Vol. 144, No. 25 — June 19, 2010

Order Amending the Export Control List

Statutory authority

Export and Import Permits Act

Sponsoring department

Department of Foreign Affairs and International Trade

REGULATORY IMPACT ANALYSIS STATEMENT

(This statement is not part of the Order.)

Issue and objectives

Canada’s export control system is a significant component of our multilateral commitments to restrict the illicit proliferation of weapons of mass destruction by states and non-state actors. Canada implemented a “catch-all” control to respond to these commitments in 2002, but a number of concerns expressed by the Standing Joint Committee for the Scrutiny of Regulations (Standing Joint Committee) have resulted in a need to revisit this measure. The Department of Foreign Affairs and International Trade (DFAIT) consequently seeks to amend the Export Control List (ECL), specifically item 5505 — Goods and Technology for Certain Uses. This proposed amendment will serve to address the concerns of the Standing Joint Committee and update the Regulations to reflect current foreign policy and security considerations.

Description and rationale

Canada is a participating state in four multilateral export control regimes and is a party to the Nuclear Non-proliferation Treaty and the Chemical Weapons Convention. Together, they form the basis of Canada’s non-proliferation export control policies and procedures. In order to implement appropriate controls, several export control regimes maintain lists of goods and technology that could be used in the development and production of weapons of mass destruction applications, and each participating state has committed to control the export of these goods and technology. In Canada, all of these goods and technology are included in the ECL.

Since it is not possible to control all goods and technology that could potentially be used, directly or indirectly, in the proliferation of a weapon of mass destruction, several multilateral export control regimes have defined a “catch-all” control. A catch-all control is a mechanism designed to cover unlisted goods and technology that could be used in the development or production of chemical, biological or nuclear weapons.

On April 11, 2002, Canada added item 5505 to the ECL to implement the catch-all control in domestic law. Item 5505 imposes a permit requirement on the export of items not listed elsewhere on the ECL when they are likely to be used in an activity or facility associated with weapons of mass destruction or their delivery systems.

The Standing Joint Committee requested that DFAIT confirm its legislative authority to implement the catch-all control and clarify when an application to export an item not listed elsewhere on the ECL is required. The proposed amendment reformulates the catch-all control in light of the underlying legislative authority found in subsection 3(2) of the Export and Import Permits Act (EIPA) and clarifies that an exporter is required to submit an application only if the item’s properties (i.e. technical characteristics or capabilities) and any other information made known to the exporter would lead a reasonable person to suspect that it will be used in the specified proliferation contexts.

The proposed amendment explicitly designates the Minister of Foreign Affairs as the person responsible for making determinations that an item meets the criteria applicable to catch-all controls outlined under item 5505. This is authorized under subsection 3(2) of the EIPA, which indicates that a description of goods listed on the ECL “may contain conditions that are based on approvals, classifications or determinations made by specified persons or specified government entities.”

Further, on April 30, 2009, as a result of legislative amendments to the EIPA under Part 8 of the Public Safety Act, 2002 (2004, c. 15), which came into force on March 31, 2007, the ECL, including item 5505, was amended to explicitly impose export controls on technology.

Item 5505 currently includes a list of exempt destination countries. This ensures that the catch-all measure does not inordinately restrict or impede legitimate trade. DFAIT proposes to reduce the list of exempt destination countries under item 5505 to those that participate in all four multilateral export control regimes. In addition, the exempt destination country list will hereinafter apply only to item 5505(1), as opposed to item 5505 in its entirety. These proposed changes will not result in an increased administrative burden on Canadian exporters, and will result in a strengthened catch-all control.

The proposed amendment also broadens the types of weapons subject to control under item 5505 to include nuclear explosive and radiological dispersal devices, in order to address the potential proliferation of such weapons.

Consultation

Consultations on the proposed amendment have been held intradepartmentally and with other involved Canadian government departments, specifically the Department of Justice.

Implementation, enforcement and service standards

All items listed on the ECL are subject to export permit requirements, unless otherwise stated. Failure to comply with the EIPA, or its related regulatory or other requirements, can lead to prosecution under the EIPA. The Canada Border Services Agency and the Royal Canadian Mounted Police are responsible for the enforcement of export controls.

Contact

Blair Hynes
Deputy Director
Export Controls Division (TIE)
Foreign Affairs and International Trade Canada
111 Sussex Drive, 6th Floor
Ottawa, Ontario
K1N 1J1
Telephone: 613-944-0558
Email: Blair.Hynes@international.gc.ca

PROPOSED REGULATORY TEXT

Notice is hereby given that the Governor in Council, pursuant to paragraph 3(1)(a) (see footnote a), subsection 3(2) (see footnote b) and section 6 (see footnote c) of the Export and Import Permits Act (see footnote d), proposes to make the annexed Order Amending the Export Control List.

Interested persons may make representations concerning the proposed Order within 30 days after the date of publication of this notice. All such representations must cite the Canada Gazette, Part I, and the date of publication of this notice, and be addressed to Blair Hynes, Deputy Director, Export Controls Division, Export and Import Controls Bureau, Foreign Affairs and International Trade Canada, 111 Sussex Drive, Ottawa, Ontario K1N 1J1 (tel.: 613-944-0558; fax: 613-996-9933; email: blair.hynes@international.gc.ca).

Ottawa, June 10, 2010

JURICA ČAPKUN
Assistant Clerk of the Privy Council

ORDER AMENDING THE EXPORT CONTROL LIST

AMENDMENT

1. Item 5505 of the schedule to the Export Control List (see footnote 1) is replaced by the following:

5505. (1) Goods and technology not included elsewhere in this List if their properties and any information made known to the exporter by any intermediary or final consignee or from any other source would lead a reasonable person to suspect that they will be used

(a) in the development, production, handling, operation, maintenance, storage, detection, identification or dissemination of

(i) chemical or biological weapons,

(ii) nuclear explosive or radiological dispersal devices, or

(iii) materials or equipment that could be used in such weapons or devices;

(b) in the development, production, handling, operation, maintenance or storage of

(i) missiles or other systems capable of delivering chemical or biological weapons or nuclear explosive or radiological dispersal devices, or

(ii) materials or equipment that could be used in such missiles or systems; or

(c) in any facility used for any of the activities described in paragraphs (a) and (b).

(2) Goods and technology not included elsewhere in this List if the Minister has determined, on the basis of their properties and any additional information relating to such matters as their intended end-use or the identity or conduct of their intermediary or final consignees, that they are likely to be used in the activities or facilities referred to in subitem (1).

(3) Subitem (1) applies to goods and technology intended for export to all destinations unless

(a) they are intended for end-use in Argentina, Australia, Austria, Belgium, Bulgaria, the Czech Republic, Denmark, Finland, France, Germany, Greece, Hungary, Ireland, Italy, Japan, Luxembourg, the Netherlands, New Zealand, Norway, Poland, Portugal, the Republic of Korea, Spain, Sweden, Switzerland, Turkey, Ukraine, the United Kingdom or the United States;

(b) their intermediary consignees, if any, are located in those countries; and

(c) their final consignee is located in one of those countries.

(4) Subitem (2) applies to goods and technology intended for export to all destinations.

COMING INTO FORCE

2. This Order comes into force on the day on which it is registered.

[25-1-o]

Footnote a
S.C. 2006. c. 13, s. 110

Footnote b
S.C. 2006. c. 13, s. 110

Footnote c
S.C. 1991, c. 28, s. 3

Footnote d
R.S., c. E-19

Footnote 1
SOR/89-202

NOTICE:
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