Foreign Affairs Committee on Oct. 31st, 2016

[The Chair (Hon. Robert Nault (Kenora, Lib.)), Liberal, Bob Nault]

Colleagues, let's bring this meeting to order. Thanks to all of you for attending.

We'll continue with our study pursuant to the order of reference of Thursday, April 14, 2016, of section 20 of the Freezing Assets of Corrupt Foreign Officials Act in the statutory review of the act. As you know, of course, we're discussing SEMA as well.

In front of us this afternoon are two professors. One is Kim Richard Nossal, who is a professor at the Centre for International and Defence Policy at Queen's University.

Welcome.

On video is Mr. Goldman, the executive director of the Center on Law and Security at the New York University School of Law.

Welcome to the committee, Mr. Goldman. Can you hear us?

[Zachary Goldman, Executive Director, Center on Law and Security, New York University School of Law, As an Individual]

I can hear you very well. Thank you.

[The Chair, Liberal, Bob Nault]

With that, we'll start with Professor Nossal's presentation. We'll have both presentations and then go right into questions for the equivalent of roughly an hour. We'll go to other witnesses at 4:30.

On behalf of the committee, welcome.

I will turn it over to you, Professor.

[Professor Kim Nossal, Centre for International and Defence Policy, Queen's University, As an Individual]

Thank you very much, Chair.

I'd like to thank you all for inviting me to participate in your consideration of the effectiveness of sanctions as a tool of Canadian statecraft.

I should begin by stressing, if you haven't already figured out from what is not in my bio, that whatever assistance I might be able to afford you today is limited to a broad consideration of sanctions as a foreign policy tool. Mine is an academic's, not a practitioner's, perspective. It's academic in the sense that I'd like to pitch the focus more broadly, to address some of the general questions posed in the excellent backgrounder by Allison Goody, Brian Hermon, and Robin MacKay.

The perspective is also academic in the sense that it's broadly historical. I've been looking at the use of sanctions in foreign policy since I began my academic career in the mid-1970s. As a young and callow academic, I was particularly interested in understanding the enthusiasm for international sanctions, given the failure of this tool of statecraft under the League of Nations in the interwar period and the long-running sanctions regimes in the post-1945 period—the sanctions against the Soviet Union that began in the late 1940s, against the People's Republic of China in the 1950s, against Castro's Cuba in the 1960s, and the sanctions that were being advocated against the white minority regimes in Rhodesia, South Africa, and Portugal's African colonies in the 1960s and 1970s.

What prompted my interest was the renewed enthusiasm for sanctions against the Soviet Union following its invasion of Afghanistan and against South Africa after the collapse of order in the townships in the mid-1980s. I wondered why there was such enthusiasm, given the string of long-running failures up to that point. Much of my early writing, when I was at McMaster University in Hamilton, sought to address this puzzle.

I raise these historical cases because I think it's important that we remain very conscious of just how enduring the problems with these measures have been. Many years on, it continues to surprise me that we see the same optimism about sanctions that we saw a century ago. To be sure, much water has passed under the bridge since then. The nature of sanctions themselves has changed, and radically so, in the last generation. Instead of the blunt instruments applied in the 20th century to entire communities, instruments that invariably produced a great deal of humanitarian suffering in the target country, we now have so-called smart sanctions or targeted sanctions. Indeed, there can be no better example, in my view, of the move to targeted sanctions than the Magnitsky Act of 2012, a piece of legislation, as members of this committee know well, that was adopted by the United States government to impose sanctions on just 18 of Russia's 143 million people.

What's not changed in all these years is the conviction that imposing economic hardship on some, many, or all the people in a target community will achieve political change. But is there evidence that these measures actually produce political change? Now, it's true that economic sanctions can and do inflict economic hardship on entire communities, on groups, on sectors in the economy, on particular firms, and of course on selected individuals. But do these measures produce the desired political change? Do the economic hurts that are clearly produced by sanctions actually change the behaviour that triggered the sanctions in the first place?

Consider the sanctions regime that Canada presently has in place against 21 different countries, some now for well over a decade. This is a simple question for the committee to consider: have any of these measures actually changed the behaviour of the target government? In my view, the answer, broadly speaking, must be no.

Like the long-running sanctions regimes of the Cold War, which lingered year after year without producing any of the changes that they were supposed to produce, Canada's bundle of sanctions regimes grows older, but no more effective.

Ironically, however, we know that while these measures do produce economic pain, it's not always the pain that is intended. Consider, for example, the hugely gendered impact of the sanctions imposed on Iraq during the 1990s in the aftermath of the Persian Gulf war. The relatively greater negative impact of these sanctions on Iraqi women was one of the reasons why so-called “smart” sanctions came to replace the “dumb” sanctions of the 1980s and 1990s, sanctions dubbed that because they tended not to discriminate between targets.

We also know that sanctions can end up hurting the sender's own people. Talk to Canadian banks or firms in other sectors of the economy that have to deal with current Canadian sanctions practice and have to spend, in the aggregate, millions of dollars because the federal government has downloaded the costs of implementing its enthusiasm for this highly questionable public policy tool onto those firms.

In short, we know that these measures don't produce their intended effects, while at the same time they produce all manner of unintended, and usually negative, collateral damage. That is, of course, why students of sanctions like me continue to ask the question we've always asked: If the economic hardship that is produced by sanctions does not produce the desired change, why do governments continue to use this tool of statecraft and, importantly, continue to pretend that these measures work? The answer to this question is that sanctions, whether the “dumb”, blunt sanctions of the past or the supposedly “smart”, targeted sanctions of the contemporary era, are really not about producing actual political change in the target state.

On the contrary, sanctions are all about producing other political effects. First, sanctions, like all punishments—and we need to remember the etymological origin of the term itself—are useful for symbolic reasons. Like all harms imposed on wrongdoers, sanctions are a useful way of signalling disapproval of particular behaviour. In that sense, international economic sanctions will always “work”, because they punish. They always have, and they always will.

Second, international sanctions are a very useful tool for domestic political purposes. Because sanctions actually produce harm, unlike mere words, these measures give the impression of a stern rebuke to wrongdoers and wrongdoing.

I understand why governments continue to embrace sanctions with the same enthusiasm they always have, and continue to pretend that they will be effective in producing political change. Nonetheless, I remain highly skeptical about this tool of statecraft, and that skepticism is buttressed by the views of a new generation of sanction scholars.

You've already heard from one of this new generation, Andrea Charron. Another one is Dr. Lee Jones, a young academic at Queen Mary University of London, who has explored how sanctions actually play out in target communities. I would highly recommend his 2015 book Societies Under Siege: Exploring How International Economic Sanctions (Do Not) Work. This book demonstrates nicely how inflicting economic pain simply doesn't pay enough attention to what actually happens in societies targeted by sanctions.

Dr. Jones's research led him to write, in a briefing in 2015, the following:

If policymakers cannot specify a plausible, step-by-step mechanism by which the infliction of economic pain will generate political gain, they ought not to impose sanctions at all. Doing so merely imposes random suffering in the vain hope of positive outcomes. This is deeply unethical, and poor public policy.

In my view, there can be no better way to put it.

Thank you very much. I look forward to your questions.

[The Chair, Liberal, Bob Nault]

Thank you very much, Professor Nossal.

I'll go straight to Mr. Goldman.

Go ahead, Mr. Goldman.

[Zachary Goldman]

Chairman Nault and Vice-Chairs Allison and Laverdière, good afternoon. It is an honour to appear before you today.

My opening remarks will focus on two main issues: first, a few ways to think about the goals of financial sanctions; and second, some of the processes by which the U.S. government imposes financial sanctions.

When the government thinks about the imposition of financial sanctions, it likely has one or both of two goals in mind. Here, while I'm speaking specifically about the U.S. government, I believe the points generalize and in some sense echo the interventions of Professor Nossal. The first goal of financial sanctions is to engineer a change in behaviour in the ultimate target of the sanctions, and in so doing to advance the foreign policy and national security interests of the United States. The second is to protect the integrity of the financial system by preventing illicit capital from entering.

One prominent example of this first objective to change behaviour is the successful Iran sanctions program, where sanctions imposed by a broad coalition over many years incentivized Iran to negotiate a deal regarding its nuclear program. Other recent cases include Burma, where sanctions were recently lifted in response to important democratic reforms, and Côte d'Ivoire, where sanctions were removed in response to a successful presidential election, progress on arms control issues, and the removal of multilateral UN sanctions. There also have been important successes in the narco-trafficking context, where large numbers of individuals and entities have been delisted because of a change of behaviour.

On the preventive side, it is helpful to think about two intertwined goals. Sanctions can be used to help ensure that ordinary citizens and businesses retain their trust in the international financial system by targeting illicit conduct. Here, sanctions work in concert with other forms of preventive measures such as anti-money laundering regulations to keep illicit activity out of the global financial system. National and transnational sanctions regimes work in concert with national AML measures and guidance offered by non-governmental organizations such as the Financial Action Task Force and the Wolfsberg Group.

There is another preventive function that sanctions can serve—namely, to interfere with the ability of illicit actors to obtain the goods and services they need to function, to make it harder for them to raise, store, move, and use funds. This was another part of the rationale for the Iran sanctions program and for other successful programs, including counterterrorism sanctions.

Officials understand, of course, that sanctions alone will not cause an end to terrorism. They are not blind to some of the unintended consequences that Professor Nossal identified, but if terrorist groups are unable to gain access to the international financial system, it will be harder for them to engage in the financial activities necessary to sustain themselves. Individual attacks might not cost much, but sustaining a terrorist organization over time costs a great deal.

It is important to note that financial sanctions are preventive and not punitive. The goal is not to use sanctions in lieu of criminal prosecutions. Instead, sanctions can be a complement to indictments, but fundamentally have a different goal. Whereas criminal prosecutions are designed first and foremost to punish with respect to completed conduct, sanctions are regulatory measures designed to have broad systemic effects.

We saw an example of this complementarity in September, when the U.S. announced the indictment of Chinese industrialist Ma Xiaohong, a company she controls, and several of her associates for helping North Korean entities evade U.S. sanctions and provide support to its WMD program. At the same time as the indictment was announced, the U.S. government sanctioned some of those same entities in order to prevent them or entities they own or control from participating in the international financial system. Here, the two legal mechanisms worked side by side.

Sanctions operate through a range of legal mechanisms. Broadly, they are regulatory restrictions imposed on natural or legal persons. There are two basic types of schemes: some sanctions are directly imposed by legislation, while others rely on a grant of authority by Congress to the executive to establish sanctions programs that address particular national emergencies.

The main U.S. statute that follows this pattern is the International Emergency Economic Powers Act of 1977, or IEEPA. It authorizes the president to declare a national emergency with respect to a problem that originates wholly or substantially outside the United States. The president can then investigate, regulate, or prohibit and generally constrain a wide range of financial transactions in response to the problem. In practice, the president has adopted dozens of executive orders to address the financial dimensions of critical national security threats, such as nuclear proliferation, counterterrorism, the situation in Syria, and Russian activities that undermined democratic processes and threatened peace and stability in eastern Ukraine.

The executive orders allow the treasury department to target individuals or entities involved in illicit conduct. The Department of the Treasury can impose a range of restrictions, but most common are sanctions that block the property of designated persons subject to U.S. jurisdiction, and prevent U.S. persons from doing business with them. Other types of restrictions are also possible. For the Russia-Ukraine sanctions program, for example, the U.S. and its allies adopted creative restrictions on dealings in the debt and equity of a range of Russian companies. The objective was to target as precisely as possible the objectionable conduct and to spare, as much as possible, activities that would have a wide-ranging and unanticipated impact on the Russian economy.

The actual process of identifying targets for designation involves a number of steps. The U.S. government canvasses a wide range of information sources to develop targets and then compiles an administrative record that is subject to multiple levels of legal and policy review by different agencies before a final decision about a designation is made. Designations are then finalized with an administrative order and are made public via a press release and a public change to the relevant sanctions list on which the target will appear.

If they wish, designated parties can seek review and reconsideration of the designation by the Office of Foreign Assets Control, OFAC, the administrative agency that implements financial sanctions, or can challenge their designation in court. OFAC must make public sufficient information about the basis for designation such that the target can understand the conduct that led to the imposition of sanctions, but OFAC can use classified materials in compiling the evidentiary record, which a review in court can evaluate in camera ex parte.

Some statutes also directly impose certain financial sanctions, most prominently in the Iran context.

In the post-9/11 era, financial sanctions have taken on an increasingly important role in national security, foreign policy, and financial integrity discussions. Very few people believe that they are intended to have decisive impacts on their own. They are, however, a critical tool of risk management.

I look forward to answering any questions that you might have.

Thank you.

[The Chair, Liberal, Bob Nault]

Thank you, Mr. Goldman

Thank you, Professor Nossal.

We're going to go right to questions. We'll start with Mr. Kent.

[Peter Kent, Conservative, Thornhill, ON]

Thank you, Chair.

Thanks to both of you for attending today and sharing your insight and expertise.

In the barely six hours of testimony that we have heard in this study on the SEMA and the corrupt foreign officials act, we've heard a great deal with regard to the Canadian situation, where enforcement and/or compliance has as much to do with capacity as it does with the laws. We were told that there are gaps in our laws and that some of our departments and agencies—the RCMP, for example—have capacity issues, and that enforcement of these sorts of sanctions, or crimes for which sanctions have been imposed, is of a lower priority than their anti-terror focus.

I would like to start with a question to you, Mr. Goldman, regarding the harshest enforcement penalty levied. It was in the United States for the BNP Paribas case. I think the penalty was almost $9 billion against that financial institution for channelling many billions of dollars through the United States on behalf of clients in Sudan, Iran, and Cuba.

I'm just wondering, for a penalty of $9 billion, what would you estimate—or do you know—was the capacity cost, the enforcement and prosecution cost, of that particular case?

[Zachary Goldman]

Thank you very much for your question.

I couldn't put a precise number on it, but I would think about enforcement and compliance in two respects. The first is enforcement and compliance costs borne by the government itself. The U.S. Department of the Treasury has an office called OFAC, the Office of Foreign Assets Control, which I alluded to, and it enforces financial sanctions. Roughly 200 people work in that office, so we can back from that into a rough estimation of the annual cost.

There are others involved in that enforcement action as well. There are oftentimes multiple overlapping jurisdiction on these cases, and because the banks are located in New York, by and large, the New York banking supervisor and the New York State Department of Financial Services is involved. The local state prosecutor in Manhattan is often involved. Also, the federal prosecutors are often involved because these involve violations of federal statutes.

In that instance, the $8.9-billion fine was a result of at least four or five different agencies: OFAC; the Department of Justice, which is the only entity that can bring federal criminal prosecutions; the state prosecutors; the New York state banking supervisor; and, I believe, the Federal Reserve. These are all folks who have multiple missions. It might be difficult to disaggregate with any degree of precision the amount of time, for example, they spent on that particular case.

Another way to think about the cost of compliance is the cost borne by the banks themselves. All of the banks subject to U.S. jurisdiction must—and have—built up very elaborate compliance architectures in order to ensure that they are behaving in a manner that is consistent with U.S. law and policy and their other legal obligations.

Take a bank like BNP Paribas, for example. They're subject to French and EU law because they're a French bank, and their activities that are subject to U.S. jurisdiction are subject to U.S. law as well. Presumably, the point generalizes across the many dozens of countries in which banks like that operate. Needless to say, their compliance architectures are very complicated. They have to adhere to local law wherever they operate and also to, for example, EU law, because they are an EU person.

It's difficult, sir, to give you a precise answer, but that's perhaps a way to begin thinking about the problem.

[Peter Kent, Conservative, Thornhill, ON]

Thank you very much.

Professor Nossal, thank you for sharing your skepticism with us today. Indeed, we've heard that in fact the problems of compliance in Canada do impose significant resource costs on the banking system, on the different sectors that don't have access to consolidated lists to comply sometimes with sanctions. In fact, some potentially legal business is lost in simple avoidance because of the fear of violation of sanctions.

You brought up the Magnitsky Act. We have in fact been dealing with aspects of it for some time, even before this study officially began. I think we've been told that the Magnitsky Act isn't so much to change the behaviour as to ostracize and isolate certain gross abusers who are not caught in the Freezing Assets of Corrupt Foreign Officials Act because they are not necessarily designated individuals. They are jailers. They are police officers. They are security people who have enriched themselves criminally and who look to take some of those funds and themselves and their families to safe havens in different parts of the world.

I think that when the U.S. Congress passed the Magnitsky Act it was in the hope that other countries separately would accept similar penalties on these individuals—again, targeted Russian criminal individuals—and that by shunning, they would send a message and achieve a purpose through that alone. I wonder if you could speak to the Magnitsky Act.

[Prof. Kim Nossal]

Absolutely. When I focused on that particular act and the 18 individuals, it was really to underscore the nature of the targeted sanctions that, as you say, try to be as precise as possible. As Professor Goldman notes, the idea is to try to avoid unintended consequences.

What has been the focus of that particular act underscores, it seems to me, the symbolic purpose that you focus on, which is essentially a shunning, essentially the sending of a message about these particular individuals and their particular roles in the death of Mr. Magnitsky in 2009.

From that point of view, the measure is a useful measure, but to the extent that considerable resources are devoted to the creation of these kinds of measures, it's not entirely clear to me that there is a larger policy purpose, other than the symbolic element of signalling and shunning that is served. From that point of view, it seems to me that these kinds of targeted sanctions tend to focus too purely on the symbolic side.

There's one other element, too, and it is that when you're talking about the Russian Federation, one of the important elements here is the ability of many individuals to sidestep and subvert these measures. There's also the element of basically being able to provide individuals with a certain benefit within Russian society of being the target of western sanctions.

[The Chair, Liberal, Bob Nault]

Thank you, Professor.

Thank you, Mr. Kent.

Mr. Miller, please.

[Marc Miller, Liberal, Ville-Marie—Le Sud-Ouest—Île-des-Soeurs, QC]

Thanks for the testimony today. I'll match your “callow” professor with a number of callow politicians around this table any day.

In your 1994 book on sanctions, which focused on Canadian and Australian foreign policy, you noted that Canada in particular lacked the economic capability to “give the sanctions of major powers their bite”, thus essentially saying that the sanctions were symbolic.

If we go back to what my colleague MP Kent was saying with respect to a sanctions regime that would condemn or seize assets of gross human rights violators, the initial act of seizing the assets has some beauty to it, because it is smart, at least at first glance, in the sense that you're grabbing an asset on Canadian territory of a person who has manifestly committed these gross human rights violations, but the unintended consequence is what I'd like to focus on, or at least a countermeasure that could be enacted against Canada and could have on Canadians perverse consequences that were never intended in the first place.

It seems to me that there's a distinction to draw between the easiness of freezing an asset that belongs to someone if it's properly identified and then focusing on the countermeasure, which may have perverse consequences, vis-à-vis a broader regime that simply doesn't work because Canada lacks the heft to put bite into its actions. I do think we need to examine at what point our actions have consequences for other Canadians that weren't intended in the first place. The initial ability to freeze those assets, if you can actually do it, is interesting as a policy measure and, properly, to send a message to the person who has committed those acts that they can't hide their assets in Canada.

[Prof. Kim Nossal]

The key here is the target. When you're focusing on individuals, there's a particular logic. The real issue is what happens when the target is a state, is another government.

It seems to me that what one wants to do is to recognize the crucial role of these kinds of measures that are able to target individuals, and in particular individuals operating on Canadian soil, and to distinguish that action as a policy tool from the kinds of broader measures that we normally talk about when we are referring to broader sanctions: that is, sanctioning other states or communities where the government can in fact impose countermeasures on Canadians operating in their territory or simply tit-for-tat measures that are imposed by governments such as, let's say, the Government of the Russian Federation. It imposed almost exactly the same kind of tit-for-tat measures against the United States after the Magnitsky Act, although they added the ban on Russian adoptions by Americans.

I think the key here is to distinguish between an act that is targeted against another state, another government, and policy measures that are directed toward individuals.

[Marc Miller, Liberal, Ville-Marie—Le Sud-Ouest—Île-des-Soeurs, QC]

Mr. Goldman, perhaps you could speak more at length on the actions of the Russian government. Essentially, we're talking about state actors or quasi-state actors, and it is immediately perceived as an act against the state. Whether you freeze a person's assets or just say you're freezing that person's assets, they were acting on behalf of the state in question, so it's immediately perceived as such.

Perhaps you could speak to what happened in the Magnitsky case.

[Zachary Goldman]

I'll perhaps generalize the point a bit more and note that the general pattern now is to impose costs on states by targeting individual entities or individual persons that will be perceived to have an impact.

To take the example of Russia, but perhaps a slightly different example, after the violence in Ukraine accelerated in early 2014, the U.S. and many of its partners in the EU and elsewhere imposed sanctions that were designed to shape the cost-benefit calculations of Russian President Vladimir Putin. The U.S. and others did so by targeting individuals who were close to him, former regime officials, and banks that played a significant role, at least putatively, in hiding regime assets, such as Bank Rossiya and others. There, the purpose was to shape Putin's thinking about the cost and benefits of continued escalation in Ukraine.

Now, the question can be raised: to what extent did Russia retaliate against the U.S. and its allies for this activity? Also, what impact did the sanctions have? One can make an argument that it's of course impossible to know for certain, because to determine the impact would require knowing the outcome of a counterfactual, which is to ask what would have happened if you had not imposed sanctions, and that's obviously impossible to say with certainty.

But there's at least a credible argument could be made that the acceleration of sanctions in the first half of 2014 in that context at least dampened the escalatory cycle in eastern Ukraine. While it may have frozen the status quo, Putin did not take the other more inflammatory actions that he could have taken.

[Marc Miller, Liberal, Ville-Marie—Le Sud-Ouest—Île-des-Soeurs, QC]

At the very end of your testimony today, Mr. Goldman, you mentioned that sanctions, whether they were effective or ineffective, were still a very interesting and important tool. I was hoping you could develop that a bit.

[Zachary Goldman]

Sure. I would make two or three related points.

First, there are very few people who would advance the argument that sanctions alone will solve any particular foreign policy crisis. To take Iran, which is the most I think poignant recent example, sanctions there I think were designed to generate leverage that would ultimately be used in a course of diplomatic negotiations. I think very few people had the self-understanding that we could just sanction Iran into compliance with our desires about its nuclear program. Again, the sanctions were built up over a long period of time and involved broad multilateral efforts, but ultimately it was diplomacy that caused the nuclear agreement to materialize. It was not sanctions alone.

Let me abstract away from that specific example to a more general point that I alluded to, which is that sanctions are a tool of risk management. There, I think the key is that the international financial system relies fundamentally on trust. Individuals will not engage in trusted transactions with the international financial system if they believe the banks and others with whom they interact are doing business with rogue actors.

If you envision a world in which governments—particularly western governments and Asian governments—that harness the bulk of the world's financial activity simply stopped enforcing financial sanctions, which is to say, if they allowed with impunity those involved in acts like terrorism and narco-trafficking and WMD proliferation to have free access to the international financial system, I can't imagine that would be an international financial system in which trust and the free flow of information and financial services would be enhanced.

I can develop more points if you'd like, but those are the two I would make: one, sanctions are always used in complement with other national security tools, such as diplomacy, the use or threat of military force, and intelligence means, to achieve particular goals; and, second, it is very important to focus on the broad systemic effects on financial integrity when thinking about the utility of sanctions.

[Marc Miller, Liberal, Ville-Marie—Le Sud-Ouest—Île-des-Soeurs, QC]

Thank you.

[The Chair, Liberal, Bob Nault]

Thank you, Mr. Miller.

We'll go to Monsieur Aubin.

[Robert Aubin, NDP, Trois-Rivières, QC]

Thank you, Mr. Chair.

I want to thank the witnesses for being here and for shedding light on a file involving quite a complex study.

I want to hear from you, because in your opening remarks, you both seem to have stated somewhat different positions. Feel free to correct me if I'm misinterpreting your words.

Mr. Goldman, you seemed to say that the sanctions are preventive and not punitive. Mr. Nossal, you argued the opposite, if I understood correctly. You think the sanctions are essentially punitive or symbolic and not effective.

Let's look at this first difference and at the statistics, which particularly impressed me, on the number of economic sanction programs supported by the UN and the number of programs supported by the United States. The number is almost double. Regarding the people who are personally affected by sanctions, the number is five times higher in the United States.

Is the difference related to a systemic difference in the approach, basically, and design of the sanctions programs? Or is it related to the cumbersome nature of an institution such as the UN, for example?

Let's start with Mr. Goldman.

[Zachary Goldman]

I'll address one of your points on the preventive versus punitive discussion. Second, I'll talk about the importance of symbolism.

What I meant by that is that the classic understanding of criminal prosecution is that, one, it applies to completed conduct. There is some resemblance there with financial sanctions. More broadly, the obligations of banks to engage in other kinds of measures designed to protect the international financial system, such as anti-money laundering and things like that, are designed not only to target completed illicit activity but also to enable the systems to be established that prevent it in the first instance. Therein, I think, lies the primary difference between, for example, criminal prosecutions on the one hand, and sanctions on the other.

Obviously, another important difference is the punishment, the effect. Nobody goes to jail when they're put on a sanctions list per se. Sanctions evasion is a crime, but the result of a sanction is an asset freeze, not a trip to prison. That's obviously the most significant difference in the United States that drives different levels of legal proof and legal review.

On the symbolic point, I don't disagree with Professor Nossal. In some instances, sanctions are symbolic, but I don't think that for that reason they're useless. I think it is important to provide the international community with opportunities to express its collective disgust with particular forms of reprehensible activity and to draw boundaries around what is acceptable international conduct and what is unacceptable international conduct.

If, for example, the regime of Bashar al-Assad could freely access the international financial system, I think that would not be consistent with the horror and disgust with which almost all of us view his behaviour toward his own people. It may or may not be true that sanctions on Syria will ultimately lead to a peaceful resolution of the civil war there, but it will certainly impede the ability of the Assad regime to function and obtain the resources it needs to continue its oppression of its people, and I think the expression of disregard for his actions is appropriate and important.

[Robert Aubin, NDP, Trois-Rivières, QC]

Thank you, Mr. Goldman.

Mr. Nossal, do you have anything to add?

[Prof. Kim Nossal]

Thank you.

I agree 100% with Professor Goldman about the punitive purpose, and I would never suggest that the purpose of punishment, when it is achieved, whether in domestic law or international affairs, is useless. On the contrary, punishment is of crucial importance here because, it seems to me, the ability to inflict harm sends that important message. Just because it's symbolic doesn't make it useless by any means.

This is where I come to your question about the United Nations and the UN sanctions. It seems to me that it's when the United Nations takes those measures that you get the maximum punitive effect in that symbolic sense of being able to communicate a dislike for a particular set of actions. Denunciation of those actions becomes, then, an important part of the punitive exercise. It seems to me that when the UN does it, the international community operating through the UN, as opposed to individual states, either unilaterally or plurilaterally, you get the maximum symbolic effect.

[Robert Aubin, NDP, Trois-Rivières, QC]

Thank you, Mr. Nossal.

You have almost given me the answer to the following question, but I would still like to hear your point of view.

At the international level, does Canada have a character such that, in a certain number of cases, it may be the only government to act or may lead a resolution that might involve a sanction? More specifically, when Canada implements a sanction, when does the sanction have the most credibility?