Thank you very much.
I'm pleased to be here today to speak to you about Bill C-61, the Freezing Assets of Corrupt Regimes Act.
As you know, the Government of Canada is strongly committed to working with emerging democracies. These countries in turmoil need assistance, not sanctions. We must work together to ensure that states emerging from repressive regimes are given the assistance they need.
This bill, if passed, will allow Canada, at the request of a foreign state, to take rapid action to freeze the assets of persons who have been in positions of power in their home states and may have misappropriated state assets or illicitly acquired funds by virtue of their office or family connection and moved these to Canada. The capacity to restrain assets would extend to the family and close associates of such people.
This new legislation is designed to assist states experiencing political turmoil by allowing for the rapid preservation of assets. As such, the legislation would allow a country that finds itself in difficult circumstances the time and opportunity to make a request to Canada for the recovery of assets using existing Canadian laws. Due to the situation these states may find themselves in, their authorities may not be able to gather the evidence required to use existing Canadian legal mechanisms that govern asset restraint and recovery.
The proposed legislation is about preservation so the assets are not dissipated during the time it may take a state to put itself in a position to take legal measures in Canada. Bill C-61 will close a gap in Canada's existing capacity to assist a foreign state that finds itself in a position of turmoil with the restraint of assets.
The law in Canada, as enacted by Parliament, requires that certain preconditions be met before alleged criminal proceeds located in Canada may be restrained at the request of a foreign state. In particular, the Mutual Legal Assistance in Criminal Matters Act, which governs such requests, requires that a foreign state provide Canada with a restraint or seizure order issued by their criminal court ordering the freezing of specified property as proceeds of crime. The foreign order may then be filed with the Canadian courts and executed as if it were an order issued in Canada. The Mutual Legal Assistance in Criminal Matters Act also requires that charges be laid in the foreign state against the person whose property is sought to be restrained and/or frozen.
Canada's laws on mutual legal assistance reflect our commitment to assisting our treaty partners in fighting criminality while at the same time protecting the interests of individuals.
As I am sure you will agree, these legal safeguards are fundamental to Canada's criminal justice system. In requiring that a foreign state provide Canada with sufficient information to meet these safeguards, we are protecting the rule of law, a principle that is paramount in a free and democratic society.
Canada's proceeds of crime regime, as set out in our Criminal Code, also allows for the seizure and restraint of alleged proceeds of crime and their subsequent forfeiture. However, our domestic proceeds of crime regime also incorporates preconditions to seizure and restraint. Under our domestic proceeds of crime regime, assets may only be restrained if the following conditions are met: the assets to be restrained and/or frozen are identified; there is evidence linking the Canadian assets to an alleged criminal offence in Canada or in the foreign state; and there is evidence that the Canadian assets are the proceeds of crime.
Generally speaking, our criminal forfeiture system is conviction based. In order to obtain a forfeiture order, the law requires a successful criminal prosecution unless the offender has absconded or died. In those cases an application for criminal forfeiture of the tainted property is possible.
The preconditions of our domestic laws may be difficult for a transitioning state that is still in turmoil to meet. The information and evidence required by Canada may simply not be made available in time to prevent the assets from being diverted or depleted. The Freezing Assets of Corrupt Regimes Act would permit a freezing order without requiring the evidence of criminality or specific identification of assets that now exist under current law.
The freezing of assets would automatically expire after five years, although the period could be extended if circumstances warrant.
To ensure that companies are not put out of business while assets are subject to restrictive measures, the legislation would incorporate safeguards that would permit persons to carry out specified activities or transactions. Where necessary, it would also ensure that affected persons and their dependants have access to reasonable expenses.
We believe that the Freezing Assets of Corrupt Regimes Act will address the existing gap in our laws. We want to ensure that any misappropriated property or illicitly acquired assets are preserved in order to provide a foreign state with the time that is necessary to seek their return and make them available to the new authorities and the people of the states in turmoil.
Thank you, Mr. Chair.