Canada has imposed wide reaching economic sanctions and trade restrictions against Iran. Canada has two sanctions regimes in place against Iran:
1) Multilateral sanctions as agreed by the United Nations imposed pursuant to the Regulations Implementing the United Nations Resolutions on Iran, which were implemented pursuant to United Nations Security Council Resolutions 1737 (2006), 1747 (2007), 1803 (2008), and 1929 (2010), and
2) Unilateral sanctions imposed pursuant to the Special Economic Measures (Iran) Regulations, which were implemented under the authority of the Special Economic Measures Act.
Canada's economic sanctions and trade restrictions against Iran prohibit certain forms of dealings and activities. The prohibitions in the regulations apply to (1) persons in Canada regardless of nationality and (2) Canadians outside Canada (wherever they may be - even in Iran itself). The term “person" means "an individual, a body corporate, a trust, a partnership, a fund, an unincorporated association or organization or a foreign state." The term "Canadian" is defined to mean "an individual who is a citizen within the meaning of the Citizenship Act or a body corporate incorporated by or continued under the laws of Canada or a province." As a result, branches of Canadian companies operating in foreign jurisdictions are also covered by the prohibitions.
The prohibitions applicable to persons in Canada and Canadians outside Canada may affect their dealings with "designated persons" (which are provided in list form) and property or entities "owned or controlled by a designated person" (not on a list). The coverage of property and entities "owned or controlled by a designated person" means that a mere review of the list of designated persons is not enough to ensure compliance with Canada's export controls laws. It is necessary to obtain information concerning any Iranian person or entity with which you have dealings or propose to have dealings whether or not that person or entity is inside or outside Iran.
Canadian persons and Canadians inside and outside Canada must undertake due diligence. For example, volumes of trade with Iran go through U.A.E ports. A Canadian operating a warehouse in Dubai must make sure they are not selling prohibited goods to a designated person or to an entity owned or controlled by a designated person.
For more information, please contact Cyndee Todgham Cherniak, a Canadian export controls lawyer, at 416-307-4168.