New sanctions add four Myanmar military entities

Summary#

These final regulations (SOR/2021-237), the Regulations Amending the Special Economic Measures (Burma) Regulations, add four Myanmar military‑linked entities to Canada’s list of sanctioned persons. They also clarify an exception that allows certain payments under contracts entered into before a person was designated. The regulations were registered on December 9, 2021 and published in the Canada Gazette on December 22, 2021; they took effect on registration.

What it does#

• Adds four entities to Part 1 of the schedule to the Special Economic Measures (Burma) Regulations:
  • Myanmar War Veterans Organization
  • Ministry of Defence Quartermaster General Office
  • Myanmar Directorate of Defence Industries
  • Myanmar Directorate of Procurement (also known by several similar names)
• Replaces paragraph 18(b) to allow a limited exception: payments that are due under a contract entered into before a person became designated may be made by or on behalf of that designated person — but only if the payment is not made to a designated person or to someone acting on behalf of a designated person.
• States the regulations apply according to their terms before publication and come into force on the day they are registered (December 9, 2021).

Who's affected#

• Canadian businesses, banks and other financial institutions that must block or refuse prohibited dealings with sanctioned persons. Bolded: Canadian banks and financial institutions.
• People or organizations in Canada and Canadians abroad who might otherwise do business with the listed Myanmar entities.
• Enforcement and border agencies responsible for sanctions compliance: Royal Canadian Mounted Police and Canada Border Services Agency.
• The government office that manages foreign policy and sanctions outreach: Global Affairs Canada.
• It is unclear that many Canadian businesses actually deal with these newly listed entities; the government says direct effects on Canadian small businesses are likely to be limited.

Why it matters#

• The change expands Canada’s sanctions against the Myanmar military by naming more military‑linked entities. That aims to increase pressure on the regime for its actions since the February 2021 coup.
• In practical terms, banks and businesses must update screening and compliance systems to block dealings with the newly listed entities. This may cause small, one‑time compliance costs.
• There are criminal penalties for willfully breaching the sanctions: a fine of up to $25,000 or imprisonment for up to one year on summary conviction, or imprisonment for up to five years on indictment.
• The rules include exemptions for humanitarian aid and allow the Minister of Foreign Affairs to issue permits, so the government can still authorize some activity when needed.