Copious thanks to Jim Jatras for calling the following to our attention.
The government of Russia, and more specifically the Foreign Minister (and not, please note, their Finance Minister), has weighed into the FATCA discussion with this very forthright statement that any agreement between the US and Russia on FATCA must be fully reciprocal and must respect Russian sovereignty and must not impose foreign extraterritorial legislation on the actions of Russian institutions.
Here is the article from Russia Beyond the Headlines:
Moscow wants tax information exchanges with U.S. to be mutual, balanced
I urge everyone to write Flaherty, Harper and your members of Parliament along the following lines (please use your own words or modify mine, I don’t want this to become boilerplate text). I sent this to Flaherty with copies to Rankin, Brison, May and my MP Paul Dewar (also Foreign Affairs critic). Others might wish to send this as well to Harper (who’ll just bounce it to Flaherty if his office replies at all) and to Baird (who has never even acknowledged anything I’ve sent him, nor has his ministerial correspondence unit).
“Please note in the following news item today, that Russia has made it very clear that any agreement between the US and Russia over FATCA must be fully reciprocal and must respect Russian sovereignty. The statement also mentions that FATCA as currently formulated is an extraterritorial violation of the sovereign equality of other countries.
“It would be utterly unacceptable for Canada to accept or insist on less than what Russia does, in any agreement with the US over FATCA. As it is highly unlikely the US can respect or even get full reciprocity, which would require US Senate approval not yet forthcoming in even one IGA the US has signed, I think the most rational approach for Canada to take is to walk away from negotiations with the US over this, to insist on Canadian financial institutional compliance with current Canadian law and our Charter of Rights and Freedoms, and to contemplate protections or retaliatory sanctions against the US should it ever actually enforce the threatened sanctions against Canadian financial institutions that have branches in the US.
“Canada’s sovereignty is no less important than Russia’s, and I expect that my government will stand up for Canadians as forthrightly as the Russian government does for its own citizens and sovereignty. It would be a very sad, pathetic commentary on any Canadian government that would not do so.”
@schubert1975
There’s seems to be a problem with your link.
@Bubblebustin..
Here is the bitly link… http://bit.ly/1aSkAbh
I replaced it above with a tinyurl link, which should work, or use Just Me’s link above
Thanks to you both!
With the Swiss citizens voting to stop co-operation, the Russians giving the US the middle finger and Canada getting ready to resist, the US may as well scrap the laws they thought they had imposed on the rest of the world.
if we’d just pass the FairTax all the nonsense would simply disappear. Capital would once again find the place where it would be safest and produce the best return. What a foreign concept for the U.S. government Pukes?
Between Russia coaxing Syria to give up its chemical weapons, Snowdon singing like a canary while a guest there, and now them standing up to the US against FATCA, I’d say Putin’s looking like the alpha male he portrays his photo’s. Obama’s looking…well…not so good.
Did you hear about the new “Barack Obama Diet”?
Every week, Vladimir Putin eats his lunch.
(Not original. From Jay Leno)
LOL! That’s why he’s looking extra skinny these days.
@Jim
Are we not watching a national identity crisis being played out in front of the whole world? The things that made the US dominant in the past, for good or for bad, seem to be eroding or at least their sustainability is being called into question. The magic formula for success seems to not be working anymore. What’s next?
If any CBA persons are monitoring this thread:
How about pushing our government toward respecting Canada’s sovereignty and protecting Canadian businesses and financial institutions, as well as Canadian citizens, by pushing back, hard, against the US on FATCA?
Doesn’t that make more sense to a true Canadian, then pressuring our government to roll over, play dead, and let the US use Canadian citizens and businesses as doormats and a piggy-bank to rob to help pay down the US national debt catastrophe that is the US’s own damn fault?
I think the death of the US hegemony is still a ways off, but they are clearly not the world stud they thought they were and this is causing a bit of a problem for them.
And I don’t know about Canadian resistance. We are still far too entangled with them economically to do much more than stall in the hopes that someone with more freedom and power can squash the American Dream of controlling the financial institutions of the world.
I agree YogaGirl, we are not at a tipping point, but things are tilting away from them. FATCA will net little for them, unless of course they can manage to withhold on some FFI’s – but that would be a bad strategy to take.
From Jim via email….
@All
Please see below the link to the original statement on the website of the Russian Foreign Ministry. Note that this is in response to recent press reports that Russia was close to an IGA with the United States. If you recall, a few weeks ago, there was a report to that effect, which upon inquiry was characterized privately as only the journalist’s speculation. It now seems that someone ran the concern up the ladder, resulting in an official statement to pour some some cold water on the report.
…
Note that the Russian position is consistently supportive of mutual “sharing tax information,” a standard feature of bilateral tax conventions. It seems that pro-FATCA media, like the Treasury Department, want to mischaracterize FATCA’s collection and reporting mandates regarding financial data that may have nothing to do with taxes at all as only an “interpretation” of information-sharing. Which is clearly absurd.
Jim
The link (no-pycckuu):
http://www.mid.ru/brp_4.nsf/newsline/F422FC5604891F1344257C1700419F07
Google autotranslate:
Comment of the Information Department of the Foreign Ministry of Russia in connection with the media reports on the preparation of the Russian- American agreement on the exchange of tax information
2184-02-11-2013
Consultation with the U.S. side to work out an agreement that allows the equitable sharing of tax information , has been going on for a long time under the finance ministers of the two countries with the active involvement of the Bank of Russia and the Russian Foreign Ministry . This work is carried out on behalf of the Government of the Russian Federation and in coordination with the local banking community.
Questions to enhance transparency in the fiscal sphere occupy an important place in our efforts in the international arena , including in the context of Russia’s presidency in the “twenty” [i.e., the G-20] and Russia’s accession to the OECD and the Council of Europe Convention on Mutual Administrative Assistance in Tax matters. It is in this spirit that we are building a dialogue with the U.S. administration , insisting counterproductive approaches of , in particular, the well-known American Law Foreign Account Tax (FATCA).
Our position is well known: the law is extraterritorial in nature and contrary to the principle of sovereign equality. It demanded compliance by foreign financial institutions to U.S. law . We do not intend to take unilateral commitments and to ensure that the exchange of tax information, wore a mutual and balanced. The Russian side firmly believes that the developed bilateral Russian -American agreement should conform to international standards , to ensure protection of our financial institutions .
@Schubert,
I will write Flaherty, etc today re:Russia. Thanks for the great suggestion! I hope this post doesn’t get lost amongall the others, and that other Brockers also do some writing/emailing about this.
While I have sent to or copied Canada’s Prime Minister on MANY emails, I believe this is the first acknowledgement from that office, to my email regarding the stand of Russia compared with the Canadian (negotiations behind closed doors):
@Calgary411
I think the PMO’s fired up the PR machine, but most likely due to their senate scandal woes.
Pingback: The Isaac Brock Society
Has anyone seen this from the Moscow Times: http://www.themoscowtimes.com/business/article/ministry-lambasts-extraterritorial-us-tax-compliance-act/489033.html
“The Russian Finance Ministry insists that the bilateral information exchange agreement must be independent from and have no reference to FATCA.”
Just the kind of response we’d like our country to give, WhiteKat. Thanks for the link.
It might be a little premature to celebrate Russia’s dissension, as it appears that Russia may just sign on to something else, something we know as an IGA:
“Many nations, including Britain, Germany, and Spain chose to sign bilateral agreements with the U.S., rather than join FATCA…
Russia is likely to follow suit. However, the Finance Ministry insists that the bilateral information exchange agreement must be independent from and have no reference to FATCA.”
The IGA’s are not FATCA, yet they worry that “if the law goes into effect before most countries join FATCA, it will cause serious economic problems, he said.”
Read more: http://www.themoscowtimes.com/business/article/ministry-lambasts-extraterritorial-us-tax-compliance-act/489033.html#ixzz2jvepBEwt
The Moscow Times
Thanks for posting the Moscow Times FATCA article. The source for this article is an article in the Vedomosti business daily, translated below. There are three key points in this article:
1) Russia appears willing to sign an agreement with the US to exchange tax information, outside of FATCA, but which must be reciprocal in nature.
– Sovereign nations do not sign one-way agreements.
2) The Russian Finance Ministry, Central Bank of Russia and the Foreign Ministry may not be aligned.
3) Russia is calling for such an agreement to be effective in 2016.
http://translate.google.com/translate?sl=auto&tl=en&js=n&prev=_t&hl=en&ie=UTF-8&u=http%3A%2F%2Fwww.vedomosti.ru%2Fpolitics%2Fnews%2F18339951%2Fmvd-raskritikovalo-zakon-ob-obmene-nalogovoj-informaciej-s
Another Vedomosti article on FATCA from 1 November 2013:
“Central Bank (CB) asks not to rush with agreement of Russia to FATCA
CB asks to postpone agreement of Russia to the U.S. law FATCA: banks do not have time to prepare for a new mechanism of exchange of tax information. The banks themselves are not happy: the delay threatens them with fines and suspension of payments.”
http://translate.googleusercontent.com/translate_c?depth=1&hl=en&ie=UTF8&prev=_t&rurl=translate.google.com&sl=auto&tl=en&u=http://www.vedomosti.ru/finance/news/18260011/cb-ne-speshit-pomoch-ssha%3Ffull&usg=ALkJrhh1hpvTPPFrHDa2J3B9K28m9ZMdPw#cut
IGA vs. Treaty:
Generally, as I understand it, formal treaties between sovereign countries are difficult to cancel unilaterally. On the other hand, it appears that intergovernmental agreements are more easy to cancel. See the following article from 31 January 2013 on Russia cancelling an anti-crime agreement with the US:
http://www.themoscowtimes.com/news/article/moscow-nixes-us-anti-crime-agreement/474829.html
Will the fact that the US is treating FATCA agreements as IGAs come back to haunt the US if other countries unilaterally cancel them in the future?
The Russian business daily, Vedomosti (“The Record”), has been following the FATCA story with 24 articles to-date in 2013 (see below search). This publication is a joint venture of the Financial Times, WSJ and a Russian company and appears to be a quality business daily. It is possible to search on “FATCA” in Latin characters in this publication, which, being Russian, normally uses Cyrillic characters. Then use Google, Bing, etc. to translate the FATCA articles.
http://www.vedomosti.ru/search/?order=date&src%5B1%5D=1&src%5B2%5D=1&src%5B10%5D=1&src%5B11%5D=1&src%5B51%5D=1&src%5B59%5D=1&s=fatca
As an opinion, for Russian FATCA articles, it might be better to rely on a publication such as Vedomosti than to see what the English-language Moscow Times, RT or Russia Beyond the Headlines (rbth.ru) picks up and publishes.
Russia opposed to FATCA legislation:
“Neither Russia nor the U.S. has agreed to any terms, but the Central Bank would like to wait until 2016 so that Russian financial institutions have adequate time to prepare.”
http://www.convey.com/1099-news-tax-blog/international-tax-compliance/russia-opposed-to-fatca-legislation/#axzz2kTi9Ju5J