Belarusian Banks Added to Sanctions

Summary#

These are final changes to the Special Economic Measures (Belarus) Regulations that add nine Belarusian banks to Canada’s sanctions list. The amendments took effect on registration (on April 5, 2023) and ban most dealings with those banks.

What it does#

• Adds the following banks to Part 2 of Schedule 1 (they are now subject to the regulations’ broad dealings ban):
  • Priorbank JSC
  • Belvnesheconombank OJSC
  • BPS-Sberbank OJSC
  • VTB Bank (Belarus) JSC
  • Belorussian-Russian Belgazprombank Joint Stock Company
  • Statusbank JSC
  • Belarusbank JSC
  • National Bank of the Republic of Belarus
  • Belagroprombank JSC
• Clarifies the wording of paragraphs 3.1 and 3.2 to make clear the rules cover Belarus, entities controlled by Belarus, and people acting on their behalf or at their direction.
• The regulations apply from the day they were registered and were applied before they were published in the Canada Gazette (they came into force on April 5, 2023).

Who's affected#

• Canadian banks and financial institutions must update screening and compliance systems to block prohibited dealings with the newly listed banks.
• Businesses or people in Canada with existing or planned transactions, contracts, loans, or other dealings involving those banks could be directly blocked or need permission from the government.
• Enforcement and border agencies — notably the Royal Canadian Mounted Police and the Canada Border Services Agency — are responsible for enforcing the rules.
• The government’s analysis says it is likely that these banks have limited links with Canada, so many Canadian small businesses and the general public probably won’t notice direct effects.

Why it matters#

• The change tightens Canada’s economic pressure on Belarus for its support of Russia’s invasion of Ukraine. It makes it harder for the Belarusian banking sector to do business that touches Canada.
• For Canadians, the main day-to-day effect is on cross-border financial activity: payments, bank relationships, and permits for otherwise prohibited transactions may be blocked or delayed.
• Firms that handle international payments or compliance may face minor costs to update systems. Breaking the rules can lead to penalties under the Special Economic Measures Act, including fines (up to $25,000) and possible imprisonment (summary conviction up to 1 year, indictment up to 5 years).