Contributing Lawyers

Canada

Cyndee Todgham Cherniak

United States

Susan Kohn Ross

Australia

Andrew Hudson



Canada’s Economic Sanctions Against Syria: More Sanctions To Force Regime Change

On March 5, 2012, Canada imposed further economic sanctions and trade restrictions against Syria and closed the doors of Canada’s Embassy in Damascus.  Canada’s Minister of Foreign Affairs announced new Regulations Amending the Special Economic Measures (Syria) Regulations to stop almost all financial transactions.

Recap

On May 24, 2011, Prime Minister Harper announced that Canada was imposing targeted economic sanctions and trade restrictions under the Special Economic Measures Act (Canada) against designated persons in the Syrian regime.  On August 18, 2011, Canada’s Minister of Foreign Affairs added more designated persons to the list covered by the targeted sanctions.  On October 4, 2011, the Minister of Foreign Affairs added sanctions targeting the petroleum industry and new investments in the oil industry.  On December 23, 2011, the Minister of Foreign Affairs expanded its targeted sanctions by prohibiting all imports from Syria, except for food for human consumption, as well as all new investment in Syria and the export to Syria of telecommunications monitoring equipment.  On January 25, 2012, the Minister of Foreign Affairs expanded the list of designated persons.

Prohibitions (Rules)

Canada’s economic sanctions and trade restrictions against Syria can be restated as a series of prohibitions or rules.  However, the rules are being applied broadly and the interpretation of the rules does not permit the vast majority of forms of trade.

Designated Person Rules

Rule 1. Persons in Canada and Canadian outside Canada SHALL NOT deal in any property, wherever situated, held on or on behalf of a Designated Person.

Rule 2. Persons in Canada and Canadian outside Canada SHALL NOT enter into or facilitate any transaction related to a dealing in any property, wherever situated, held on or on behalf of a Designated Person.

Rule 3. Persons in Canada and Canadian outside Canada SHALL NOT provide any financial or related service in respect of a dealing in any property wherever situated, held on or on behalf of a Designated Person.

Rule 4. Persons in Canada and Canadian outside Canada SHALL NOT make any goods, wherever situated, available to a Designated Person.

Rule 5: Persons in Canada and Canadian outside Canada SHALL NOT provide any financial or related service to or for the benefit of a Designated Person.

A “Designated Person” is defined in the Special Economic Measures (Syria) Regulations to mean a person (individuals and entities) in Syria, or who is a national of Syria and who does not ordinarily reside in Canada and whose name listed by the Government of Canada in the Regulation, as amended from time to time.

General Rules

Rule 6: Persons in Canada and Canadian outside Canada SHALL NOT provide or acquire financial or related services to, from or for the benefit of or on the direction or order of Syria or any person in Syria for the purpose of facilitating the importation, purchase, acquisition or shipment any petroleum or petroleum products (excluding natural gas) from Syria.

Rule 7; Persons in Canada and Canadian outside Canada SHALL NOT provide or acquire financial or other related services to, from or for the benefit of or on the direction or order of Syria or any person in Syria for the purpose of investing in the oil industry in Syria.

Rule 8: Persons in Canada and Canadian outside Canada SHALL NOT export, sell, supply or ship to Syria or any person in Syria any goods, including technical data for use in the monitoring of telecommunications.

Rule 9: Persons in Canada and Canadian outside Canada SHALL NOT make an investment in Syria that is engaged in the oil industry if the investment involves a dealing in any property, wherever situated, held on or on behalf of Syria, a person in Syria or a national of Syria who is not ordinarily resident in Canada.

Rule 10: Persons in Canada and Canadian outside Canada SHALL NOT import, purchase, acquire, carry or ship any goods (other than food for human consumption) that are exported, supplied or shipped from Syria after December 23, 2011.

Rule 11: Persons in Canada and Canadian outside Canada SHALL NOT provide or acquire financial or other related services from or for the benefit of or on the direction or order of Syria or any person in Syria.

Rule 12: Persons in Canada and Canadians outside Canada SHALL NOT do anything that causes, assists or promotes or is intended to cause, assist or promote any act or thing prohibited in Rules 1-11.

Exceptions

The Minister of Affairs may issue a permit pursuant to the Special Economic Measures (Syria) Permit Authorization Order to authorize certain activities by persons in Canada and Canadians. In addition, certain activities are excluded from the prohibitions, including

·         any activity engaged in under an agreement or arrangement between Canada and Syria;

·         any payment made by or on behalf of a designated person that is due under a contract entered into before the person became a designated person, provided that the payment is not made to or for the benefit of a designated person;

·         any goods made available, or services provided, to or by any of the following entities for the purpose of safeguarding human life, disaster relief, democratization, stabilization or providing food, medicine or medical supplies or equipment:

o   an international organization with diplomatic status,

o   a United Nations agency,

o   the International Red Cross and Red Crescent Movement, or

o   a non-governmental organization that has entered into a grant or contribution agreement with the Department of Foreign Affairs and International Trade or the Canadian International Development Agency;

·        the importation, purchase, acquisition, carrying or shipping of petroleum or petroleum products that were exported, supplied or shipped from Syria before October 5, 2011;

·         any goods from the Embassy of Canada in Syria destined for Canada or any goods from Syria destined for the Embassy of Syria in Canada.;

  • personal or settlers’ effects that are taken or shipped by an individual leaving Syria and that are solely for the use of the individual or the individual’s immediate family;

  • personal correspondence, including lettermail, printed papers and postcards, of a weight not exceeding 250 g per item of correspondence;

  • pension payments to any person in Canada or any Canadian abroad;

  • any transaction in respect of the accounts at a Canadian financial institution that are used for the regular business of the Embassy of Syria or its consular missions in Canada;

  • any transaction in respect of the accounts at a Syrian financial institution that are used for the regular business of the Embassy of Canada or its consular missions in Syria;

  • any transactions necessary for a Canadian to transfer any existing accounts, funds or investments of a Canadian held with a designated person to a non-designated person; and

  • pension payments to any person in Canada, any Canadian abroad or any person in Syria;

Rule 11 has a number of specific exemptions, including:

  • loan repayments to any person in Canada, or any Canadian abroad, in respect of loans entered into before March 5, 2012, enforcement of security in respect of those loans, or payments by guarantors guaranteeing those loans;

·         financial services that are required to be provided or acquired further to a contract entered into before March 5, 2012;

·         financial services in respect of non-commercial remittances of $40,000 or less sent to or from Syria, or any person in Syria, if the person providing the financial services keeps a record of the transaction.

A Cautionary Note

The foregoing provides only an overview and does not constitute legal advice. Readers are cautioned against making any decisions based on this material alone. Rather, specific legal advice should be obtained.

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