Contributing Lawyers

Canada

Cyndee Todgham Cherniak

United States

Susan Kohn Ross

Australia

Andrew Hudson



Canada Introduces Legislative Tools to Freeze Assets of Corrupt Foreign Regimes Located in Canada

On March 3, 2011, Canada's Prime Minister Harper and Justice Minister Nicholson introduced in Canada's House of Commons important new legislation (the Freezing Assets of Corrupt Regimes Act), which will, when passed, provide the necessary tools to freeze assets of corrupt foreign regimes that are located in Canada. Go to the following link for the news release - http://www.international.gc.ca/media/aff/news-communiques/2011/089.aspx

The legislation may be found at the following link - http://www2.parl.gc.ca/HousePublications/Publication.aspx?Docid=5002566&file=4

Currently, Canada may freeze assets of named individuals pursuant to two different federal legal frameworks, namely (1) through the imposition of an economic sanctions regime under the United Nations Act or Special Economic Measures Act, or (2) pursuant to a request for mutual legal assistance in the context of the Mutual Legal Assistance in Criminal Matters Act (MLACMA) or under the Criminal Code.

However, the current tools need to be improved and the Freezing Assets of Corrupt Regimes Act contains the needed enhancements and improvements. Canada does not wish to be a safe haven for the assets stolen from the citizens of countries by their rogue leaders.

The Freezing Assets of Corrupt Regimes Act will allow the Government of Canada to act upon the request of a foreign state to freeze the assets that their former leaders and members of their entourage, including family members, senior officials and associates, may have placed in Canadian financial institutions. It will also give Canada the authority to seize any property such individuals may own in this country. The precondition will be a request by a foreign country. Where the Governor-in-Council (that is, Cabinet) has determined that the requesting country is in a state of turmoil or political uncertainty, it may order the assets to be frozen. The asset freeze order would be sent to Canadian financial institutions.

The Freezing Assets of Corrupt Regimes Act will permit Canada to issue an asset freeze order without requiring evidence of criminality or specific identification of assets to be provided by the foreign state. The assets at issue would be frozen for a period of up to five years in the interests of international relations, such as to permit the foreign state to initiate the necessary proceedings to allow for seizure and forfeiture of assets situated in Canada. The time period is open to renewal.

In light of the recent activities in the Middle East, this is an important step for Canada to make. Prime Minister Harper and Justice Minister Nicholson have acted quickly. Canada will not help leaders who have stolen money from their citizens. Canada does not want to safe-keep these ill-gotten gains. Canada has a leadership role to take in the world because humanity matters.

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