Regulations Amending the Special Economic Measures (Nicaragua) Regulations: SOR/2021-229

Canada Gazette, Part II, Volume 155, Number 24

Registration
SOR/2021-229 November 14, 2021

SPECIAL ECONOMIC MEASURES ACT

P.C. 2021-957 November 13, 2021

Whereas the Governor in Council is of the opinion that gross and systematic human rights violations have been committed in Nicaragua;

Therefore, Her Excellency the Governor General in Council, on the recommendation of the Minister of Foreign Affairs, pursuant to subsections 4(1) footnote a, (1.1) footnote b, (2) and (3) of the Special Economic Measures Act footnote c, makes the annexed Regulations Amending the Special Economic Measures (Nicaragua) Regulations.

Regulations Amending the Special Economic Measures (Nicaragua) Regulations

Amendments

1 (1) Paragraph 4(a) of the French version of the Special Economic Measures (Nicaragua) Regulations footnote 1 is replaced by the following:

  • a) de tout paiement — fait par une personne dont le nom figure sur la liste ou par une personne agissant pour son compte — exigible aux termes d’un contrat conclu par une personne dont le nom figure sur la liste avant que son nom y figure, pour autant que le paiement ne soit adressé ni à une personne dont le nom figure sur la liste ni à une personne agissant pour son compte;

(2) Paragraph 4(h) of the French version of the Regulations is replaced by the following:

  • h) de toute transaction à laquelle est partie un organisme international ayant un statut diplomatique, un organisme des Nations Unies, le Mouvement international de la Croix-Rouge et du Croissant-Rouge ou toute entité avec qui le ministère des Affaires étrangères, du Commerce et du Développement a conclu un accord de subvention ou de contribution;

2 The schedule to the Regulations is amended by adding the following after item 24:

  • 25 Alba Luz RAMOS Vanegas
  • 26 Bayardo ARCE Castaño
  • 27 Luis Angel MONTENEGRO Espinoza
  • 28 Mohamed LASHTAR
  • 29 Sadrach ZELEDÓN Rocha
  • 30 Leonidas Nicolás CENTENO Rivera
  • 31 Francisco Ramón VALENZUELA Blandon
  • 32 José Adrián CHAVARRÍA Montenegro
  • 33 Rodolfo Francisco LÓPEZ Guitiérrez
  • 34 José Antonio CASTAÑEDA Méndez
  • 35 Salvador MANSELL Castrillo

Application Before Publication

3 For the purpose of paragraph 11(2)(a) of the Statutory Instruments Act, these Regulations apply according to their terms before they are published in the Canada Gazette.

Coming into Force

4 These Regulations come into force on the day on which they are registered.

REGULATORY IMPACT ANALYSIS STATEMENT

(This statement is not part of the Regulations.)

Issues

The human rights situation in Nicaragua has not improved since April 2018, when the Government of Nicaragua violently repressed social protests in the country. In response, Canada has enacted sanctions against 24 Nicaraguan officials under the Special Economic Measures (Nicaragua) Regulations through two rounds of sanctions, in July 2021 and June 2019. Human rights abuses have continued and in the months leading up to the November 7, 2021 elections, the Government of Nicaragua intensified its efforts to eliminate any and all political opposition, making a free and fair elections impossible.

The Government of Nicaragua ignored repeated calls from the international community to work with opposition groups and engage in substantial electoral reform before the November elections. Instead, the Government worked to consolidate its control over all aspects of the electoral process and enacted a series of laws that it used to suppress independent media and arbitrarily detain dozens of leading figures, including political opponents, journalists and civil society leaders. On August 5, 2021, Nicaragua’s Supreme Electoral Council disqualified the only remaining opposition party eligible to participate in the elections. These actions were all taken with the sole goal of ensuring that the Government of Nicaragua could guarantee the results of the election well in advance of any voting.

Background

In April 2018, massive anti-government protests broke out countrywide in Nicaragua. Police, in coordination with armed pro-government groups, brutally repressed protesters, which left a death toll of 328 people and almost 2 000 people injured. Hundreds of protesters were arbitrarily arrested and detained, many for months. Many were subjected to torture and ill-treatment including electric shocks, severe beatings, fingernail removal, asphyxiation, and rape. Serious violations of due process and other rights marred prosecutions. Authorities have failed to investigate and establish responsibility for gross human rights violations that have occurred in the context of the protests.

The abuses have continued, with ongoing reports of police attacking and detaining demonstrators and anyone identified with the opposition. For several months leading up to the November elections, the Government of Nicaragua worked to systematically eliminate any opportunity for the opposition to effectively contest the elections. This period was marked by the arbitrary detention of dozens of prominent figures, including major potential opposition candidates for president. In order to justify their arrests, the latter have been charged on trumped-up allegations of money laundering and coup mongering. The detained presidential candidates were also barred from running in the election.

There has been widespread international condemnation of the Government of Nicaragua’s actions. Canada has enacted two rounds of sanctions (July 2021 and June 2019) against a total of 24 key officials in the Government of Nicaragua under the Special Economic Measures (Nicaragua) Regulations (the Regulations) in response to gross and systematic human rights violations that had been committed in Nicaragua. The United States, the European Union, Switzerland the United Kingdom have also enacted their own sanctions against Nicaragua in response to the situation.

The Organization of American States has passed several resolutions calling on the Government of Nicaragua to stop the human rights abuses and engage in serious electoral reform, most recently in October 2021. This most recent resolution was approved with no votes against, demonstrating the grave concern across the region with the deteriorating situation in Nicaragua. The Government of Nicaragua ignored these calls and went ahead with the rigged November elections, securing the result it had worked to guarantee for months.

The Regulations prohibit persons (individuals and entities) in Canada and Canadians outside Canada from conducting the following activities with listed individuals:

  • (a) deal in any property, wherever situated, that is owned, held or controlled by a listed person or by a person acting on behalf of a listed person;
  • (b) enter into or facilitate any transaction related to a dealing referred to in paragraph (a);
  • (c) provide any financial or related services in respect of a dealing referred to in paragraph (a);
  • (d) make available any goods, wherever situated, to a listed person or to a person acting on behalf of a listed person;
  • (e) provide any financial or related services to or for the benefit of a listed person.

Consequential to being listed in the Regulations, and pursuant to the application of paragraph 35(1)(d) of the Immigration and Refugee Protection Act, the listed individuals are inadmissible to Canada.

The Regulations were accompanied by the Special Economic Measures (Nicaragua) Permit Authorization Order. The Order authorizes the Minister of Foreign Affairs to issue permits to individuals and entities in Canada, and Canadians outside Canada, to carry out activities or transactions otherwise prohibited by the Regulations.

Objectives

  • To apply pressure on the Government of the Republic of Nicaragua to respect its constitutional and international human rights obligations;
  • To communicate a clear message to the Government of the Republic of Nicaragua that Canada stands with the people of Nicaragua and the international community in condemning the ongoing gross and systematic human rights violations committed with impunity at the hands of the State;
  • To raise the costs to the Nicaraguan government of continuing the policies that erode democracy in Nicaragua and deny fundamental human rights of the people of Nicaragua;
  • To send a clear message to the region and beyond on the importance Canada places on respect for democracy, rule of law and the ability of all people to participate in free and fair elections and to stand in solidarity with like-minded countries in conveying this message.

Description

The Regulations Amending the Special Economic Measures (Nicaragua) Regulations (the amendments) add 11 individuals to the list in the schedule to the Regulations.

Regulatory development

Consultation

Global Affairs Canada engages regularly with relevant stakeholders including civil society organizations and cultural communities and other like-minded governments regarding Canada’s approach to sanctions implementation.

With respect to this specific proposal, public consultation, including prepublication, would not have been appropriate, as publicizing the names of the listed persons targeted by sanctions would have likely resulted in asset flight prior to the coming into force of the amendments.

Modern treaty obligations and Indigenous engagement and consultation

An initial assessment of the geographical scope of the initiative was conducted and did not identify any modern treaty obligations, as the amendments do not take effect in a modern treaty area.

Instrument choice

Regulations are the sole method to enact sanctions in Canada. No other instrument could be considered.

Regulatory analysis

Benefits and costs

Application of additional sanctions will serve to apply increased pressure on the Government of the Republic of Nicaragua to respect its constitutional and international human rights obligations by changing its behaviour. The sanctions communicate a clear message that Canada stands with the international community and its allies in condemning the gross and systematic human rights violations which continue to take place in Nicaragua at the hands of the State, with impunity.

Canadian banks and financial institutions are required to comply with the sanctions. They will do so by adding the new prohibitions to their existing monitoring systems, which may result in a minor compliance cost.

The amendments will create additional costs for businesses seeking permits that would authorize them to carry out specified activities or transactions that are otherwise prohibited. However, costs will likely be low as it is unlikely that Canadian businesses have dealings with the newly listed individuals.

Small business lens

To facilitate compliance by small businesses, Global Affairs Canada conducts enhanced outreach with stakeholders to better inform them of changes to the Canada’s sanctions. This includes updates to the sanctions website as well as the creation of the sanctions hotline. In addition, the Trade Commissioner Service is engaged in implementing Canada’s Trade Diversification Strategy, which will support Canadian companies seeking to find alternative export markets.

One-for-one rule

The one-for-one rule does not apply to the amendments, as they do not impose an incremental administrative burden on businesses.

Regulatory cooperation and alignment

While the amendments are not related to a work plan or commitment under a formal regulatory cooperation forum, they align with actions taken by like-minded partners. For example, the United States implemented additional sanctions since June 2019, with the latest round on June 9, 2021.

Strategic environmental assessment

The amendments are unlikely to result in important environmental effects. In accordance with the Cabinet Directive on the Environmental Assessment of Policy, Plan and Program Proposals, a preliminary scan concluded that a strategic environmental assessment is not required.

Gender-based analysis plus (GBA+)

The focus of the amendments is on specific individuals who are members of the Government of Nicaragua and/or individuals engaged in activities that contribute to human rights violations in Nicaragua. This results in minimizing collateral effects to those dependent on those individuals.

Exceptions are included in the Regulations, including, among others, to allow for the delivery of humanitarian assistance to provide some mitigation of the impact of sanctions on vulnerable groups. The Minister of Foreign Affairs can also issue permits pursuant to the Special Economic Measures (Nicaragua) Permit Authorization Order. Therefore, these new sanctions are likely to have limited impact on the citizens of Nicaragua.

Rationale

Canada has taken a multipronged response to the political and human rights crisis in Nicaragua, including efforts at bilateral engagement with the government, working through multilateral fora to maintain pressure and attention on the crisis, providing support to development initiatives to create a positive environment for change in the country and coordinated sanctions measures. Ortega has shown that he can respond to pressure. For example, since the eruption of the 2018 mass protests, Ortega has engaged in talks with the opposition groups only when he felt acutely weak or exposed. As an example, this happened once in May 2018, when hundreds of thousands of people were marching every day in the streets of the country’s main cities, and again in early 2019, when one of his key allies, Venezuela’s Maduro, seemed on the brink of being toppled. The Canadian sanctions imposed to date have also been successful in demonstrating solidarity with the people Nicaragua, such as political prisoners and opposition. As an example, such groups have consistently called upon the international community to exert greater pressure on the regime, including through sanctions, and have expressed their gratitude for Canadian leadership.

Compliance and enforcement

Canada’s sanctions regulations are enforced by the Royal Canadian Mounted Police and the Canadian Border Services Agency. In accordance with section 8 of the Special Economic Measures Act, every person who willfully contravenes the Special Economic Measures (Nicaragua) Regulations is liable upon summary conviction to a fine of not more than $25,000 or to imprisonment for a term of not more than one year, or to both; or upon conviction on indictment, to imprisonment for a term or not more than five years.

Contact

Sébastien Sigouin
Director
Central America, Cuba and Dominican Republic
Global Affairs Canada
Telephone: 343‑548‑7620
Email: Sebastien.Sigouin@international.gc.ca