Minister may issue China sanctions permits

Summary#

The Canada Gazette published the Special Economic Measures (People's Republic of China) Permit Authorization Order on April 14, 2021 (registered March 24, 2021). The order lets the Minister of Foreign Affairs grant permits that allow specific activities otherwise blocked by Canada’s sanctions related to the situation in Xinjiang.

What it does#

• Authorizes the Minister of Foreign Affairs to issue permits to any person in Canada or any Canadian outside Canada.
• Those permits can allow a specified activity or a class of activities that are otherwise restricted or prohibited under the Special Economic Measures (People's Republic of China) Regulations.
• Examples of the kinds of restrictions the Regulations create (and that a permit might override in a specific case) include dealing in property owned or controlled by a listed person and providing financial or related services to a listed person.
• The order is made under the Special Economic Measures Act and is an administrative tool to allow narrow exceptions to the sanctions.

Who's affected#

• Canadians and people or businesses in Canada who might otherwise be prohibited from dealing with persons listed under the Regulations.
• The order relates to the Regulations that list one entity and four individuals; those listed persons are the targets of the restrictions.
• Financial institutions, businesses with international ties, and anyone who needs to carry out transactions that touch on the listed people could be the most likely to seek a permit.
• It is unclear how many Canadian businesses or individuals will actually need permits; the government notes it is unlikely many will have dealings with the newly listed persons.

Why it matters#

• This is a practical step that gives the government a way to approve specific exceptions to sanctions without changing the sanctions themselves.
• In real life, it matters if you or your business needs to complete a transaction that would otherwise be blocked by these sanctions (for example, transferring funds, dealing with property, or providing services). A permit could make that transaction legal.
• The order is part of Canada’s broader response to reported human-rights abuses in the Xinjiang Uyghur Autonomous Region. There have been ongoing credible reports of mass detention, forced labour and other abuses; the Canadian measures and this permitting mechanism are meant to allow targeted pressure while keeping a route for limited, authorized exceptions.