On October 18, 2017, the Justice for Victims of Corrupt Foreign Officials Act (also referred to as the “Sergei Magnitsky Law”), received Royal Assent.

This Act introduces a new legal framework that enables Canada to impose targeted sanctions and travel bans on foreign nationals complicit in “extrajudicial killings, torture or other gross violations of internationally recognized human rights”, as well as acts of “significant corruption.”

The Act includes whistleblower protection to those that expose the illegal conduct of government officials or individuals. That protection is extended to people irrespective of nationality, including nationals of the country in which the abusive conduct occurred, and any non-national located within that country. Time will tell how effective such protections are to foreign whistleblowers residing outside of Canada.

The new framework permits Canada, upon receipt of “reliable and appropriate” evidence that a foreign national has engaged in illegal conduct, to issue orders and regulations to have the foreign national “listed”.  The consequences of being listed potentially include the seizure or freezing of the foreign national’s property within Canada, as well as the barring of the foreign national from entry into Canada.

The Act also makes it illegal for any person in Canada or Canadian outside Canada to engage in business dealings, directly or indirectly, with listed foreign nationals. This means that Canadian businesses now need to assess whether their business dealings include foreign nationals on the targeted sanctions list.

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 beaches 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.