.

May 15 2017 Response of some Witnesses [Including those of FATCA supporter Elise Bean] to U.S. House Subcommittee with recommendations to “improve legal framework” of FATCA

[I now include in this LINK the recommendations of Elise Bean, a long-time FATCA supporter and witness at the FATCA hearing.]

On April 26 2017 there was a Hearing at the U.S. House Subcommittee on Government Operations dealing with the harm caused by the U.S. FATCA law imposed on the world.

At the conclusion of the hearing, Chairman Meadows asked the Witnesses for “three recommendations on how to improve the legal framework set up by the Foreign Account Tax Compliance Act” (FATCA).

My personal-only interpretation of this request is that the Chair is saying something like: “If FATCA has to be replaced with something else, can you recommend three compromise laws/approaches that would achieve the “good” aims of FATCA but minimize the harm, and which would receive bipartisan support?”

— I enclose as a link the May 15, 2017 submitted personal recommendations of Jim Bopp, a witness and attorney for the U.S. FATCA/IGA/FBAR lawsuit currently pending in United States Court of Appeals for the Sixth Circuit (I am one of the plaintiffs).

From the Bopp text:

“This letter provides three recommendations on how to improve the legal framework set up by the Foreign Account Tax Compliance Act (“FATCA”).

First, we recommend that any taxation of overseas Americans comply with established United States constitutional principles and international legal norms.

Second, we recommend that the current laws be repealed in their entirety [Bopp goes on to include specifically FATCA, IGAs, FBAR, and citizenship-based taxation] and certain proposals rejected.

Third, we recommend that Congress enact a 1099 requirement on foreign banks, established by treaty, as long as this complies with established United States constitutional principles and international legal norms…”

—- Appended to the end of the Bopp recommendations are my personal thoughts as a separate submission: I support, as does Mr. Bopp, the repeal in entirety of FATCA, FBAR, IGAs, and citizenship-based taxation (the latter to be replaced with territorial/residence-based taxation), do not support any “watered-down” FATCA-replacement legislation whatsoever — which I believe will continue the harm, and offer suggestions on changing U.S. citizenship laws in the very limited context of FATCA harm. In hindsight, I now feel that I should have gone further in my recommendations for citizenship law changes.

—- When I receive the recommendations of strong FATCA supporter Elise Bean, a hearing witness, I will post.

Ongoing developments: Republicans Overseas has initiated an intensive lobbying campaign with Congress to kill citizenship-based taxation and replace with territorial taxation. There can be no promise of success, but these people are trying. I am not aware of similar efforts on the Democrat side.

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