Regulations Amending the Special Economic Measures (Iran) Regulations: SOR/2026-179

Canada Gazette, Part II, Volume 160, Number 17

Registration
SOR/2026-179 August 13, 2026

SPECIAL ECONOMIC MEASURES ACT

P.C. 2026-757 August 13, 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 4(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

Amendment

1 Part 2 of Schedule 1 to the Special Economic Measures (Iran) Regulations footnote 1 is amended by adding the following in numerical order:

Application Before Publication

2 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

3 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 undermine international peace and security through its destabilizing activities across the Middle East region and beyond, which include its armed attacks on neighbouring states and malign actions to disrupt navigation in and around the Strait of Hormuz. This is contrary to international law. Iran’s actions threaten the stability of global energy markets, the global economy and critical supply chains, including those linked to food, fuel and humanitarian goods.

Background

Iran’s actions around the Strait of Hormuz

Following armed attacks by the United States (U.S.) and Israel against Iran on February 28, 2026, Iran retaliated by announcing the closure of the Strait of Hormuz and threatening to strike any vessel crossing the Strait, leading to a significant reduction of transit through the waterway. Iranian authorities, primarily the Islamic Revolutionary Guard Corps (IRGC), have issued warnings that passage is prohibited without prior Iranian authorization and subsequently threatened, seized, or targeted multiple commercial vessels operating in or near the Strait of Hormuz. The IRGC has struck at least 3 cargo vessels in the Strait and seized at least 2, including vessels owned by Greece and Italy. Since May 2026, reporting by the International Maritime Organization indicated that an estimated 1 500 to 3 000 vessels with approximately 20 000 seafarers on board were stranded in the Persian Gulf due to fear of military confrontation. As of July 2026, more than 1 500 vessels remain stranded, with 6 000 seafarers trapped on board. Iran has also created a new state regulatory authority to authorize passage through the waterway and has suggested that fees may be incurred by vessels transiting through.

Bordered by Iran and Oman, approximately 20% of the world’s oil and liquefied natural gas supplies transit through the Strait of Hormuz, in addition to critical shipments of fertilizer, food products and other essential goods. Iranian actions that have disrupted the freedom of maritime navigation through the Strait of Hormuz since March 2026 have led to the largest disruption to global energy supplies since the energy crisis in the 1970s and the most significant disruption in the history of the global oil market. Reports indicate that shipping traffic has dropped 90% since February 28, 2026. Furthermore, humanitarian aid has been hindered, exacerbating humanitarian crises and economic insecurity, with the United Nations World Food Programme warning on March 19, 2026, that, if the escalation of the conflict in the Middle East continues, an additional 45 million people globally could be pushed into acute hunger due to rising food and fuel costs and supply chain disruptions, signalling a major global economic impact.

International response

Iranian actions in and around the Strait of Hormuz have been widely condemned by the international community and Canada. On March 11, 2026, the United Nations Security Council (UNSC), with 135 co-sponsors, including Canada, adopted Resolution 2817 concerning Iranian missile and drone strikes on the member states of the Cooperation Council for the Arab States of the Gulf and Jordan, which condemned and demanded the immediate cessation of Iranian strikes, actions described as a breach of international law and a threat to international peace and security. On April 24, 2026, the Secretary-General of the International Maritime Organization called for the release of the 20 000 seafarers unable to leave the Persian Gulf and on June 23, 2026, announced an evacuation plan for stranded seafarers. In statements in March 2026 and in June 2026, the G7 Foreign Ministers, including Canada, affirmed the importance of safeguarding maritime routes and the safety of navigation and reiterated the absolute necessity of permanently restoring safe and toll-free freedom of navigation in the Strait of Hormuz, while underscoring the importance of minimizing the impact of the conflict on regional partners, civilian populations and civilian infrastructure, and the need to coordinate humanitarian aid efforts.

Independent of U.S. efforts, the United Kingdom (U.K.) and France have spearheaded international, cross-regional efforts with partners, including Canada, to affirm their commitment to using collective diplomatic, economic and military capabilities to support freedom of navigation through the Strait of Hormuz. These efforts include working groups on economic and political issues, leaders’ statements, and political support for an independent and strictly defensive multinational maritime mission, announced on May 14, 2026. On May 11 and 12, 2026, the U.K. and Australia announced new sanctions targeting Iran’s illicit activities, regional destabilization and transnational repression. On May 22, 2026, the European Union expanded its sanctions regime, allowing the targeting of individuals and entities threatening the freedom of navigation in the Strait of Hormuz, and on June 8, 2026, imposed sanctions on two individuals and one entity impeding lawful transit passage and freedom of navigation through the Strait of Hormuz. Throughout the first half of 2026, the United States has imposed multiple rounds of sanctions on Iran, including efforts to block Iran’s nuclear ambitions and disrupt its oil smuggling networks. In May and July 2026, the United States imposed sanctions on entities linked to the extortion of commercial shipping activities and the monetization of the Strait of Hormuz.

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). On March 6, 2025, Canada amended the Iran Regulations 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 IRGC officials). With these amendments, 232 Iranian individuals and 260 Iranian entities are listed under the SEMA and the Justice for Victims of Corrupt Foreign Officials Act (JVCFOA).

Objective

The Regulations Amending the Special Economic Measures (Iran) Regulations (the amendments) aim to increase pressure on Iran to change its behaviour and to send a clear message of

Description

The amendments add five individuals to Schedule 1 of the Iran Regulations for their role in activities that undermine international peace and security by obstructing navigation rights around the Strait of Hormuz. Among those listed are senior IRGC officials and senior Government of Iran officials linked to the facilitation, promotion and military enforcement of Iranian measures that include strikes on vessels and seafarers in and near the Strait of Hormuz and strikes on civilians and civilian infrastructure in regional states, which contribute to ongoing regional and global instability. 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 individuals. 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 names removed from the Schedule of listed 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, the SEMA and the JVCFOA.

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, 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 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, therefore, have less impact on Canadian businesses than traditional broad-based economic sanctions and have a limited impact on the citizens of the country of the listed individuals. Global Affairs Canada’s review of publicly available trade data indicates that the newly listed individuals 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 bear 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 definitions 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 U.K. and the United States.

International obligations

Compliance with Canada’s international commitments and obligations 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 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 the 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 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 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 IRPA, the listed individuals are rendered 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 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 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 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