International Cooperation
Of major importance is the attempt to resolve jurisdictional clashes by means of international co-operation, There are various ways of slicing this topic, but the one adopted here is classifying the co-operation on the basis of whether as a matter of legal form it is unilateral, bilateral, or multilateral.
The attitude of the local judiciary is often crucial, as we have seen, to regulatory efforts by foreign agencies. The trail may be blocked by an injunction, as the local courts effectively elevate a local public policy, such as bank secrecy, into a universal human right. However, local legislation may provide an avenue to foreign regulators to side-step the courts. It may have no basis in treaty or other international agreementAn example is in Part III of the Companies Act 1989, which empowers the Secretary of State to respond to a request for assistance by a foreign regulator by setting up a companies investigation.
Its powers could be used, for example, when the information required is confidential, concerning bank accounts.Of greater importance is the power of the Bank of England to obtain such information as it may reasonably require from authorized institutions for the performance of its functions as bank regulator. That information may clearly relate to individual customers, although the Bank is under a general duty to keep the information confidential, It may be disclosed, however, to bank regulators in other jurisdictions to assist them in exercising their functions.
On its face the legislation does not empower the Bank to act purely as an information-gatherer for a foreign bank regulator: the information must be required by the Bank for its own regulatory purposes. With multinational banking, however, information required by one bank regulator will generally be required by bank regulators in any other jurisdiction where a bank has a presence. This reality of modern banking and bank regulation was recognized in an important decision directing a bank to comply with a Bank of England notice, even though the Bank was co-operating with the US Federal Reserve Board.
Hirst J said that the bank's counsel seeks to draw a line down the centre of the Atlantic, and to suggest that in some way the supervisory operations of the Federal Reserve Board and those of the Bank of England are separate and unconnected. In fact, in the world of international banking today, supervisory authorities in various countries can, should, and no doubt do regularly cooperate on matters of mutual supervisory concern.
There has been considerable progress with mutual legal-assistance treaties, especially between the United States and foreign countries. These provide for the law-enforcement machinery of one country to be made available to assist investigations in other countries. Assistance can include locating persons, obtaining testimony, and providing records (even confidential records).
Modern mutual legal-assistance treaties cover conspiracy, if only implicitly, and are in terms wide enough to cover most other criminal offences in which the US authorities have an interest (save, in some cases, fiscal offences).
US mutual-assistance treaties cover grand jury proceedings, but not always proceedings which are quasi-criminal, such as forfeiture. The procedures under the treaties are not exclusive. Mutual legal assistance treaties may permit disclosure otherwise in breach of local bank secrecy laws.
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