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14 Int'l L. News 1 (1985)

handle is hein.journals/inrnlwnw14 and id is 1 raw text is: INTERNATIONAL

Vol. 14, No. 1 s Winter 1985

Section ~ ~ ~ of Inentoa La  an  rcie4reica  a  soitc

Chairman's Columno
In Release No. 21186 of
July 30, 1984, the United
States Securities and  Ex-
change Commission solicited
comments upon the proposed
codification of the waiver
by conduct doctrine as a
method for the S.E.C. to ob-
tain documents and informa-
tion  concerning  securities
transactions on U.S. markets
through foreign banks pro-       Mont P. Hoyt
tected by bank secrecy laws.      Chairman
Under the waiver by conduct doctrine, an individual
waives his right to the protection of bank secrecy laws
when he orders the purchase or sale of securities on a
U.S. market through the agency of a bank. The S.E.C.
hopes to make the waiver by conduct doctrine a prin-
ciple of U.S. law. The primary concern of the S.E.C. in
making the proposal is the enforcement of the anti-
fraud provisions of the U.S. securities law against indi-
viduals who preserve anonymity by engaging in securities
activities in the U.S. through the agency of foreign
banks.
The primary benefit to be derived from the adoption
of the waiver by conduct doctrine, the S.E.C. sug-
gests, is that it would be recognized by foreign banks
and foreign governments (e.g., Switzerland) as an ex-
ception to their bank secrecy laws. The recognition of
this doctrine abroad, the S.E.C. reasons, would eliminate
conflicts when the S.E.C. seeks to discover evidence
abroad from foreign banks subject to secrecy laws. The
voluntary cooperation which would result, the S.E.C.
concludes, would lead to prosecution of securities fraud
originating abroad which would be more effective than
the approaches currently available to the S.E.C.: com-
pulsory discovery powers of U.S. courts and treaties for
cooperation in the prosecution of criminal matters.
A more comprehensive review of the waiver by con-
duct doctrine, however, indicates that it would in
general be rejected abroad as an impermissible extra-
territorial application of U.S. law. Based upon a text
issued by the Legal Staff of the Commission of the
European Economic Community in the wake of the
attempt to apply U.S. export controls to oil equipment
manufactured in Europe for use on the Siberian pipe-
line, it would seem that the current S.E.C. proposal is
indistinguishable, under generally accepted principles of
law in Europe, from other recently failed attempts to
apply U.S. law abroad.
Continued on p. 6
* The views expressed in this column are those of Mr. Hoyt
and are not official positions of the ABA or the Section
of International Law and Practice.

Section Holds

Wint r Meeting
fif'rSain Antonio
The' Stiie of Texas and various Latin American
countries were the jurisdictions receiving the most at-
:ffntion, t-the Section's Winter Meeting, held in San
Antoio from November 30 through December 2. In
addition, the Section's Council addressed various sub-
stantive and administrative matters.
The meeting began with a joint open meeting of
the Council and the Texas State Bar International Law
Section. The program, chaired by John M. Stephenson,
Jr. (who, with Jay M. Vogelson, co-chaired the Winter
Meeting in its entirety), considered a program proposal
for the 1985 Texas State Bar Annual Meeting and a
proposal for the practice of foreign lawyers in Texas
as counselors in foreign law, among other subjects.
The meeting next featured a full day program on
trade with and investment in Mexico, described in the
previous issue of the International Law News. In addi-
tion to numerous speakers from Mexico, there were in at-
tendance an array of Bar leaders from Central America
and the Dominican Republic. These guests were later
honored at a Lone Star Buffet Dinner, and then
addressed at a breakfast meeting by William W. Fals-
graf, President-Elect of the ABA.
In its deliberations on substantive matters, the Council
declined to further advance a resolution, originally
adopted at the Annual Meeting in August but later de-
ferred, pertaining to the case brought by Nicaragua
against the United States at the International Court of
Justice; adopted a resolution condemning a September
attack by two Iranian arbitrators of the Iran-United
States Claims Tribunal on a third nation arbitrator and
reaffirming support of the Tribunal; supported a resolu-
tion of the Standing Committee on World Order Under
Law, the Section of Individual Rights and Responsi-
bilities and the Washington State Bar Association with
respect to proliferation of nuclear weapons; supported
in part a resolution of the same groups concerning
establishment of a nuclear free zone in Latin America;
voted to request the same groups to defer their resolu-
tion on the subject of a nuclear test ban treaty, and
to oppose the resolution if it is not so deferred; con-
sidered a resolution proposed by the Section of Individual
Rights and Responsibilities concerning free movement of
information and people across international borders, and
directed its Ad Hoe Committee on this subject to work
with that Section to develop final language for re-
consideration; and authorized the Section's Ad Hoc
Continued pn p. 5

Copyright@ 1984 American Bar Association

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