Canada: Sanctions Alert: Canada Imposes New Sanctions Against China, Additional Sanctions On Crimea, Russia And Myanmar

The Government of Canada has made several recent changes to Canadian sanctions legislation to impose new sanctions against the People's Republic of China (China) and designate additional individuals and entities under existing sanctions targeting Crimea, Russia and Myanmar.

CHINA SANCTIONS

On March 22, 2021, Canada imposed new sanctions under the Special Economic Measures Act (SEMA) to target four Chinese individuals and one Chinese entity (Listed Persons) in connection with gross and systemic human rights violations alleged to have been committed in the Xinjiang region of China.

The sanctions have been implemented by the Special Economic Measures (People's Republic of China) Regulations (China Regulations), made under SEMA, and apply to persons in Canada and to Canadian citizens and Canadian-incorporated entities outside Canada. The China Regulations prohibit dealings in the property of Listed Persons and impose an obligation to report to Canadian law enforcement on the property of Listed Persons. In addition, the listed individuals are inadmissible to Canada under the Immigration and Refugee Protection Act.

Like other regulations made under SEMA, the China Regulations require regulated financial institutions to determine on a continuing basis whether they are in possession or control of property of a Listed Person. Regulated financial institutions are not, however, required to file a monthly report with their principal regulator in respect of these Listed Persons.

These sanctions were made in coordination with similar measures adopted by the United States, United Kingdom and European Union. China has announced reciprocal sanctions, including against individuals in Canada.

It is noteworthy that Canada chose to impose sanctions pursuant to the SEMA, rather than the Sergei Magnitsky Law. This indicates that Canada may broaden the nature of the sanctions imposed, such as to extend to prohibitions on trade in goods from China or the Xinjiang region in particular. In January, the Government of Canada issued an advisory to Canadian companies with ties to Xinjiang urging them to examine their activities to ensure they do not support repression of ethnic minorities in China. For more information on this advisory, please see our Blakes Bulletin: Government of Canada Sets Compliance Expectations for Canadian Businesses Linked to Xinjiang, China.

RUSSIA AND UKRAINE SANCTIONS

The Government of Canada also expanded the existing sanctions program in respect of Russia and Crimea to target additional individuals and entities. Specifically, on March 21, 2021, Canada amended the Special Economic Measures (Russia) Regulations (Russia Regulations) to designate nine new individuals in connection with human rights violations in Russia. Later, on March 29, 2021, the Russia Regulations and Special Economic Measures (Ukraine) Regulations (Ukraine Regulations) were both amended to target an additional two individuals and four entities in connection with the continued Russian occupation of the Crimea region. These amendments did not affect the sectoral sanctions under Schedules 2 and 3 of the Russia Regulations, which impose prohibitions on dealings in specific securities of Russian financial institutions and energy companies.

MYANMAR SANCTIONS

On February 18, 2021, the Government of Canada also expanded its existing sanctions against Myanmar, amending the Special Economic Measures (Burma) Regulations (Myanmar Regulations) to target nine Myanmar military officials in connection with the military's recent actions to take control of the country. The Myanmar Regulations now prohibit dealings in the property of 44 entities and 54 individuals, and continue to prohibit trading in arms and related material or providing financial or other services related to military activities to Myanmar or any person in Myanmar.

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