Boycott Watch  
June 21, 2012
Open Letter to the Presbyterian Church, USA from Fred Taub, President of Boycott Watch, regarding the anti-peace and illegal nature of the MRTI Boycott-Israel proposal to be presented at your 220th General Assembly, June 30 through July 7, 2012, in Pittsburgh, Pennsylvania.
Fred Taub
President, Boycott Watch

Presbyterian Church, USA
On the occasion of the GA 220

Dear Presbyterian Church members,

My name is Fred Taub, I am the President of Boycott Watch and author of the book Boycotting Peace. As an expert in boycotts, I regularly appear in the media, from Fox News to Al-Jazeera, to the Wall Street Journal, LA Times, USA Today and several other television, radio, print and online publications. In addition to speaking to groups including Scholars for Peace in the Middle-East, my work has also been cited in two cases before the U.S. Supreme Court.

I am writing today to address the divest-from-Israel proposal before you, as submitted by the Committee on Mission Responsibility Through Investment (MRTI) of the Presbyterian Church (U.S.A.) on its engagement with corporations doing business in Israel-Palestine.

Divestment is another word for boycott, a topic I address in detail in my recently released book, Boycotting Peace, published by Balfour Books. As I state in my book and lectures, you cannot have peace with someone who will not sit down with you for a cup of coffee. Boycotts separate people, not bring people together - it is a logical fallacy to assume you can separate people into brotherhood. Peace can only be obtained and sustained when people work together.

History proves economic cooperation is essential to building peace. The U.S. and Canada, for example, were once warring nations but now share the world's strongest peace because these two nations share the world's largest trade. A similar situation exists between the U.S. and England, but the opposite exists between the U.S. and Cuba which have neither peace not trade. A recent example of trade maintaining peace occurred when the U.S. had foreign policy differences with France regarding Iraq. While the relationship between the U.S. and France has been strained, friendship remained in tact because trade makes war between nations too expensive.

Perhaps the best great example of trade growing peace nations can be seen with the U.S. and China, two nations which went from cold-war nuclear adversaries to partners in seeking peace with North Korea. Trade makes war between nations too costly to fathom.

Boycotts divide people, so rather than considering a proposal to separate people, I suggest following the only Middle-East peace model that works, the Israel-Jordan model, where the peace continues to grow based on growing trade. In fact, the DGP Per Capita growth rate in Jordan has been exceeding the U.S. growth rate for several years. Jordan's economy is booming thanks to trade with Israel. It stands to reason, therefore, that increased trade, not boycott or divestment, is the best model for peace, and not just in the Middle-East.

If, however, you still chose to follow the anti-peace path of divestment, you need to be aware you will be violating several provisions of U.S. law. For starters, the Import Export Amendments Law of 1977 created the Office of Antiboycott Compliance within the U.S. Department of Commerce. The law states that no U.S. persons may participate in foreign sanctioned boycotts of nations friendly to the United States. Being that the divest-from-Israel campaign was created on behalf of the Palestinian Authority by its legal council, and since the PA is signatory to the Arab boycott of Israel which is coordinated by the Arab league, it qualifies for illegal boycott status under U.S. law.

U.S. law, Part 760.1 (a) states: "For purposes of this part, the term "person" means any individual, or any association or organization, public or private, which is organized, permanently established, resident, or registered to do business, in the United States or any foreign country. This definition of "person" includes both the singular and plural and, in addition, includes…"

In accordance with the law, not only could the Presbyterian Church, USA be held in violation of federal law, but so can the members advocating your BDS proposal, as well as all the individual members of the MRTI Committee if you approve engaging in this illegal foreign sanctioned boycott. It is advisable not to blatantly and knowingly engage in a direct violation of federal law. Since you have already been asked to violate the law, you may still be required to file a notice to the Office of Antiboycott Compliance under the Bureau of Industry and Security within the U.S. Department of Commerce as defined within the law, as Part 760 includes a requirement for all persons to report requests to engage in foreign sanctioned boycotts, a requirement already triggered by the previous actions of the MRTI and other Presbyterian Church, USA committees.

I strongly suggest, therefore, consulting with or hiring a tax attorney who specializes in Part 760 as boycotting Israel requires businesses, churches and individuals to file IRS form 5713, the International Boycott Report form, available on the website. Question 11 of the form asks: "Were you requested to participate in or cooperate with an international boycott?" Since you have been requested to participate in the boycott, you are required to answer yes to this question, which also affirms your filing requirement to the U.S. Department of Commerce.

Question 12 of the form asks: "Did you participate in or cooperate with an international boycott?" By acting upon any boycott of Israel request, including the MRTI divestment requests, you will be required to answer yes to this question. In doing so, you will be required to, as the form again states, to "attach a copy (in English) of any and all boycott clauses agreed to…" This includes, therefore, submitting with you tax returns to the IRS all documents submitted to you in support of boycotting and divesting from Israel, including all documentation submitted in this review by pro-BDS advocates, such as Sabeel.

I trust all members of this committee have maintained complete and accurate records of these proceedings, because the IRS form then states: "If the answer to either question 11 or 12 is "Yes," you must complete the rest of Form 5713. If you answered "Yes" to question 12, you must complete Schedules A and C or B and C (Form 5713)." If you have already engaged in the illegal boycott, you may also be required to file amended tax returns for all prior years in which you may have participated in the illegal foreign boycott.

The law is very clear. It does not take an attorney to realize the first check box of IRS tax form 5713 states "individual," nor does it take an attorney to realize U.S. Law Part 760 applies to individuals, as that is specified in the opening paragraph of the law. I must suggest, therefore, that you neither engage in anti-peace activities; nor illegal boycott activities; nor ignore U.S. Department of Commerce rules; nor ignore U.S. Internal Revenue Service rules; nor engage in activities that will require extra IRS form filings and probably trigger an automatic audit. In this case, it is all one in the same.

Fred Taub
President, Boycott Watch

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