Moldova sanctions: 7 individuals and Shor Party

Summary#

The Special Economic Measures (Moldova) Regulations are final Canadian sanctions that came into force on May 30, 2023. They add 7 individuals and 1 entity to a sanctions list and ban Canadians and people in Canada from dealing with those listed persons’ property or providing them services.

What it does#

• Prohibits anyone in Canada and Canadians abroad from dealing in property owned or controlled by a listed person.
• Bans entering into or facilitating transactions, and providing financial or related services, to listed persons.
• Makes it illegal to supply goods to a listed person or to knowingly help someone else do the banned activities.
• Requires banks and certain financial and trust companies to keep checking whether they hold property linked to listed persons and to report it.
• Lists the people and the political party that are targeted (see “Who’s affected” below).
• Creates limited exceptions (for example, some pension payments, diplomatic mission accounts, or certain legal services).
• A related instrument, the Special Economic Measures (Moldova) Permit Authorization Order, was prepared in parallel to allow the Minister of Foreign Affairs to issue permits in specific cases.

Who's affected#

• Anyone in Canada and Canadians outside Canada who might deal with the listed people or the listed entity.
• Banks, credit unions, trust companies, insurers and securities firms that must screen accounts and report suspected assets.
• Businesses that provide goods, services or financial services internationally and could be asked to check clients or transactions.
• The listed people and entity themselves, who are subject to the restrictions: Vladimir Plahotniuc, Ilan Mironovich Shor, Vladimir Andronachi, Veaceslav Platon, Constantin Botnari, Gheorghe Cavcaliuc, Marina Tauber, and the Shor Party.
• If it is unclear whether a specific person or business is affected, they will likely need to check their clients and counterparties against the public consolidated sanctions list.

Why it matters#

• Practically, the rules act like an asset freeze: listed individuals and the listed party are cut off from Canadian money, services and trade.
• Financial institutions will add these names to screening systems. That can mean extra checks or blocking transactions, even if most Canadian businesses are unlikely to have links to the listed Moldovan figures.
• There are criminal penalties for knowingly breaking the rules: a summary conviction can bring a fine of up to $25,000 or up to 1 year in jail (or both); a conviction on indictment can bring up to 5 years in jail.
• The measures are meant to pressure Russia-aligned actors in Moldova and support Moldova’s democratically elected government, while aligning Canada with allies taking similar steps.