The Special Economic Measures

On March 17, 2014, the Canadian Government announced that it intended to impose economic sanctions against Ukraine through the Special Economic Measures (Ukraine) Regulations (the “Ukraine Regulations”). The Ukraine Regulations impose an asset freeze on a list of designated persons.

On July 24, 2014 the list of designated individuals was expanded from 42 to 49. Those designated persons are:

  1. Serhiy Valeriyovich AKSYONOV
  2. Volodymyr  Andriyovych KONSTANTYNOV
  3. Viktor  Volodymyrovich MEDVEDCHUK
  4. Rustam Ilmirovich TEMIRGALIEV
  5. Deniz Valentinovich BEREZOVSKIY
  6. Aleksei Mikhailovich CHALIY
  7. Pyotr Anatoliyovych ZIMA
  8. Yuriy ZHEREBTSOV
  9. Sergey Pavlovych TSEKOV
  10. Mikhail MALYSHEV
  11. Valery MEDVEDEV
  12. Olga Fedorovna KOVATIDI
  13. German PROKOPIV
  14. Valeriy BOLOTOV
  15. Andriy PURGIN
  16. Denys PUSHYLIN
  17. Sergey Gennadevich TSYPLAKOV
  18. Petr Grigorievich JAROSH
  19. Oleg Grigorievich KOZYURA
  20. Viacheslav PONOMARIOV
  21. Igor Mykolaiovych BEZLER
  22. Igor KAKIDZYANOV
  23. Oleg TSARIOV
  24. Roman LYAGIN
  25. Aleksandr MALYKHIN
  26. Natalia  Vladimirovna POKLONSKAYA
  27. Igor Sergeievich SHEVCHENKO
  28. Viktor Yuriiovych ANOSOV
  29. Viacheslav  Anatoliiovych APRAKSIMOV
  30. Fedir Dmytrovych BEREZIN
  31. Ruslan Yunirovish ILKAEV
  32. Valery Vladimirovich KAUROV
  33. Oleksandr  Sergiyovych KHODAKOVSKYI
  34. Mykola Ivanovych KOZITSYN
  35. Oleksii Borysovych MOZGOVYI
  36. Valerii  Kostiantynovych MUSIIENKO
  37. Viacheslav Mykolaiovych PETROV
  38. Ihor Venedyktovych PLOTNYTSKY
  39. Yurii Oleksandrovych PROTSENKO
  40. Oleh Anatoliiovych VASIN
  41. Serhii Anatoliyovych ZDRILIUK
  42. Vladimir ANTYUFEYEV
  43. Marat BASHIROV
  44. Alexsandr Yurivich BORODAI
  45. Yuriy IVAKIN
  46. Alexandr  Alexsandrovich KALYUSSKY
  47. Aleksey KARYAKIN
  48. Alexandr KHRYAKOV
  49. Vasyl NIKITIN

As of July 24, 2014, the designated entities now subject to the Ukraine Regulations are:

  1. Chernomorneftegaz
  2. Feodosia
  3. Donetsk People’s Republic
  4. Luhansk People’s Republic

The Ukraine Regulations prohibit persons in Canada and Canadians abroad from:

  • Dealing in any property held by or on behalf of a designated person, or facilitating or providing financial or other related services in respect of such a dealing;
  • Making any goods available to a designated person; and,
  • Providing any financial or related services to or for the benefit of a designated person.

“Causing, assisting, or promoting” these prohibited activities is also not permitted. There are some exceptions, including the following:

  • Payments made by or on behalf of designated persons pursuant to contracts entered to before their designation, provided the payment is not for their benefit
  • Pension payments to any person in Canada or Canadian abroad;
  • Certain transactions in respect of diplomatic missions;
  • Transactions to UN agencies, the International Red Cross and Red Crescent Movement, and Canadian NGOs in certain circumstances;
  • Transactions necessary for a Canadian to transfer to a non-designated person any accounts, funds or investments held by a designated person when that person became a designated person;
  • Financial services required in order for a designated person to obtain certain legal services in Canada; and
  • Payments to any person in Canada or any Canadian abroad in respect of loans entered into prior to March 17, 2014.

It is worth noting that the Minister of Foreign Affairs does have the power to issue to any person in Canada or a Canadian abroad a permit to carry out any of the activities or transactions that are currently restricted or prohibited by way of the Ukraine Regulations.

Those conducting business in Ukraine, or with Ukrainian business partners outside of Ukraine, may wish to consider implementing incremental processes and procedures to ensure compliance with these new Canadian laws. The economic sanctions imposed on Ukraine have rapidly evolved and ongoing vigilance with respect to developments is the prudent course.