5/17/2023 0 Comments Political disintegration![]() Although the volume of business lost is not known it is obvious that Canada is losing both dignity and cash by permitting U.S. In fact, China is becoming an increasingly important customer for Canada. These practices are in direct conflict with Canadian trade policies which is very much more liberal. Although similar legislation with respect to Cuba is slightly less stringent, American authorities have called for voluntary compliance which, in effect, places pressure on foreign subsidiaries not to engage in any trade with Cuba. ![]() Because all three producers are American subsidiaries, Canada was prevented from exporting potash lo China. For this reason, Saskatchewan potash producers could not sell fertilizer to Chinn. The law applies even where subsidiaries do not use American materials, components or technology. Violation of the law invited criminal action against all Americans who are stockholders or directors of the parent company. Trading with the Enemy Act prohibits affiliates and subsidiaries, in which 50 per cent of the stock is American-owned, from engaging in trade with China, North Korea and North Vietnam. Of these three, public attention has fastened on the export policies of American subsidiaries. corporations have been obliged, by American law or administrative pressures, to follow practices which are in conflict with Canadian government policy indeed, in some instances, in conflict with Canadian law. In each case, Canadian subsidiaries of U.S. In Canada the extra-territoriality issue has arisen in three areas of conflicting jurisdiction: export policy, anti-trust legislation and measures taken by U.S authorities to protect their balance of payments. The subsidiary is faced by the question: which law is to be respected: the law of the land in which the firm is located, or the law of the country in which the owners reside? “Confronted witl1 two peaks of sovereignty it is likely to defer to the higher peak on which its foreign owners reside”. its political independence is directly reduced.” Insofar as subsidiaries become instruments of the home country rather than the host country, the capacity of the latter to effect decisions, i.e. “The successful intrusion of foreign law constitutes a direct erosion of the sovereignty of the host country insofar as the legal capacity of the latter to make decisions is challenged or suspended. When the metropolitan government insists on the primacy of its law over subsidiaries located in hinterland countries there is a direct conflict of jurisdiction. The loss of sovereignty is most evident in the matter of “extra-territoriality”. But how long can our political sovereignty remain a reality if we permit the erosion of out powers over economic affairs to proceed.” We like to believe that we have all the powers of a politically sovereign state. ![]() “Far from diminishing, our dependence on the United States increases with each crisis that comes along. His observation following the return of Finance Minister Sharp from a recent mendicant mission to Washington is representative of Canadian editorial opinion: Claude Ryan of the influential Montreal “Le Devoir” is noted for the moderate nod measured tone of his statements. The erosion of Canada’s sovereignty is now the subject of daily public comment. After a decade or more of heavy American direct investment Canada’s freedom of action has been progressively restricted to the point where a question arises whether it can ever be regained. ![]()
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