Regulations Amending the Special Economic Measures (Iran) Regulations: SOR/2022-205
Canada Gazette, Part II, Volume 156, Number 21
SOR/2022-205 October 3, 2022
SPECIAL ECONOMIC MEASURES ACT
P.C. 2022-1055 October 3, 2022
Whereas the Governor in Council is of the opinion that the actions of the Islamic Republic of Iran constitute a grave breach of international peace and security that has resulted or is likely to result in a serious international crisis;
And whereas the Governor in Council is of the opinion that gross and systematic human rights violations have been committed in the Islamic Republic of Iran;
Therefore, Her Excellency the Governor General in Council, on the recommendation of the Minister of Foreign Affairs, makes the annexed Regulations Amending the Special Economic Measures (Iran) Regulations under subsections 4(1)footnote a, (1.1)footnote b, (2)footnote c and (3) of the Special Economic Measures Act footnote d.
Regulations Amending the Special Economic Measures (Iran) Regulations
1 (1) Section 2 of the Special Economic Measures (Iran) Regulations footnote 1 is amended by adding the following after paragraph (a):
- (a.1) a person who has participated in gross and systematic human rights violations in Iran;
(2) Paragraphs 2(c) to (e) of the Regulations are replaced by the following:
- (c) an associate of a person referred to in any of paragraphs (a) to (b);
- (d) a family member of a person referred to in any of paragraphs (a) to (c) and (f);
- (e) an entity owned, held or controlled, directly or indirectly, by a person referred to in any of paragraphs (a) to (d) or acting on behalf of or at the direction of such a person; or
- (f) a senior official of an entity referred to in paragraph (e).
2 The headings before Part 1 of Schedule 1 to the Regulations are replaced by the following:
Entities — Grave Breach of International Peace and Security
3 Schedule 1 to the Regulations is amended by adding the following after Part 1:
Entities — Gross Human Rights Violations
- 1 The Islamic Revolutionary Guard Corps’ (IRGC) Cyber Defense Command
- 2 The Basij Cooperative Foundation
- 3 Basij Resistance Force
- 4 Evin Prison
- 5 Press TV
- 6 Office of the Enjoining Right and Forbidding Evil
- 7 Ministry of Intelligence and Security (MOIS)
- 8 The Morality Police
- 9 Qassem Soleimani Foundation
4 The headings before Part 2 of Schedule 1 to the Regulations are replaced by the following:
Individuals — Grave Breach of International Peace and Security
5 Part 2 of Schedule 1 to the Regulations is amended by adding the following in numerical order:
- 42 Mohammed Hossein Bagheri (born in 1960)
- 43 Hossein Salami (born in 1960)
- 44 Ali Shamkhani (born in 1955)
- 45 Mohammad Bagher Ghalibaf (born in 1961)
- 46 Ahmad Vahidi (born in 1958)
- 47 Esmail Qaani (born in 1957)
- 48 Alireza Tangsiri (born in 1962)
- 49 Gholamreza Soleimani (born in 1964)
- 50 Mohsen Razaei (born in 1954)
- 51 Safer Ali Mousavi
- 52 Zeinab Soleimani (born in 1991)
- 53 Saeed Jalili (born in 1965)
- 54 Ali Akbar Velayati (born in 1945)
- 55 Ahmad Jannati (born in 1927)
- 56 Sayyed Abdolrahim Mousavi (born in 1960)
6 Schedule 1 to the Regulations is amended by adding the following after Part 2:
Individuals — Gross Human Rights Violations
- 1 Esmail Khatib (born in 1961)
- 2 Hassan Rouhani (born in 1948)
- 3 Mahmoud Alavi (born in 1954)
- 4 Hossein Ashtari (born in 1959)
- 5 Issa Zarepour (born in 1980)
- 6 Seyyed Mohammed Saleh Hashemi Golpayegani (born in 1967)
- 7 Sadeq Ardeshir Larijani (born in 1961)
- 8 Mohammad Rostami Cheshmeh Gachi (born in 1976)
- 9 Haj Ahmad Mirzaei (born in 1957)
- 10 Gholam-Hossein Mohsei-Eje’i (born in 1956)
Application Before Publication
7 For the purpose of paragraph 11(2)(a) of the Statutory Instruments Act, these Regulations apply according to their terms before they are published in the Canada Gazette.
Coming into Force
8 These Regulations come into force on the day on which they are registered.
REGULATORY IMPACT ANALYSIS STATEMENT
(This statement is not part of the Regulations.)
Iran commits gross and systematic human rights violations and threatens international peace and security.
Between 2006 and 2010, Canada implemented into domestic law several rounds of United Nations sanctions against Iran in response to its nuclear program. In July 2010, Canada imposed additional sanctions against Iran, in consultation with the United States (U.S.), the European Union (EU) and other like-minded partners, under the Special Economic Measures Act (SEMA). The sanctions were based upon a finding by the Governor in Council that Iran’s failure to meet its international obligations amounted to a grave breach of international peace and security that resulted or was likely to result in a serious international crisis.
Additional SEMA sanctions against Iran were implemented through amendments made between 2011 and 2013. In 2015, the implementation of key milestones in the Joint Comprehensive Plan of Action (JCPOA) triggered immediate changes to sanctions imposed by the United Nations (UN), the U.S. and the EU against Iran, resulting in significant sanctions relief for Iran.
In 2016, Canada amended its sanctions against Iran under SEMA to recognize progress made under the JCPOA, but continued to have serious concerns about Iran’s nuclear ambitions. Therefore, Canada maintained tight restrictions on sensitive goods related to nuclear proliferation and the development of Iran’s ballistic missile program, while also maintaining sanctions on individuals and entities. Canada’s Special Economic Measures (Iran) Regulations (the Regulations) currently list 161 Iranian entities, covering all elements of the Islamic Revolutionary Guard Corps (IRGC), various other parts of the regime’s security, intelligence and economic apparatus, and 41 individuals. These listings result in an asset freeze and a prohibition on dealings including for specific goods and services.
In addition to the SEMA sanctions described above, Canada designated the state of Iran as a supporter of terrorism under the State Immunity Act in 2012. In concert with the Justice for Victims of Terrorism Act, this listing allows victims to bring civil action against Iran for losses or damages from an act of terrorism with links to Iran committed anywhere in the world. Following the designation, Canada expelled Iranian diplomats from Canada and closed its embassy in Tehran.
Bilateral relations are governed by a controlled engagement policy (CEP) and are limited to a small set of issues, including consular matters (this includes the downing of Flight PS752), human rights, Iran’s nuclear program and regional security.
The Regulations Amending the Special Economic Measures (Iran) Regulations build upon Canada’s existing sanctions against Iran by expanding their scope to include gross and systematic human rights violations. This will allow Canada to target sanctions at key individuals and entities who routinely, and as a matter of state policy, violate human rights or justify the regime’s actions to a domestic and global audience.
The proposed regulatory amendments align with existing policy and objectives to maintain pressure on Iran to change its behaviour and to reinforce Canada’s steadfast commitment to holding Iran to account for its actions at home and abroad.
These sanctions are intended to increase pressure on Iran to cease its egregious behaviour with respect to human rights violations and to publicly reaffirm Canada’s commitment to holding Iran to account for its activities at home and abroad.
The Regulations Amending the Special Economic Measures (Iran) Regulations (the amendments) add, to Schedule 1 of the Regulations, 25 individuals and 9 entities that are subject to a broad dealings ban.
The individuals are senior Iranian officials and prominent figures within Iran’s security and intelligence apparatus, their associates or family members, and Iranians who have participated in the commission of gross and systematic human rights violations. The entities participate in gross and systematic human rights violations in Iran, as well as in misinformation and disinformation activities, or are owned or controlled by former or current senior regime officials or entities.
Any individual or entity in Canada, and Canadians and Canadian entities outside Canada are thereby prohibited from dealing in the property of, entering into transactions with, providing services to, or otherwise making goods available to listed persons and entities.
Global Affairs Canada engages regularly with relevant stakeholders including civil society organizations and cultural communities and other like-minded governments regarding Canada’s approach to sanctions implementation.
With respect to the amendments targeting individuals and entities, public consultation would not have been appropriate, given the urgency to impose these measures in response to the violations of human rights occurring in Iran and Iran’s ongoing breach of international peace and security.
Modern treaty obligations and Indigenous engagement and consultation
An initial assessment of the geographical scope of the initiative was conducted and did not identify any modern treaty obligations, as the amendments do not take effect in a modern treaty area.
Regulations are the sole method to enact sanctions in Canada. No other instrument could be considered.
Benefits and costs
Sanctions targeting specific persons have less impact on Canadian businesses than traditional broad-based economic sanctions, and have limited impact on the citizens of the country of the listed persons. It is likely that the newly listed individuals and entities have limited linkages with Canada and Canadians outside Canada, and therefore do not have business dealings that are significant to the Canadian economy.
Canadian banks and financial institutions are required to comply with sanctions. They will do so by adding the newly listed individuals to their existing monitoring systems, which may result in a minor compliance cost.
While possible, it is unlikely that the amendments could potentially create additional costs for businesses seeking permits that would authorize them to carry out specified activities or transactions that are otherwise prohibited, as Canada has applied comprehensive sanctions against Iran for several years. The combination of Canadian, UN and U.S. sanctions severely limit trade and there is no active trade promotion, reducing the likelihood of costs for businesses.
Small business lens
While possible, it is unlikely the amendments could potentially create additional costs for small businesses seeking permits that would authorize them to carry out specified activities or transactions that are otherwise prohibited, as Canada has applied comprehensive sanctions against Iran for several years. The combination of Canadian, UN and U.S. sanctions severely limit trade and there is no active trade promotion, reducing the likelihood of costs for businesses.
However, should additional costs be created for small businesses, these costs will likely be low, as it is highly unlikely that Canadian small businesses have or will have dealings with the newly listed individuals and entities. No significant loss of opportunities for small businesses is expected as a result of the amendments.
The permitting process for businesses meets the definition of “administrative burden” in the Red Tape Reduction Act and would need to be calculated and offset within 24 months. However, the proposal addresses an emergency circumstance and is exempt from the requirement to offset administrative burden and regulatory titles under the one-for-one rule.
Regulatory cooperation and alignment
While the amendments are not related to a work plan or commitment under a formal regulatory cooperation forum, they align with actions taken by Canada’s allies.
Strategic environmental assessment
The amendments are unlikely to result in important environmental effects. In accordance with the Cabinet Directive on the Environmental Assessment of Policy, Plan and Program Proposals, a preliminary scan concluded that a strategic environmental assessment is not required.
Gender-based analysis plus (GBA+)
The subject of economic sanctions has previously been assessed for effects on gender and diversity. Although intended to facilitate a change in behaviour through economic pressure on individuals and entities in foreign states, sanctions under the Special Economic Measures Act can nevertheless have an unintended impact on certain vulnerable groups and individuals. Rather than affecting Iran as a whole, these targeted sanctions impact individuals and entities believed to be engaged in activities that violate human rights and present an ongoing breach of international peace and security. Therefore, these sanctions are unlikely to have a significant impact on vulnerable groups as compared to traditional broad-based economic sanctions directed toward a state, and limit the collateral effects to those dependent on those targeted individuals and entities. Furthermore, these sanctions are being introduced in support of the women of Iran who are facing increasingly repressive and unacceptable levels of discrimination, harassment, and persecution by the Iranian regime.
Iran’s disregard for its international human rights obligations has long been the subject of condemnation by Canada and the international community. As part of Canada’s leadership of the United Nations General Assembly (UNGA) Resolution on the Human Rights Situation in Iran, Canada, together with like-minded partners, documents the systemic human rights violations perpetrated by the Iranian regime, including increasing numbers of executions, including of minors, systematic violations of the rule of law and rights to due process through the use of sham trials, and the discrimination, persecution, harassment, and arbitrary detention of minority ethnic and religious communities, such as the members of the Bahá’í Faith, and LGBTQ persons in Iran.
Recent events in Iran demonstrate a gravely concerning pattern of gross and systematic human rights violations, particularly against women. The killing of Mahsa Amini, a young woman who was reportedly beaten and later died while in custody of Iran’s so-called morality police, purportedly for failing to wear her hijab “properly,” have shocked the world. News of her death sparked domestic and international condemnation, and thousands of Iranian citizens took to the streets in peaceful protest against Iran’s modesty laws for women. Those protestors faced a brutal crackdown by various branches of Iran’s law enforcement and security and intelligence apparatus.
In its actions abroad, Iran is challenging the rules-based international system through deliberate policies to support extremist groups throughout the Middle East. Iran routinely targets and threatens Canada’s partners in the region, such as Israel and several Gulf States. Iran continues to develop and employ new threats to regional and international security, including malicious cyber activities and the transfer of advanced weapons-capable unmanned aerial systems.
The amendments will bring Canada into closer alignment with its close allies, who have existing or new measures targeting the Iranian regime. In particular, the U.S. has recently responded to Iran’s increased belligerent behaviour on the domestic, regional and global stage by announcing new sanctions in response to weapons proliferation, human rights abuses and cyber attacks.
Implementation, compliance and enforcement, and service standards
The amendments come into force on the day on which they are registered.
The names of the listed individuals and entities will be available online for financial institutions to review, and will be added to the Consolidated Canadian Autonomous Sanctions List. This will help to facilitate compliance with the amendments.
Canada’s sanctions regulations are enforced by the Royal Canadian Mounted Police and the Canada Border Services Agency (CBSA). In accordance with section 8 of the Special Economic Measures Act, every person who knowingly contravenes or fails to comply with the 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.
The CBSA has enforcement authorities under SEMA and the Customs Act, and will play a role in the enforcement of these sanctions.
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