SANCTIONS AGAINST IRAN: OPERATIONAL BULLETIN RELEASED

Operational Bulletin 378 - January 20, 2012

Sanctions against Iran

Issue

Iranian nationals, who for the purpose of this Operational Bulletin (OB) are defined as persons holding Iranian citizenship, or persons residing in Iran may face restrictions in transferring funds to Canadian banks, as a result of the imposition on November 21, 2011, of amended sanctions against Iran under the Special Economic Measures Act (SEMA). Indeed these sanctions prohibit persons in Canada and Canadians outside Canada from providing or acquiring “any financial services to, from or for the benefit of, or on the direction or order of, Iran or any person in Iran.”
There is an exemption under the amended sanctions for non-commercial remittance of $40,000 or less, or for payments required under a contract that was entered into prior to November 22, 2011.

Background

In response to the International Atomic Energy Agency (IAEA)’s November 9, 2011 assessment of Iran’s nuclear program, Canada imposed further sanctions under the SEMA. New Regulations amending the Special Economic Measures (Iran) Regulations entered into force on November 21, 2011. The latest sanctions prohibit financial transactions with Iran, expand the list of prohibited goods to include all goods used in the petrochemical, oil and gas industry in Iran, amend the list of prohibited goods to include additional items that could be used in Iran’s nuclear program, and add new individuals and entities to the list of designated persons found in Schedule 1 of the SEMA regulations. The amendments also remove certain entities that no longer present a proliferation concern.
The text of the November 21, 2011, Regulations amending the Special Economic Measures (Iran) Regulations can be found at Regulations Amending the Special Economic Measures (Iran) Regulations.
As a result of the amended sanctions Iranian nationals or persons residing in Iran may face restrictions in transferring funds to Canadian financial institutions if they do not fit within the exemptions to the sanctions found in section 5(d) of the amended Regulations. The restrictions also operate to prohibit persons in Iran from opening a bank account in Canada prior to their immigration to Canada for the purpose of transferring funds, even if the funds themselves would be allowed under the exemptions.

Instructions

Citizenship and Immigration Canada (CIC) offices in Canada and overseas are instructed to continue processing applications for permanent and temporary residence of Iranian nationals and persons residing in Iran, to visa issuance, as per normal office procedure. In cases where applicants need to show that they can or have transferred funds to Canada, such as for federal Investor class applicants who are required to make their $400,000 or $800,000 investment, applicants should be informed that they may face restrictions in transferring funds to a Canadian financial institution and should be referred to the text of the sanctions Regulations. The same information should be provided to all other applicants at visa issuance.
Persons affected by the sanctions on financial transactions, whether they be applicants for a visa or already in Canada, may apply for permits from the Department of Foreign Affairs and International Trade (DFAIT) that authorize specified activities or transactions that are otherwise prohibited under the sanctions. This permit process should be taken into consideration when assigning a deadline for submitting evidence that funds can be transferred to Canada or an investment made, prior to refusing an application from an Iranian national or person in Iran for failure to transfer the required funds or investments.
In-Canada CIC offices and overseas missions may wish to use the following text when communicating with clients who may be affected by the sanctions:

“Effective November 21, 2011, Iranian nationals and persons residing in Iran may face restrictions in transferring funds to, or opening bank accounts with Canadian financial institutions. The text of Regulations amending the Special Economic Measures (Iran) Regulations, can be found at Regulations Amending the Special Economic Measures (Iran) Regulations. Persons affected by the sanctions on financial transactions, whether they are applicants for a visa or already in Canada, may apply for permits from the Department of Foreign Affairs and International Trade (DFAIT) that authorize specified activities or transactions that are otherwise prohibited under the sanctions. Exemptions to the sanctions can be found in section 5(d) of the amended Regulations.
For more information, applicants should contact:
Department of Foreign Affairs and International Trade
Economic Law Section (JLHB)
125 Sussex Drive
Ottawa, Ontario
Canada K1A 0G2
Tel: 613-995-1108
Fax: 613-992-2467