Regulations Amending the Special Economic Measures (Burma) Regulations: SOR/2022-65
Canada Gazette, Part II, Volume 156, Number 8
SOR/2022-65 March 24, 2022
SPECIAL ECONOMIC MEASURES ACT
P.C. 2022-257 March 24, 2022
Whereas the Governor in Council is of the opinion that the situation in Burma constitutes a grave breach of international peace and security that has resulted or is likely to result in a serious international crisis;
Therefore, Her Excellency the Governor General in Council, on the recommendation of the Minister of Foreign Affairs, pursuant to subsections 4(1)footnote a, (1.1)footnote b, (2) and (3) of the Special Economic Measures Act footnote c, makes the annexed Regulations Amending the Special Economic Measures (Burma) Regulations.
Regulations Amending the Special Economic Measures (Burma) Regulations
1 Items 22 to 30 of Part 1 of the schedule to the Special Economic Measures (Burma) Regulations footnote 1 are replaced by the following:
- 22 Burma Ar (Power) Construction Services (also known among other names as Myanmar Ar (Power) Construction Services)
- 23 Burma Brewery Ltd. (also known among other names as Myanmar Brewery Ltd.)
- 24 Burma Daewoo International (also known among other names as Myanmar Daewoo International)
- 25 Burma Imperial Jade Co. Ltd. (also known among other names as Myanmar Imperial Jade Co. Ltd.)
- 26 Burma Nouveau Steel Co. Ltd. (also known among other names as Myanmar Nouveau Steel Co. Ltd.)
- 27 Burma Posco Steel Co. Ltd. (also known among other names as Myanmar Posco Steel Co. Ltd.)
- 28 Burma Rubber Wood Co. Ltd. (also known among other names as Myanmar Rubber Wood Co. Ltd.)
- 29 Burma Ruby Enterprise (also known among other names as Myanmar Ruby Enterprise)
- 30 Burma Segal International Ltd. (also known among other names as Myanmar Segal International Ltd.)
2 Item 42 of Part 1 of the schedule to the Regulations is replaced by the following:
- 42 Union of Burma Economic Holding Ltd. (also known among other names as Union of Myanmar Economic Holding Ltd. and Myanma Economic Holdings Limits (MEHL))
3 Part 1 of the schedule to the Regulations is amended by adding the following after item 58:
- 59 Myanmar Chemical & Machinery Company Limited
- 60 Yatanarpon Aviation Support Company Limited
4 Part 2 of the schedule to the Regulations is amended by adding the following after item 73:
- 74 Aung Hlaing Oo
- 75 Sit Taing Aung
- 76 Aung Moe Myint
- 77 Htun Aung
Application Before Publication
5 For the purpose of paragraph 11(2)(a) of the Statutory Instruments Act, these Regulations apply according to their terms before they are published in the Canada Gazette.
Coming into Force
6 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.)
On February 1, 2021, under the direction of Senior General Min Aung Hlaing, Commander in Chief of the Myanmar Armed Forces (Tatmadaw), the Myanmar military initiated a military coup against the democratically elected National League for Democracy (NLD) government.
Despite condemnation by the international community, repeated calls to halt violence, and efforts led by the Association of Southeast Asian Nations (ASEAN) to engage the regime in inclusive dialogues toward peace, the military has not altered course. In fact, violence is escalating while gross human rights violations are increasing in number.
Individuals and entities acting on behalf of the regime continue to procure and supply arms and military equipment to Myanmar, thus perpetuating the armed conflict and use of disproportionate force against civilian populations, and fuelling the ongoing grave breach of international peace and security.
Escalating violence, severe human rights violations, humanitarian impacts on the most vulnerable, spillover into neighbouring countries by those fleeing violence, and the lack of tangible movement toward peace merit further coercive action.
Following the coup launched in February 2021, the military moved quickly to imprison the NLD’s political leaders, effectively removing them from the national political scene. The same was done to pro-democracy activists, civil society, journalists, and human rights defenders. Popular resistance emerged, including mass national protests and a Civil Disobedience Movement, both of which prevented the military from consolidating power. The military and other security forces hindered protests using intentional and disproportionate lethal force documented on publicly available video.
Violence by armed opposition groups known as the People’s Defence Forces (PDFs) has increased against the Myanmar military. Meanwhile, long-standing conflicts between the military and Ethnic Armed Organizations continue. The National Unity Government (NUG) is increasingly shifting toward armed opposition, forming a command and control structure to coordinate the hundreds of PDFs and field their own armed forces.
The military continues to commit acts of violence against the civilian population (arbitrary arrests, torture, and killings), as detailed in the United Nations (UN) Special Rapporteur’s August 2021 report on violence in Myanmar. The UN Secretary General’s outgoing Special Envoy to Myanmar, Christine Schraner Burgener, asserted in October 2021 that the situation in Myanmar had descended into a state of civil war. Atrocities have increased notably in the latter quarter of 2021. The military launched a major operation in the northwest of the country targeting local PDFs and their civilian support, resulting in severe violence against the civilian population in the region. The military burned an estimated 600 buildings (private businesses, homes and churches); shelled villages; and attacked and killed many civilians including women, children and humanitarian aid workers. Since then the military has continued to attack civilians, including launching indiscriminate air strikes against densely populated civilian areas. Canada has responded with multiple joint statements with allies condemning the violence and raising alarm over the likelihood of further atrocities in the absence of accountability.
As of early January 2022, violencefootnote 2 associated with the coup has resulted in the following, with the accompanying humanitarian disaster is growing daily.
|Violence associated with the coup||Number of people affected|
|Civilians killed by regime||1 597|
|Civilians arbitrarily detained||12 261|
|Civilians currently arbitrarily detained||9 478|
|Military members killed||9 283|
|Military members injured||2 410|
|Number of internally displaced persons since the coup||441 500|
|Number of refugees in neighbouring countries||39 000|
One year after the 2021 coup, gross human rights violations continue as the military escalates violence against its own population. The democratic opposition, including the National Unity Government (NUG) and People’s Defence Forces, which now number in the hundreds across the country, continue to struggle to remove the regime and return to democratic rule and peace. The regime’s military forces which brutally suppressed protests in the wake of their takeover are now being deployed against the civilian population — with the stated aim of eliminating the support base the civilian population provides to the pro-democracy opposition. To do this, the military is employing weapons of war to destroy civilian infrastructure and kill civilians. Many of the actions undertaken targeting the civilian population constitute gross human rights violations, and violations of international humanitarian law and international criminal law. The situation constitutes an ongoing grave breach of international peace and security and worsening serious international crisis, including spilling over into neighbouring countries who are hosting those fleeing violence. The lack of tangible movement toward peace merits further coercive action by Canada.
Integral to the perpetration of these actions are the arms and equipment the regime uses to commit them. Weapons supplied to the regime fuel violence and atrocities throughout Myanmar. Few states in the international community are willing to continue the sale and transfer of arms and military equipment to Myanmar given the risks of how they would be used. The regime seeks to conceal their acquisitions and relies upon well-connected individuals and the corporate entities they control to act on the regime’s behalf to purchase and deliver arms and military equipment. As called for in United Nations General Assembly Resolution 75/287, Canada has called on all United Nations Member States to prevent the sale and transfer of arms, military equipment, materiel, dual-use equipment, and technical assistance to Myanmar. Canada has already implemented a national arms embargo and strongly encourages other countries to likewise undertake measures to prevent the sale and transfer of arms and military equipment to the regime.
The military coup also threatens regional peace and security with regard to organized crime, drug trafficking, and other illicit industries. The Myanmar military has long been complicit in Myanmar’s illegal drug, timber, gems and jade mining economies, which attract organized criminal syndicates and incentivize corruption across the region. In the absence of domestic oversight or accountability in Myanmar, these industries, and the associated corruption they generate, are growing to new heights.
The situation constitutes an ongoing grave breach of international peace and security and a worsening serious international crisis. Escalating violence, severe human rights violations, humanitarian impacts on the most vulnerable, spillover into neighbouring countries hosting those fleeing violence, and the lack of tangible movement toward peace merit further coercive action.
Canada has taken a multipronged response to the crisis in Myanmar. Canada has refused to legitimize the regime or engage with the regime’s government officials, except on specific topics in an ASEAN context or where it is critical to the delivery of essential services to vulnerable populations. Canada has pushed for international condemnation, action and attention, calling on the regime to halt violence, release those arbitrarily detained, engage genuinely with ASEAN, and permit full and unrestricted humanitarian access. This is supplemented by the pressure of four previous rounds of coordinated sanctions with Canada’s allies and parallel support to accountability efforts for past and ongoing crimes through international justice mechanisms. Canada also provides humanitarian support and development programming to support vulnerable and conflict-affected populations. Canada has engaged through various bilateral and multilateral fora to develop and maintain pressure and attention on the crisis, while working to maintain development programming to provide life-saving care and treatment to vulnerable populations, including COVID-19 response. With sustained, concerted and coordinated pressure, combined with efforts to incentivize cooperation, the aim is for the regime to reverse course, engage with international peace efforts, and ultimately return to peace, democracy, prosperity and stability. This is likewise intended to address the grave breach of international peace the situation represents and the resulting serious international crisis. Canada is committed to coordination and solidarity with key allies to better achieve these objectives.
Canada continues to be strongly engaged in diplomatic efforts to resolve the situation in Myanmar through bilateral and multilateral channels.
Since 2007, Canada has maintained sanctions on Myanmar individuals and entities under the Special Economic Measures (Burma) Regulations (the Regulations). The Regulations prohibit persons (individuals and entities) in Canada and Canadians outside Canada from conducting the following activities with designated persons:
- (a) deal in any property, wherever situated, that is owned, held or controlled by a designated person or by a person acting on behalf of a designated person;
- (b) enter into or facilitate any transaction related to a dealing referred to in paragraph (a);
- (c) provide any financial or related services in respect of a dealing referred to in paragraph (a);
- (d) make available any goods, wherever situated, to a designated person or to a person acting on behalf of a designated person; and
- (e) provide any financial or related services to or for the benefit of a designated person.
Since February 2021, Canada enacted four rounds of sanctions, coordinated with the United States and the United Kingdom, with Canadian sanctions now covering 73 individuals and 58 entities, a total of 131 designated persons.
- To put additional pressure on the military regime to change its behaviour, including to immediately and genuinely engage with ASEAN-led peace efforts, immediately halt violence, engage in inclusive peace dialogues, grant unrestricted humanitarian access.
- To further restrict the military regime’s access to the arms and military equipment it is using against its own population by deterring individuals acting on the regime’s behalf to obtain and deliver arms and military equipment.
- To communicate a clear message to the military regime, and to those who support it, that Canada will not accept that actions constituting a grave breach of international peace and security, resulting in a serious international crisis, are taking place with impunity and disregard for the will and democratic rights of the people of Myanmar.
- To align with actions taken by international partners specifically on Armed Forces Day.
The Regulations Amending the Special Economic Measures (Burma) Regulations add four individuals and two entities that are either linked to, or part of, the military regime to the schedule of the Regulations.
Global Affairs Canada engages regularly with relevant stakeholders, including civil society organizations and cultural communities and other like-minded governments regarding Canada’s approach to sanctions implementation.
With respect to the amendments, public consultation would not have been appropriate, as publicizing the names of the listed individuals and entities targeted by sanctions would have potentially resulted in asset flight prior to the coming into force of the amendments.
Modern treaty obligations and Indigenous engagement and consultation
An initial assessment of the geographical scope of the initiative was conducted and did not identify any modern treaty obligations, as the amendments do not take effect in a modern treaty area.
Regulations are the sole method to enact sanctions in Canada. No other instrument could be considered.
Benefits and costs
Application of sanctions will serve to put pressure on the military regime to change its behaviour and demonstrate Canada’s readiness to impose real costs on those working to obstruct or undermine international efforts to resolve the crisis in Myanmar. This will further demonstrate that those who support the regime will face consequences. The sanctions communicate a clear message that Canada will not accept that actions constituting a grave breach of international peace and security resulting in a serious international crisis continue to take place in Myanmar at the hands of the military with impunity. As efforts to date have not convinced the military to accept accountability for their actions, additional sanctions send an important message from Canada and incentivize the regime to change its behaviour.
Canadian banks and financial institutions are required to comply with the sanctions. They will do so by adding the new prohibitions to their existing monitoring systems, which may result in a minor compliance cost.
The amendments will create additional costs for businesses seeking permits that would authorize them to carry out specified activities or transactions that are otherwise prohibited. However, costs will likely be low, as it is unlikely that Canadian businesses have dealings with the newly designated persons.
Small business lens
As it is unlikely that Canadian businesses have dealings in these sectors, no significant loss of opportunities for small businesses is expected as a result of the amendments. To facilitate compliance by small businesses, Global Affairs Canada is in the process of conducting enhanced outreach with stakeholders to better inform them of changes to the Regulations. This includes updates to the sanctions website as well as the creation of the sanctions hotline.
In addition, on April 9, 2021, Canada issued a business advisory in order to help ensure Canadian companies, including small businesses, are aware of heightened commercial and reputational risks of doing business in Myanmar. The advisory also outlined the Government of Canada’s expectations with respect to responsible business practices abroad, and recommended that Canadian companies undertake thoroughly responsible business conduct due diligence, including closely examining their supply chains to determine whether their activities support military-owned conglomerates or their affiliates.
The one-for-one rule does not apply to the amendments, as they do not impose an incremental administrative burden on businesses.
Regulatory cooperation and alignment
While the amendments are not related to a work plan or commitment under a formal regulatory cooperation forum, they align with actions taken by like-minded partners.
Strategic environmental assessment
The amendments are unlikely to result in important environmental effects. In accordance with the Cabinet Directive on the Environmental Assessment of Policy, Plan and Program Proposals, a preliminary scan concluded that a strategic environmental assessment is not required.
Gender-based analysis plus (GBA+)
The focus of the amendments is on specific individuals and entities that are members of the Myanmar military and persons engaged in activities that have contributed to the grave breach of international peace and security that has occurred in Myanmar, rather than against the citizens of Myanmar as a whole. This results in minimizing collateral effects to those dependent on those individuals.
Exemptions are included in the Regulations, including, among others, to allow for the delivery of humanitarian assistance to provide some mitigation of the impact of sanctions on vulnerable groups. The Minister of Foreign Affairs can also issue permits pursuant to the Special Economic Measures (Burma) Permit Authorization Order. As such, these new sanctions are likely to have limited impact on the citizens of Myanmar.
Implementation, compliance and enforcement, and service standards
Canada’s sanctions Regulations are enforced by the Royal Canadian Mounted Police and the Canada Border Services Agency. In accordance with section 8 of the Special Economic Measures Act, every person who willfully contravenes the Special Economic Measures (Burma) Regulations is liable upon summary conviction to a fine of not more than $25,000 or to imprisonment for a term of not more than one year, or to both, or upon conviction on indictment, to imprisonment for a term or not more than five years.
Southeast Asia Division II
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