Skip to content

Navigating Canada’s economic sanctions against Russia

By Kim Walsh and Olivia Bungay

Canadian sanctions targeting Russia in relation to Russia’s ongoing invasion of Ukraine were significantly expanded over the past year.

The Special Economic Measures (Russia) Regulations impose sanctions on individuals and entities listed in Schedule 1 (designated persons), most of whom are tied in some way to Russian oil and gas companies, financial institutions, government departments, the Russian central bank, and Russian companies that provide military services to Russia.  As recently as April 13, 2023, Canada announced additions to those listed in Schedule 1, which now contains over 1600 individuals and entities.

The sanctions effectively impose an asset freeze on designated persons. It is prohibited to deal in property of any kind that is owned, held or controlled by a designated person, no matter where that property may be located.  In addition, individuals and entities in Canada, Canadian citizens when they are outside Canada, and Canadian businesses operating outside Canada are not permitted to:

  • enter into transactions with designated persons,
  • provide financial and related services to designated persons, or
  • make goods available to designated persons.

Sanctions are not limited to dealings with designated persons, and a broad array of Russian industries including financial services, oil and gas, shipping, aviation, mining and manufacturing are targeted. For instance, Canadian businesses are not permitted to export, sell, supply or ship goods for use in oil exploration, wherever situated, to Russia or to any person in Russia. Likewise, Canadian businesses are not permitted to provide to Russia or to any person in Russia any financial, technical or other services related to any good whose export, sale, supply or shipment is intended for use in oil exploration.

Canada has also prohibited trade in luxury goods, the provision of insurance and underwriting services to the Russian aviation industry, and the provision of services like accounting, advertising, engineering, management and technical services to various Russian industries. Further, persons in Canada and Canadians outside Canada are prohibited from knowingly doing anything that causes, facilitates or assists in, or is intended to cause, facilitate or assist in, the activities prohibited by the Regulations.

It is prohibited for ships registered in Russia or used for the benefit of Russia to dock in Canada or pass through Canada, unless the docking or passage is necessary to safeguard human life or to ensure navigational safety. These restrictions are also having an impact on global supply chains.

Some Russian businesses are seeking out alternate means to secure goods and services, and to supply goods to customers, as the scope of sanctions against Russia expand. Notably, this includes the use of shell companies in jurisdictions outside Russia, designed to conceal their involvement.  Canadian businesses should therefore exercise a sufficient level of due diligence when transacting business with foreign entities, particularly when the business relationship is new, to reduce the risk of noncompliance with the Regulations.

This client update is provided for general information only and does not constitute legal advice. If you have any questions about the above, please contact the author.

Click here to subscribe to Stewart McKelvey Thought Leadership.



Search Archive


“Sale” away: The SCC’s more flexible approach to exclusion clauses in contracts for the sale of goods

July 9, 2024

By Jennifer Taylor & Marina Luro A recent Supreme Court of Canada decision has clarified how to interpret exclusion clauses in sale of goods contracts. The Court in Earthco Soil Mixtures Inc. v Pine Valley…

Read More

Recent case re-confirms temporary ailment is not a disability

June 24, 2024

By Mark Tector and Tiegan A. Scott Decision On April 3, 2024, the Alberta Court of King’s Bench (“ABKB”) upheld a decision of the Chief of the Commissions and Tribunals (the “CCT Decision”), which held…

Read More

Compensation for expropriation: Fair, but not more than fair

June 17, 2024

By Erin Best, Stephen Penney, Robert Bradley, Megan Kieley1 and Elizabeth Fleet1 Expropriation is a live issue in Canadian courts. The Supreme Court of Canada’s decision to broaden the test for constructive expropriation in Annapolis…

Read More

Changes affecting federally regulated employers

June 10, 2024

By Killian McParland and Sophie Poulos There have been many changes in recent months affecting employers governed by federal labour and employment laws. In September 2024, Stewart McKelvey will be hosting a webinar to review…

Read More

Impending changes to Nova Scotia’s Workers’ Compensation Act – Gradual onset stress

June 4, 2024

By Mark Tector and Annie Gray What’s changing? Currently, workers’ compensation coverage in Nova Scotia applies to only a narrow subset of psychological injuries. Specifically, in Nova Scotia – as in all Atlantic Provinces –…

Read More

Appeal Courts uphold substantial costs awards for regulators

May 22, 2024

By Sean Kelly & Michiko Gartshore Professional regulators can incur substantial costs through discipline processes. These costs are often associated with investigations, hearings as well as committee member expenses and are an unfortunate by-product of…

Read More

Less than two weeks to go … Canada Supply Chain Transparency Reports are due May 31st

May 21, 2024

By Christine Pound, ICD.D., Twila Reid, ICD.D., Sarah Dever Letson, CIPP/C, Sheila Mecking, Hilary Newman, and Daniel Roth Introduction The first reports under the Fighting Against Forced Labour and Child Labour in Supply Chains Act (the…

Read More

Court upheld municipality’s refusal to disclose investigation report

May 1, 2024

By Sheila Mecking and Sarah Dever Letson A recent decision out of the Court of King’s Bench of New Brunswick,[1] upheld the Municipality of Tantramar’s decision to withhold a Workplace Assessment Report under section 20(1)…

Read More

Occupational Health and Safety sentencing decision – Nova Scotia

April 29, 2024

By Sean Kelly & Tiegan Scott Earlier this month, the Provincial Court of Nova Scotia issued its sentencing decision in R v The Brick Warehouse LP, 2024 NSPC 26, imposing a monetary penalty of $143,750 (i.e.,…

Read More

Canada 2024 Federal Budget paves the way for Open Banking

April 22, 2024

By Kevin Landry On April 15, 2024, the Canadian federal budget was released. Connected to the budget was an explanation of the framework for Canada’s proposed implementation of Open Banking (sometimes called consumer-driven banking). This follows…

Read More

Search Archive

Scroll To Top