Special Economic Measures (Extremist Settler Violence) Regulations: SOR/2024-91

Canada Gazette, Part II, Volume 158, Number 12

Registration
SOR/2024-91 May 16, 2024

SPECIAL ECONOMIC MEASURES ACT

P.C. 2024-519 May 16, 2024

Whereas the Governor in Council is of the opinion that the actions of Israeli extremist settlers in the occupied Palestinian territories constitute a grave breach of international peace and security that has resulted in or is likely to result in a serious international crisis;

Therefore, Her Excellency the Governor General in Council, on the recommendation of the Minister of Foreign Affairs, makes the annexed Special Economic Measures (Extremist Settler Violence) Regulations under paragraph 4(1)(a)^{footnote a} and subsections 4(1.1)^{footnote b}, (2)^{footnote c} and (3) of the Special Economic Measures Act ^{footnote d}.

Special Economic Measures (Extremist Settler Violence) Regulations

Definition

Definition of Minister

1 In these Regulations, Minister means the Minister of Foreign Affairs.

List

Listed person

2 A person whose name is listed in the schedule is a person in respect of whom the Governor in Council, on the recommendation of the Minister, is satisfied that there are reasonable grounds to believe is

• (a) a person who has engaged in activities that undermine the peace and security of the State of Israel and the occupied Palestinian territories by directly or indirectly facilitating, supporting, providing funding for or contributing to the use — or the threatened or attempted use — of violence by Israeli extremist settlers against Palestinian civilians or their property in the occupied Palestinian territories;
• (b) an associate of a person referred to in paragraph (a);
• (c) a family member of a person referred to in paragraph (a) or (b); or
• (d) an entity owned — or held or controlled, directly or indirectly — by a person referred to in any of paragraphs (a) to (c).

Prohibitions

Prohibited dealings and activities

3 It is prohibited for any person in Canada and any Canadian outside Canada to

• (a) deal in any property, wherever situated, that is owned — or that is held or controlled, directly or indirectly — by a listed person;
• (b) enter into or facilitate any transaction related to a dealing referred to in paragraph (a);
• (c) provide any financial or related services in respect of a dealing referred to in paragraph (a);
• (d) make available any goods, wherever situated, to a listed person or to a person acting on behalf of a listed person;
• (e) transfer or provide any property other than goods to a listed person or to a person outside Canada who is not Canadian for the benefit of a listed person; or
• (f) provide any financial or related services to or for the benefit of a listed person.

Non-application

4 Section 3 does not apply in respect of

• (a) any payment made by or on behalf of a listed person that is due under a contract that the listed person entered into before they became a listed person, provided that the payment is not made to a listed person or to a person acting on behalf of a listed person;
• (b) any transaction necessary for a Canadian to transfer to a person other than a listed person any accounts, funds or investments of a Canadian held by a listed person on the day on which that person became a listed person;
• (c) any dealings with a listed person required with respect to loan repayments made to any person in Canada, or any Canadian outside Canada, for loans entered into with any person other than a listed person, and for enforcement and realization of security in respect of those loans or payments by guarantors guaranteeing those loans;
• (d) any dealings with a listed person required with respect to loan repayments made to any person in Canada, or any Canadian outside Canada, for loans entered into with that listed person before they became a listed person, and for enforcement and realization of security in respect of those loans or payments by guarantors guaranteeing those loans;
• (e) any benefit paid under the Old Age Security Act, the Canada Pension Plan or the Act respecting the Québec Pension Plan, CQLR, c. R-9, any superannuation, pension or benefit paid under or in respect of any retirement savings plan or under any retirement plan, any amount paid under or in respect of the Garnishment, Attachment and Pension Diversion Act or the Pension Benefits Division Act and any other payment made in respect of disability to any person in Canada or any Canadian outside Canada;
• (f) financial services necessary for a listed person to obtain legal services in Canada regarding the application to them of these Regulations or any order made under the Special Economic Measures Act; and
• (g) any transaction with any international organization with diplomatic status, with any United Nations agency, with the International Red Cross and Red Crescent Movement or with any entity that has entered into a grant or contribution agreement with the Department of Foreign Affairs, Trade and Development.

Assisting in prohibited activity

5 It is prohibited for any person in Canada and any Canadian outside Canada to knowingly do anything that causes, facilitates or assists in, or is intended to cause, facilitate or assist in, any activity prohibited by section 3.

Duty to determine

6 The following entities must determine on a continuing basis whether they are in possession or control of property that is owned — or that is held or controlled, directly or indirectly — by a listed person:

• (a) banks regulated by the Bank Act and, in respect of their business in Canada, authorized foreign banks as defined in section 2 of that Act;
• (b) cooperative credit societies, savings and credit unions and caisses populaires regulated by a provincial Act and associations regulated by the Cooperative Credit Associations Act;
• (c) foreign companies, as defined in subsection 2(1) of the Insurance Companies Act, in respect of their insurance business in Canada;
• (d) companies, provincial companies and societies, as those terms are defined in subsection 2(1) of the Insurance Companies Act;
• (e) fraternal benefit societies regulated by a provincial Act in respect of their insurance activities and insurance companies and other entities regulated by a provincial Act that are engaged in the business of insuring risks;
• (f) companies regulated by the Trust and Loan Companies Act;
• (g) trust companies regulated by a provincial Act;
• (h) loan companies regulated by a provincial Act;
• (i) entities that engage in any business described in paragraph 5(h) of the Proceeds of Crime (Money Laundering) and Terrorist Financing Act if the business involves the opening of an account for a client; and
• (j) entities authorized under provincial legislation to engage in the business of dealing in securities or to provide portfolio management or investment counselling services.

Duty to disclose

7 (1) Every person in Canada, every Canadian outside Canada and every entity set out in section 6 must disclose without delay to the Commissioner of the Royal Canadian Mounted Police or to the Director of the Canadian Security Intelligence Service

• (a) the existence of property in their possession or control that they have reason to believe is owned — or held or controlled, directly or indirectly — by a listed person; and
• (b) any information about a transaction or proposed transaction in respect of property referred to in paragraph (a).

Immunity

(2) No proceedings under the Special Economic Measures Act and no civil proceedings lie against a person for a disclosure made in good faith under subsection (1).

Applications

Removal from list

8 (1) A listed person may apply to the Minister in writing to have their name removed from the schedule.

Reasonable grounds

(2) On receipt of an application, the Minister must decide whether there are reasonable grounds to recommend the removal to the Governor in Council.

New application

9 If there has been a material change in circumstances since the last application was submitted, a listed person may submit another application under section 8.

Mistaken identity

10 (1) A person whose name is the same as or similar to the name of a listed person and who claims not to be that person may apply to the Minister in writing for a certificate stating that they are not that listed person.

Determination by Minister

(2) Within 30 days after the day on which the Minister receives the application, the Minister must

• (a) if it is established that the applicant is not the listed person, issue the certificate; or
• (b) if it is not so established, provide notice to the applicant of the determination.

Application Before Publication

Application

11 For the purpose of paragraph 11(2)(a) of the Statutory Instruments Act, these Regulations apply according to their terms before they are published in the Canada Gazette.

Coming into Force

Registration

12 These Regulations come into force on the day on which they are registered.

SCHEDULE

(Section 2 and subsection 8(1))

Persons

• 1 David Chai Chasdai (born on November 23, 1994)
• 2 Yinon Levi (born on December 19, 1992)
• 3 Zvi Bar Yosef (born on September 20, 1992)
• 4 Moshe Sharvit (born on November 13, 1994)

REGULATORY IMPACT ANALYSIS STATEMENT

(This statement is not part of the Regulations.)

Issues

While extremist settler violence is a longstanding issue, the recent escalation of violent actions led by Israeli extremist settlers and affiliates against Palestinian civilians and their property in the occupied Palestinian territories^{footnote 1} (oPt) threatens the viability of a two-state solution, leads to destabilization, and undermines the peace and security of the State of Israel and the oPt, consequently posing a threat to regional peace and security.

Background

The Special Economic Measures Act (SEMA) allows Canada to impose sanctions in four situations: when a grave breach of international peace and security has occurred and has resulted in, or is likely to result in, a serious international crisis; when an international organization calls on members to impose sanctions; circumstances of gross and systematic human rights violations; or when acts of significant corruption have been committed. There are a broad range of prohibitions that can be imposed, including a dealings ban on individuals or entities, and restrictions on trade or financial transactions. Listed individuals are also rendered inadmissible to Canada under the Immigration and Refugee Protection Act (IRPA).

Israeli extremist settler violence against Palestinians and their property in the oPt remains a source of tension and conflict. The severity of violent crimes has risen over the past few years. This violence includes the use of arms, killings, physical and verbal assaults, trespassing, damages of private property, theft, destruction of farming lands (including olive groves), vandalism, and other various forms of harassment by Israeli extremist settlers, which has resulted in the forced displacement of Palestinians. The Fourth Geneva Convention applies to the occupied territories and establishes Israel’s obligations as an occupying power with respect to the humane treatment of the inhabitants of the occupied territories. As referred to in United Nations Security Council resolutions 446 and 465, and consistent with Canada’s longstanding policy, all Israeli settlements in the occupied territories are in violation of the Fourth Geneva Convention.

The issue of settler violence predates the October 7, 2023, attacks by Hamas on the State of Israel. However, a sharp increase in violent actions (over 400 incidents) occurred between October 2023 and January 2024.^{footnote 2} During that period, the United Nations reported at least 494 attacks against Palestinians by Israeli extremist settlers. Violence by extremist settlers threatens the viability of a two-state solution and poses a major risk to regional peace and security, as it could trigger broader escalations of violence in the oPt and the State of Israel, but also beyond in neighbouring countries and the region writ large.

Canada has been outspoken on the issue of extremist settler violence. Canadian engagement is conducted via public channels, in bilateral discussions with Israel at the senior official, political and leader levels, and through the support of humanitarian and other initiatives on the ground.

This is the first time that the SEMA has been used to apply restrictive measures in response to violence by Israeli extremist settlers. Listing persons for their connection to the grave breach of international peace and security under these new Regulations is a clear pronouncement on Canada’s position on violent extremism and illegal settlements in the oPt, as well as on Canada’s commitment to a two-state solution as the only viable solution to the conflict.

Objective

These sanctions intend to

• (1) Hold accountable the persons responsible for these harmful actions and attacks, including for the threat they pose to the viability of a two-state solution;
• (2) Deter future attacks by Israeli extremist settlers against Palestinian civilians in the oPt;
• (3) Emphasize Canada’s longstanding policy opposing settler violence against Palestinian civilians, forced displacement, and the expansion of illegal settlements in the oPt.

Description

The Regulations establish a new sanctions regime related to violence by Israeli extremist settlers in the oPt and designate four individuals who are subject to a dealings ban. There are reasonable grounds to believe that these individuals have engaged in activities that undermine the peace and security of the State of Israel and the oPt by directly or indirectly facilitating, supporting, providing funding for or contributing to the use — or the threatened or attempted use — of violence by Israeli extremist settlers against Palestinian civilians or their property in the oPt.

Any person in Canada or Canadian outside Canada is thereby prohibited from dealing in the property of, entering into transactions with, providing services to, transferring property to, or otherwise making goods available to listed persons. These measures will also render listed individuals inadmissible to Canada under the IRPA.

The Regulations include exceptions for any transaction with any international organization with diplomatic status, with any United Nations agency, with the International Red Cross and Red Crescent Movement or with any entity that has entered into a grant or contribution agreement with the Department of Foreign Affairs, Trade and Development. For example, this exception would include humanitarian activities and activities that serve the purpose of safeguarding human life, disaster relief, or providing food, medicine or medical supplies or equipment. Other exceptions include those related to payments under pre-existing contracts or loan agreements to any person in Canada or any Canadian outside Canada.

The Regulations also create a duty for certain entities (including businesses such as banks and cooperative credit associations) to determine and disclose to the Commissioner of the Royal Canadian Mounted Police whether they are in possession or control of property belonging to a listed person. The duty to disclose also applies to every person in Canada and every Canadian outside Canada.

Under the Regulations, listed persons may apply to the Minister of Foreign Affairs to have their name removed from the schedule of designated persons. The Minister must determine whether there are reasonable grounds to make a recommendation to the Governor in Council for removal. The Regulations are accompanied by the Special Economic Measures (Extremist Settler Violence) Permit Authorization Order (the Order). The Order authorizes the Minister of Foreign Affairs to issue to any individual or entity in Canada, and any Canadian outside Canada, a permit to carry out a specified activity or transaction, or any class of activity or transaction that is otherwise restricted or prohibited pursuant to the Regulations.

Regulatory development

Consultation

Global Affairs Canada engages regularly with relevant stakeholders, including civil society organizations, cultural communities and other like-minded governments, regarding Canada’s approach to sanctions implementation.

With respect to the Regulations, public consultation would not have been appropriate given the urgency to impose these measures. Public consultation on the persons being listed under the Regulations would not have been appropriate either, as publicizing the names of the persons targeted by sanctions would have potentially resulted in asset flight prior to the coming into force of the Regulations.

Modern treaty obligations and Indigenous engagement and consultation

An initial assessment of the geographical scope of the initiative was conducted and did not identify any modern treaty obligations, as the Regulations do not take effect in a modern treaty area.

Instrument choice

Regulations are the sole method to enact sanctions in Canada. No other instrument could be considered.

Regulatory analysis

Benefits and costs

The Regulations are targeting specific persons. Therefore, they are expected to have less impact on Canadian businesses than traditional broad-based sanctions, as well as limited impact beyond the listed persons. Based on initial assessment of available open-source information, it is believed that the individuals listed have limited linkages with Canada and, therefore, do not have significant business dealings that are relevant to the Canadian economy. It is therefore anticipated that there will be no significant impacts on Canadians and Canadian businesses as a result of these Regulations.

Canadian banks and financial institutions are required to comply with the sanctions. They will do so by adding the new prohibitions to their existing monitoring systems, which may result in a minor compliance cost.

As a result of the humanitarian exception incorporated into the Regulations, activities such as the provision of humanitarian aid to civilians would not be prohibited and, as such, organizations seeking to conduct these activities will not incur any additional costs because of the Regulations.

Small business lens

With respect to the individuals being listed under the Regulations, analysis under the small business lens concluded that the Regulations could impact Canadian small businesses. The Regulations prohibit Canadian businesses from dealing with, providing services to, or otherwise making goods available to listed persons, but do not create any direct administrative obligations related to them. While Canadian businesses may seek permits under the Regulations, they are granted on an exceptional basis, and Global Affairs Canada does not anticipate any applications resulting from listing these individuals. Therefore, there will be no incremental administrative burden arising from this requirement. Canadian small businesses are also subject to the duty to disclose under the Regulations, which would represent a direct compliance requirement. However, as the newly listed individuals have limited known linkages with Canada, Global Affairs Canada does not anticipate any disclosures resulting from the amendments.

One-for-one rule

The one-for-one rule does not apply, as there is no incremental change in the administrative burden on businesses. The permitting process for businesses meets the definition of “administrative burden” in the Red Tape Reduction Act; however, while permits may be granted under the Regulations on an exceptional basis, given that the listed individuals have limited business ties to the Canadian economy, Global Affairs Canada does not anticipate any permit applications with respect to the Regulations.

Regulatory cooperation and alignment

The Regulations are not related to a work plan or commitment under a formal regulatory cooperation forum. Imposing sanctions in relation to Israeli extremist settler violence is aligned with Canada’s longstanding policy opposing the expansion of illegal settlements in the oPt and settler violence. Canada and like-minded countries, including the European Union, the Nordic countries, the United Kingdom and the United States, have been consistent in public opposition to settlement expansion in the oPt and Israeli extremist settler violence.

Strategic environmental assessment

The Regulations 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

The subject of economic sanctions has previously been assessed for effects on gender and diversity. Although intended to facilitate a change in behaviour through economic pressure on individuals in foreign states, sanctions under the SEMA can nevertheless have an unintended impact on certain vulnerable groups and individuals. Rather than affecting the whole region, these targeted sanctions impact individuals believed to be engaged in activities that contribute to a grave breach of international peace and security. Therefore, these sanctions are unlikely to have a significant impact on vulnerable groups, as compared to traditional broad-based economic sanctions directed toward a foreign state, and should limit the collateral effects to those dependent on the targeted individuals.

Implementation, compliance and enforcement, and service standards

The Regulations come into force on the day they are registered.

Consequential to being listed in the Regulations, and pursuant to the application of paragraph 35.1(b) of the IRPA, the listed individuals will be inadmissible to Canada.

The names of the listed individuals will be available online for financial institutions to review and will be added to the Consolidated Canadian Autonomous Sanctions List. This will help to facilitate compliance with the Regulations.

Under the SEMA, both Royal Canadian Mounted Police and Canada Border Services Agency officers have the power to enforce sanctions violations through their authorities, as defined under the Customs Act, the Excise Act or the Excise Act, 2001, and sections 487 to 490, 491.1 and 491.2 of the Criminal Code.

In accordance with section 8 of the SEMA, every person who knowingly contravenes or fails to comply with the Regulations is liable, upon summary conviction, to a fine of not more than $25,000 or to imprisonment for a term of not more than one year, or to both; or, upon conviction on indictment, to imprisonment for a term of not more than five years.

Contact

Israel, West Bank and Gaza Division
Global Affairs Canada
125 Sussex Drive
Ottawa, Ontario
K1A 0G2
Telephone: 343‑204‑5401
Email: extott-ela@international.gc.ca