You are an information technology company, not an arms dealer. So, you can safely ignore this article on the clash between the U.S. International Traffic in Arms Regulations ("ITAR") and Canadian human rights laws, right? Wrong. Keep reading.
ITAR is now one of the biggest yet quietest issues hitting the radar of Canadian importers of U.S. defence-related articles and services. But do not be mistaken – defence-related articles and services do not include just military equipment; they can include components used in those articles and services. As an example, computer chips exported from the US to Canada for use in defence-related telecommunications, aeronautics and transport are caught by ITAR.
The ITAR was adopted under the U.S. Arms Export Contract Act. In our post 9/11 world, they have become more closely scrutinized than when they were first introduced. They impose strict requirements before any non-U.S. person or company can come into contact with articles or services controlled under ITAR. The clash with Canadian human rights laws arises because, among other things, no citizens of any one of 26 countries under the ITAR embargo list may have contact with ITAR controlled articles or services. Countries currently on the embargo list are Afghanistan, Burma, Belarus, China (PR), Ivory Coast, Cuba, Cyprus, Congo, Eritrea, Haiti, Iran, Iraq, Lebanon, Liberia, Libya, North Korea, Rwanda, Sierra Leone, Somalia, Sri Lanka, Sudan, Syria, Venezuela, Vietnam, Yemen and Zimbabwe.
Consider the following. You are a Canadian business that does not ask employees about their citizenship, ethnicity or country of origin when hired or any point after. You purposely stay away from these questions knowing that making hiring and other employment-related decisions on these grounds is in breach of both federal and provincial human rights laws across the country. So far so good. But what do you do when your U.S. parent company or U.S. supplier asks you for confirmation that none of your employees are citizens of countries on the ITAR embargo list? What if they tell you that they can no longer be your supplier or send you certain business unless you can provide them with that confirmation?
Little law on this point exists in Canada, in large part because employers do their best to resolve these complaints before they become public. One of the few cases to catch the public eye was discussed in a January 2008 press release issued by the Quebec Human Rights Commission regarding a settlement involving Bell Helicopter Textron Canada Ltd. In the Bell Helicopter case, the complainant alleged that he had been refused an internship with the company because he was born in Haiti. The complainant had held Canadian citizenship for nearly 30 years. His application for an internship was initially accepted, but subsequently disqualified after he advised of his country of birth. A confidential settlement was reached and the complainant received damages. However, that did not stop the Commission from stating that the ITAR rules are inconsistent with Quebec human rights laws. This settlement followed closely on the heels of an Ontario settlement reached in mid-2007 between General Motors Defence and number of its employees who were dual nationals of Canada and embargoed countries.
Where do we go from here? Although the Canadian Department of National Defence and the U.S. State Department recently entered into an agreement to allow DND personnel who are dual nationals to have access to ITAR-controlled materials, no such agreement is in place for private Canadian businesses. However, discussions continue between governments and one can only hope that these discussions will result in a similar agreement for private business. In the meantime, the best advice is to tread carefully and get the assistance of legal counsel. No easy answer exists when balancing Canadian human rights and liberties with the demands of doing business with the U.S. in the post-9/11 world.
