The law governing export controls is a niche area, and I have to say I know very little about it. I did, however, recently come across a post by Clif Burns of Bryan Cave that called to mind the Kuwait Airways case I’ve written about before. Burns’s post noted a recent sanction that the Office of Foreign Assets Control imposed on American Honda Finance Corp.

The issue for OFAC was that American Honda’s Canadian subsidiary financed the purchase of new Hondas by Cuban government officials. This was a violation of the Cuban Asset Control Regulations. But as Burns pointed out, Canadian law made it illegal for the Canadian subsidiary to refuse to finance the purchases on account of the US Cuba sanctions. Burns’s point—one of his points, anyway—is that the government is overreaching: “This applicable Canadian law is not even mentioned as a mitigating factor. Once again, it appears that the U.S. is telling one of its closest allies that we don’t really care what their laws are.”

This seems a reasonable criticism, but remember the Kuwait case? There, Kuwait Air had refused to sell a ticket to an Israeli traveler flying from New York to London, and it claimed that Kuwaiti law forbade it to do business with Israelis. The Department of Transportation did not allow the requirements of Kuwaiti law to stand in the way of enforcement of the laws against national origin discrimination.

Of course, there are differences between the two situations. In the Honda case, it was a foreign subsidiary that violated US law, whereas in the Kuwait case it was Kuwait Airlines itself. In the Kuwait case the US law in question was a civil rights law. In the Honda case, the law was an economic sanctions law. Still, I think the Kuwait case shows us that there are limits to any critique of the OFAC decision. It seems that there’s not a reason in principle to refuse to punish a firm that violates US law even when it complains that foreign law is making inconsistent demands. Rather, the analysis will involve some sort of weighing of the importance of comity against the importance of the policy at stake in the US law and in the foreign law.