The nation's antitrust chief warned other nations yesterday that enacting laws blocking their citizens from giving evidence for use in U. S. judicial proceedings is not satisfactory as far as the United States is concerned.
Given the proliferation of such statues obviously intended to frustrate the enforcement of American laws, the antitrust division may be left with no choice but to press the courts, as a practical matter, to ignore this particular type of foreign legislation." John Shenefield assistant attorney general for antitrust, said.
When the circumstances warrant, he pledged "we will not hesitate to ask the court to draw negative inferences with regards to evidence that is not provided, regardless of the foreign statute."
Shenefield's remarks came during an American Bar Association panel discussion on the extraterritorial application of U. S. laws. The U.S. view that its antitrust and other laws apply to citizens and companies and other countries when their actions have substantial effects on US. citizens or commerce has generated an increasing amount of controversy worldwide in recent years.
Noting that a primary purpose in applying U.S. antitrust laws to foreign transactions is to prevent external arrangements from threatening the U.S. economy, Shenefield said the recent activities of "a few international raw material carrels"have underlined the impact that foreign agreements can have on other economics.
Other countries do not agree with the U.S. view, however. The clash of U.S. and British hviews in particular, culminated in a recent decision by Britain's highest court that Britain's sovereignty was underminde. The case which involved a British proceeding in which Westinghouse Electric Corp. sought to get testimony and documents from a British-based uranium producer who had participated in a worldwide cartel. The uranium cartel and the roles played in it by various governments has given rise to several blocking statutes.
Whether or not a foreign non-disclosure law may provide a valid defense for a foreign national is open to question Shenefield contended.
"At the very least, our laws require that the party make a good faith effort to obtain relief from the foreign law's proscription, and there is case law supporting the conclusion that there are circumstances under which no such defense is available," he said.
Complaining that the extraterritoriality controversy has created some dissention among countries that otherwise are good friends - like Canada and Great Britain - he urged countries with blocking statutes to "consider seriously their broader ramifications and, at the very least, to utilize them with the greatest amount of care."
In a presentation following Shenefield's remarks, Samuel Silkin, attorney general of the United Kingdom complained that it would be unfair of the United States to ask courts to infer that a national of another country is quilty when the individual may have wanted to give evidence but was prevented from doing so by the laws of his own country.
Both Silkin and Justice Gordon Blair of the supreme court of Ontario in Canada insisted that what one country may think of as being in its public interest may often clash with another country's perceptions of its interest.
Blair noted that Shenefield referred to a "raw material cartel" while the Canadians refer to the "desirability of controlling the orderly exploitation of their valuable natural resources." Likewise, blocking statutes are considered by the Canadians to be "defensive measures to protect themselves against overreaching American antitrust laws," he said.