Makarov v. Canada (Minister of Foreign Affairs)

Makarov v. Canada (Foreign Affairs)
Court (s) Database
Federal Court Decisions
Date
2024-08-07
Neutral citation
2024 FC 1234
File numbers
T-2382-23
Decision Content
Date: 20240807
Docket: T-2382-23
Citation: 2024 FC 1234
Ottawa, Ontario, August 7, 2024
PRESENT: The Hon Mr. Justice Henry S. Brown
BETWEEN:
IGOR VIKTOROVICH MAKAROV
Applicant
and
CANADA (MINISTER OF FOREIGN AFFAIRS) AND THE ATTORNEY GENERAL OF CANADA
Respondents
JUDGMENT AND REASONS
Table of Contents
I. Nature of the matter 3
II. Background 4
A. Context: Russia’s invasion of the Ukraine and the Russia Regulations 4
B. The Applicant 6
(1) The Applicant and Russian regional energy interests 6
(2) The Applicant’s extensive relationships with Russians in relation to cycling and energy 9
(3) The Applicant is relisted on Russia Regulations Sanction List August 4, 2023 11
III. Applicant’s requests to be delisted 15
IV. Decision under review 17
V. Relevant legislative provisions 20
VI. Issues 24
VII. Analysis 25
A. Standard of review 25
B. The Minister’s Decision is reasonable 30
(1) News articles as evidence 36
(2) Irrelevant considerations 43
(3) Unlawful request to prove a negative 47
(4) Fabricated facts 48
(5) Failed to consider credible evidence 49
C. Minister’s interpretation of the Russia Regulations not properly raised on judicial review 50
VIII. Conclusion 53
IX. Costs 53
I. Nature of the matter
[1] This is an application for judicial review pursuant to sections 18 and 18.1 of the Federal Courts Act, RSC 1985, c F-7 [Federal Courts Act] of a decision dated October 20, 2023 by the Minister of Foreign Affairs [Minister] not to recommend removing the Applicant from the sanction list under Schedule I, Part I of the Special Economic Measures (Russia) Regulations, SOR/2014-58 [Russia Regulations] [Decision]. The Russia Regulations were enacted under the Special Economic Measures Act, SC 1992, c 17 in response to the Russian Federation’s [Russia’s] unlawful 2014 invasion of Crimea, and amended after Russia’s unlawful 2022 invasion of Ukraine.
[2] The Applicant was originally listed under predecessor sanction regulations. However, those regulations applied only to Russian citizens, which the Applicant was. The Applicant asked Russian authorities to cancel his Russian citizenship. Russian authorities complied. The Applicant then applied to the Minister to have his name removed from the predecessor regulations because he was no longer a Russian citizen.
[3] While the Minister recommended and the Governor in Council agreed to remove him from the sanctions list because he was no longer a Russian citizen, the Governor in Council revised the regulations to close that loophole so as to apply the sanction regulations to former Russian citizens, and then by further Order in Council, the Governor in Council relisted the Applicant and placed him back on the sanctions list under the Russia Regulations.
[4] A few days later, the Applicant re-applied to the Minister to recommend he be removed from the sanctions list. The Minister refused the Applicant’s request because there were no reasonable grounds to recommend he be delisted. The Applicant challenges the Minister’s Decision in this application for judicial review.
[5] As more particularly set out below, this application for judicial review will be dismissed because among other things: (1) the Minister is entitled to the widest deference in weighing and assessing the record and making the Decision in this case given its nature and purpose and her role at the apex of Canadian decision making, (2) the Minister is not bound by the strict rules of evidence in making this Decision, (3) the Decision is not one to be tested on criminal or civil standards of proof, (4) absent fundamental error or exceptional circumstances, reweighing and reassessing the evidence and inferences forms no part of judicial review, and (5) because viewed holistically the Decision meets the tests of reasonableness established by the Supreme Court of Canada in that it is justified, transparent and intelligible.
Given the widest deference the Court finds is owed to the Minister, I conclude the record and the Minister’s expert assessment of it support the express conclusions in the Decision concerning the Applicant and his association with Russian officials and business interests including Alexei Miller, Sergei Chemezov and President Putin. There is no reviewable error. Background
A. Context: Russia’s invasion of the Ukraine and the Russia Regulations
[6] The Court accepts the following submission of the Respondents which were not materially disputed and which are set out in Regulatory Impact Assessment Statements relating to the Orders in Council sanctioning the Applicant:
7. The [Special Economic Measures Act] provides the GIC with authority to impose sanctions against foreign states, entities and individuals in prescribed circumstances, including when there has been a breach of international peace and security, or when gross and systemic human rights violations have been committed. In March 2014, pursuant to the SEMA, the GIC adopted the Regulations in response to Russia’s illegal occupation and attempted annexation of Crimea. The GIC was and continues to be of the opinion that the actions of Russia constitute a grave breach of international peace and security that has resulted or is likely to result in a serious international crisis.
8. Over the last decade, Russia has continued to play a destabilizing role in Ukraine and to violate human rights in a systematic fashion. On February 24, 2022, Russian forces launched a full-scale invasion of Ukraine. The Russian military has committed atrocities against civilians, killed thousands and devastated Ukraine’s infrastructure. Canada, in tandem with its partners and allies, has responded with more comprehensive sanctions through amendments to the Regulations. Since 2014, Canada has imposed sanctions on more than 2,700 individuals and entities who have been involved in and/or profited from the ongoing conflict.
9. The primary objective of the sanctions regime is to undermine Russia’s ability to conduct its military aggression in Ukraine by imposing substantial economic consequences on Russia, including influential individuals and entities. The Regulations also seek to signal Canada’s condemnation of Russia’s unlawful conduct, and to align Canada’s measures with those taken by its international partners.
10. Economic sanctions are a crucial tool to respond to breaches of international peace and security and systemic human rights violations. Over the years, Canada’s sanctions regime has been amended to more effectively isolate Russia’s economy, in a context where capital flows with ease and influential persons help Russia to evade or circumvent sanctions measures.
….
13. While the Regulations target specific current and former Russian nationals whose names are on the Sanctions List, the Regulations achieve this by regulating the actions of Canadians and individuals within Canada in relation to the listed persons. Specifically, Canadians and individuals within Canada are prohibited from dealing in the property of, entering into transactions with, providing services to, or otherwise making goods available to persons whose names are on the Sanctions List. These prohibitions serve to effectively freeze the assets of a listed person that could otherwise be dealt with by a Canadian or anyone in Canada.
B. The Applicant
[7] The Applicant was a major gas commodity trader in Russia and former professional cyclist. He was born in Turkmenistan when it was part of the former USSR. He later moved to Russia, and is now a citizen of Cyprus and Moldova. During his dealings with Canada, he also declared himself a citizen of Turkmenistan. After he was first sanctioned as a citizen of Russia, as noted above, Russian authorities agreed to let him renounce his Russian citizenship.
[8] The Respondents reasonably submit and I agree that the associations between the Applicant and some of the most substantial Russian state and business entities are twofold: those in the oil and gas sector, and those in the cycling sector.
(1) The Applicant and Russian regional energy interests
[9] On August 4, 2023, the Applicant was relisted under the Russia Regulations because of his close associations with Russian government officials while brokering opaque non-transparent Russian-Turkmenistan energy deals, and as an associate of individuals also currently listed under the Russia Regulations namely Alexei Miller [Miller] and Sergei Chemezov [Chemezov]. These associations helped generate significant revenues that the Kremlin has relied on to lay the groundwork for its aggressions including its war in Ukraine.
[10] In the Respondents’ submission the record before the Minister establishes reasonable grounds to believe the Applicant was a close associate of senior officials of the Government of Russia, including Chemezov (the Chief Executive Officer of Rostec) and Miller (the Chief Executive Officer of Gazprom), both of whom are also sanctioned by the Russia Regulations.
[11] Gazprom and Rostec appear to be the two largest Russian state-owned enterprises.
[12] The largest player in the Russian gas sector is Gazprom, as noted above. Gazprom is owned by the Russian state. Gazprom is run by Miller, who like the Applicant is also sanctioned by the Russia Regulations.
[13] Rostec is a “sprawling defense and technology giant comprising more than 700 enterprises controlled by 14 holding companies.” The CEO of Rostec is Chemezov, who like the Applicant and Miller is also sanctioned by the Russia Regulations.
[14] Notably, Rostec and Rosneft have collaborated in the past.
[15] Also notably, both Rostec and Rosneft are sanctioned by Canada. Indeed, Rosneft and the CEO of Rostec (Chemezov) were sanctioned by Canada in February 2015 in response to Russia’s invasion of Ukraine.
[16] It is not disputed the Applicant has a very long involvement in Russia’s oil and gas sector. It is not disputed he amassed very great wealth (billions of dollars) through opaque business dealings in Russia and elsewhere in the region. From 1992 until 2013, the Applicant owned ITERA Oil and Gas [ITERA], which operated in Russia, Turkmenistan and elsewhere. ITERA was the third largest natural gas trading company in the world in the late 1990s and early 2000s. In 2013, the Applicant sold ITERA to Rosneft, another Russian state-owned enterprise. Since then, he has been the President of ARETI (ITERA backwards), which also operates in the regional energy sectors.
[17] More specifically, in 1992, the Applicant founded and until 2013 owned ITERA. Beginning in the early to mid 1990s, the Applicant through ITERA began brokering Turkmen (from Turkmenistan) natural gas. By the late 1990s, ITERA had a monopoly on the sale of Turkmen natural gas to Ukraine. In the early 2000s, ITERA’s gas was transported through Gazprom’s pipelines. Gazprom is the largest Russian state-owned gas company.
[18] In 2012 and 2013, the Applicant sold ITERA to Rosneft (51% in 2012 and 49% in 2013). The Applicant alleges the 2013 sale (the 49% sale) was forced on him.
[19] Whether forced or not, the sale price was between $2.8 and $3.0 billion, making the Applicant a billionaire. Notably the Applicant did not disclose the sale price(s).
[20] Rosneft (which bought ITERA from the Applicant) is a very large Russian state-owned oil company. Rosneft is the second-largest Russian state-owned enterprise. Rosneft is also the largest player in the Russian oil sector.
[21] As noted, in 2015, the Applicant established and became President of ARETI.
[22] The ARETI group also operates in the fuel and energy sectors in Europe and Central Asia, including Turkmenistan where the Applicant had extensive Turkmen gas contracts with Gazprom in his capacity as the owner of ITERA.
[23] While and according to the Applicant, ARETI does not operate in Russia itself, ARETI does have dealings in Turkmenistan where the Applicant’s previous company ITERA had extensive business gas dealings including as monopoly supplier to Ukraine, as noted.
(2) The Applicant’s extensive relationships with Russians in relation to cycling and energy
[24] With respect to cycling, the Applicant was a professional cyclist from 1979-1986. He created and sponsored Katusha, a Russian cycling team, between 2008 and 2017 and was President of the Russian Cycling Federation from 2010 to 2016.
[25] Since 2011, the Applicant has been an honorary member of the Management Committee of the Union Cycliste Internationale [UCI], a governing body of international cycling.
[26] The record also establishes: (1) the Applicant was associated with Chemezov and Miller through the sponsorship of the professional cycling team Katusha between 2009 and 2017 (or 2019); and (2) in June 2015, in his capacity as President of the Russian Cycling Federation, the Applicant took part in a meeting of the Council for the Development of Physical Culture and Sport, chaired by Russian President Vladimir Putin.
[27] The Respondents submit and I agree that in his Delisting Application, the Applicant concedes he has had interactions with these individuals (i.e., Chemezov, Miller and President Putin). However, in essence the Applicant disputes the “closeness” of these associations.
[28] In response, the Respondents say and the Applicant essentially acknowledges that:
a)The Applicant, Chemezov and Miller were initiators of the establishment of the All-Russian Cycling Development Project, and from that project emerged a professional cycling team, Katyusha, that the Applicant was a sponsor of from 2009 to 2019;
b)The Applicant was President of the Russian Cycling Federation (“RCF”) from 2010 to 2016 and from 2016 onwards, he continued to be the Honorary President of the RCF; and
c)In his capacity as the President of the RCF, the Applicant attended a 2015 meeting of the Russian Council for the Development of Physical Culture and Sport, chaired by President Putin. The Applicant made a speech recognizing the contributions of Chemezov to Russian cycling, and asking President Putin to resolve issues relating to funding.
[29] It is also the case, quite notably that (1) Chemezov acted as the Chairman of the Russian Cycling Federation at the time when the Applicant was its President, (2) that Chemezov continues to be a trustee of the federation. Furthermore, (3) Chemezov’s wife was an ITERA shareholder, and (4) Chemezov’s son was employed by one of ITERA’s companies.
(3) The Applicant is removed from and relisted on the Russia Regulations sanction list August 4, 2023
[30] The following explanation for the Applicant’s relisting, which the Court finds reasonable in all the circumstances, is set out in the Regulatory Impact Analysis Statement issued together with the Governor in Council’s Order relisting him dated August 4, 2023 per SOR/2023-176:
Issues
Russian billionaire Igor Viktorovich Makarov, founder and president of private energy company ARETI International Group, benefited from close associations with top government officials while brokering non-transparent Russian-Turkmen energy deals. This helped generate significant revenues that the Kremlin has relied on to lay the groundwork for its aggressions in the near abroad, including Ukraine.
Background
Following Russia’s illegal occupation and attempted annexation of Crimea in March 2014, the Canadian government, in tandem with partners and allies, enacted sanctions through the Special Economic Measures (Russia) Regulations (the Regulations) under the Special Economic Measures Act (SEMA). These sanctions impose dealings prohibitions (an effective asset freeze) on designated individuals and entities in Russia and Ukraine supporting or enabling Russia’s violation of Ukraine’s sovereignty. Any person in Canada and Canadians outside Canada are thereby prohibited from dealing in the property of, entering into transactions with, providing services to, or otherwise making goods available to listed persons.
On February 24, 2022, Russian President Putin announced a “special military operation” as Russian forces launched a full-scale invasion of Ukraine from Russian and Belarusian territory. The war has become a grinding war of attrition, which sees little prospect of a quick victory for either side, and both continue to incur heavy losses. The Russian military has committed horrific atrocities against civilians, including in Izium, Bucha, Kharkiv and Mariupol. Experts, including the Organization for Security and Cooperation in Europe (OSCE) Moscow Mechanism fact-finding missions, the Independent International Commission of Inquiry on Ukraine and the United Nation’s (UN) Office of the High Commissioner for Human Rights (OHCHR), have concluded that Russia is committing serious human rights violations, war crimes, possible crimes against humanity, and conflict-related sexual violence. These studies have linked Russian external aggression with systematic repression and human rights abuses domestically. According to Ukraine’s State Emergency Department, 30% of Ukrainian territory (approximately the size of Austria) is mined. President Putin’s military invasion has been paired with significant malicious cyber operations and disinformation campaigns that falsely portray the West as the aggressor; and claim Ukraine is developing chemical, biological, radiological and/or nuclear weapons with North Atlantic Treaty Organization (NATO) support. The deterioration of Russia’s relations with Ukraine has paralleled the worsening of its relations with the United States and the NATO, which has led to heightened tensions.
International response
The coalition of countries supporting Ukraine includes, but is not limited to, G7 and European countries and some of Ukraine’s neighbours. This group is working to support Ukraine across a number of areas, including energy security, nuclear safety, food security, humanitarian assistance, combatting Russian disinformation, sanctions and economic measures, asset seizure and forfeiture, military assistance, accountability, recovery and reconstruction. Canada and G7 countries are engaged in intense diplomacy with the broader international community to encourage support for Ukraine and counter false Russian narratives. Key votes in multilateral forums have effectively isolated Russia, including resolutions in the UN General Assembly condemning Russian aggression against Ukraine (March 2022), deploring the humanitarian consequences of Russian aggression against Ukraine (March 2022), suspending Russian membership in the UN Human Rights Council (April 2022) and condemning Russia’s illegal annexation of Ukrainian territories (October 2022). Many developing countries have refrained from openly criticizing Russia or imposing penalties due to geopolitical considerations, commercial incentives, or simply fear of retaliation, with some also arguing the conflict is less of a priority for their regions. Russia continues to use its position as a permanent member of the UN Security Council (UNSC) to block UNSC action on its war on Ukraine and its corrosive disinformation policies.
Canada’s response
Since February 2022, Canada has committed or delivered over Can$5 billion in assistance to Ukraine. This includes military aid, cyber defence and training to Ukrainian troops in the United Kingdom and Poland under the aegis of Operation UNIFIER. Economic resilience support includes new loan resources, a loan guarantee, and Ukraine Sovereignty Bonds. Canada is helping Ukraine repair its energy infrastructure and has temporarily removed trade tariffs on Ukrainian imports. Canada has also committed development and humanitarian assistance, and is countering disinformation through the G7 Rapid Response Mechanism. Canada is also providing security and stabilization programming, including support for civil rights organizations and human rights defenders. Canada announced two new immigration streams for Ukrainians coming to Canada: the temporary Canada Ukraine Authorization for Emergency Travel and a special permanent residence stream for family reunification.
Since 2014, in coordination with its allies and partners, Canada has imposed sanctions on more than 2 600 individuals and entities in Russia, Belarus, Ukraine and Moldova who are complicit in the violation of Ukraine’s and Moldova’s sovereignty and territorial integrity. In addition, Canada implemented targeted restrictions against Russia and Belarus in financial, trade (goods and services), energy and transport sectors. Canada is part of the Oil Price Cap Coalition, which limits the provision of maritime services to Russian crude oil and petroleum products above a price set by the coalition. These amendments to the Regulations build upon Canada’s existing sanctions by further impeding Russian dealings with Canada. Canada seeks to align its measures with its partners, including the United States, the United Kingdom, the European Union, Australia, New Zealand, Japan and Ukraine.
Conditions for imposing and lifting sanctions
Pursuant to SEMA, the Governor in Council may impose economic and other sanctions against foreign states, entities and individuals when, among other circumstances, a person has contributed to a grave breach of international peace and security or participated in gross and systematic human rights violations in Russia.
The duration of sanctions by Canada and like-minded partners has been explicitly linked to the peaceful resolution of the conflict, and the respect for Ukraine’s sovereignty and territorial integrity, within its internationally recognized borders, including Crimea, as well as Ukraine’s territorial sea. The United States, the United Kingdom, the European Union and Australia have continued to update their sanction regimes against individuals and entities in both Ukraine and Russia.
Objective
1. Undermine Russia’s ability to conduct its military aggression against Ukraine.
2. Align Canada’s measures with those taken by international partners.
3. Signal Canada’s condemnation of this individual’s actions given that they relate to Russia’s illegal war in Ukraine.
4. Restrict this individual from accessing Canada’s financial system via sanctions.
Description
The amendments add Igor Viktorovich Makarov to Schedule 1 of the Regulations.
….
Rationale
The Regulations seek to impose a direct economic cost on Russia and Russia-backed actors and signal Canada’s strong condemnation of Russia’s violation of the sovereignty and territorial integrity of Ukraine. As the conflict in Ukraine continues in its second year, the Regulations seek to further degrade Russia’s capabilities that are being used to invade Ukraine. The Regulations also align Canada’s efforts with those of our international partners and expose individuals and entities engaged in activities that undermine international peace and security.
Igor Viktorovich Makarov has been added to Schedule 1 of the Regulations because he is a person who has amassed enormous wealth from close associations with top Russian officials, as an associate of individuals that are currently listed under the Regulations. He has brokered opaque energy deals that helped generate significant revenues that the Kremlin has relied on to lay the groundwork for its aggressions in the near abroad, including Ukraine. This individual was listed under the Regulations in the past.
II. Applicant’s requests to be delisted in more detail
[31] Russia invaded Ukraine on February 24, 2022.
[32] Six or seven weeks later, on April 1, 2022, the Applicant asked Russian officials to allow him to renounce his Russian citizenship. It is the case as the Applicant submits that he made this request before he was subject to sanctions by Canada or any other country.
[33] Shortly thereafter, on April 19, 2022, the Applicant was listed by Canada in Part 1, Schedule 1 of Canada’s sanctions list on the predecessor of the current Russia Regulations.
[34] On June 27, 2022, the Applicant asked the Minister to remove him from this sanctions list as permitted by section 8 of the Russia Regulations.
[35] A series of communication between the Applicant’s counsel and Global Affairs Canada ensued. The following are examples. On August 15, 2022, the Applicant sent a letter to Global Affairs Canada making bare allegations of harm he claimed he was experiencing as a result of the sanctions. There was little actual evidence of the alleged harm. On August 31, 2022, he sent a further letter to Global Affairs Canada addressing a media article dated August 17, 2022, which he alleged was premised on false allegations and inaccuracies. On November 7, 2022, the Applicant sent another letter to Global Affairs Canada addressing additional information found on the internet, and requesting a decision on the First Delisting Application by November 21, 2022.
[36] On November 14, 2022, the Applicant received one of several notice letters from the Sanctions Policy and Operations Coordination Division of the Minister’s department requesting additional information from the Applicant. The Applicant responded on December 9, 2022.
[37] On April 19, 2023, the Applicant filed a notice of application for judicial review (Court File No. T-846-23) seeking mandamus to compel the Minister to make a decision. He alleged the Minister was outside the 90-day time limit outlined by subsections 8(3) and (4) of the Russia Regulations.
[38] On May 23, 2023, the Applicant received a procedural fairness letter from the Sanctions Policy and Operations Coordination Division of Global Affairs Canada identifying open-source information relied upon by the Minister, and requested additional information from the Applicant. The Applicant responded on May 31, 2023.
[39] On June 8, 2023, the Applicant advised the Sanctions Policy and Operations Coordination Division that Russian authorities agreed to permit him to renounce his Russian citizenship.
[40] On August 4, 2023, on the Minister’s recommendation the Applicant was removed from the predecessor Russia Regulations by the Governor in Council, (Regulations Amending the Special Economic Measures (Russia) Regulations, SOR/2023-174) because he was no longer a Russian citizen.
[41] However, on the same date, the Governor in Council further amended the Russia Regulations through the Regulations Amending the Special Economic Measures (Russia) Regulations, SOR/2023-175 to include former Russian citizens in the definition of “designated person.” The Governor in Council by a third Order in Council relisted the Applicant as Item 1315 of the new sanctions list through a third set of amendments (under the Regulations Amending the Special Economic Measures (Russia) Regulations, SOR/2023-176).
[42] The Applicant received a letter from the Minister of this date informing him of his delisting, and subsequent relisting pursuant to the amended regulation. The Minister invited the Applicant to file a new delisting application in accordance with the Russia Regulations should he choose to do so.
[43] On August 8, 2023, the Applicant submitted a new delisting application that included all previous submissions.
[44] On October 20, 2023, the Minister sent a letter to the Applicant, rejecting the Applicant’s second delisting application.
[45] On November 10, 2023, the Applicant filed this application for judicial review of the Minister’s Decision refusing his request that the Minister recommend the Governor in Council delist him.
III. Decision under review
[46] The Minister’s Decision letter, dated October 20, 2023, states:
I am writing with regard to the delisting application you submitted under subsection 8(1) of the Special Economic Measures (Russia) Regulations (the Russia Regulations) on August 8, 2023.
You were designated on August 4, 2023, under Schedule 1, Item 1315 of the Russia Regulations under paragraph 2(c) as an associate of a person referred to in paragraphs (a) to (b) on my recommendation to the Governor in Council.
I have considered the information and arguments put forth in your submission of August 8, 2023, to Global Affairs Canada, and have decided not to make a recommendation to the Governor in Council to remove you from Schedule 1 of the Russia Regulations.
Based on a review of the materials that you submitted and available open-source information, I do not believe that there are reasonable grounds to conclude that you are no longer an associate of senior officials of the Government of Russia, including Mr. Sergei Chemezov and Mr. Alexei Miller. You were associated with Mr. Chemezov and Mr. Miller through the sponsorship of a professional cycling team between 2009 and 2019. In June 2015, in your capacity as President of the Russian Cycling Federation, you took part in a meeting of the Council for the Development of Physical Culture and Sport, chaired by President Vladimir Putin.
I have considered your claims that you have taken steps to distance yourself from Russia and the regime. In the circumstances, I do not consider the act of renouncing citizenship to be sufficient to demonstrate a genuine effort to distance yourself from the regime. While you claim to be opposed to Russia’s illegal invasion of Ukraine, you have not issued any public statements denouncing the war in Ukraine or President Putin’s regime.
On March 17 and August 17, 2023, the United Kingdom published a Financial Sanctions Notice indicating that you have been and may continue to be involved in obtaining a benefit from or supporting the Government of Russia by owning or controlling, or working as a director or equivalent of one or more entities, which have been carrying on business in a sector of strategic significance to the Government of Russia, namely the Russian energy sector.
Canada’s autonomous sanctions aim to denounce Russia’s breach of international security and apply pressure on the Russian regime, including to limit Russia’s ability to fund its war against Ukraine and shine a light on Russia’s unlawful actions. These sanctions include listings that target individuals whom the Government of Canada considers to have ties to the Russian regime. Maintaining your listing is consistent with Canada’s foreign policy goals with regard to Russia and with Canada’s approach to sanctions implementation.
[47] The Minister’s Decision letter was contained in and formed part of a Memorandum for Action [Memorandum] containing a summary recommendation from the Deputy Minister of Foreign Affairs.
[48] The Memorandum also contained an extensively footnoted and detailed submission document setting out bases for sanctioning the Applicant including background and other considerations. It also contained well over a thousand pages of supporting material. All of this material is in the public record with the exception of brief solicitor-client redactions. All of the material in the Memorandum comprise the record in this case, in addition to the signed version of the Decision Letter, and the Minister’s signed approval of the summary recommendation from the Deputy Minister of Foreign Affairs.
[49] Specifically, the Memorandum was titled Application for Delisting – Igor Viktorovich Makarov, and included:
● Memorandum to the Minister from the Deputy Minister of Foreign Affairs
● Draft letter to the Applicant
● Annex A: Supporting Information (14 pages)
● Annex B: Supporting Evidence (PDF documents of open-source links included in the Supporting Information document) (544 pages)
● Annex C: Application for Delisting (551 pages)
IV. Relevant legislative provisions
[50] Paragraph 4(1)(a) of the Special Economic Measures Act grants the Governor in Council authority to make Orders in Council such as that of sanctioning the Applicant. The Applicant did not challenge the Governor in Council’s decision to place him on the current Russia Regulations sanctions list. Nor did he challenge the Russia Regulations on jurisdictional, Charter, division of power or any other grounds in his submissions to the Minister. Paragraph 4(1)(a) provides:
Orders and Regulations
Décrets et règlements
4 (1) The Governor in Council may, if the Governor in Council is of the opinion that any of the circumstances described in subsection (1.1) has occurred,
4 (1) S’il juge que s’est produit l’un ou l’autre des faits prévus au paragraphe (1.1), le gouverneur en conseil peut :
(a) make any orders or regulations with respect to the restriction or prohibition of any of the activities referred to in subsection (2) in relation to a foreign state that the Governor in Council considers necessary; and
a) prendre les décrets et règlements qu’il estime nécessaires concernant la restriction ou l’interdiction, à l’égard d’un État étranger, des activités énumérées au paragraphe (2);
(b) by order, cause to be seized or restrained in the manner set out in the order any property situated in Canada that is owned — or that is held or controlled, directly or indirectly — by a foreign state or a person who is identified in an order or regulation made under paragraph (1)(a).
b) par décret, faire saisir ou bloquer, de la façon prévue par le décret, tout bien qui se trouve au Canada et qui appartient à un État étranger ou à une personne visée par un décret ou un règlement pris en vertu de l’alinéa (1)a) ou tout bien qui est détenu ou contrôlé, même indirectement, par cet État ou cette personne.
[51] As may be seen, a person may be named in the Sanctions list if the Governor in Council, on the recommendation of the Minister, is satisfied there are reasonable grounds to believe the person falls into one of the categories of section 2 of the Russia Regulations:
List
Liste
Schedule 1
Annexe 1
2 A person whose name is listed in Schedule 1 is a person in respect of whom the Governor in Council, on the recommendation of the Minister, is satisfied that there are reasonable grounds to believe is
2 Figure sur la liste établie à l’annexe 1 le nom de personnes à l’égard desquelles le gouverneur en conseil est convaincu, sur recommandation du ministre, qu’il existe des motifs raisonnables de croire qu’elles sont l’une des personnes suivantes :
(a) a person engaged in activities that directly or indirectly facilitate, support, provide funding for or contribute to a violation or attempted violation of the sovereignty or territorial integrity of Ukraine or that obstruct the work of international organizations in Ukraine;
a) une personne s’adonnant à des activités qui, directement ou indirectement, facilitent une violation ou une tentative de violation de la souveraineté ou de l’intégrité territoriale de l’Ukraine ou procurent un soutien ou du financement ou contribuent à une telle violation ou tentative ou qui entravent le travail d’organisations internationales en Ukraine;
(a.1) a person who has participated in gross and systematic human rights violations in Russia;
a.1) une personne ayant participé à des violations graves et systématiques des droits de la personne en Russie;
(b) a former or current senior official of the Government of Russia;
b) un cadre supérieur ou un ancien cadre supérieur du gouvernement de la Russie;
(c) an associate of a person referred to in any of paragraphs (a) to (b);
c) un associé d’une personne visée à l’un des alinéas a) à b);
(d) a family member of a person referred to in any of paragraphs (a) to (c) and (g);
d) un membre de la famille d’une personne visée à l’un des alinéas a) à c) et g);
(e) an entity owned, held or controlled, directly or indirectly, by a person referred to in any of paragraphs (a) to (d) or acting on behalf of or at the direction of such a person;
e) une entité appartenant à une personne visée à l’un des alinéas a) à d) ou détenue ou contrôlée, même indirectement, par elle ou pour son compte ou suivant ses instructions;
(f) an entity owned, held or controlled, directly or indirectly, by Russia or acting on behalf of or at the direction of Russia; or
f) une entité appartenant à la Russie ou détenue ou contrôlée, même indirectement, par elle ou pour son compte ou suivant ses instructions;
(g) a senior official of an entity referred to in paragraph (e) or (f).
g) un cadre supérieur d’une entité visée aux alinéas e) ou f).
[52] Section 3 of the Russia Regulations sets a range of restrictions and prohibitions on transactions and activities of those on the sanctions list:
Prohibited transactions and activities
Opérations et activités interdites
3 It is prohibited for any person in Canada and any Canadian outside Canada to
3 Il est interdit à toute personne au Canada et à tout Canadien à l’étranger :
(a) deal in any property, wherever situated, that is owned, held or controlled by or on behalf of a person whose name is listed in Schedule 1;
a) d’effectuer une opération portant sur un bien, où qu’il se trouve, appartenant à une personne dont le nom figure sur la liste établie à l’annexe 1 ou détenu ou contrôlé par elle ou pour son compte;
(b) enter into or facilitate, directly or indirectly, any transaction related to a dealing referred to in paragraph (a);
b) de conclure, directement ou indirectement, une transaction relativement à une opération visée à l’alinéa a) ou d’en faciliter, directement ou indirectement, la conclusion;
(c) provide any financial or other related service in respect of a dealing referred to in paragraph (a);
c) de fournir des services financiers ou des services connexes à l’égard de toute opération visée à l’alinéa a);
(d) make available any goods, wherever situated, to a person listed in Schedule 1 or to a person acting on their behalf; or
d) de rendre disponibles des marchandises, où qu’elles se trouvent, à une personne dont le nom figure sur la liste établie à l’annexe 1 ou à une personne agissant pour son compte;
(e) provide any financial or related service to or for the benefit of a person listed in Schedule 1.
e) de fournir des services financiers ou des services connexes à toute personne, dont le nom figure sur la liste établie à l’annexe 1, ou pour son bénéfice.
[53] Section 8 of the Russia Regulations outlines the process for persons seeking to have their named removed from the sanctions list. The Applicant followed this process here, as he did in his earlier request, by asking the Minister to recommend to the Governor in Council that he be delisted:
Application to no longer be listed
Demande de radiation
8 (1) A person may apply in writing to the Minister to have their name removed from Schedule 1, 2 or 3.
8 (1) Toute personne dont le nom figure sur la liste établie aux annexes 1, 2 ou 3 peut demander par écrit au ministre d’en radier son nom.
Recommendation
Recommandation
(2) On receipt of the application, the Minister must decide whether there are reasonable grounds to recommend to the Governor in Council that the applicant’s name be removed from Schedule 1, 2 or 3.
(2) Sur réception de la demande, le ministre décide s’il a des motifs raisonnables de recommander la radiation au gouverneur en conseil.
Decision
Décision
(3) The Minister must make a decision on the application within 90 days after the day on which the application is received.
(3) Il rend sa décision dans les quatre-vingt-dix jours suivant la réception de la demande.
Notice
Avis
(4) The Minister must give notice without delay to the applicant of the decision taken.
(4) Il donne sans délai au demandeur un avis de sa décision.
New application
Nouvelle demande
(5) If there has been a material change in circumstances since the last application was submitted, a person may submit another application under subsection (1).
(5) Si la situation du demandeur a évolué de manière importante depuis la présentation de sa dernière demande, il peut en présenter une nouvelle.
V. Issues
[54] The Applicant raises the following issues:
1.Has the Minister relied upon news articles of little to no evidentiary value, irrelevant considerations, an unlawful request to prove a negative, and fabricated facts and failed to take into account credib