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Special Economic Measures Act

Bill to Amend--Second Reading--Debate Continued

September 24, 2024


Hon. Leo Housakos [ - ]

Honourable senators, I rise today to speak to Bill S-278, An Act to amend the Special Economic Measures Act (disposal of foreign state assets).

I’ll start by thanking Senator Omidvar for proposing this legislation and for her ongoing commitment and tireless efforts on this very important matter. I also want to make it clear from the start that I fully support this bill, though I am the critic — a friendly one at that.

I believe it is a natural continuation of some of the efforts we have been making in the Senate to fight back against gross human rights violations and bullies such as Vladimir Putin. I must say, however, that we have a long way to go with regard to how some members of this chamber pick and choose which human rights violations to speak out against, as we know from voting patterns in the past.

At any rate, while I’m not sure how much in relevant assets remains in Canada to be seized under this legislation, I believe the amendments being proposed to the Special Economic Measures Act, or SEMA, will, even if only in small part, be beneficial to Ukrainians. Hopefully, it will also show Canada to be leading by example among Western democracies in dealing with rogue states that seek to upset the world’s rules-based order — something we haven’t exactly been doing as of late.

As Senator Omidvar said in her speech, the purpose of this legislation is to:

. . . allow for a legal mechanism to seize and repurpose the state assets of perpetrators who breach international peace and security and to redirect those assets to the victims whose lives have been shattered.

I don’t know how that could be seen as anything other than reasonable and just.

It is not just a one-off. Not only would this legislation allow our government to seize Russian assets to assist in the rebuilding of Ukraine, but it would also leave us with a legal mechanism to deal with other human rights violations.

This is incredibly important as we continue to see the rise of authoritarianism and gross human rights violations around the world, with tyrants and despots becoming more and more emboldened as they see what they believe to be weakness and hesitancy to act on the part of Western democracies. They are quite literally taunting us with their increased acts of aggression. Rest assured, their acts are coordinated. They are designed to test our mettle and resolve and to distract us. We see it with Erdoğan, Xi and the Islamic Revolutionary Guard Corps, or IRGC. They are starting as many fires on as many fronts as possible, and while this must not go unchecked, in responding to it we have a moral and existential responsibility to maintain order by implementing measures such as those being proposed here.

As for how these measures will be used in relation to Russia’s invasion of Ukraine, as I mentioned earlier, the amount of assets here in Canada does not necessarily tell the whole story about the importance of this legislation. In 2021, before Russia’s invasion, the public accounts of Russia reported they had approximately $16 billion in assets right here in Canada. However, Russia has since moved much of that out of Canada, and it is unclear how much money is left here. We have seen a number of news stories about still-veiled Russian operations and oligarchs operating in some sensitive industries in Canada, including mining.

However, considering that the World Bank estimates the cost of war in Ukraine at US$600 billion, Ukraine will need every dollar that will come their way. Finding innovative ways to increase financial aid capacity will be a game changer in this conflict and in others. Furthermore, even if we are not the first to do so, we must be in lockstep with our allies on measures of this nature, especially right now when we are increasingly being seen as being out of step with our allies.

We are seeing similar legislation to this bill in the U.S. and the United Kingdom. As for any questions about whether Canada has the right to seize another government’s assets, international law obliges us to take the kinds of measures that this bill is proposing.

In fact, according to Article 41 of the articles on the Responsibility of States for Internationally Wrongful Acts adopted by the UN General Assembly, states are obliged to cooperate through lawful means to bring to an end an illegal act that breaches peremptory norms.

I think we can all agree that Russia’s actions against Ukraine have been illegal and breach peremptory norms.

At the risk of being redundant, but for the benefit of those who were not here for Senator Omidvar’s speech and may still have some concerns about this particular point, I would like to refer once again to her speech because she explained the principle quite well:

The principle behind countermeasures is that a state, in this case Canada, can suspend an obligation it has under international law in a way that is intended to bring the offending state back into compliance with international legal obligation. In this case, it is Russia’s breach with the invasion of Ukraine and its failure to compensate for the devastation it has caused. If it is a valid countermeasure, then seizure of state assets in itself is not a breach of international law. Quite the opposite: It is a valid and lawful response to Russia’s breach of fundamental norms of forbidding one state from mounting an armed attack on another.

Colleagues, we can have our political differences in this place — and outside of it, for that matter — but I think I can speak for all of us when I say the world order feels much less stable of late, more so than it has in many years.

We have Beijing’s sabre rattling against Taiwan, Iran’s involvement in the attacks against Israel on October 7 and the ensuing war, Erdoğan’s involvement in Azerbaijan’s ethnic cleansing of the Armenian people of Nagorno-Karabakh and Putin’s atrocities committed against the people of Ukraine. Any one of these could be described as a powder keg requiring us to act in a responsible manner.

Act we must. Now is not the time for appeasement. The international community tried the appeasement method for the conflict involving Russia in Crimea in 2014. It did not work then, and it surely won’t work now. We know that appeasement has never worked when dealing with tyrants and despots.

The underlying principles that guide this legislation are noble. It is inspired by justice in its purest form. In passing this legislation and implementing the measures within, we are saying we will use every tool available to us to fight back against threats to our way of life.

It is our duty and our obligation to stand up for freedom and democracy, not just here at home but anywhere in the world where it is under threat.

For too long, Russia and other rogue states have not only hidden behind the protections of international law; they have used their inclusion in the rules-based order against us. That’s what they are trying to do here when they argue that we don’t have the legal capacity to seize their assets. It is a joke, colleagues. If anything, they’ve made a complete mockery of organizations like the United Nations and, for that matter, our Western democratic foundations.

The joke is on them, however. By using domestic law to enforce international law, we are adding an arrow to Western democracy’s quiver to maintain peace and rule of law around the globe. We cannot wait until the end of this illegal war to decide how we are going to make Russia pay reparations to Ukraine. Good luck in forcing Putin to do the right thing at any point. In joining our allies in measures like this now, no matter how many Russian assets are still in Canada, we are helping to ensure there are much-needed funds when the time comes to rebuild Ukraine and undo the damage being done by Putin. Every little bit will count.

Colleagues, Canada has an obligation to do the right thing. At times we don’t, and recently we have picked and chosen when we follow the moral high ground and when we don’t. Time and again we say the right things but don’t follow it up with action. For example, we have recognized that a rogue dictatorship like Beijing has been infiltrating and exercising foreign interference in our country, and we saw our government dragging its feet. They’re not dragging their feet because the Prime Minister loves this country any more or any less than do Conservatives or other Canadians; I think they are dragging their feet because we always allow economic considerations to seep through. Essentially, we’re ready to trade our values and principles when dealing with states like China, Russia, Cuba, Türkiye or with the IRGC. We allow economic considerations to trump doing what’s right and supporting the foundations and principles that this country has been built on.

When our government turned a blind eye and gave the green light for LR3 technology to be sold to Erdoğan’s regime in Türkiye last year, and that technology, of course, was passed on to Azerbaijan and used to carry out ethnic cleansing in Nagorno-Karabakh — in essence our government was basically saying, “We are going to allow a few hundred million-dollar deal determine if it is wrong or right to carry out ethnic cleansing.”

Then we turn a blind eye; while the rest of the world — who has the courage — calls it out in Nagorno-Karabakh to be what it is, we hesitate. When we have motions recognizing what is going on against the Uighur Muslim people in China as ethnic cleansing and as genocide, we take the right stance in the House of Commons. We vote for a motion, but the government pretends it never happened, and they carry on because they don’t want to offend the tyrant.

I will remind colleagues of the shameful day in this place. We didn’t even have the decency to support that basic, moral high ground motion or call out what was happening to the Uighur people as ethnic cleansing. It is stuck in my throat, and I can’t get over it: This is the only democratic house in the Western world that voted down that motion. It is a shame and a blemish on us that I don’t think this institution will ever overcome.

I think Senator Omidvar’s bill is reasonable and just. It’s consistent with the values and principles that Canadian governments should aspire to follow at all times, so I support it. I think the government would heed the right advice here with reason and common sense, and they should take this bill and run with it. This should not only be a private member’s bill that is passed in terms of posturing. This bill should also be looked at carefully. The government should roll up their sleeves and embrace the similar legislation that the United States and United Kingdom passed, and they should show moral leadership when it comes to human rights. Thank you very much, colleagues.

Senator Housakos, thank you very much for that speech and for voicing your support of this bill. When Senator Omidvar delivered her second reading speech last fall about this, I expressed my support for it as one of 1.4 million Ukrainian Canadians. I want those Russian assets that still exist in Canada to be quickly and properly seized so that they cannot be used to finance Putin’s continuing illegal and brutal war against Ukraine.

At the time, I asked Senator Omidvar a question because there had recently been a budget implementation act that had some government provisions in it which provided some measures about this exact thing. I asked her to explain how her bill provided some additional measures on that front. She explained to me it was an important clarification that she saw on these measures.

Given that it is an important clarification, why isn’t the government taking this up, as Senator Omidvar has pointed out? I’m not sure when this bill was introduced, whether it was a year ago or a little longer than that, but they have had considerable time now. Is this something where perhaps these measures could be used in a future budget implementation act or omnibus bill, which the government is so fond of putting forward?

Senator Housakos [ - ]

Thank you, Senator Batters. I can only assume why the government has been dragging its feet when it comes to these issues. I believe it comes down to dollars and cents. Like I said in my speech, the government is always putting ahead economic considerations at the price of human rights. We talk a good game, but when it is time to stand up and make the sacrifice required, we are not ready to do it.

There are a number of rules, regulations and laws that prevent dictatorships and autocrats from coming to Canada to hide and launder their money. We have seen many cases, which the media brought to our attention, when it comes to family members of the Islamic Revolutionary Guard Corps, or IRGC, who have come to this country and set up shop. We know there are a number of oligarchs still operating business interests in this country which have been discovered and brought to the forefront by the media.

The Erdoğan regime in Türkiye has more journalists in prison than any other country on earth, along with countries like Cuba, yet we continue to encourage economic and commercial transactions. Global Affairs Canada does more high-end shrimp parties with the Cuban dictatorship and with Beijing than they sometimes do with our own democratic allies around the world. One has to shake their head and ask, “What have we come to as a country that always took the moral high ground?”

There has to be a political will to put into force some of the laws that are already in place. They have to give directives to the Canada Revenue Agency, to customs and so forth to put into place some of the measures that are already there. We have what is essentially slave labour being carried out by the Beijing regime using the Uighur people in Xinjiang. We have laws in the books that call upon goods that are being imported into this country where you have slave labour that we can confiscate and pursue. There is no political will to execute those laws. There has to be the political will, and leadership always comes from the top.

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