Foreign Affairs Committee on Nov. 21st, 2016

[Tom Kmiec, Conservative, Calgary Shepard, AB]

Thank you again for coming in today.

To start, I want to focus on page 11 of your notes. It talks about sanctions in each case where an exemption to the regulations is requested. On humanitarian grounds, someone can make an application for the non-imposition of sanctions. Can you explain how that request is made and who can make a request?

[Sarah Taylor]

Basically any Canadian organization or individual can make a request. The case here is in relation to North Korea. Any individual or organization that wanted, for whatever reason, to export to North Korea or to have some financial transaction or any other activity that's precluded could apply to the government through our department to make that request.

We look at these on a case-by-case basis. We would look at each individual request to see what's being proposed and whether we think it matches with the allowed exemptions under the act and the regulations, so if, for example, it seemed like these, genuinely, were goods that would be primarily humanitarian in nature. For North Korea, in particular, we are looking also at the possibility of diversion. One of the concerns is whether anything you're exporting could be diverted for use by, let's say, the military or the government.

We're looking—again, case by case—at the nature of what is being proposed. If it seems to be acceptable on humanitarian grounds, then an exemption would be granted.

[Tom Kmiec, Conservative, Calgary Shepard, AB]

Who makes the final decision? Does the minister have the final decision-making authority for an exemption, or is it cabinet?

[Sarah Taylor]

It's the minister.

[Tom Kmiec, Conservative, Calgary Shepard, AB]

It's the minister for the exemption. Okay.

You said any organization or any individual Canadian can also make the request through the minister to the department.

[Sarah Taylor]

As far as I know, I don't think there's any.... Yes. There's no particular restriction on who could—

[Tom Kmiec, Conservative, Calgary Shepard, AB]

How many of these types of exemptions have been granted for the DPRK, for instance?

[Sarah Taylor]

There have been 12 since the regulations were put in place.

[Tom Kmiec, Conservative, Calgary Shepard, AB]

Were these Canadians or NGOs? Were they some other types of organizations?

[Sarah Taylor]

I can't give you too much detail on them because the individual requests are private. That's because, in some instances, there might be commercial considerations. However, I'd say that in almost all instances these are around humanitarian goods. In most cases, we are talking about organizations that were involved in humanitarian assistance in North Korea.

[Tom Kmiec, Conservative, Calgary Shepard, AB]

This committee has heard, from Professor Charron that some of the unintended consequences of more punishing measures would only harm innocent civilians. The professor was saying that when it comes to Russia, Syria, Zimbabwe, and some other countries, the policy calculations of their leaders there, and the regime, don't take into account Canadian sanctions, whether multilateral or unilateral.

However, we heard from Andrei Sannikov, who was an opposition leader in Belarus, that this is the case, that prison guards, prison administrators, the people who actually carry out the orders of the political leadership, do take it into account. They don't want to see their names popping up on a sanction list.

Does any of that come into the calculation by the department when you make a recommendation to the minister on whether or not to levy the sanctions, that kind of coercion, not so much on the political leadership but on the people carrying out the orders to oppress political leaders, human right activists, and NGOs?

[Marc-Yves Bertin]

Our current approach to sanctions reflects a significant evolution in terms of learning over the past 25 years. It used to be that state practice looked at embargoes, basically sanctions, being a rather blunt instrument. The main driver behind the shift away from using sanctions as a blunt instrument was basically humanitarian considerations, that we were potentially harming vast populations as opposed to shifting state behaviour in a more targeted manner through a more targeted approach.

The international practice today.... I think you've heard this from various witnesses, including from Dr. Thomas Biersteker, who have spoken to this notion that we've very much honed in on tailored messages and on decision-makers and their associates in a specific country. That approach is seen to be perhaps a more effective way to bring about that behaviour that we're trying to shift, particularly in—

[Tom Kmiec, Conservative, Calgary Shepard, AB]

If I could just interrupt you, because I don't have a lot of time, wouldn't that more selective approach on sanctions to target specific groups of people or individuals avoid some of the harm that could potentially be done to a broader population? Something like the Magnitsky act would then make sense. You could specifically target groups of people, put them on a list, and make it easy for businesses to access the list, so that they know that prison administrators in these specific prisons are being targeted for sanctions in order to protect political opposition leaders, political prisoners, and civil society in general. It is a way to put pressure on the regime. It's not to punish them, but it's either to coerce them into stopping their oppression or to entice them into different actions.

Of course, there's always that power consideration, with large countries, superpowers, quasi-superpowers, and then smaller countries. However, wouldn't it make sense to do it in tandem with our allies?

[Marc-Yves Bertin]

If you take a look, including at the Russia sanctions, for example, that is precisely what we've done. We've targeted individuals, decision-makers and their associates. We've done so because of the learning over 25 years of application, which is to avoid harming broad populations and to focus targeted measures on decision-makers and their associates.

This approach is not only good for the populations, but it's also more effective in terms of operationalizing these sanctions, insofar as we're mitigating the potential implications for third countries. Also, by mitigating the implications for third countries, we're mitigating the desire to circumvent the sanctions. From that perspective, the approach of targeted select measures toward individuals, decision-makers, and their associates is very much the current practice.

[Tom Kmiec, Conservative, Calgary Shepard, AB]

If I still have time, Mr. Chair, I'd like to move back to DPRK for a moment.

In the notes, it mentioned that unilateral sanctions were imposed on them. It was unilateral sanctions that Canada imposed that were later mostly copied in the United Nations security resolution, which I have noted and now can't find it here.

Were those unilateral sanctions that Canada imposed effective? Have our sanctions been effective?

[Sarah Taylor]

Just to clarify maybe a little, there have been a suite of UN Security Council resolutions and sanctions associated with those. With each resolution, we've then implemented measures under the UN Act. We've been implementing that as they go along. Those all relate to non-proliferation concerns basically. I'd say on those, in terms of effectiveness, it's hard to separate out the Canadian piece from the broader piece. I think you'd have to look at how effective the UN sanction regime has been as a whole.

Your main question was about the unilateral one, though. Those were under SEMA. Those were in response to that specific incident, the sinking of the Cheonan, and I'd say, in purely commercial terms, they were quite effective. We didn't have very much trade with North Korea to begin with. I believe that it was in the order of about $26 million before sanctions. I don't have the exact figure, but it's now under $1 million, I would imagine. Our trade with North Korea has gone down to virtually nothing, again, outside of those small number of humanitarian exemptions. That has been very effective.

Since our trade was so small before, these sanctions probably haven't had a huge material impact in North Korea, but some of the other measures, relating to, for instance, financial transactions and transiting through Canadians ports, have perhaps had more significant impact. It's a little hard to measure those, but I'd say, in terms of the importance to North Korea economically, those may have been more important.

[Tom Kmiec, Conservative, Calgary Shepard, AB]

Okay, thank you.

[The Chair, Liberal, Bob Nault]

Thank you very much, Mr. Kmiec.

We'll now go to Madam Laverdière, please.

[Hélène Laverdière, NDP, Laurier—Sainte-Marie, QC]

Thank you very much, Mr. Chair.

I would like to take advantage of the witnesses' presence to find out a bit more about these issues.

Since 2011, 148 persons of Egyptian origin were put on the list pursuant to the Freezing Assets of Corrupt Foreign Officials Act. Currently, in 2016, no one of Egyptian origin is on that list. Since the situation in Egypt has not necessarily improved, I am wondering why that is.

[Mark Glauser]

Do you have any information on the effect?

[Hugh Adsett]

Thank you very much.

The Freezing Assets of Corrupt Foreign Officials Act was established in order to respond to a request from a foreign state. It's the foreign state, in particular circumstances under the act, that makes a request to Canada to actually freeze those assets. Those lists expire after a period of time. The reason that the act is set up that way is that it's intended to be a temporary action. It's not meant to be a permanent seizure of the assets, but the idea behind the act is that the foreign state will presumably make a request for mutual legal assistance.

Again, it's the context of the act itself that's important. It was initially established as a response to the events that have been described as the Arab Spring, and it was meant to deal with those situations of turmoil, of governmental change, when there is a concern of assets fleeing the jurisdictions. However, it was never meant to be anything other than a temporary response. It is to support the foreign state. If the foreign state requests that the list be extended, it can be done, but if the foreign state does not wish for the list of names to be extended, then it comes to an end.

[Hélène Laverdière, NDP, Laurier—Sainte-Marie, QC]

That would also explain the fact that the number of people from Tunisia on that list went from 123 to 8. As for Tunisia, you will remember that a legal request was made for assets to be returned to Tunisia. I do not remember the figures—this goes back a few years and I have a short memory—but Canada intended to keep most of these assets and only remit a small part to Tunisian authorities. Is this a normal practice?

[Hugh Adsett]

I can't speak to the specifics of that because I'm not aware of the specific details. As I say, the Freezing Assets of Corrupt Foreign Officials Act is very much meant to be a temporary measure to be followed by a request for mutual legal assistance. Whatever rules guide mutual legal assistance would then apply to how the assets are returned and the specifics of that.

[Hélène Laverdière, NDP, Laurier—Sainte-Marie, QC]

Would it be possible to provide the committee with the data on the request from the Tunisian government to have Mr. Ben Ali's assets turned over to them? I think that is a good example. What was given to them in the end? Could you give as much information as possible to the committee on this, in writing? That would be greatly appreciated.

[Mark Glauser]

We can return to the committee with more information on that in writing.