Regulations Amending the Special Economic Measures (Iran) Regulations: SOR/2026-60

Canada Gazette, Part II, Volume 160, Number 7

Registration
SOR/2026-60 March 25, 2026

SPECIAL ECONOMIC MEASURES ACT

P.C. 2026-270 March 25, 2026

Whereas the Governor in Council is of the opinion that the actions of the Islamic Republic of Iran constitute a grave breach of international peace and security that has resulted 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 Regulations Amending the Special Economic Measures (Iran) Regulations under paragraph 4(1)(a)footnote a and subsections (1.1)footnote b, (2)footnote c and (3) of the Special Economic Measures Act footnote d.

Regulations Amending the Special Economic Measures (Iran) Regulations

Amendments

1 Part 1 of Schedule 1 to the Special Economic Measures (Iran) Regulations footnote 1 is amended by adding the following in numerical order:

2 Part 2 of Schedule 1 to the Regulations is amended by adding the following in numerical order:

Application Before Publication

3 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

4 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

The Islamic Republic of Iran (Iran) continues to threaten international peace and security through its destabilizing activities across the Middle East region and beyond, both through its armed forces and its support to its allies and proxies. Iran has significantly expanded its production of ballistic missiles, drones and key drone components, which are being transferred to malign actors and used in armed conflicts. Iran has also expanded its defence and security cooperation partnerships with other states engaged in malign activities, notably Russia, to which it has transferred ballistic missiles and drones. Iran’s contribution to the development and export of weapons and technology has exacerbated conflicts in the Middle East region and aided Russia in its illegal and unjustifiable war against Ukraine.

Background

Iran’s malign activities

Despite decades of concerted efforts by the international community, Iran remains a destabilizing force across the Middle East through malign activities by its own military, as well as its support of a network of aligned non-state militias and armed terrorist groups, often referred to as the “Axis of Resistance.” Axis members include groups such as Hamas, Hezbollah and the Houthis, most of which Canada has designated as terrorist entities and/or sanctioned. Iran supports Axis members through funding, arms provision, technology transfers, training, and ideological and political support.

The regime and its proxies have heightened the risk of regional escalation through a track record of attacks against Israel, neighbouring states, and American and other military installations in the region. The conflict referred to as the “12-day war” in June 2025 between Israel, the United States (U.S.) and Iran was marked by tit-for-tat strikes, attacks on Iranian nuclear facilities and unprecedented barrages of ballistic missiles and drones. Conflict involving extensive use of ballistic missiles and drones erupted again in the region on February 28, 2026, when the United States and Israel launched joint airstrikes against Iran and Iran responded with retaliatory strikes against Israel and U.S.-related military installations across the region, as well as on civilian and economic infrastructure in the Middle East. This represents a dangerous escalation that risks spreading and seriously undermining regional and international stability, with growing economic impact and disruptions to global trade, shipping, and energy markets, as well as growing humanitarian needs and displacement.

Beyond the Middle East, Iran supports Russia through the supply of ammunition, ballistic missiles and missile launchers, drones and technology transfers, enabling local manufacturing of drones and operational use for Russia’s illegal war of aggression against Ukraine. Russia continues to use Iranian weaponry, such as drones, to kill Ukrainian civilians and strike critical infrastructure. Russia’s aggression constitutes a grave violation of international law, including the United Nations Charter, and a direct threat to the Ukrainian people as well as European and international stability.

International response

Attacks by Iran and its proxies and the transfer of weapons technology to malign actors have been widely condemned by the international community. In particular, Iran’s actions are of longstanding concern to the G7 and the subject of regular joint statements. In April 2024, G7 leaders condemned Iran’s actions against Israel, called for an immediate de-escalation, and coordinated sanctions against Iran. In September 2024 and throughout 2025, Canada and G7 partners assessed that Iran continued to transfer weaponry to Russia despite repeated international calls to stop, representing a further escalation of Iran’s military support to Russia’s war against Ukraine. In June 2025, G7 leaders described Iran as the principal source of regional instability and terror. G7 statements have also condemned transnational repression and other malign activities by Iran. Most recently, on January 14, 2026, G7 Foreign Ministers expressed grave concern about the ongoing protests in Iran and the brutal repression of the Iranian people by the Iranian authorities.

With regard to sanctions measures, Canada and like-minded partners, including the European Union, the United Kingdom and the United States, have imposed multiple rounds of sanctions against Iranian individuals and entities for their links to destabilizing activities, such as weapons and technology transfers to malign actors, including the sale and transfer of Iranian ballistic missiles and drones to Russia.

Canadian sanctions against Iran

Canada established the Special Economic Measures (Iran) Regulations (the Iran Regulations) in 2010, pursuant to the Special Economic Measures Act (SEMA). In October 2022, Canada amended the Iran Regulations to expand the scope to cover gross and systematic human rights violations. On March 6, 2025, Canada amended the Iran Regulations again to expand the scope of the listing criteria to allow the imposition of sanctions in response to the evolving threat that Iran poses to peace and security in the region and globally, as well as the designation of any current or former senior government officials, beyond senior Islamic Revolutionary Guard Corps (IRGC) officials. In total, 217 Iranian individuals and 254 Iranian entities are listed under the Iran Regulations. This includes the listing of three individuals and four entities on March 6, 2025, for activities that contributed to Iran’s military support to Russia’s war against Ukraine.

Beyond the Iran Regulations, Canada imposed sanctions under the Special Economic Measures (Hamas Terrorist Attacks) Regulations in May 2024 on three members of the IRGC. Canada listed two Iranian entities under the Special Economic Measures (Russia) Regulations on February 21, 2025, for linkages to the Iranian drone program and their role in transporting sanctioned goods between Russian cities and third countries. On December 7, 2023, Canada also amended the Justice for Victims of Corrupt Foreign Officials Regulations to include two Iranian officials for their role in human rights violations in Iran.

Objective

These amendments aim to increase pressure on Iran and to send a clear message of

Description

These amendments add five individuals and four entities to Schedule 1 of the Iran Regulations for their actions, which undermine international peace, security, or stability in a manner that is consistent with the policies of Iran. Among the listed individuals and entities are Iranian businesspeople and companies directly connected to procurement networks that produce and supply sophisticated technology supporting Iran’s IRGC military activities, weapons production and transfers. These transfers contribute to ongoing regional and global instability, including support for Iran-aligned proxy groups and to Russia for its war against Ukraine.

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 (individuals and entities). These measures will also render listed individuals inadmissible to Canada under the Immigration and Refugee Protection Act (IRPA). Under the Iran 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.

Regulatory development

Consultation

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

With respect to these amendments, public consultation would not have been appropriate, given that publicizing the names of the persons targeted by sanctions would have likely resulted in asset flight prior to the coming into force of the amendments.

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 (UNA), SEMA and the Justice for Victims of Corrupt Foreign Officials Act.

Canada has established a rigorous due diligence process to consider and evaluate possible cases that may warrant the use of sanctions. Given the elements proposed in the amendments, SEMA was identified as the instrument of choice.

Sanctions measures under SEMA are imposed by the Governor in Council, on the recommendation of the Minister of Foreign Affairs, through a regulatory process. Regulations are the only option to enact sanctions in Canada. No other instruments could be considered.

Regulatory analysis

Benefits and costs

The incremental cost to the Government of Canada to administer and enforce these additional sanctions measures is minimal. The amendments target specific individuals and entities, and as such have less impact on Canadian businesses than traditional broad-based economic sanctions and have limited impact on the citizens of the country of the listed individuals and entities. The department’s review of publicly available trade data indicates that the newly listed individuals and entities have limited commercial linkages with Canada and therefore do not have business dealings that are significant to the Canadian economy. Therefore, it is anticipated that there will be no significant impacts on Canadians and Canadian businesses as a result of these amendments.

The Canada Border Services Agency, the Royal Canadian Mounted Police, Immigration, Refugees and Citizenship Canada and other departments and agencies will incur a small cost to ensure their relevant systems include the persons listed through these amendments. Canadian financial institutions will be required to incorporate the newly listed individuals and entities into their existing compliance and monitoring systems. This may result in minor administrative adjustments, but overall incremental compliance costs are anticipated to remain low.

Small business lens

Analysis under the small business lens concludes that the amendments will have minimal impact on Canadian small businesses. The amendments listing new individuals and entities do not impose any new compliance or administrative burden on small businesses in Canada. These amendments prohibit Canadian businesses from dealing with, providing services to, or otherwise making goods available to listed persons, but do not create obligations related to them. While Canadian businesses may seek permits under the Special Economic Measures Permit Authorization Order, Global Affairs Canada does not anticipate any applications resulting from listing these persons. Thus, there would be no incremental administrative burden arising from this requirement. Canadian small businesses are also subject to the duty to disclose under the Iran Regulations, which would represent a direct compliance requirement. However, as the newly listed persons 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 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 Special Economic Measures Permit Authorization Order 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 application with respect to the amendments.

Regulatory cooperation and alignment

While the amendments are not related to a work plan or a commitment under a formal regulatory cooperation forum, they align with actions taken by Canada’s allies and partners, such as the European Union, the United Kingdom and the United States.

International obligations

Compliance with Canada’s international commitments was considered in the development of the Iran Regulations.

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 a strategic environmental and economic assessment is not required.

Gender-based analysis plus

None of the newly listed individuals have Canadian citizenship. As a result, the scope of the gender-based analysis plus (GBA+) is limited.

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 SEMA can nevertheless have an unintended impact on certain groups and individuals in vulnerable situations. Rather than affecting Iran as a whole, these targeted sanctions impact individuals and entities believed to be engaged in activities that present an ongoing breach of international peace and security. Therefore, these targeted sanctions limit the collateral effects to those dependent on listed individuals and entities and are unlikely to have a significant impact on vulnerable groups as compared to traditional broad-based economic sanctions directed toward a state.

Implementation, compliance and enforcement, and service standards

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

Consequential to being listed in the Iran Regulations, and pursuant to the application of paragraph 35.1(b) of the Immigration and Refugee Protection Act, the listed individuals are rendered 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 to facilitate compliance with the Iran Regulations.

The Trade Commissioner Service (TCS) at Global Affairs Canada continues to assist clients in understanding Canadian sanctions regulations and, notably, the impact of the Iran Regulations on any activities in which Canadians may be engaged, abroad and in Canada. Global Affairs Canada is also increasing outreach efforts across Canada — including engaging with businesses, universities, and provincial and territorial governments — to enhance national awareness of and compliance with Canadian sanctions.

Under 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 SEMA, every person who knowingly contravenes or fails to comply with the Iran 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