Vol. 148, No. 23 — November 5, 2014
Registration
SOR/2014-235 October 24, 2014
SPECIAL ECONOMIC MEASURES ACT
Special Economic Measures (South Sudan) Regulations
P.C. 2014-1116 October 23, 2014
Whereas the Governor in Council is of the opinion that the situation in South Sudan constitutes a grave breach of international peace and security that has resulted or is likely to result in a serious international crisis;
Therefore, His Excellency the Governor General in Council, on the recommendation of the Minister of Foreign Affairs, pursuant to subsections 4(1) to (3) of the Special Economic Measures Act (see footnote a), makes the annexed Special Economic Measures (South Sudan) Regulations.
SPECIAL ECONOMIC MEASURES (SOUTH SUDAN) REGULATIONS
INTERPRETATION
Definitions
1. The following definitions apply in these Regulations.
“Convention”
« Convention »
“Convention” means the Vienna Convention on Diplomatic Relations, done at Vienna on April 18, 1961.
“Cessation of Hostilities Agreement”
« Accord de cessation des hostilités »
“Cessation of Hostilities Agreement” means the Agreement on Cessation of Hostilities between the Government of South Sudan and the Sudan People’s Liberation Movement/Army (In Opposition), done at Addis Ababa on January 23, 2014, that was mediated by the Intergovernmental Authority on Development.
“designated person”
« personne désignée »
“designated person” means a person who is in South Sudan, or is a national of South Sudan who does not ordinarily reside in Canada, and whose name is listed in the schedule.
“Minister”
« ministre »
“Minister” means the Minister of Foreign Affairs.
“pension”
« pension »
“pension” means a benefit paid under the Old Age Security Act, the Canada Pension Plan or an Act respecting the Quebec Pension Plan, CQLR, c. R-9, any superannuation, pension or benefit paid under or in respect of any retirement savings plan or under any retirement plan, any amount paid under or in respect of the Garnishment, Attachment and Pension Diversion Act or the Pension Benefits Division Act, and any other payment made in respect of disability.
“South Sudan”
« Soudan du Sud »
“South Sudan” means the Republic of South Sudan and includes
- (a) any political subdivision of South Sudan;
- (b) the government, and any department, of South Sudan or of a political subdivision of South Sudan; and
- (c) any agency of South Sudan or of a political subdivision of South Sudan.
LIST
Schedule
2. A person whose name is listed in the schedule is a person in respect of whom the Governor in Council, on the recommendation of the Minister, is satisfied that there are reasonable grounds to believe is a person engaged in activities that directly or indirectly facilitate, support, provide funding for or contribute to a violation or attempted violation of the Cessation of Hostilities Agreement.
PROHIBITIONS
Prohibited transactions and activities
3. It is prohibited for any person in Canada and any Canadian outside Canada to
- (a) deal in any property, wherever situated, held by or on behalf of a designated person;
- (b) enter into or facilitate, directly or indirectly, any transaction related to a dealing referred to in paragraph (a);
- (c) provide any financial or related service in respect of a dealing referred to in paragraph (a);
- (d) make any goods, wherever situated, available to a designated person; or
- (e) provide any financial or related service to or for the benefit of a designated person.
Non-application
4. Section 3 does not apply in respect of
- (a) 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;
- (b) pension payments to any person in Canada or any Canadian outside Canada;
- (c) any transaction in respect of any account at a financial institution held by a diplomatic mission, if the transaction is required in order for the mission to fulfill its diplomatic functions as set out in Article 3 of the Convention or, if the diplomatic mission has been temporarily or permanently recalled, when the transaction is required in order to maintain the mission premises;
- (d) any transaction to international organizations with diplomatic status, a United Nations agency, the International Red Cross and Red Crescent Movement, or Canadian non-governmental organizations that have entered into a grant or contribution agreement with the Department of Foreign Affairs, Trade and Development;
- (e) any transactions necessary for a Canadian to transfer to a non-designated person any accounts, funds or investments of a Canadian held by a designated person on the day on which that person became a designated person;
- (f) financial services required in order for a designated person to obtain legal services in Canada with respect to the application of any of the prohibitions set out in these Regulations;
- (g) any dealings with a designated person required with respect to loan repayments made to any person in Canada, or any Canadian outside Canada, for loans entered into with any person other than a designated person, and for enforcement and realization of security in respect of those loans, or payments by guarantors guaranteeing those loans; and
- (h) any dealings with a designated person required with respect to loan repayments made to any person in Canada, or any Canadian outside Canada, for loans entered into with a designated person before that person became a designated person, and for enforcement and realization of security in respect of those loans, or payments by guarantors guaranteeing those loans.
Assisting prohibited act
5. It is prohibited for any person in Canada and any Canadian outside Canada to do anything that causes, assists or promotes, or is intended to cause, assist or promote, any act or thing prohibited under section 3.
OBLIGATIONS
Duty to determine
6. Each of the following entities must determine on a continuing basis whether it is in possession or control of property owned or controlled by or on behalf of a designated person:
- (a) authorized foreign banks, as defined in section 2 of the Bank Act, in respect of their business in Canada or banks to which that Act applies;
- (b) cooperative credit societies, savings and credit unions and caisses populaires regulated by a provincial Act and associations regulated by the Cooperative Credit Associations Act;
- (c) foreign companies, as defined in subsection 2(1) of the Insurance Companies Act, in respect of their insurance business in Canada;
- (d) companies, provincial companies and societies, as those terms are defined in subsection 2(1) of the Insurance Companies Act;
- (e) fraternal benefit societies regulated by a provincial Act in respect of their insurance activities and insurance companies and other entities engaged in the business of insuring risks that are regulated by a provincial Act;
- (f) companies to which the Trust and Loan Companies Act applies;
- (g) trust companies regulated by a provincial Act;
- (h) loan companies regulated by a provincial Act;
- (i) entities that engage in any activity described in paragraph 5(h) of the Proceeds of Crime (Money Laundering) and Terrorist Financing Act, if the activity involves the opening of an account for a client; and
- (j) entities authorized under provincial legislation to engage in the business of dealing in securities, or to provide portfolio management or investment counselling services.
Disclosure
7. (1) Every person in Canada and every Canadian outside Canada must disclose without delay to the Commissioner of the Royal Canadian Mounted Police
- (a) the existence of property in their possession or control that they have reason to believe is owned or controlled, directly or indirectly, by a designated person or by an entity owned or controlled by a designated person; and
- (b) information about a transaction or proposed transaction in respect of property referred to in paragraph (a).
Immunity
(2) No person contravenes subsection (1) by disclosing in good faith under that subsection.
APPLICATIONS
Application to no longer be a designated person
8. (1) A designated person may apply in writing to the Minister to have their name removed from the schedule.
Recommendation
(2) On receipt of the application, the Minister must decide whether there are reasonable grounds to recommend to the Governor in Council that the applicant’s name be removed from the schedule.
Decision
(3) The Minister must make a decision on the application within 90 days after the day on which the application is received.
Notice
(4) The Minister must give notice without delay to the applicant of the decision taken.
New application
(5) If there has been a material change in circumstances since the last application was submitted, a person may submit another application under subsection (1).
Application for a certificate
9. (1) A person claiming not to be a designated person may apply to the Minister for a certificate stating that they are not the person who has been designated under section 2.
Certificate
(2) If it is established that the person is not a designated person, the Minister must issue a certificate to the applicant within 30 days after the day on which the application is received.
APPLICATION PRIOR TO PUBLICATION
Statutory Instruments Act
10. For the purpose of paragraph 11(2)(a) of the Statutory Instruments Act, these Regulations apply before they are published in the Canada Gazette.
COMING INTO FORCE
Registration
11. These Regulations come into force on the day on which they are registered.
SCHEDULE
(Sections 1, 2, and 8)
PERSONS
- 1. Marial CHANUONG
- 2. Peter GADET
REGULATORY IMPACT ANALYSIS STATEMENT
(This statement is not part of the Regulations or the Order.)
Issues
The situation in South Sudan continues to deteriorate as both parties to the conflict engage in activities that undermine the Cessation of Hostilities Agreement, mediated by the Intergovernmental Authority on Development (IGAD). Estimates of casualties due to the conflict range from 10 000 to 40 000 people and are possibly much higher, while over 1.5 million people have been displaced internally or as refugees.
Background
Since December 2013, forces loyal to President Salva Kiir and those loyal to former Vice-President Riek Machar have engaged in violent conflict, much of it along ethnic lines. The IGAD (a regional body consisting of Djibouti, Ethiopia, Kenya, Somalia, Sudan and Uganda, as well as South Sudan) is leading peace talks. The Cessation of Hostilities Agreement was signed by both parties on January 23, 2014, followed by the Agreement to Resolve the Crisis in South Sudan signed on May 9, 2014. Both agreements were violated shortly thereafter, and international observers suspect that both sides have been deliberately stalling negotiations in hopes of furthering their military gains. On June 10, 2014, Mr. Kiir and Mr. Machar agreed to end fighting and form a transitional government within 60 days, but little progress has been made since then.
Estimates of casualties due to the conflict range from 10 000 to 40 000 people and are possibly much higher. Also, over 1.5 million people have been displaced internally or as refugees. On May 12, 2014, United Nations (UN) Secretary Ban Ki-Moon called for a special tribunal for South Sudan, saying there are grounds to believe that crimes against humanity have been committed during the crisis.
On April 3, 2014, Barack Obama, the President of the United States, issued an executive order that allows for the imposition of targeted sanctions on individuals in South Sudan, in response to breaches of the Cessation of Hostilities Agreement, lack of cooperation with regional mediators and human rights violations perpetrated by both parties. Pursuant to this executive order, on May 6, 2014, U.S. Secretary of State John Kerry announced sanctions against Peter Gadet, a former Sudan People’s Liberation Army (SPLA) commander who defected to join anti-government forces at the start of the conflict, and Major-General Marial Chanuong, head of Salva Kiir’s Presidential Guard. This decision freezes any of their assets in the United States, blocks U.S. individuals and entities from dealing with them and suspends their entry into the United States. On July 10, 2014, the European Union imposed sanctions against two South Sudanese military leaders (Peter Gadet and Santino Deng, commander of the third infantry division of the SPLA). Sanctions are also currently under discussion in the UN Security Council.
According to publicly available information from the Office of the U.S. Special Envoy for Sudan and South Sudan, Mr. Chanuong led the operations in Juba following fighting that began on December 15, 2013. Mr. Chanuong, a member of the Dinka tribe, reportedly ordered the use of tanks to target political figures in Juba, killing 29 unarmed bodyguards, including those of Riek Machar, the Nuer opposition leader.
According to a May 8, 2014, report titled “Conflict in South Sudan: A Human Rights Report,” by the United Nations Mission in the Republic of South Sudan (UNMISS), UNMISS officials met with a local official in Bor on December 19, 2013, who stated that forces loyal to Mr. Gadet were responsible for the attack on the country support base in Akobo where Dinka civilians were targeted. According to publicly available information from the Office of the U.S. Special Envoy for Sudan and South Sudan, in March 2014, Mr. Gadet led anti-government forces in the battle for control of Bentiu (Unity State) in breach of the Cessation of Hostilities Agreement. On April 9, 2014, Mr. Gadet refused to abide by any future peace agreements made between anti-government forces and the Government of South Sudan. Mr. Gadet also reportedly authorized the targeting of civilians, including women in Bentiu on April 15, 2014, after the government forces were defeated.
Objectives
The Special Economic Measures (South Sudan) Regulations impose targeted sanctions against persons engaged in activities that directly or indirectly facilitate, support, provide funding for or contribute to a violation or attempted violation of the Cessation of Hostilities Agreement, mediated by the IGAD.
Description
The proposed Regulations establish a list of two individuals. The category for listing is established in section 2 of the Regulations. The Regulations prohibit any person in Canada and any Canadian outside Canada from
- dealing in any property, wherever situated, held by or on behalf of a designated person;
- entering into or facilitating, directly or indirectly, any transaction related to such a dealing;
- providing any financial or related service in respect of such a dealing;
- making goods, wherever situated, available to a designated person; and
- providing any financial or related service to or for the benefit of a designated person.
Exceptions to the above-noted prohibitions are available for the following:
- Payments made by or on behalf of designated persons pursuant to contracts entered into prior to the coming into force of the Regulations, provided that the payments are not made to or for the benefit of a designated person;
- Pension payments to any person in Canada or any Canadian outside Canada;
- Transactions in respect of accounts at financial institutions held by diplomatic missions, provided that the transaction is required in order for the mission to fulfill its diplomatic functions under the Vienna Convention on Diplomatic Relations, or, transactions required in order to maintain the mission premises if the diplomatic mission has been temporarily or permanently recalled;
- Transactions by international organizations with diplomatic status, agencies of the United Nations, the International Red Cross and Red Crescent Movement, or Canadian nongovernmental organizations that have entered into a grant or contribution agreement with the Department of Foreign Affairs, Trade and Development;
- Transactions necessary for a Canadian to transfer to a non-designated person any accounts funds or investments of a Canadian held by a designated person on the day on which that person became designated;
- Financial services required in order for a designated person to obtain legal services in Canada with respect to the application of any of the prohibitions in the Regulations; and
- Loan repayments made to any person in Canada or any Canadian abroad in respect of loans entered into before the coming into force of the Regulations, enforcement of security in respect of those loans, or payments by guarantors guaranteeing those loans.
A separate Special Economic Measures (South Sudan) Permit Authorization Order, made pursuant to subsection 4(4) of the Special Economic Measures Act authorizes the Minister of Foreign Affairs to issue to any person in Canada and any Canadian outside Canada a permit to carry out a specified activity or transaction, or any class of activity or transaction, with a designated person that is otherwise restricted or prohibited pursuant to the Regulations.
“One-for-One” Rule
The “One-for-One” Rule applies to this proposal, as there are minimal administrative costs to business, because of the reporting requirement. However, the administrative burden associated with these Regulations is carved out from the “One-for-One” Rule, as they address unique, exceptional circumstances.
Small business lens
The small business lens does not apply to this proposal, as there are no costs (or insignificant costs) on small business and small businesses would not be disproportionately affected.
Consultation
Foreign Affairs, Trade and Development Canada drafted the Regulations in consultation with the Department of Justice and Citizenship and Immigration Canada.
Rationale
The measures contained in the Regulations demonstrate Canada’s concern about the situation in South Sudan. The proposed sanctions target individuals engaged in activities that obstruct or undermine the IGAD-led peace process; or constitute breaches of the Cessation of Hostilities Agreement or human rights violations.
Implementation, enforcement and service standards
Canada’s sanctions regulations are enforced by the Royal Canadian Mounted Police and the Canada Border Services Agency. In accordance with section 8 of the Special Economic Measures Act, every person who wilfully contravenes these 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
Karen MacArthur
Director
Southern and Eastern Africa Division
Foreign Affairs, Trade and Development Canada
125 Sussex Drive
Ottawa, Ontario
K1A 0G2
Telephone: 343-203-3333
Fax: 613-944-7432
Email: Karen.MacArthur@international.gc.ca
- Footnote a
S.C. 1992, c. 17