Vol. 150, No. 22 — November 2, 2016

Registration

SOR/2016-278 October 21, 2016

UNITED NATIONS ACT

Regulations Amending the Regulations Implementing the United Nations Resolutions on the Democratic People’s Republic of Korea (DPRK)

P.C. 2016-935 October 21, 2016

Whereas the Security Council of the United Nations, acting under Article 41 of the Charter of the United Nations, adopted Resolution 2270 (2016) on March 2, 2016;

And whereas it appears to the Governor in Council to be necessary to make regulations for enabling the measures set out in that resolution to be effectively applied;

Therefore, His Excellency the Governor General in Council, on the recommendation of the Minister of Foreign Affairs, pursuant to section 2 of the United Nations Act (see footnote a), makes the annexed Regulations Amending the Regulations Implementing the United Nations Resolutions on the Democratic People’s Republic of Korea (DPRK).

Regulations Amending the Regulations Implementing the United Nations Resolutions on the Democratic People’s Republic of Korea (DPRK)

Amendments

1 (1) The definitions resources contributing to the DPRK’s weapons programme and technical data in section 1 of the Regulations Implementing the United Nations Resolutions on the Democratic People’s Republic of Korea (DPRK) (see footnote 1) are repealed.

(2) The definitions arms and related material, Canadian, Committee of the Security Council, designated person, DPRK, luxury goods, person, property, Security Council Resolutions, Security Council Resolution 1718 and Security Council Resolution 1874 in section 1 of the Regulations are replaced by the following:

arms and related material means any type of weapon, ammunition, military vehicle, military equipment or paramilitary equipment, and their spare parts. (armes et matériel connexe)

Canadian means a citizen within the meaning of the Citizenship Act or a corporation incorporated by or continued under the laws of Canada or a province. (Canadien)

Committee of the Security Council means the Committee of the Security Council established under paragraph 12 of Security Council Resolution 1718. (Comité du Conseil de sécurité)

designated person means a person that is designated by the Committee of the Security Council under paragraph 8(d) or 12(e) of Security Council Resolution 1718 or by the Security Council under paragraph 8(d) of that resolution or a person whose name appears on the list established under Security Council Resolution 2270. (personne désignée)

DPRK means the Democratic People’s Republic of Korea and includes

luxury goods includes jewelry, gems, precious and semi-precious stones, precious metals, lead crystal, watches, cigarettes, alcoholic beverages, perfume, designer clothing and accessories, furs, sporting goods, private aircraft, gourmet foods and ingredients, lobster, computers, televisions and other electronic devices, yachts, racing cars, personal watercraft, snowmobiles, automobiles and other motor vehicles, except those that are used for public transportation, that are used to transport people. (articles de luxe)

person means an individual or an entity. (personne)

property means any real, personal, movable or immovable property. (bien)

Security Council Resolutions means Security Council Resolution 1718, Security Council Resolution 1874, Security Council Resolution 2087, Security Council Resolution 2094 and Security Council Resolution 2270. (résolutions du Conseil de sécurité)

Security Council Resolution 1718 means Resolution 1718 (2006) of October 14, 2006 adopted by the Security Council. (résolution 1718 du conseil de sécurité)

Security Council Resolution 1874 means Resolution 1874 (2009) of June 12, 2009 adopted by the Security Council. (résolution 1874 du conseil de sécurité)

(3) Section 1 of the Regulations is amended by adding the following in alphabetical order:

entity means a corporation, a trust, a partnership, a fund, an unincorporated association or organization or a foreign state. (entité)

Focal Point for De-listing means the Focal Point for De-listing established under Resolution 1730 (2006) of December 19, 2006 adopted by the Security Council. (point focal pour les demandes de radiation)

national means an individual who possesses the nationality of the DPRK as determined in accordance with the laws of the DPRK. (national)

official means an individual who

Security Council means the Security Council of the United Nations. (Conseil de sécurité)

Security Council Resolution 2087 means Resolution 2087 (2013) of January 22, 2013, adopted by the Security Council. (résolution 2087 du Conseil de sécurité)

Security Council Resolution 2094 means Resolution 2094 (2013) of March 7, 2013, adopted by the Security Council. (résolution 2094 du Conseil de sécurité)

Security Council Resolution 2270 means Resolution 2270 (2016) of March 2, 2016, adopted by the Security Council. (résolution 2270 du Conseil de sécurité)

working day means a day that is neither a Saturday nor a holiday. (jour ouvrable)

2 Sections 3 to 17 of the Regulations are replaced by the following:

Prohibited dealings and activities — designated persons

3 (1) It is prohibited for any person in Canada or any Canadian outside Canada to knowingly

Cash

(2) It is prohibited for any person in Canada or any Canadian outside Canada to knowingly supply or transfer, directly or indirectly, any bulk cash that is destined for the DPRK, for any person in the DPRK or for any national or to knowingly receive any bulk cash from the DPRK, from any person in the DPRK or from any national.

Providing financial or related services

4 (1) It is prohibited for any person in Canada or any Canadian outside Canada to knowingly provide financial or related services to the DPRK, to any person in the DPRK or to a person acting on behalf of or at the direction of the DPRK or any person in the DPRK that is intended to cause, facilitate or assist in any act or thing prohibited by these Regulations.

Accepting financial or related services

(2) It is prohibited for any person in Canada or any Canadian outside Canada to accept any financial or related services from the DPRK, from any person in the DPRK or from a person acting on behalf of or at the direction of the DPRK or any person in the DPRK that is intended to cause, facilitate or assist in any act or thing prohibited by these Regulations.

Specific products

6 (1) It is prohibited for any person in Canada or any Canadian outside Canada to knowingly sell, supply or transfer, directly or indirectly, any of the following products, wherever situated, that are destined for the DPRK or for any person in the DPRK:

DPRK’s weapons programme

(2) It is prohibited for any person in Canada or any Canadian outside Canada to knowingly sell, supply or transfer, directly or indirectly, any of the following products, wherever situated, that are destined for the DPRK or for any person in the DPRK:

Technical assistance

(3) It is prohibited for any person in Canada or any Canadian outside Canada to knowingly provide technical assistance to the DPRK, or to any person in the DPRK, related to the sale, supply, transfer, manufacture, use or maintenance of any of the products referred to in paragraph (1)(a) or subsection (2).

Training to nationals

(4) It is prohibited for any person in Canada or any Canadian outside Canada to knowingly provide to any national teaching or training in disciplines which could contribute to proliferation-sensitive nuclear activities or the development of nuclear weapon delivery systems in the DPRK, including teaching or training in advanced physics, advanced computer simulation and related computer sciences, geospatial navigation, nuclear engineering, aerospace engineering, aeronautical engineering and related disciplines.

Prohibited acquisitions — products

7 (1) It is prohibited for any person in Canada or any Canadian outside Canada to knowingly import, purchase or acquire any of the products referred to in paragraph 6(1)(a) or subsection 6(2), wherever situated, from the DPRK or from any person in the DPRK.

Coal and minerals

(2) It is prohibited for any person in Canada or any Canadian outside Canada to knowingly import, purchase or acquire coal, iron, iron ore, gold, titanium ore, vanadium ore and rare earth minerals, wherever situated, from the DPRK or from any person in the DPRK.

Technical assistance and training

(3) It is prohibited for any person in Canada or any Canadian outside Canada to receive, from the DPRK, from any person in the DPRK or from any national, any technical assistance or training related to the sale, supply, transfer, manufacture, use or maintenance of any of the products referred to in paragraph 6(1)(a) or subsection 6(2).

Canadian vessel or aircraft

8 (1) It is prohibited for any owner or master of a Canadian vessel, as defined in section 2 of the Canada Shipping Act, 2001, any operator of an aircraft registered in Canada or any Canadian owner or master of a vessel or Canadian operator of an aircraft to knowingly carry, cause to be carried or permit to be carried any of the products referred to in subsection 6(1) or (2) or any bulk cash, wherever situated, that is destined for the DPRK or for any person in the DPRK.

Maintaining vessel

9 (1) It is prohibited for any person in Canada or any Canadian outside Canada to knowingly provide products or services for the operation or maintenance of a vessel that is registered in the DPRK, including with respect to stevedoring and lighterage, if there are grounds to believe that the vessel is carrying any of the products referred to in subsection 6(1) or (2), unless it is necessary to do so for the safeguarding of human life.

Crew services

(2) It is prohibited for any person in Canada or any Canadian outside Canada to knowingly provide, under a lease or a charter agreement, a Canadian-flagged vessel or aircraft, or crew services for such a vessel or aircraft, to the DPRK, to any person in the DPRK, to a designated person, to a person acting on behalf of or at the direction of a designated person or to a person that is owned, held or controlled by a designated person.

Registration of vessel

(3) It is prohibited for any person in Canada or any Canadian outside Canada to register a vessel in the DPRK, to obtain authorization for a vessel to fly the DPRK flag, to own, lease, operate or insure any DPRK-flagged vessel, or to provide any vessel classification, certification or related service for any DPRK-flagged vessel.

Assisting a prohibited act or thing

10 It is prohibited for any person in Canada or any Canadian outside Canada to knowingly do anything that causes, facilitates or assists in, or is intended to cause, facilitate or assist in, any act or thing prohibited by section 3, 4, 5, 6, 7, 8 or 9.

Obligations

Duty to determine

11 (1) The following entities must determine on a continuing basis whether they are in possession or control of property that is owned, held or controlled by or on behalf of a designated person:

Duty to disclose — supervising and regulating agencies

(2) Every entity referred to in subsection (1) must disclose, every month, to the principal agency or the body that supervises or regulates it under federal or provincial law, whether it is in possession or control of any property referred to in subsection (1) and, if so, the number of persons or contracts involved and the total value of the property.

Immunity

(3) No proceedings under the United Nations Act and no civil proceedings lie against a person for a disclosure made in good faith under subsection (2).

Duty to disclose — RCMP or CSIS

12 (1) Every person in Canada and every Canadian outside Canada must disclose without delay to the Commissioner of the Royal Canadian Mounted Police or to the Director of the Canadian Security Intelligence Service

Immunity

(2) No proceedings under the United Nations Act and no civil proceedings lie against a person for a disclosure made in good faith under subsection (1).

Applications

Exemption

13 (1) A person that wishes to do an act or thing that is prohibited under these Regulations may, before doing the act or thing, apply to the Minister in writing for a certificate to exempt the act or thing from the application of the Regulations.

Certificate

(2) The Minister may issue the certificate if the Security Council did not intend that such an act or thing be prohibited or if it is established that the requirements of Security Council Resolution 1718 and Security Council Resolution 2270 have been met and, if required by those resolutions, that the Committee of the Security Council has approved the act or thing in advance.

Exemption for property

14 (1) A person whose property has been affected by the application of section 3 may apply to the Minister in writing for a certificate to exempt the property from the application of that section if the property

Certificate — subsection (1)

(2) If it is established in accordance with Security Council Resolution 1718 that the property is necessary for basic or extraordinary expenses or is subject to a lien, mortgage or security interest, to a hypothec or prior claim, to a charge or to a judicial, administrative or arbitral decision, the Minister must issue a certificate within the following deadlines:

Mistaken identity

15 (1) A person in Canada or any Canadian outside Canada whose name is the same as or similar to the name of a designated person and that claims not to be that designated person may apply to the Minister in writing for a certificate stating that they are not that designated person.

Determination by Minister

(2) Within 45 days after receiving the application, the Minister must,

Disclosure of Information

Disclosure by official

16 (1) An official may, for the purpose of responding to a request from the Security Council, the Committee of the Security Council, the Panel of Experts established under Security Council Resolution 1874 or the Focal Point for De-listing, disclose personal information to the Minister.

Disclosure by Minister

(2) The Minister may, for the purpose of administering or enforcing these Regulations or fulfilling an obligation under the Security Council Resolutions, disclose personal information to the Security Council, the Committee of the Security Council, the Panel of Experts established under Security Council Resolution 1874 or the Focal Point for De-listing.

Legal Proceedings

Prohibition — legal proceedings

17 No legal proceedings lie in Canada at the instance of the Government of the DPRK, of any person in the DPRK, of a designated person or of any person claiming through or acting on behalf of any such person in connection with any contract or other dealing if its performance was prevented in any way by these Regulations.

Application Before 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

On March 2, 2016, the United Nations Security Council (UNSC), acting under Chapter VII of the Charter of the United Nations (UN Charter), adopted Resolution 2270 (2016) imposing additional sanctions against the Democratic People’s Republic of Korea (DPRK) as a result of the systematic, ongoing and severe violations of past UNSC resolutions by the DPRK. The sanctions strengthen and modify measures that had been imposed by the UNSC in Resolution 1718 (2006), Resolution 1874 (2009), Resolution 2087 (2013) and Resolution 2094 (2013). Resolution 2270 was adopted in response to the fourth nuclear test conducted by the DPRK on January 6, 2016, which violated the previous resolutions. The implementation of UNSC Resolution 2270 (2016) in Canadian law requires amendments to the Regulations Implementing the United Nations Resolutions on the Democratic People’s Republic of Korea (DPRK).

Background

Security Council Resolution 1718 (2006) imposed an embargo on the sale or supply of arms and related material, resources contributing to the DPRK’s weapons program and the transfer of related technical assistance, and the export of luxury goods to the DPRK. Resolution 1718 (2006) further imposed a travel ban and assets freeze against persons designated by the United Nations Sanctions Committee (1718 Committee) established to oversee the sanctions against the DPRK. As a member of the United Nations, Canada is legally obliged, pursuant to Article 25 of the UN Charter, to apply binding decisions of the Security Council, in accordance with Article 41 of Chapter VII of the Charter of the United Nations. The United Nations Act provides the appropriate legislative authority to implement these decisions in Canadian law.

Canada implemented its international obligations under Resolution 1718 (2006) by introducing, pursuant to section 2 of the United Nations Act, the Regulations Implementing the United Nations Resolutions on the Democratic People’s Republic of Korea (DPRK), which came into force on November 9, 2006. The implementation of the travel ban imposed by Resolution 1718 (2006) is ensured in Canada under provisions of the Immigration and Refugee Protection Act.

In 2009, noting the DPRK’s second nuclear test and missile activities, which generated increased tension in the region, the UNSC determined that the situation continued to constitute a threat to international peace and security. Accordingly, the UNSC adopted Resolution 1874 (2009) to modify and strengthen the measures imposed against the DPRK by expanding the arms embargo to include all arms and related materials, with the exception of the export, sale, supply, transfer or shipment of small arms and light weapons; expanding the prohibition on the provision, to any person in the DPRK, of technical assistance concerning arms and related materials; and creating a prohibition on financial transactions related to the provision, manufacture, maintenance or use of arms or related material. It also expanded the list of sanctioned items, materials, equipment, goods and technology which could contribute to the DPRK’s nuclear-related, ballistic missile-related or other weapons of mass destruction-related programs and activities; and required States to prohibit the provision of refuelling and other services to DPRK vessels believed to contain sanctioned cargo.

Canada implemented its international obligations under Resolution 1874 (2009) by introducing, pursuant to section 2 of the United Nations Act, the Regulations Amending the Regulations Implementing the United Nations Resolutions on the Democratic People’s Republic of Korea (DPRK), which came into force on July 30, 2009.

On March 7, 2013, the UNSC adopted Resolution 2094 (2013) imposing additional sanctions against the DPRK in response to a third nuclear test conducted by the DPRK on February 12, 2013, which violated the two previous resolutions. The sanctions strengthened and modified measures that had been imposed by the UNSC in Resolution 1718 (2006) and Resolution 1874 (2009) and included (a) amendments to the definitions of “DPRK” and “luxury goods;” (b) prohibitions on transfers of bulk cash; (c) prohibitions on the provision of financial services to, from, for the benefit of, or on the direction or order of the DPRK or any person in the DPRK with respect to activities already prohibited under the Regulations; and (d) further elaboration of the prohibition on the provision of services or assistance in relation to arms and related material or resources contributing to the DPRK’s weapons program, namely, to explicitly include brokering or other intermediary services in the class of prohibited services or assistance.

Canada implemented its international obligations under Resolution 2094 (2013) by introducing the Regulations Amending Certain Regulations Imposing Sanctions on the Democratic People’s Republic of Korea, which came into force on November 29, 2013. These Regulations amended the Special Economic Measures (Democratic People’s Republic of Korea) Regulations and the Regulations Implementing the United Nations Resolutions on the Democratic People’s Republic of Korea (DPRK).

Objectives

Resolution 2270 (2016) was adopted by the UNSC pursuant to Article 41 of Chapter VII of the UN Charter and is binding on all member states. As a member state of the United Nations and pursuant to Article 25 of the UN Charter, Canada is legally obligated to implement binding decisions of the UNSC. The implementation of the resolution in Canadian law requires amendments to the Regulations Implementing the United Nations Resolutions on the Democratic People’s Republic of Korea (DPRK). These amendments will also give effect to recommendations of the Standing Joint Committee for the Scrutiny of Regulations.

Description

These Regulations implement the decisions of Security Council Resolution 2270 not already incorporated in Canadian domestic legislation. In accordance with Security Council Resolution 2270 (2016), the Regulations

The Regulations continue to impose asset freezes on the individuals and entities maintained on the list of designated persons per Resolution 1718, including those listed in Annex I and II of Resolution 2270. In Canada, implementation of travel restrictions is ensured under the Immigration and Refugee Protection Act and its Regulations.

The Regulations allow for the issuance of ministerial certificates to authorize certain prohibited activities if it is established that the requirements for participation in such activities are met, including, when required, the approval of the Committee of the Security Council established per Resolution 1718.

Finally, the Regulations update language throughout the Regulations Implementing the United Nations Resolutions on the Democratic People’s Republic of Korea (DPRK) to give effect to certain recommendations made by the Standing Joint Committee for the Scrutiny of Regulations, to clarify intent and to ensure consistency across Canada’s economic sanctions regulations.

The United Nations Act constitutes the appropriate legislative authority to implement into Canadian law the asset freeze and additional restrictive measures mandated by the Security Council. The UNSC resolutions relevant to the Regulations, and information concerning the work of the Security Council Committee established pursuant to Resolution 1718 (2006) to oversee the relevant sanctions measures, including listings, are available at https://www.un.org/sc/suborg/en/sanctions/1718.

Resolution 2270 (2016) is available at http://www.securitycouncilreport.org/atf/cf/%7B65BFCF9B-6D27-4E9C-8CD3-CF6E4FF96FF9%7D/s_res_2270.pdf.

“One-for-One” Rule

These Regulations are carved out from the “One-for-One” Rule, as they implement non-discretionary international obligations.

Small business lens

The small business lens does not apply to this proposal, as there are no costs (or insignificant costs) 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, the Department of Finance, Transport Canada, Immigration, Refugees and Citizenship Canada and the Canada Border Services Agency.

Rationale

The Regulations amending the Regulations Implementing the United Nations Resolutions on the Democratic People’s Republic of Korea (DPRK) enable Canada to align with the sanctions adopted unanimously by the UNSC in Resolution 2270 (2016), co-sponsored by Canada. As Canada has very limited bilateral trade with North Korea and has imposed very strict sanctions since 2011, additional sanctions are expected to have minimal costs or impacts. Canada has always shown leadership in its dealing with North Korea and its sanctions are consistent with Canada’s official position.

Implementation, enforcement and service standards

Canada’s sanctions regulations are enforced by the Royal Canadian Mounted Police and the Canada Border Services Agency. Every person who contravenes the Regulations is liable, upon conviction, to the punishments set out in section 3 of the United Nations Act (i.e. on summary conviction, to a fine of not more than $100,000 or to imprisonment for a term of not more than one year, or to both; or, on conviction on indictment, to imprisonment for a term of not more than 10 years).

Contact

Christopher Burton
Director
Northeast Asia Division
Foreign Affairs, Trade and Development Canada
125 Sussex Drive
Ottawa, Ontario
K1A 0G2
Telephone: 343-203-3366
Email: Christopher.Burton@international.gc.ca