whose law is it, anyway?

The Star's Thomas Walkom grinds the Deep Integration gears. He's right. This really pisses me off.

Canada still lets U.S. laws apply here
Royal Bank case this week just the latest example

Thomas Walkom

Here's what I don't understand. I don't understand why companies that operate in Canada are allowed to flout Canadian laws. I don't get why, when Canadian laws interfere with U.S. ones, the latter take precedence. Here. In Canada.

I understand why the federal government lets this happen. It doesn't like to rock the boat when it comes to dealing with Washington.

But I really don't understand why more Canadians aren't outraged that their own government is so cavalier about the centrepiece of any country's claim to independence – its right to legislate in its own territory.

The problem is ongoing. The latest example came to light just this week after the Royal Bank refused to let a Canadian citizen open a U.S.-dollar bank account in one of its Montreal branches – because he was born in Iran.

Payam Eslami, 27, moved to Canada when he was 8.

The bank's explanation was that if it wants to do business in the U.S., it must strictly follow American law. American laws discriminate against people from certain countries that Washington doesn't like, including Iran and Cuba.

All of which would have been fine if Eslami had been attempting to open a bank account in, say, Syracuse. But at last count, Montreal was still part of Canada. And in Canada it is illegal and unconstitutional to discriminate against individuals on the base of nationality.

Not that the Canadian government seems to care.

"This is a jurisdictional issue, and the jurisdictions are clear," Public Safety Minister Stockwell Day said. "These are accounts in U.S. currency, and the law applies to the country of jurisdiction."

By which he meant that U.S. dollar holders around the world have to adhere to American rules, while Canadian currency holders – even in the U.S.– have to obey Canadian ones.

Now, first of all, this is almost certainly not true. If a Canadian living in New York tried to ship Canadian dollars to a country under U.S. sanctions, he'd be arrested and charged. The fact that Canada imposes no such sanctions would be deemed irrelevant by U.S. authorities.

Second, Day's explanation is beside the point. Countries may attempt to apply their laws outside their own borders. But other nations don't have to agree.

Imagine the outrage if the Royal Bank had refused to let a Canadian Jew open a bank account just because it wanted to protect its business with Saudi Arabia.

In fact, you don't have to imagine. There was such outrage some 30 years ago when countries such as Saudi Arabia attempted to extend the so-called Arab boycott against Israel to countries that wanted to do business in the Middle East.

Ontario responded by making it illegal for firms in this province to adhere to the Arab boycott. So did Ottawa.

In 1990, the director general of the Ontario Science Centre was fired after it came to light that the government-run attraction had signed a contract with Oman containing a boycott-of-Israel clause.

As well, successive Canadian governments have consistently objected to U.S. laws that penalize Canadian firms doing business with Cuba. Ottawa's quite reasonable argument here has been that American laws have no standing in Canada.

But that's not the case these days, it seems. The Royal Bank incident is just one of many. Since 9/11, defence firms operating in Canada have routinely prevented Canadian workers who are dual citizens of countries on the U.S. blacklist from working on certain military projects.

A case involving Bell Helicopter's Montreal plant came to light last week after the company shifted 24 workers who are dual citizens away from a U.S. military project. In October, another defence firm, CAE Inc., refused to allow workers born in countries on the U.S. blacklist from applying for certain jobs. In 2002, General Motors of Canada laid off 172 dual citizens in its London defence plant.

All of these actions were designed to bring the firms in line with discriminatory U.S. defence procurement rules. All are almost certainly illegal under Canadian law. Indeed, the Ontario Human Rights Commission is bringing both GM and the London plant's current owner, General Dynamics, before a human rights tribunal over this issue.

Meanwhile, the Royal Bank has tried to defuse the situation by agreeing to let Eslami open his U.S- dollar account – as long as he promises not to make too many trips to Iran.

Which may solve his particular problem, but leaves the general point – the question of whose laws taken precedence in this country – very much unresolved.