I think Spartacus is right and our options to get justice through the American political process are very limited. Our representation is simply too diluted to make much of a difference. The U.S. courts are probably no use – my understanding is that citizen-based taxation has already been challenged and upheld.
That leaves the political processes and courts of other states. I won’t hide from anyone that I am counting on Canada to a great extent for short-term relief. Not only does Canada have a large number of American expats and duals, Americans perceive Canada as “not so foreign.” They can relate to you in a way that they can’t relate to those of us who live in Rio or London or Paris.
There is a great story in one of Montaigne’s essays about the siege of Guelphe. The emperor didn’t want to let any of townspeople go but under pressure (most likely he didn’t want to be considered a completely unchivalrous bastard) he finally relented and said that the women could leave on foot with only what they could carry on their backs. So the women simply put their husbands, their children and even their duke on their backs and began to leave. The emperor was said to be so touched by their bravery that he was moved to better treatment of all the townspeople. If Canada’s bravery and unwillingness to compromise its sovereignty and integrity can force the U.S. government to relent, than perhaps the rest of us stand a chance.
In the longer term however FATCA and citizenship-based taxation will probably end up in the courts. Here in Europe it will most likely end up in the European Court of Justice. There is an EU Charter of Fundamental Rights based on both the 1950 European Convention on Human Rights and the different constitutional traditions of the Member-states. It’s a fine document and after I read it I became all the more resolved to seek citizenship here. Here are a few of the articles that might be of interest in our context:
Article 1 Human dignity. Human dignity is inviolable. It must be respected and protected.
(Nothing dignified about being chased down by the “fisc” of a foreign power.)
Article 4 Prohibition of torture and inhuman or degrading treatment or punishment: No one shall be subjected to torture or to inhuman or degrading treatment or punishment.
(Being treated like “tax evaders” and being punished through draconian penalties definitely falls under the category of “degrading treatment” not to mention the penalties which are all out of proportion to the “crime.”)
Article 8 Protection of personal data
1. Everyone has the right to the protection of personal data concerning him or her.
2. Such data must be processed fairly for specified purposes and on the basis of the consent of the person concerned or some other legitimate basis laid down by law. Everyone has the right of access to data which has been collected concerning him or her, and the right to have it rectified.
3. Compliance with these rules shall be subject to control by an independent authority.
(This one would seem to outlaw FATCA all together or at the very least put some very strict limits on how it could be implemented in the EU)
Article 17 Right to property
1. Everyone has the right to own, use, dispose of and bequeath his or her lawfully acquired possessions. No one may be deprived of his or her possessions, except in the public interest and in the cases and under the conditions provided for by law, subject to fair compensation being paid in good time for their loss. The use of property may be regulated by law in so far as is necessary for the general interest.
(The unreasonable penalties and the seizure of assets definitely runs afoul of this one.)
These are the rights of EU citizens and all duals (those “Accidental Americans” in particular) should have full protection under this Charter. The very best case, I think, would be one of a child of an American and EU citizen or someone inadvertently born in the U.S. being “caught” by the U.S. government and then fined or taxed. Next best case would be a naturalized EU citizen in the same situation.
This would take time. A case would have to make its way through the national courts before it gets to the EU level. However, even the threat that this might occur might slow the U.S. government down. The publicity alone, especially in the case of an EU citizen who refuses to be considered an American, would be very detrimental to U.S. interest and image.
Just imagine Le Monde (the paper that proclaimed 10 years ago, “We are all Americans now”) running a front-page article that says, “We are NOT Americans!”