How to fight American extraterritorial laws? Here is the answer from business lawyer Louis de Gaulle, co-president of the Iranian Affairs Commission of the French legal think tank Club des Juristes.
It is extremely difficult for a business to evade American extraterritorial laws because they apply to all activities involving the United States, even when these activities take place entirely outside of America’s borders. Americans can simply declare that any activity with a possible connection to their country is under their jurisdiction.
They use a broad interpretation of such connections since they think, for example, that they have jurisdiction if a deal uses the U.S. dollar, if a transaction went through a clearing house located in America, if an American employee works in one of the businesses involved or even if information passes through servers on American soil.
Jurisdiction is the legal basis of all laws considered part of the international order by countries that are party to it, including France. Our justice system can, for example, launch an inquiry outside the country if French citizens are victims of an air crash. However, in actual application, this is only valid in criminal matters.
Today It Is Practically Impossible to Avoid the U.S.
Theoretically, sanctions can only be applied if the businesses have a direct connection with the U.S., for instance an activity on its territory or even a trip over American soil by one of its employees. In reality, though, American power blocks the entire financial ecosystem.
In most international trade matters, the businesses concerned need bank accounts with major financial institutions. In their terms of use, the latter include clauses of conformity to international export control laws. Such contracts are often connected to American legal arrangements.
America’s economy might make it unavoidable these days. Iran made appeals against America’s withdrawal from the nuclear deal signed in Vienna in 2015 under the U.N.’s aegis. These appeals did not derive from a challenge to American extraterritorial laws as such but rather from the treaties signed by America and Iran on the application of extraterritorial laws to Iranian affairs.
“Instex,” a Sort of International Barter Platform
The only means to counter America’s hegemony would be to create international reciprocity. The E.U.’s General Data Protection Regulations are a rare European example of the effectiveness of this. American internet enterprises cannot do without the European market and have to comply with its regulations.
Meanwhile, Europe is considering a sort of monetary system using payments in currencies other than the U.S. dollar. Also, early this year three countries founded a sort of platform for international barter called Instex. However, it is likely that its effects will be limited.
Leave a Reply
You must be logged in to post a comment.