Regulations Amending the Special Economic Measures (Russia) Regulations: SOR/2024-15
Canada Gazette, Part II, Volume 158, Number 4
Registration
SOR/2024-15 February 2, 2024
SPECIAL ECONOMIC MEASURES ACT
P.C. 2024-83 February 2, 2024
Her Excellency the Governor General in Council, on the recommendation of the Minister of Foreign Affairs, makes the annexed Regulations Amending the Special Economic Measures (Russia) Regulations under paragraph 4(1)(a)footnote a of the Special Economic Measures Act footnote b.
Regulations Amending the Special Economic Measures (Russia) Regulations
Amendment
1 Item 816 of Part 1 of Schedule 1 to the Special Economic Measures (Russia) Regulations footnote 1 is repealed.
Coming into Force
2 These Regulations come into force on the day on which they are registered.
REGULATORY IMPACT ANALYSIS STATEMENT
(This statement is not part of the Regulations.)
Issues
Section 8 of the Special Economic Measures (Russia) Regulations (the Regulations) provides for designated persons to apply to the Minister of Foreign Affairs (the Minister) to have their name removed from the Regulations. The Minister has been provided evidence supporting the removal of one individual from Schedule 1 of the Regulations, who does not meet the criteria to be listed.
Background
Following Russia’s illegal occupation and attempted annexation of Crimea in March 2014, the Government of Canada, in tandem with partners and allies, enacted sanctions through the Regulations under the Special Economic Measures Act. These sanctions impose dealings prohibitions (an effective asset freeze) on designated individuals and entities supporting or enabling Russia’s violation of Ukraine’s sovereignty. Any person in Canada and Canadians outside Canada are thereby prohibited from dealing in the property of, entering into transactions with, providing services to, or otherwise making goods available to listed persons.
On February 24, 2022, Russian President Vladimir Putin announced a “special military operation” as Russian forces launched a full-scale invasion of Ukraine from Russian and Belarusian territory. The war has become a grinding war of attrition, which sees little prospect of a quick victory for either side, and both continue to incur heavy losses. The Russian military has committed horrific atrocities against civilians, including in Izium, Bucha, Kharkiv and Mariupol. Experts, including the Organization for Security and Cooperation in Europe Moscow Mechanism fact-finding missions, the Independent International Commission of Inquiry on Ukraine and the United Nations Office of the High Commissioner for Human Rights, have concluded that Russia is committing serious human rights violations, war crimes, possible crimes against humanity, and conflict-related sexual violence. These studies have linked Russian external aggression with systematic repression and human rights abuses domestically. According to Ukraine’s State Emergency Department, 30% of Ukrainian territory (approximately the size of Austria) has been mined by Russia.
President Putin’s military invasion has been paired with significant malicious cyber operations and disinformation campaigns that falsely portray the West as the aggressor and claim that Ukraine is developing chemical, biological, radiological and/or nuclear weapons with North Atlantic Treaty Organization (NATO) support. The deterioration of Russia’s relations with Ukraine has paralleled the worsening of its relations with the United States and NATO, which has led to heightened tensions.
Since 2014, in coordination with its allies and partners, Canada has imposed sanctions on more than 2 700 individuals and entities in Russia, Belarus, Ukraine and Moldova who are complicit in the violation of Ukraine’s sovereignty and territorial integrity. In addition, Canada implemented targeted restrictions against Russia and Belarus in financial, trade (goods and services), energy and transport sectors. Canada is part of the Oil Price Cap Coalition, which limits the provision of maritime services to Russian crude oil and petroleum products above a price set by the coalition.
Conditions for lifting sanctions
The duration of sanctions by Canada and its partners in the context of Russia’s war in Ukraine is explicitly linked to the peaceful resolution of the conflict and the respect for Ukraine’s sovereignty and territorial integrity within its internationally recognized borders, including Crimea and Ukraine’s territorial sea. Canada has continued to update its sanctions regimes against individuals and entities supporting the conflict in Ukraine, and has delisted persons when warranted, in accordance with relevant sanctions policies and legal frameworks. Similar approaches to the duration and the lifting of sanctions have been adopted by Canada’s like-minded partners, including the United States, the United Kingdom, the European Union and Australia.
The delisting recourse process is an integral part of Canada’s robust sanctions framework and supports the fair and transparent application of sanctions. This includes ensuring that only persons who meet the criteria under the Regulations are listed. Applications for delisting are considered on a case-by-case basis.
Designated persons may apply to the Minister to have their name removed from Schedule 1, 2 or 3 of the Regulations. A detailed description of the relevant circumstances and reasons supporting an application for delisting are requested. Following receipt of an application, the Minister must decide within 90 days whether there are reasonable grounds to recommend to the Governor in Council that the applicant’s name be removed from the Regulations. Notice of the decision taken by the Minister must be provided to the applicant without delay. Information on the delisting application process is available on Global Affairs Canada’s website (Listed persons [international.gc.ca]).
Objective
To fairly respond to the evolving situation of designated persons and safeguard the integrity of Canada’s sanctions regime by ensuring that only persons that meet the criteria for listing under the Regulations remain listed.
Description
The Regulations Amending the Special Economic Measures (Russia) Regulations (the amendments) remove Sergey Alexandrovich Maltsev (also called Sergei Alexandrovich Maltcev or Сергей Александрович Мальцев) from Schedule 1 of the Regulations, as this individual does not meet the criteria to be listed.
Regulatory development
Consultation
Global Affairs Canada engages regularly with other like-minded governments regarding Canada’s approach to the implementation of sanctions.
With respect to these amendments, public consultation would not have been appropriate.
Modern treaty obligations and Indigenous engagement and consultation
An initial assessment of the geographical scope of the amendments was conducted and did not identify any modern treaty obligations, as the amendments do not take effect in a modern treaty area.
Instrument choice
Regulations are the sole method to remove persons subject to sanctions in Canada. No other instrument could be considered.
Regulatory analysis
Benefits and costs
In the absence of this amendment, the individual would remain on Schedule 1 of the Regulations and be faced with restrictions from travelling to Canada and having business transactions with Canadians. This amendment will remove those restrictions, providing a theoretical benefit to the individual and any Canadian or Canadian entity that may wish to engage in dealings with the individual that would have otherwise been prohibited. There will be no direct costs to businesses or the Government because of the delisting, and the removal of these prohibitions is not considered a risk to Canada’s security objectives.
Small business lens
Analysis under the small business lens concluded that the amendment will not impact Canadian small businesses. While the Regulations will remove dealings prohibitions on the individual, it is considered unlikely that any such activities will occur. In the unlikely event that they do, these changes would be beneficial.
One-for-one rule
The one-for-one rule does not apply, as there is no incremental change in the administrative burden on businesses and no regulatory titles are repealed or introduced. The Regulations do contain a process to allow the Minister to issue to any person in Canada or any Canadian outside Canada a permit to carry out a specified activity prohibited pursuant to the Regulations. However, the permitting process is provided to prevent the unforeseen consequences of the listing of individuals and will no longer be applicable once the individual’s name will be removed.
Regulatory cooperation and alignment
The amendments are not related to a work plan or commitment under a formal regulatory cooperation forum.
Strategic environmental assessment
The amendments are unlikely to result in important environmental effects. In accordance with the Cabinet Directive on the Environmental Assessment of Policy, Plan and Program Proposals, a preliminary scan concluded that a strategic environmental assessment is not required.
Gender-based analysis plus
Given the targeted nature of the amendments, no gender-based analysis plus (GBA+) impacts have been identified.
Rationale
Section 8 of the Regulations provides for designated persons to apply to the Minister to have their name removed from the Regulations. Canada considers the delisting recourse process to be an important part of a robust sanctions framework and crucial to the fair application of sanctions.
On May 27, 2022, Sergey Alexandrovich Maltsev (also called Sergei Alexandrovich Maltcev or Сергей Александрович Мальцев) was listed under the Regulations as a senior official of an entity in the Russian financial sector listed under Schedule 1, Part 2 of the Regulations. Based on the information the individual submitted as part of their delisting application, the Minister determined that the individual does not meet the criteria to be listed under Schedule 1 of the Regulations and that their name should be removed.
Implementation, compliance and enforcement, and service standards
The amendments come into force on the day they are registered.
The name of the individual will be removed from the Consolidated Canadian Autonomous Sanctions List. This will help to facilitate compliance with the Regulations.
Contact
Sanctions Policy and Operations Division
Global Affairs Canada
125 Sussex Drive
Ottawa, Ontario
K1A 0G2
Telephone: 343‑203‑3975 or 1‑833‑352‑0769
Email: sanctions@international.gc.ca