On May 20, 2018, the Venezuelan government held presidential, regional and local council elections. The electoral process and results have been rejected by Canada on the basis that they did not meet international standards.
On May 29, 2018, Canada amended the Special Economic Measures (Venezuela) Regulations (the “Regulations”) to add fourteen (14) individuals to the list of forty (40) listed persons that Canada had initially identified as responsible for the current social and economic situation in the country. This amendment is in direct response to Canada’s public view that the Venezuelan elections lacked transparency, legitimacy and credibility.
The sanctions against Venezuela were first introduced on September 22, 2017. Under the Regulations, it is prohibited for any person in Canada or any Canadian outside Canada to knowingly do anything that causes, facilitates or assists in dealing with any property, wherever situated, that is owned, held or controlled by a listed person or by an agent of a listed person. It is also illegal to enter into or facilitate such a transaction, or to provide any financial or related service in respect of such dealings. Finally, it is also illegal to make available any goods to a listed person or to a person acting on their behalf.
While there are some limited exceptions, the sanctions effectively prohibit Canadians from carrying on almost any business dealings with the 54 listed persons – who are all senior Venezuelan officials and individuals, including President Nicola Maduro.
The imposition of economic sanctions does not mean that Canadians must cease business with Venezuela. On-going business is permitted so long as it does not involve, directly or indirectly, a listed person. The introduction of economic sanctions does, however, impose on Canadians conducting business with Venezuela an obligation to scrutinize ongoing business transactions to ensure compliance.
The lawyers at Tereposky & DeRose have significant experience in the design and implementation of sanctions-related compliance programs, including policies, procedures, employee training, and internal control mechanisms. They also regularly assist both Canadian and international businesses, financial institutions, and individuals with internal investigations when “red flags” appear and provide advice on compliance in these areas. Where breaches have occurred, they have worked closely with their clients in making voluntary disclosures and in engaging with the ensuing investigations conducted by the RCMP and Global Affairs Canada.