The Government of Canada today announced important amendments
that loosen its economic sanctions against Iran. The amendments
follow on the successful implementation of the Joint Comprehensive
Plan of Action on January 16 by the P5+1 and Iran. (See Implementation Day for the P5+1 Iran Nuclear Agreement: What It
Means for Canadian and International Businesses for more
details.) The amendments will create market openings for key
industrial sectors in Canada, including oil and gas services,
exploration and production, aerospace, engineering and
construction, automotive parts and technology, and financial
Canada first introduced targeted sanctions against Iran in July
2010 in response to Iran's nuclear proliferation activities.
The targeted sanctions were subsequently expanded on several
occasions until May 2013, when they were further amended to
encompass almost all trade in goods with Iran.
Today's amendments lift the sanctions with respect to the
majority of goods and services, including financial services,
although restrictions remain on trade in certain goods, and
business dealings more generally with certain individuals and
entities. The prohibitions that have been removed include:
the near blanket restriction on imports from and exports to
Iran and the transfer or provision of related technical data and
the prohibitions on providing financial and correspondent
banking services to Iran and sending and receiving payments to or
from Iran (although dealings with a number of Iranian banks remains
the prohibition on Canadian investment in Iran;
the prohibitions on providing maritime services to Iranian
The only unilateral Canadian economic sanctions on Iran that
remain in place are prohibitions on:
transactions involving property with certain listed individuals
and entities (Listed Persons);
the export, sale, supply or shipment of certain goods listed in
Schedule 2 of the Iran Regulations (certain products with potential
military or nuclear applications) to Iran, any person in Iran, or
any person for the purpose of a business carried on in or operated
from Iran; and
transferring, providing or disclosing to Iran or any person in
Iran any technical data related to the goods listed in Schedule
The number of Listed Persons has been reduced to 161 entities
and 41 individuals from 508 entities and 79 individuals previously.
However, it is important to note that a number of prominent Iranian
entities including certain financial institutions remain on the
list. Similarly, although the broad export prohibition has been
lifted, Schedule 2 contains an extensive list of scientific and
industrial items that still cannot be supplied to Iran, in addition
to those already subject to Canada's general export controls.
These include certain items that may not be obvious, such as
aluminum products, precious metals, vacuum pumps, stainless steel
valves, piping, tubing and fittings (and even paint ball guns).
There are also a number of new items added to the list that were
not on Schedule 2 previously.
Canada also amended its Regulations Implementing the United
Nations Resolutions on Iran to implement the decisions of the
United Nations Security Council under Resolution 2231 in relation
to nuclear-related sanctions against Iran. However, Canada (like
other countries) continues to maintain restrictions on the export
of certain military, missile and nuclear-related goods and
technology to Iran as well as export controls of general
application on sensitive and security-related goods, technology and
Today's amendments open significant scope for enhanced trade
between Canada and Iran. Nevertheless, companies should carry out
adequate due diligence to make sure that they are not inadvertently
dealing with any of the numerous listed persons with whom business
is prohibited, including certain listed banks. Similarly, in light
of the fact that most international transactions implicate multiple
jurisdictions, it is important to ensure that all potentially
applicable sanctions and export restrictions are considered.
The content of this article is intended to provide a general
guide to the subject matter. Specialist advice should be sought
about your specific circumstances.
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