Regulations Amending the Special Economic Measures (Russia) Regulations: SOR/2026-30
Canada Gazette, Part II, Volume 160, Number 5
Registration
SOR/2026-30 February 19, 2026
SPECIAL ECONOMIC MEASURES ACT
P.C. 2026-139 February 19, 2026
Whereas the Governor in Council is of the opinion that the actions of the Russian Federation constitute a grave breach of international peace and security that has resulted 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 Regulations Amending the Special Economic Measures (Russia) 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.
Regulations Amending the Special Economic Measures (Russia) Regulations
Amendments
1 Part 1 of Schedule 1 to the Special Economic Measures (Russia) Regulations footnote 1 is amended by adding the following in numerical order:
- 1565 Vasilii Vasilevich ELISTRATOV
- 1566 Kirill Vadimovich LUPANDIN
- 1567 Evgeny Alexandrovych HUTSUL (also known as Yevgeny Gutsul)
- 1568 Vyacheslav Konstantinovich BARBASOV (born on March 16, 1992)
- 1569 Olga Nikolaevna SKOROBOGATOVA (born on June 4, 1969)
- 1570 Andrey Anatolyevich YATSKOV (born on April 2, 1978)
- 1571 Dmitry BOBROVSKY
- 1572 Anatoly PRONIN
- 1573 Gleb ZEMSKOY
- 1574 Andrei Nikolaevich KOSOGOV (born on March 15, 1965)
- 1575 Aleksandr Aleksandrovich VOLOSOVIK (born on January 30, 1983)
- 1576 Kirill Andreevich ZATOLOKIN (born on April 30, 1992) (also known as downlow)
- 1577 Yulia Vladimirovna PANKOVA (born on December 10, 1996)
- 1578 Etibar EYYUB (also known as Akin KOCAK)
- 1579 Tahir GARAYEV (born in January 1980)
- 1580 Talat SAFAROV
- 1581 Ahmed KERIMOV
- 1582 Anar MADATLI
- 1583 Patrick Louis COTASSON
- 1584 Sergey Viktorovich DOBRINOV
- 1585 Nail Ulfatovich MAGANOV (born on July 28, 1958)
2 Part 2 of Schedule 1 to the Regulations is amended by adding the following in numerical order:
- 768 AI Alliance Russia (also known as Alliance)
- 769 Kapitza Institute for Physics Problems
- 770 Institute of Automation and Electrometry (also known as IA&E and Institute of Automation and Electrometry of the Siberian Branch of the Russian Academy of Sciences)
- 771 AFK Sistema (also known as JSC Sistema, Joint Stock Financial Corporation Systema and AFK Sistema PAO)
- 772 Russian Artificial Intelligence Research Institute of the Russian Academy of Sciences (also known as RAIRI)
- 773 Skolkovo Foundation
- 774 BitRiver Group (also known as UK BITRIVER, OOO Management Company Bitriver, OOO Bitriver Rus, OOO Everest Grup, OOO Siberskie Mineraly, OOO Tuvaasbest, OOO Torgovy Dom Asbest, OOO Bitriver-B, OOO Bitriver-K, OOO Bitriver-North and OOO Bitriver-Turma)
- 775 VizorLabs (also known as OOO VizorLabs)
- 776 Positive Technologies (also known as Positive Group, OOO Positive Technologies and AO Positive Technologies)
- 777 Kraftway (also known as Craftway, JSC Craftway Corporation and Kraftway Russian Technologies)
- 778 Rosatom Digital Solutions (also known as RDS LLC)
- 779 NtechLab
- 780 Red Soft
- 781 JSC SEZ Technopolis Moscow (Moscow Special Economic Zone) (also known as Special Economic Zone Technopolis Moscow)
- 782 Zelenograd Nanotechnology text-center (also known as ZNTC)
- 783 Astra Group (also known as PJSC Astra Group)
- 784 IBS (also known as IBS Soft LTD and IBS Soft OOO)
- 785 Lanit
- 786 Rosatom Additive Technologies (also known as Rusatom Additive Technologies)
- 787 Advanced Research Foundation (FPI)
- 788 ERA Technopolis (also known as Era Military Innovation Technopolis)
- 789 Federal Scientific and Production Centre (also known as Scientific Research Institute for Applied Chemistry)
- 790 JSC Infotecs (also known as Joint Stock Company Information Technologies and Communication Systems and Infoteks)
- 791 Digital Lab
- 792 BK Software UAB
- 793 Arcus Novus
- 794 AmberCore
- 795 Staut (also known as LLC STAUT)
- 796 OOO S-MIT (also known as LLC Special Microprocessor Technologies and S-MIT)
- 797 Nurzat IC VE DIS TIC
- 798 Bosphorus Shipping Company LLC
- 799 PJSC TransContainer (also known as Public Joint Stock Company text-center for Cargo Container Traffic Transcontainer)
- 800 KB Veter (also known as Limited Liability Company Design Bureau Veter)
- 801 Vekom-Plus Limited Liability Company
- 802 Far Eastern Winds UAV Group
- 803 Vitim Charity Foundation (also known as Vitim Fund)
- 804 Drone Solutions LLC (also known as Sakhalin Drone Solutions Production Centre)
- 805 Smart Birds LLC
- 806 ANO Neurolab (also known as ANO Neirolab, ANO TsTII Neirolab and text-center for Artificial Intelligence Technologies Neurolab)
- 807 Progmatic LLC
- 808 Zala Aero (also known as Zala Aero Group and ZALA Aero LLC)
- 809 KB Vostok (also known as Vostok Design Bureau)
- 810 KB Microb Design Bureau (also known as KB Microb)
- 811 TBank
- 812 Data text-center Kirishi (also known as DC Kirishi)
- 813 VTB Bank (PJSC) Shanghai Branch
- 814 Aeza Group LLC
- 815 Media Land LLC (also known as Media Land, Media Lend and Medialand)
- 816 Media Land Technology Limited Liability Company (also known as MLT LLC)
- 817 ML Cloud LLC (also known as ML.Cloud LLC)
- 818 Omega Energy LLC
- 819 PJSC Tatneft (also known as Tatneft and PAO Tatneft)
- 820 PJSC RussNeft (also known as PJSC NK RussNeft and Russneft)
- 821 Rosneft PJSC (also known as PJSC Rosneft Oil Company)
| Item | Build date |
|---|---|
| 333 | 2009 |
| Item | Build date |
|---|---|
| 336 | 2000 |
| Item | Build date |
|---|---|
| 343 | 2006 |
| Item | Build date |
|---|---|
| 353 | 2006 |
| Item | Build date |
|---|---|
| 362 | 2003 |
| 363 | 2007 |
| Item | Build date |
|---|---|
| 370 | 2000 |
| Item | Build date |
|---|---|
| 384 | 2005 |
| Item | IMO number | Vessel name | Type | Build date |
|---|---|---|---|---|
| 411 | 9435337 | Akhty | Chemical/Products Tanker | 2008 |
| 412 | 9327360 | Aria | Chemical/Products Tanker | 2006 |
| 413 | 9377042 | Armada Explorer | Chemical/Products Tanker | 2006 |
| 414 | 9282493 | Asteri | Oil Tanker | 2005 |
| 415 | 9387255 | Azure | Oil Tanker | 2008 |
| 416 | 9621560 | Bavly | Oil Products Tanker | 2013 |
| 417 | 9266865 | Bivola | Oil Tanker | 2004 |
| 418 | 9273442 | Blue Ember | Oil Products Tanker | 2004 |
| 419 | 9389679 | Bullar | Oil Tanker | 2008 |
| 420 | 9436020 | Centurion I | Oil Tanker | 2010 |
| 421 | 9259745 | Eternal Peace | Oil Tanker | 2004 |
| 422 | 9408530 | Evita | Oil Tanker | 2008 |
| 423 | 9459242 | Feliks | Oil Products Tanker | 2010 |
| 424 | 9224441 | Firn | Oil Tanker | 2002 |
| 425 | 9395379 | Fortis | Oil Tanker | 2008 |
| 426 | 9326718 | Fulger | Oil Tanker | 2007 |
| 427 | 9257802 | Furia | Oil Tanker | 2002 |
| 428 | 9537109 | Gazpromneft Zuid East | Oil Products Tanker | 2012 |
| 429 | 9185528 | Gelor | Oil Tanker | 2000 |
| 430 | 9430210 | Gogland | Chemical/Products Tanker | 2018 |
| 431 | 9255684 | Golden Eagle | Oil Tanker | 2004 |
| 432 | 9261619 | Hannah | Oil Tanker | 2003 |
| 433 | 9056571 | Immanuel | Oil Products Tanker | 1995 |
| 434 | 9435375 | Irtysh River | Chemical/Products Tanker | 2009 |
| 435 | 9876359 | Ivan Aivazovsky | Chemical/Products Tanker | 2025 |
| 436 | 9313498 | Jacklyn | Oil Tanker | 2008 |
| 437 | 9402732 | Jewel 1 | Oil Tanker | 2008 |
| 438 | 9281009 | Ji Hang | Oil Tanker | 2004 |
| 439 | 9397535 | Jupiter | Chemical/Products Tanker | 2009 |
| 440 | 9236004 | Kairos | Oil Tanker | 2002 |
| 441 | 9585924 | Kaluga | Chemical/Products Tanker | 2021 |
| 442 | 9372559 | Kapitan Gotsky | Oil Tanker | 2008 |
| 443 | 9260275 | Katran | Chemical/Products Tanker | 2004 |
| 444 | 9333682 | Kirill Lavrov | Oil Tanker | 2010 |
| 445 | 9299161 | Kord Atlantic | Chemical/Products Tanker | 2004 |
| 446 | 9749154 | Kupava | Chemical/Products Tanker | 2017 |
| 447 | 9189146 | Kylo | Oil Tanker | 2001 |
| 448 | 9255672 | Lebre | Oil Tanker | 2004 |
| 449 | 9385831 | Leruo | Oil Products Tanker | 2010 |
| 450 | 9294331 | Lily | Oil Tanker | 2005 |
| 451 | 9384069 | Lion I | Oil Tanker | 2009 |
| 452 | 9292838 | Listiga | Oil Products Tanker | 2005 |
| 453 | 9247443 | Magnus | Oil Tanker | 2003 |
| 454 | 9424651 | Manta | Oil Products Tanker | 2009 |
| 455 | 9323974 | Marble | Oil Tanker | 2006 |
| 456 | 9247376 | Mariel | Oil Tanker | 2002 |
| 457 | 9585912 | Marlin | Chemical/Products Tanker | 2020 |
| 458 | 9315745 | Marquise | Chemical/Products Tanker | 2006 |
| 459 | 9384992 | Mars 6 | Oil Tanker | 2007 |
| 460 | 9590137 | Megion | Oil Products Tanker | 2011 |
| 461 | 9837547 | Mikhail Lazarev | Oil Tanker | 2019 |
| 462 | 9333670 | Mikhail Ulyanov | Oil Tanker | 2010 |
| 463 | 9389095 | Minion | Oil Tanker | 2009 |
| 464 | 9299771 | Mires | Oil Tanker | 2005 |
| 465 | 9296810 | Missoni | Oil Tanker | 2005 |
| 466 | 9297553 | Monte 1 | Oil Tanker | 2006 |
| 467 | 9113276 | MT Konstantinovsk | Oil Products Tanker | 1994 |
| 468 | 9167930 | Murmansk | Oil Products Tanker | 1998 |
| 469 | 9292577 | Nexus | Oil Products Tanker | 2005 |
| 470 | 9942392 | Nikolay Anishchenkov | General Cargo | 2023 |
| 471 | 8821761 | Nimbus SPB | Oil Products Tanker | 1991 |
| 472 | 9151890 | Odin | Chemical/Products Tanker | 1998 |
| 473 | 9142916 | Okean | Oil Products Tanker | 1996 |
| 474 | 9286463 | Olanga | Oil Products Tanker | 2004 |
| 475 | 9418509 | Omsk | Oil Products Tanker | 2008 |
| 476 | 9236640 | Onyx | Chemical/Products Tanker | 2003 |
| 477 | 9286023 | Opal | Oil Tanker | 2004 |
| 478 | 9314820 | Osar | Chemical/Products Tanker | 2006 |
| 479 | 9224805 | Oxis | Oil Tanker | 2001 |
| 480 | 9329667 | Pacific | Chemical/Products Tanker | 2008 |
| 481 | 8700096 | Partizansk | Oil Products Tanker | 1988 |
| 482 | 9276028 | Pegasus | Chemical/Products Tanker | 2004 |
| 483 | 9630028 | Perle | LNG Tanker | 2014 |
| 484 | 9276561 | Petra | Oil Tanker | 2004 |
| 485 | 9266877 | Pierre | Oil Tanker | 2004 |
| 486 | 9236743 | Primorye | Oil Products Tanker | 2001 |
| 487 | 9329655 | Proxima | Chemical/Products Tanker | 2008 |
| 488 | 9384095 | Ragnar | Chemical/Products Tanker | 2008 |
| 489 | 9206671 | Rangler | Oil Tanker | 2001 |
| 490 | 9306562 | Rhein | Oil Tanker | 2005 |
| 491 | 9650016 | RN Sakhalin | Oil Products Tanker | 2018 |
| 492 | 9308857 | Rymo | Oil Tanker | 2006 |
| 493 | 9286281 | Samadha | Oil Tanker | 2004 |
| 494 | 9315654 | Sea Honor | Oil Tanker | 2005 |
| 495 | 9321172 | Sea Owl I | Oil Tanker | 2007 |
| 496 | 9266750 | Seahorse | Oil Tanker | 2004 |
| 497 | 9308950 | Seasons I | Oil Tanker | 2006 |
| 498 | 9752084 | Shturman Albanov | Oil Tanker | 2016 |
| 499 | 9759939 | Shturman Koshelev | Oil Tanker | 2017 |
| 500 | 9752096 | Shturman Malygin | Oil Tanker | 2016 |
| 501 | 9752101 | Shturman Ovtsyn | Oil Tanker | 2016 |
| 502 | 9759927 | Shturman Shcherbinin | Oil Tanker | 2017 |
| 503 | 9759915 | Shturman Skuratov | Oil Tanker | 2017 |
| 504 | 9309576 | Silver | Chemical/Products Tanker | 2005 |
| 505 | 9389100 | Smyrtos | Oil Tanker | 2009 |
| 506 | 9211999 | Sofia | Oil Tanker | 2000 |
| 507 | 9409259 | Spirit 2 | Oil Tanker | 2008 |
| 508 | 9386536 | Spring Fortune | Oil Tanker | 2009 |
| 509 | 9434890 | Vokki | Oil Tanker | 2010 |
| 510 | 9377779 | Vozrozhdeniye | Oil Tanker | 2007 |
11 Item 2 of Schedule 3 to the Regulations is repealed.
| Item | Column 3 Price Cap (USD per Barrel) |
|---|---|
| 1 | $44.10 |
Application Before Publication
13 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.
Transitional Provision
14 Item 1 of Schedule 10.01 to the Special Economic Measures (Russia) Regulations, as it read immediately before the day on which these Regulations come into force, continues to apply, for a period of 45 days after that day, in respect of goods loaded onto a ship before that day.
Coming into Force
15 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
Russia’s war of aggression against Ukraine violates international law and has upended the European security architecture. While international sanctions have been effective in hampering Russia’s war efforts, maintaining pressure requires Canada and its partners to continuously adapt their sanctions regimes to counter Russia’s attempts at circumvention.
Background
Russia’s full-scale invasion of Ukraine on February 24, 2022, violated the United Nations (UN) Charter and international law. More than four years later, the war persists with ongoing aggression and atrocities.
To sustain the conflict, Russia has restructured its economy around military spending and self-sufficiency in strategic sectors. In May 2025, President Putin outlined plans to modernize Russia’s military through artificial intelligence (AI)-enabled technologies, foreign partnerships and expanded domestic production — efforts that could strengthen capabilities in energy, technology and finance.
Central to this effort is Russia’s AI strategy, driven by state corporations and supported by academia, industry and select international partners. Russia exercises robust, centralized oversight of its AI industry, through strong state direction and control of research institutes, design bureaus and scientific production enterprises, and state-industry collaboration and integration. This approach leverages government programs and the technological sector to accelerate military innovation and production, both in conventional capabilities and hybrid sectors, to be used in its unprovoked and unjustifiable war of aggression against Ukraine.
Russia’s efforts depend on access to restricted components and financial networks. Sanctions evasion remains a major concern, as Russian importers use third-country intermediaries and complex transshipment networks to secure critical goods, requiring persistent enforcement and international coordination. Financial flows also enable the war. Russia moves funds abroad for arms and receives energy revenues through intermediary banks and cryptocurrency.
Despite sanctions, oil and gas revenues made up about 25% of Russia’s total federal revenues in 2025. To bypass restrictions, Russia relies on a “shadow fleet” mainly composed of oil tankers that disable tracking, conceal ownership, and engages in covert transfers and cargo mislabelling via free trade zones. Given the importance of oil and gas revenue to Russia’s economy and its war effort, Canada and the members of the Oil Price Cap Coalition have sought to limit Russian access to revenue from the energy sector through various measures.
International response
Canada and its partners, including the G7, have maintained coordinated pressure on Russia through comprehensive sanctions targeting its energy sector, financial networks, maritime logistics, and defence-industrial base. These measures aim to degrade Russia’s war machine and financing capabilities.
A broad coalition of countries supporting Ukraine — largely coordinated by G7 efforts — continues to assist across multiple areas: energy security, nuclear safety, food security, humanitarian aid, combating Russian disinformation, imposing sanctions and economic measures, asset seizure and forfeiture, military assistance, accountability initiatives, and socio-economic recovery and reconstruction. Sanctions regimes are regularly updated to increase pressure and close loopholes exploited by Russia and third-country enablers.
Recent sanctions measures underscore continued international resolve. On October 15, 2025, the United Kingdom (U.K.) announced economic measures targeting energy firms (including Lukoil and Rosneft, both already sanctioned by Canada), Russia’s defence-industrial base and sanctions evaders. On October 22, 2025, the United States also sanctioned Rosneft and Lukoil, along with 35 subsidiaries, and tightened export controls. On October 23, 2025, the European Union (EU) introduced sanctions that mirrored these priorities and added individuals linked to the abduction of Ukrainian children. Most recently, on December 4, 2025, the U.K. announced measures targeting Russian military intelligence assets, notably by imposing sanctions on the Main Directorate of the General Staff of the Armed Forces of the Russian Federation (GRU) following their egregious acts on British soil and ongoing hybrid warfare operations.
In order to constrain Russia’s oil and gas revenues, which are critical to its economy and war effort, Canada lowered the price cap for Russian crude oil from US$60 to US$47.60 per barrel, effective August 28, 2025, alongside partners, including Australia, the EU, Japan, New Zealand and the U.K. On January 15, 2026, the EU and the UK further lowered the Russian crude oil price cap (OPC) to US$44.10 per barrel.
Canada’s response
Canada has imposed extensive sanctions under the Special Economic Measures Act (SEMA) in response to Russia’s violations of Ukraine’s sovereignty. These measures prohibit dealings with listed individuals, entities and vessels under the Special Economic Measures (Russia) Regulations (the Russia Regulations), effectively freezing assets and restricting transactions, services and goods.
Since 2014, Canada has sanctioned more than 3 300 individuals and entities across Russia, Belarus, Ukraine and Moldova, and listed over 400 vessels. Restrictions target financial, trade and transport sectors, including Russian networks operating through third countries. Canada also participates in the G7 diamond import ban and efforts to use proceeds from Russian sovereign assets to support Ukraine.
Furthermore, Canada has acted against foreign financial institutions for intentionally facilitating cross-border payments and continues to restrict the role of Russian banks as intermediaries.
Under the Russia Regulations, Canada prohibits the import of any Russian crude oil, refined petroleum products and gaseous hydrocarbons, and prohibits the export of goods related to oil exploration and production in Russia. Canada also restricts services linked to marine transport of oil sold above the price cap and broadly prohibits services supporting Russia’s energy, manufacturing and transportation sectors.
To strengthen enforcement, Canada has barred Russian-linked ships from Canadian waters since 2022, with 2025 amendments to the Russia Regulations adding a schedule of vessels believed to have transported goods for Russia and prohibiting financial or other services related to these ships. Under Canada’s G7 presidency, participating G7 members launched a Shadow Fleet Task Force with members of the Nordic-Baltic Eight (NB8), including Denmark, Estonia, Finland, Iceland, Latvia, Lithuania, Norway and Sweden, to enhance monitoring, detection and coordination to disrupt and deter the global shadow fleet engaged in illegal, unsafe and environmentally hazardous activities.
Furthermore, during its G7 Presidency in 2025, Canada continued to lead efforts to coordinate sanctions, enhance enforcement, and advance measures that limit Russia’s ability to finance its war. On October 1, 2025, G7 Finance Ministers agreed to take bold steps to increase the economic costs of Russia’s war efforts by imposing restrictive measures on key sectors and supporters of the Russian economy, such as energy, finance, the military industrial base, special economic zones, and enablers and profiteers. This will cut off the funds sustaining Russia’s military aggression and will have a powerful impact on those who violate those restrictive measures. They also agreed that now is the time to maximize pressure on Russia’s oil exports, a major source of their revenue. Canada is and will remain steadfast in its commitment to support Ukraine’s sovereignty, territorial integrity, independence, and its efforts toward a just and sustainable peace.
Objective
- Degrade Russia’s conventional and hybrid military capabilities used against Ukraine in Russia’s war of aggression.
- Further increase the economic costs to Russia for its war against Ukraine by targeting Russia’s energy revenues and financial enablers.
Description
The Regulations Amending the Special Economic Measures (Russia) Regulations (the amendments):
- Add 21 individuals, including a senior Russian military official instrumental in Moscow’s hybrid and AI strategy, an essential component of its broader military campaign against Ukraine; senior leadership of companies supporting the Russian defence-industrial base with drones and technology; cyber and malign influence operators; individuals complicit in Russian energy trade and sanctions evasion; and senior executives at Russia’s leading state-owned lenders who are advancing international cryptocurrency payment infrastructure to maintain financial flows under sanctions.
- Add 53 entities, including organizations within Russia’s defence-industrial base; active drone manufacturers, developers, and related actors; organizations within its sensitive technology ecosystem — such as those involved in AI — that enhance conventional and hybrid military capabilities; supporting research centres and institutes; major financial institutions that enable sanctions evasion via cryptocurrency; companies connected to Russian energy trading networks and technology procurement operations. Additionally, Special Economic Zones and military development hubs that support Russia’s war efforts are included.
- Add 100 vessels to Schedule 1.1 for involvement in shadow fleet activities facilitating the transport of oil, liquid natural gas (LNG), arms and other sanctioned goods.
- Make non-substantive corrections to Schedule 1.1 of the Russia Regulations for precision and accuracy. These changes are corrections to the build years of eight vessels previously listed and do not affect the validity of the original listings.
- Move one entity currently listed under Schedule 3 — which covers new debt financing prohibitions — to Schedule 1 of the Russia Regulations, subjecting this entity to the full range of measures applicable under Schedule 1, including a comprehensive dealings ban.
- Amend Schedule 10.01 to lower the OPC per barrel on Russian crude oil from US$47.60 to US$44.10.
Any person in Canada or Canadians outside Canada are prohibited from dealing in the property of, entering into transactions with, providing services to, transferring property to, or otherwise making goods available to listed individuals and entities (persons), unless explicitly authorized by a permit granted on an exceptional basis or an exception in the Russia Regulations. Listed individuals are also rendered inadmissible to Canada under the Immigration and Refugee Protection Act (IRPA).
Under the Russia 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. Information on the delisting application process is available on Global Affairs Canada’s website.
Regulatory development
Consultation
Global Affairs Canada regularly engages with relevant stakeholders, including civil society organizations and cultural communities, and other like-minded governments regarding Canada’s approach to sanctions implementation.
New sanctions measures are not prepublished in the Canada Gazette, Part I, and public consultation would not have been appropriate for these amendments. Publicizing the names of the listed persons targeted by sanctions could have resulted in asset flight and sanctions evasion prior to the coming into force of the amendments, which could compromise Canada’s foreign policy objectives.
Indigenous engagement, consultation and modern treaty obligations
In accordance with the Cabinet Directive on the Federal Approach to Modern Treaty Implementation, an analysis was undertaken to determine whether the amendments are likely to give rise to modern treaty obligations. The assessment examined the geographic scope and subject matter of the amendments in relation to modern treaties in effect, and no modern treaty obligations were identified.
Instrument choice
The imposition of sanctions against foreign states and non-state actors is a key tool for the international community to support peace and security and enforce international norms and laws. The Parliament of Canada has enacted legislation authorizing the imposition of sanctions through the United Nations Act, the SEMA and the Justice for Victims of Corrupt Foreign Officials Act (Sergei Magnitsky Law).
Canada has established a rigorous due diligence process to consider and evaluate possible cases that may warrant the use of sanctions. Given the elements in the amendments, the SEMA was identified as the instrument of choice.
Sanctions measures under the SEMA are imposed by the Governor in Council, on the recommendation of the Minister of Foreign Affairs, through a regulatory process. Regulations are therefore the only available legal instrument for the amendments. No other instrument could be considered.
Regulatory analysis
Benefits and costs
These amendments will strengthen existing economic measures against Russia, constrain Russia’s ability to finance and resource its unjustified war in Ukraine, and discourage individuals and entities from contributing, directly or indirectly, to Russia’s war efforts.
The incremental cost to the Government of Canada to administer and enforce these additional prohibitions will be minimal. The Canada Border Services Agency (CBSA), the Royal Canadian Mounted Police (RCMP) and Immigration, Refugees and Citizenship Canada will incur a small cost to ensure their relevant systems include the persons and vessels listed through this amendment.
Canadian banks and financial institutions are required to comply with sanctions. They will do so by adding the newly listed individuals, entities and ships to their existing monitoring systems, resulting in a minor compliance cost. As of August 2024, financial institutions must report transactions suspected of being related to sanctions evasion to the Financial Transactions and Reports Analysis Centre of Canada (FINTRAC). Financial institutions also have other legal obligations with respect to the monitoring and reporting of relevant property ownership, export and import of goods and other activities in connection with sanctioned individuals and entities.
Sanctions targeting specific persons have less impact on Canadian businesses than traditional broad-based economic sanctions. Based on an initial assessment of available open-source information and consultations within the Government of Canada, it is believed that most of the individuals and entities listed in the amendments have limited linkages with Canada and do not have business dealings that are significant to the Canadian economy. However, available information suggests that some persons proposed for listing may have connections with Canada, which could result in impacts on certain companies. Potential impacts could include company relocation, employment losses, reduced taxation and spending, contraction of operations, revenue impacts and sale of assets.
The amendments related to the listing of vessels are not expected to result in incremental impacts on Canada. Since 2022, the Russia Regulations have banned certain ships from docking in or passing through Canada. This applies to all ships registered in Russia or used, leased or chartered, in whole or in part, by or on behalf of or for the benefit of Russia, a person in Russia or a listed person. While the amendments do not introduce new prohibitions, listing the 100 identified vessels will facilitate the enforcement of the general prohibition on docking and passage in Canada. Without the names of the vessels in Schedule 1.1, enforcement authorities must determine on a case-by-case basis whether a vessel is subject to the general prohibition. Schedule 1.1 provides a predetermination of status for a category of vessels that can be used to identify them for purposes of denying them docking and passage.
All Canadian companies providing services related to vessels, such as insurance, technical services or ship supply services, will be required to screen against Schedule 1.1 to ensure that they are not providing a service in relation to a listed vessel. There is no data available to ascertain if any Canadian businesses are currently providing services in relation to listed vessels. However, Global Affairs Canada (GAC) has concluded that it is highly unlikely because there is no record of these vessels entering Canada, and none of the vessels are owned, managed, operated or insured by Canadian companies.
Based on an assessment of available open-source information and consultations within the Government of Canada, it is believed that the lower OPC for crude oil is unlikely to cause significant spikes in the price of crude oil. Given that Canada already prohibits the direct import of Russian oil and petroleum products, it is unlikely that lowering the OPC will have a direct impact on Canada or Canadian businesses. Canadian oil is primarily exported to the United States. Canadian oil exports on the Trans Mountain Pipeline are sold to markets that also import Russian oil. However, Canada and Russia export different crude grades that do not directly compete, so it is unlikely that changes to Russian oil flows will have a direct impact on Canadian businesses. Global Affairs Canada does not have data to ascertain if any Canadian businesses are currently providing maritime insurance or financial services to tankers transporting Russian oil above the new OPC. However, given Canada’s existing sanctions in relation to Russian oil transactions, it is highly unlikely that any Canadian businesses currently provide such services.
Russian seaborne exports are around 9% of global supply, which is significant. Global oil markets and the Canadian economy could be impacted if a large volume of Russian seaborne oil exports is taken off the market. However, reports from the International Energy Agency show that the market is well supplied, with weak demand growth and growing supply from both the Organization of the Petroleum Exporting Countries (OPEC) and non-OPEC suppliers. Significant impacts on the global oil market are considered unlikely given current market conditions.
Small business lens
Analysis under the small business lens concludes that the amendments will not impact Canadian small businesses. The amendments listing new individuals and entities do not impose any new compliance or administrative burden on small businesses in Canada. Additionally, given that Canada already prohibits the import of Russian oil and petroleum products, it is unlikely that Canadian companies provide services related to the movement of Russian oil.
Canadian businesses may seek permits under the Special Economic Measures Permit Authorization Order to allow them to perform a specified activity with a listed person. Those permits are granted on an exceptional basis. Global Affairs Canada does not anticipate any applications resulting from listing these persons or ships because no business dealings significant to Canada’s small businesses have been identified.
Canadian small businesses are subject to the duty to disclose under the Russia Regulations, which represent a direct compliance requirement. However, the newly listed individuals, entities and ships have no known legitimate linkages with Canadian small businesses. Furthermore, it is highly unlikely that any Canadian small businesses currently provide services related to the movement of Russian oil, as there is no record of these tankers entering Canada and as there is no data available to ascertain any links with Canadian small businesses. This is why 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 administrative burden on business. The permitting process for businesses meets the definition of “administrative burden” in the Red Tape Reduction Act. As permits may be granted under the Special Economic Measures Permit Authorization Order on an exceptional basis, it is possible that some businesses currently dealing with the newly listed entities will seek permits to continue such activity.
Regulatory cooperation and alignment
While the amendments are not related to a work plan or commitment under a formal regulatory cooperation forum, they align with actions taken by Canada’s partners. Countries and jurisdictions that have sanctioned individuals, entities and vessels related to Russia’s infringement of Ukraine’s sovereignty and territorial integrity as well as Russia’s gross and systematic violations of human rights include Australia, the EU, Japan, New Zealand, Switzerland, the U.K. and the United States.
International obligations
Compliance with Canada’s international commitments was considered in the development of the amendments.
Effects on the environment
The amendments are unlikely to result in important environmental effects. In accordance with the Cabinet Directive on Strategic Environmental and Economic Assessment, a preliminary scan concluded that an environmental and economic assessment is not required.
Gender-based analysis plus
A gender-based analysis plus (GBA+) assessment concluded that the amendments are unlikely to result in differential impacts on the basis of identity factors, such as gender, race, ethnicity, sexuality, religion, etc.
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 and entities in foreign states, sanctions under the SEMA can nevertheless have an unintended impact on certain vulnerable groups and individuals. Rather than affecting Russia as a whole, these targeted sanctions impact individuals believed to be engaged in activities that directly or indirectly support, provide funding for or contribute to a violation of the sovereignty or territorial integrity of Ukraine. Therefore, these sanctions are unlikely to have a significant impact on vulnerable groups as compared to traditional broad-based economic sanctions directed toward a state. Insofar as sanctions limit Russia’s ability to wage war, individuals and groups vulnerable to gender-based discrimination are likely to benefit from these measures.
Implementation, compliance and enforcement, and service standards
The amendments come into force on the day they are registered. The amendments include a 45-day non-application period for the revised OPC in respect of services provided in relation to goods that were loaded onto a vessel and unloaded at the port of destination within 45 days after the day the amendments are registered.
Consequential to being listed in the Russia Regulations, and pursuant to the application of paragraph 35.1(b) of the IRPA, the listed individuals would be inadmissible to Canada.
The names of the listed individuals and entities will be available online for financial institutions to review and will be added to the Consolidated Canadian Autonomous Sanctions List. This will help persons in Canada and Canadians outside of Canada to comply with the amendments.
The Trade Commissioner Service at Global Affairs Canada, abroad and in Canada, continues to assist clients in understanding Canadian sanctions regulations, and notably the impact of the regulations on any activities in which Canadians may be engaged. Global Affairs Canada is also increasing outreach efforts across Canada through presentations and other events — including to engage with businesses, universities, and provincial/territorial governments — to enhance national awareness of and compliance with Canadian sanctions.
The prohibitions on ships entering or passing through Canada are enforced by a multi-departmental process involving Transport Canada, the Canadian Coast Guard, the CBSA, the RCMP and others. These partners were consulted during the development of the amendments.
Under the SEMA, both RCMP and CBSA officers have the power to enforce sanctions measures 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 Russia 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
Global Affairs Canada
Sanctions Bureau
125 Sussex Drive
Ottawa, Ontario
K1A 0G2
Telephone (toll-free): 1‑833‑352‑0769
Telephone (local): 343‑203‑3975
Fax: 613‑995‑9085
Email: sanctions@international.gc.ca