Insight

Hobbling the War Machine

Since late spring, the Canadian government has been actively sanctioning business and political entities, as well as numerous individuals, with alleged ties to Vladimir Putin and the Russian military, including some in Belarus. You can’t tell the players without a scorecard—so here’s an overview.

Military tank with prohibited symbol
SN

Shawn C.D. Neylan

September 30, 2022 12:00 AM

ON JUNE 27, Canada imposed new sanctions on Russia intended to prohibit the export of certain advanced technologies and goods that could be used in the production and manufacturing of weapons by Vladimir Putin’s regime. The categories of goods and technologies that fall under the sanctions are extensive:

  • quantum computing materials;
  • cryogenic refrigeration systems;
  • ultra-high vacuum equipment;
  • high quantum efficiency photodetectors;
  • additive manufacturing equipment for certain uses or processes;
  • metal powders for additive manufacturing;
  • certain microscopes and detectors;
  • decapsulation equipment for semiconductor devices;
  • software related to the above items
  • software for digital twins of additive manufactured products or the determination of the reliability of additive manufactured products (digital twin technology can be used for testing and process monitoring of additive manufacturing); and
  • technology related to the above items.

The sanctions also covered six senior Russian defense officials and 46 Russian defense entities.

Designations of Russian Media

Ten days later, on July 7, Canada took the remarkable step of designating 29 individuals who are, according to the Canadian government, figures involved in Russian disinformation and propaganda, as well as 15 entities that Canada refers to as involved in disinformation activity, including a media regulator. The Russian government likely considers the sanctioned individuals to be media figures, albeit state-friendly or outright state-controlled. Illustrative of the news-media nature of the people are the names of the entities:

  • Channel One Russia JSC;
  • Television Station Russia-1;
  • NTV Broadcasting Company JSC;
  • Russotrudnichestvo (known as “the Federal Agency for the Commonwealth of Independent States Affairs, Compatriots Living Abroad and International Humanitarian Cooperation”);
  • TASS;
  • the All-Russia State Television and Radio Broadcasting Company (VGTRK);
  • Gazprom Media;
  • National Media Group;
  • Rossiya-24 TV Channel;
  • Smotrim;
  • Ru;
  • RT;
  • Sputnik;
  • REGNUM News Agency; and
  • Roskomnadzor (the “Federal Service for Supervision of Communications, Information technology and Mass Media”).

Notably, Chrystia Freeland, the Canadian Deputy Prime Minister, who is widely considered to be driving the policy on Canada’s sanctions on Russia and Belarus, was formerly a well-known member of the press who once served as the Moscow bureau chief for an international business-news organization.

Gold Import Ban

Also on July 7, Canada prohibited the import of certain gold products from Russia, including unwrought gold, semi-manufactured gold, gold powder, monetary gold and jewelry made of gold.

This poses an ever-increasing burden on Canadian companies, which must comply with these sanctions."

Services Ban Expanded

A week later, on July 14, Canada added two more manufacturing services to the list of those that cannot be provided to banned industries: services incidental to manufacturing, except to the manufacture of metal products, machinery and equipment; and services incidental to the manufacture of metal products, machinery and equipment.

Canada also added eight new industries to the list of those to which banned services cannot be provided:

  • the manufacture of basic metals;
  • of fabricated metal products;
  • of computer, electronic and optical products;
  • of electrical equipment;
  • of machinery and equipment;
  • of motor vehicles, trailers and semi trailers;
  • of other transport equipment; and
  • land transport and transport via pipelines.

The Bucha Massacre and Other Defense-Sector Designations

On July 29, Canada designated for sanctions an additional 43 individuals and 17 entities. These include military officials allegedly involved in the massacre of more than 1,000 Ukrainians in the city of Bucha early in the war, as well as entities in the defense sector that, according to Canada’s government, directly or indirectly support the Russian military.

Sanctions on Belarus Are Expanded

On June 27, Canada imposed new sanctions on Belarus similar to those previously or contemporaneously imposed on Russia. These prohibit the export to Belarus of certain goods and technologies, luxury goods and goods for the manufacture of weapons; they also ban the import of certain luxury goods from Belarus. The same day, Canada designated for sanctions 13 senior officials of Belarus’s Ministry of Defense and two Belarusian military entities.

Designation of Certain Ukrainian Nationals

Also on June 27, Canada sanctioned 15 former senior officials of the so-called Luhansk People’s Republic and Donetsk People’s Republic, along with their family members and purported leaders in areas of eastern Ukraine illegally occupied by Russian forces or controlled by Russia-backed proxies.

Potential Implications for Canadian Businesses

As detailed above, Canada continues to add to the thicket of sanctions on Russia and Belarus. This poses an ever-increasing burden on Canadian companies, which must comply with these sanctions. It’s important to take care to ensure compliance; enforcement is surely more top-of-mind than it has been in recent years.

Conclusion

The pace of new Canadian sanctions has yet to abate. Although the number of people and entities who could potentially be designated for their involvement in or support of Russia’s war is presumably vast, logically there ought to be an end point for other types of sanctions given how extensive the ones already imposed have been—and the diminishing returns of identifying any remaining areas of commercial relations between Canada and Russia (or Belarus). This hasn’t happened yet, however, and the Canadian government remains creative in finding new sanctions to impose, apparently wishing to maintain a position of global leadership to whatever extent it is able.

This article was first published on Stikeman Elliott LLP’s Knowledge Hub and originally appeared at www.stikeman.com. All rights reserved.

Shawn C.D. Neylan is a partner in the Competition & Foreign Investment Group of Stikeman Elliott and advises businesses in relation to business crime laws. He concentrates his practice on Canadian federal regulatory and criminal laws with regard to anti-corruption, national security, economic sanctions, commercial bribery, anti-money laundering and proceeds of crime prohibitions and merger control laws. Highly esteemed for his expertise in substantive competition and antitrust matters, Shawn has received numerous accolades for his work.

Headline Image: ISTOCK/AlexKontz, ISTOCK/ulimi, ISTOCK/Aurelio Antonio

Related Articles

The Antipodean Advantage


by Gordon Grieve and Tony Britten-Jones

As the pandemic recedes, Australia remains one of the best countries in which to invest. The commercial law experts at Piper Alderman review the country’s advantages when it comes to outside money looking for outsized returns.

Man pointing to cave wall

It’s Official: Options for Challenging “Official Marks” in Canada


by Jamie-Lynn Kraft and Philip Lapin

“Official marks” are a strangely obscure corner of Canadian intellectual-property law. What are they, what explains their strength and what can a business owner in search of a trademark do to challenge them?

Two griffins on royal crest

Growing Canadian Business Abroad


by Didier Culat

Canadian entrepreneurs looking to expand their businesses beyond the geographic confines of their home dominion must consider a vast range of questions to ensure they’re fit to branch out. Here’s a quick primer.

Green arrows rising with Canada in backdrop

Latinflation


by Alejandra Daroch, Domingo Russi and Jaime Carey Astaburuaga

Long a beacon of economic stability in South America, Chile has been buffeted lately by the global rise in inflation. Can a key element of its monetary policy help it weather the storm?

Waves crashing into lighthouse

The Future of Trade is Digital


by Alan de Rochefort-Reynolds, Daniel Allman and Jo Feldman

Digital information increasingly drives bilateral and multilateral trade throughout the Indo-Pacific region. It behooves countries to devise agreements governing the use and exchange of the enormous amounts of vital data generated every day.

Neon colored boxes in circle with black background

The Carbon Conundrum


by Martin Hamer and Natalie Kopplow

Companies that trade internationally might soon face a “carbon tariff” when importing certain goods into the European Union. Why is the EU doing this—and how will it affect world trade?

Power plant billowing smoke

Competitive Balance


by David Feldman and Peter Flynn

Major amendments to Canada’s Competition Act were rushed through Parliament this June with scarcely any debate. They will likely have enormous antitrust ramifications—and businesses had better be ready.

Blaring megaphone sounds the alarm

Rental House of Cards


by Tyler D’Angelo

The pandemic devastated uncountable businesses worldwide. A recent court case involving some of Canada’s most venerable companies and pension funds sheds light on the stringency of the country’s commercial leases—and the judiciary’s reluctance to meddle in sophisticated commercial contracts amid a “black swan” event.

Toppling house of cards

The 2023 Best Lawyers in Portugal™


by Best Lawyers

Announcing the elite group of lawyers recognized in Portugal for 2023.

Green and red Portuguese flag

"Lawyer of the Year"


Woman standing in front of dark background

Julie Dunne

Litigation - Labor and Employment

San Diego, CA

2023

Easton & Easton Knocks It Out of the Park


by Justin Smulison

With exceptional results and new strategic partnerships, 2023 U.S. News - Best Lawyers® "Best Law Firms" Tier 1* ranked powerhouse firm Easton & Easton is launching homeruns and scoring goals for personal injury victims.

Four men wearing jerseys and holding sports gear

Enhancing Consumer Safety Through Winning Jury Trials and Substantial Settlements


by Justin Smulison

Firm founder and lead trial lawyer James P. Frantz discusses how landmark victories in litigation and trial protect consumers.

Lawyers sitting around a table in conference room

California’s Plan to Phase Out Gas-Powered Cars by 2035


by Gregory Sirico

Best Lawyers weighs in on California, the largest automotive market in the U.S., and their current plan to phase out gas-powered transportation altogether.

Car fuel gauge reading empty

2023's Best Lawyers in Colombia™


by Best Lawyers

Announcing Colombia's elite group of lawyers recognized for 2023.

Yellow, blue and red stripes

Fighting for Florida


by Justin Smulison

Three-time “Lawyer Of The Year”* Steve Yerrid reflects on how South Florida was the setting for some of his most memorable trials.

Headshot of man with dark suit and red tie outside in front of fountain

IN PARTNERSHIP

Rewriting 𝙃𝙀𝙍𝙨𝙩𝙤𝙧𝙮 One Verdict at a Time


by Justin Smulison

Athea Trial Lawyers was formed only a year ago by several prestigious lawyers seeking justice for their clients, and together they are making history.

Six female lawyers sitting in office

Trending Articles

The Best Lawyers in Spain™ 2023


by Best Lawyers

Announcing Spain's recognized lawyers for 2023.

Flag of Spain

Announcing the 2023 The Best Lawyers in America Honorees


by Best Lawyers

Only the top 5.3% of all practicing lawyers in the U.S. were selected by their peers for inclusion in the 29th edition of The Best Lawyers in America®.

Gold strings and dots connecting to form US map

The Best Lawyers in Chile™ 2023


by Best Lawyers

The results include an elite field of top lawyers and firms in Chile.

White star in blue box beside white box with red box on bottom

Thirteen Years of Excellence


by Best Lawyers

For the 13th consecutive year, “Best Law Firms” has awarded the most elite and talented law firms across the country through a thorough and trusted data review process.

Red, white and blue pipes and writing on black background

The Best Lawyers in South Africa™ 2023


by Best Lawyers

Best Lawyers proudly announces lawyers recognized in South Africa for 2023.

South African flag

The 2023 Best Lawyers in Portugal™


by Best Lawyers

Announcing the elite group of lawyers recognized in Portugal for 2023.

Green and red Portuguese flag

Announcing The Best Lawyers in Peru™ 2023


by Best Lawyers

Honoring our awarded lawyers for 2023 in Peru.

Red and white stripes with green leaf symbol

Best Lawyers: Ones to Watch in America for 2023


by Best Lawyers

The third edition of Best Lawyers: Ones to Watch in America™ highlights the legal talent of lawyers who have been in practice less than 10 years.

Three arrows made of lines and dots on blue background

The Best Lawyers in Spain™ 2022


by Best Lawyers

The results include an elite field of top lawyers and firms.

The Best Lawyers in Spain™ 2022

Famous Songs Unprotected by Copyright Could Mean Royalties for Some


by Michael B. Fein

A guide to navigating copyright claims on famous songs.

Can I Sing "Happy Birthday" in Public?

IN PARTNERSHIP

Rewriting 𝙃𝙀𝙍𝙨𝙩𝙤𝙧𝙮 One Verdict at a Time


by Justin Smulison

Athea Trial Lawyers was formed only a year ago by several prestigious lawyers seeking justice for their clients, and together they are making history.

Six female lawyers sitting in office

Announcing the 2022 Best Lawyers® in the United States


by Best Lawyers

The results include an elite field of top lawyers listed in the 28th Edition of The Best Lawyers in America® and in the 2nd Edition of Best Lawyers: Ones to Watch in America for 2022.

2022 Best Lawyers Listings for United States

Strength in Numbers: When Partnering Up May Be Best in Whistleblower Litigation


by Justin Smulison

Whistleblower claims make headlines when they result in multimillion-dollar settlements. But the journey to the courtroom is characterized by complexity and requires time and resources. Bienert Katzman Littrell Williams partner and The Best Lawyers in America awardee Michael R. Williams discusses when and why partnerships between counsel will strengthen whistleblower litigation.

A Blue Person in the Middle of White People

What the Courts Say About Recording in the Classroom


by Christina Henagen Peer and Peter Zawadski

Students and parents are increasingly asking to use audio devices to record what's being said in the classroom. But is it legal? A recent ruling offer gives the answer to a question confusing parents and administrators alike.

Is It Legal for Students to Record Teachers?

Announcing the 2023 The Best Lawyers in Canada Honorees


by Best Lawyers

The Best Lawyers in Canada™ is entering its 17th edition for 2023. We highlight the elite lawyers awarded this year.

Red map of Canada with white lines and dots

Announcing the 2022 "Best Law Firms" Rankings


by Best Lawyers

The 2022 “Best Law Firms” publication includes all “Law Firm of the Year” recipients, national and metro Tier 1 ranked firms and editorial from thought leaders in the legal industry.

The 2022 Best Law Firms Awards