USA Law and Practice Contributed by: Aly Dossa and Marcus Burnside, Chamberlain Hrdlicka
5.4 Blocking Statutes No US Blocking Statutes; Courts Retain Discovery Power Despite Foreign Laws The United States does not have blocking statutes like those found in Europe that categorically prohibit compliance with foreign discovery orders or restrict cross-border disclosures. Unlike many countries that have enacted laws to prevent their citizens and com - panies from responding to foreign court requests, US law generally facilitates rather than restricts inter - national information sharing and foreign judgment enforcement. States have adopted laws (Uniform Foreign-Country Money Judgments Recognition Acts) that make it easier to recognise and enforce foreign court judgments in the US, not harder. These laws create a presumption in favour of honouring foreign judgments and place the burden on anyone resisting enforcement to prove specific problems with the for - eign court’s decision. However, US federal law does create some targeted restrictions. The most significant are Treasury Depart - ment sanctions administered by the Office of Foreign Assets Control (OFAC), which prohibit transactions with specially designated nationals and blocked per - sons from countries like Iran, North Korea, Russia and others. These sanctions can restrict sharing informa - tion with sanctioned entities or individuals. Additional - ly, export control laws (including the International Traf - fic in Arms Regulations for defence items and Export Administration Regulations for dual-use technology) restrict disclosure of technical data, source code and defence-related information to foreign nationals or entities without proper authorisation. Courts handle these restrictions by issuing specialised protective orders that limit who can access sensitive materials and require compliance with federal export rules. How US Courts Handle Foreign Blocking Statutes and Privacy Laws When foreign blocking statutes or privacy laws (like the EU’s General Data Protection Regulation) conflict with US court discovery orders, American courts do not simply defer to foreign law. The Supreme Court established in the 1987 Aerospatiale case that foreign blocking statutes do not deprive US courts of power to order parties under their jurisdiction to produce evi - dence, even if doing so violates foreign law. Instead,
foreign nationals without State Department authorisa - tion. Regulated industries such as banking, healthcare and education may use offshore storage but must main - tain strong contractual protections to ensure privacy, security and regulatory access. A 2024 executive order is expected to impose new restrictions on trans - ferring sensitive personal data (such as geolocation, biometrics, genetic data and certain health or finan - cial information) to specific countries of concern, but final rules are still pending. CFIUS may also require US-based storage when foreign investors acquire US companies holding sensitive data. In practice, most commercial data may be stored globally, while gov - ernment, defence and some categories of sensitive personal information face stricter controls. Remote Access For ordinary business and personal data, remote access from outside the United States is gener - ally allowed without government filings. The require - ments mirror offshore storage – appropriate contracts, encryption and access controls – but no licensing. However, remote access to controlled technology, such as encryption source code or defence-related technical data, is treated as an export and may require authorisation from BIS (under the EAR) or DDTC (under ITAR) unless an exception applies. Organisa - tions must determine whether the data is controlled, the nationality of the person accessing it, and whether they or their country appear on restricted party lists. Remote access by persons located in or connected to sanctioned countries such as Cuba, Iran, North Korea, Syria or certain sectors in Russia requires OFAC approval. For federal and defence contractors, remote access from outside the US or by non-US persons is typically prohibited unless explicitly permitted under the contract. Overall, remote access is freely allowed for routine business data but restricted or subject to licensing when involving controlled technology, sanc - tioned individuals or countries, or federal and defence information.
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