Vol. 150, No. 7 — April 6, 2016

Registration

SOR/2016-51 March 18, 2016

SPECIAL ECONOMIC MEASURES ACT

Regulations Amending the Special Economic Measures (Ukraine) Regulations

P.C. 2016-135 March 18, 2016

Whereas the Governor in Council is of the opinion that the situation in Ukraine 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 Regulations Amending the Special Economic Measures (Ukraine) Regulations.

Regulations Amending the Special Economic Measures (Ukraine) Regulations

Amendments

1 Part 1 of the schedule to the Special Economic Measures (Ukraine) Regulations (see footnote 1) is amended by adding the following after item 89:

2 Part 2 of the schedule to the Regulations is amended by adding the following after item 35:

Application Prior to Publication

3 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

4 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.)

Issues

Pro-Russian forces continue to destabilize eastern Ukraine and facilitate Russian military action against the Ukrainian government.

Background

Acting in coordination with the United States (U.S.) and the European Union (EU), the Governor in Council has found that the situation in Ukraine constitutes a grave breach of international peace and security that has resulted or is likely to result in a serious international crisis. As a result, the Special Economic Measures (Ukraine) Regulations (the Ukraine Regulations) were approved on March 17, 2014. Amendments to the Ukraine Regulations were made on March 19, 2014, April 12, 2014, May 12, 2014, June 21, 2014, July 11, 2014, July 24, 2014, August 6, 2014, December 19, 2014, February 17, 2015, and June 29, 2015.

Since the last round of amendments on June 29, 2015, the situation in eastern Ukraine has remained tense and volatile. Reporting from the United Nations (UN) and the Special Monitoring Mission (SMM) of the Organization for Security and Cooperation in Europe (OSCE) indicates that a reduction in hostilities, in September and October 2015, has been followed by increased skirmishes and military presence along the line of contact, including the use of artillery systems. Reports of a gradual re-escalation in hostilities around flashpoints such as the Donetsk airport have stoked fears of a resumption of indiscriminate shelling of populated areas. Throughout December 2015, the SMM has reported an increase in ceasefire violations, which occur on a near daily basis in the Donetsk and Luhansk regions.

The SMM has also noted concerns over live-fire exercises, shelling in separatist-controlled areas by multiple launch rocket systems, as well as a mounting number of tragic incidents involving mines and unexploded ordnance along the line of contact. Russian-backed separatist insurgents frequently deny OSCE SMM observers access to areas under their control, and continue to receive Russian support, including the suspected provision of supplies delivered by large convoys which cross the border from Russia into Ukraine. The work within the “Normandy Four” format (France, Germany, Russia and Ukraine) and the Trilateral Contact Group (the OSCE, Russia and Ukraine) continues. On December 30, 2015, Normandy format leaders reaffirmed their commitment to a ceasefire in eastern Ukraine, among other Minsk measures. However, much remains to be done toward achieving concrete results.

The durations of sanctions by Canada and our like-minded partners has been explicitly linked to the complete implementation of the Minsk agreements by all parties. With the expectation that the Minsk agreements would not be fully implemented by the December 31, 2015, deadline, the European Council has recently prolonged EU economic sanctions against Russia until July 31, 2016. Recent actions were also taken by the United States in their December 22, 2015, announcement of a package of measures designed to maintain the efficacy of existing sanctions. The U.S. actions reflect a continued effort to counter attempts to circumvent sanctions and to align measures with international allies.

The cost of the conflict in human terms is high. The UN has recorded at least 29 830 casualties (Ukrainian armed forces, civilians and members of the armed groups) in the armed conflict area of eastern Ukraine from mid-April 2014 to mid-November 2015, including at least 9 098 killed and 20 732 injured. As of November 15, 2015, the Ministry of Social Policy of Ukraine had registered 1 578 925 internally displaced persons throughout Ukraine. Actual numbers are widely judged to be much higher.

The UN has also received numerous reports of serious human rights abuses against individuals residing in the areas of the Donbas region controlled by the self-proclaimed “Donetsk People’s Republic” and the self-proclaimed “Luhansk People’s Republic”, including allegations of killings, ill-treatment and torture, illegal detention and forced labour, as well as restrictions on assembly, expression and movement. The onset of winter and lack of humanitarian access to the region under separatists’ control are expected to worsen the already difficult situation of the 2.9 million people in the conflict area.

Objectives

The Regulations Amending the Special Economic Measures (Ukraine) Regulations (the Regulations) add three individuals and four entities to the Schedule.

These measures are being taken to align with recent actions taken by international partners, to underscore continued trans-Atlantic unity in responding to Russia’s actions in Ukraine, to maintain pressure on Russia to fully implement its Minsk commitments, and to demonstrate our commitment to a policy of non-recognition of Russia’s illegal annexation of Crimea.

Description

The Regulations add three individuals and four entities to the list of designated persons under the Special Economic Measures (Ukraine) Regulations.

Any person in Canada and any Canadian outside Canada is prohibited from

Exceptions to the above-noted prohibitions are available for the following:

“One-for-One” Rule

The “One-for-One” Rule applies to these Regulations, 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 these Regulations, as there are no costs (or insignificant costs) imposed on small business, and small businesses would not be disproportionately affected.

Consultation

Global Affairs Canada drafted the Regulations in consultation with the Department of Justice and Immigration, Refugees and Citizenship Canada.

Rationale

The measures contained in the Regulations demonstrate Canada’s concern about the continuing violation of Ukraine’s sovereignty and territorial integrity.

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 (SEMA), every person who wilfully contravenes the Special Economic Measures (Ukraine) Regulations under the SEMA 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

Kevin Hamilton
Director
Eastern Europe and Eurasia Division
Global Affairs Canada
125 Sussex Drive
Ottawa, Ontario
K1A 0G2
Telephone: 343-203-3603
Fax: 613-995-1277
Email: Kevin.Hamilton@international.gc.ca