US to Firms Trading with Cuba: Watch It ; This Month, a Canadian Became the First Foreign National Convicted of Trading with Cuba

Article excerpt

Earlier this month, businessman James Sabzali was found guilty of violating the US trade embargo against Cuba. The case, tried in Philadelphia, passed unnoticed in most US cities. In Canada, however, the verdict has generated a public outcry.

Mr. Sabzali, a Canadian who sold water-purification products to Cuba from an office in Canada, is the first foreign national to be convicted under the United States Trading With the Enemy Act.

By prosecuting a Canadian - who was breaking no Canadian laws - the case underscores a tougher enforcement stance on the part of the Bush administration. And it highlights the diverging views between Canada and the US on how to deal with the Marxist regime.

Sabzali was convicted along with the two owners of Bro-Tech Corp., of Bala Cynwyd, Pennsylvania. From 1992 to 1996, Sabzali worked as a sales representative, selling chemicals to Cuba. In 1996, he was made marketing director of the company and moved to Philadelphia with his wife and two children. While in the US, he approved travel expenses for another Canadian to do business in Cuba.

Of the 21 charges of which Sabzali was convicted, eight occurred when he was living in Canada. Trade with Cuba is permitted under Canadian law. Other countries, such as England, Spain, and Mexico, also allow trade with Cuba. And many US companies do quietly trade with Cuba from foreign subsidiary offices outside the US.

But under the 1992 Cuban Democracy Act, US companies and their foreign subsidiaries are specifically forbidden to trade with Cuba.

"This has been really difficult for Canadians to understand," says David Robertson, a Toronto-based international trade lawyer who assisted in Sabzali's defense. "What's difficult is the apparent hypocrisy of singling out one nation that doesn't pose any significant military threat."

Sabzali might not have been prosecuted if he'd continued operating out of Canada. But he had clearly violated [US law] and then he moved to the US," says David Sharp, director at the Center for International Business Studies at the University of Western Ontario. "You can only wave the red flag for so long before the bull charges. Other people haven't been quite that blatant."

Though Canada and many European nations don't dispute the US's right to set its own foreign policy, many Canadians are concerned about what Mr. Robertson calls a "unilateral claim on jurisdiction" towards someone who was obeying Canadian laws.

Assistant US Attorney Joseph Poluka says the case involves no contradiction between Canadian and US law, because the bulk of Mr. Sabzali's work was related to the US.

"Order forms were processed here [in the US], some manufacturing was done here, the product was stored here, it was shipped from here and didn't enter Canada - so the notion that Canadian commerce is involved is wrong," says Mr. …