Originally published in Blakes Bulletin on Blakes Bulletin on International Trade - February 2008.
As of September 2007, Canadians – including Canadian subsidiaries of foreign companies – are no longer permitted to export arms or arms-related materials to the Lebanese Republic without obtaining prior authorization from the Minister of Foreign Affairs.
Regulations Implementing the United Nations' Resolution on Lebanon
On August 11, 2006, the United Nations (UN) Security Council passed Resolution 1701 calling for an embargo on the exportation of arms and related materials to the Lebanese Republic .
This measure is designed to reinforce the Government of Lebanon's commitment to limit the forces and weapons available in its territory to those that are for its own use in asserting authority over the Lebanese Republic. This Resolution calls for member states to prohibit the sale or supply of any type of weapon, ammunition, military vehicle or military or paramilitary equipment, and their spare parts.
Understanding the Prohibitions
Members of the UN are obligated to adopt the resolutions of the UN Security Council and implement those resolutions within domestic laws. Canada, as a longstanding member of the UN, is no exception. Thus, the federal government has recently enacted new Regulations implementing Resolution 1701.
Canadian exporters should be aware of the complexities associated with the new Regulations to avoid any possible compliance issues. The Regulations came into force on September 18, 2007, and prohibit the sale of arms and related materials by persons in Canada or Canadians outside Canada to persons in the Lebanese Republic. The term "person", as used in the Regulations, includes not only an individual but also a body corporate, a trust, a partnership, a fund, an unincorporated association or organization and a foreign state.
The new Regulations apply to all Canadians – meaning an individual who is a citizen of Canada as defined in the Citizenship Act, including Canadians located abroad, or a body corporate incorporated or continued under the federal or provincial laws in Canada. By definition, Canadian subsidiaries of foreign parent companies must comply with these Regulations. Therefore, what may seem like a straightforward prohibition is much more encompassing than the plain language utilized in the new Regulations.
The prohibition applies to "arms and related materials". This includes any type of weapon, ammunition, military vehicle or military or paramilitary equipment. The definition also includes spare parts for these items. None of these items may be sold, supplied, exported or shipped to any person in Lebanon.
Canadian exporters should also be aware that the prohibition on the export of arms and related materials includes the sale, supply, or shipment, whether direct or indirect, of any technical assistance. Technical assistance consists of any provision of instructions, training, consulting services, technical advice or the transfer of know-how or technical data relating to arms and arms-related materials. The term "technical data", to which the prohibition applies, is used to denote blueprints, technical drawings, photographic imagery, computer software, models, formulas, engineering designs and specifications, technical and operating manuals and any technical information. Given the broad scope of these prohibitions, Canadians must exercise caution even in the supply of information related to arms and related materials.
How to Avoid Contravention of Regulations
Canadian exporters who wish to continue operating on a lawful basis when engaged in arms-related transactions with persons in Lebanon must apply for a certificate from the Minister of Foreign Affairs prior to the export of arms or arms-related materials. A certificate may be issued by the Minister of Foreign Affairs if the Minister is satisfied that the proposed transaction is either not prohibited by the UN Security Council Resolution or that the transaction has been expressly approved by the UN Security Council.
Proceed With Caution
Compliance with the new Regulations will be monitored by both the Royal Canadian Mounted Police and the Canada Border Services Agency. Persons who contravene any provision of the Regulation are liable, upon conviction, to fines of up to C$100,000 and a maximum prison term of 10 years. Canadian exporters dealing in arms or arms-related materials are urged to carefully review and follow the new Regulations. Transacting with the Lebanese Republic is not impossible as long as the proper procedures are followed.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
