Special Economic Measures Act

Honourable senators, I rise today to speak to Bill S-214, An Act to amend the Special Economic Measures Act (disposal of foreign state assets). This bill would amend the Special Economic Measures Act, or SEMA, to create a legal pathway to seize and repurpose the state assets, including central bank reserves, of perpetrators who breach international peace and security. More specifically, it creates a pathway to seize these assets through executive order. These assets can then be redirected to the victims who have suffered at the hands of these perpetrators.

This bill was previously introduced as Bill S-278 by former Senator Omidvar, and I took stewardship of the bill when she left the Senate just before Parliament dissolved in 2025. I want to thank Senator Housakos, Senator Patterson and Senator Kutcher for their excellent interventions on that bill in the last Parliament. I especially want to commend Senator Omidvar for her far-sighted leadership in advancing these concepts through this bill and through an earlier bill, which served as the inspiration for government legislation in 2022.

Bill S-214 rests on the widely shared belief that foreign leaders and nations who violate international human rights through violence, oppression, corruption or war must be held accountable for their actions, and asset forfeiture can be a powerful option to help achieve this and to assist the victims of these actions.

A good way to introduce Bill S-214 is to describe the situation with respect to Russia’s invasion of Ukraine in February 2022. After this invasion, Western countries, including the EU, the U.S., the U.K., Canada and other countries, froze hundreds of billions of dollars in Russian state assets, primarily the Russian central bank’s foreign reserves — around €210 to €300 billion total — as well as the private assets of oligarchs such as planes, yachts and real estate. The bulk of the frozen state assets sit in Europe today, with Belgium’s Euroclear holding the largest share.

Soon after these events, Canada took a bold leap. In the budget implementation act of June 2022, the government amended the Special Economic Measures Act to permit not only the freezing of the assets of sanctioned individuals and entities but to also permit the seizure and forfeiture of such assets. With this move, Canada became the first G7 nation with the power to not only freeze but also to permanently confiscate and redistribute the assets of sanctioned individuals and entities.

The concept of asset seizure was also the basis of Senator Omidvar’s earlier bill, which was Bill S-217, as I mentioned earlier, and this bill was the inspiration for the government’s move. Canada became the first G7 nation with the power to confiscate and redistribute these assets.

As currently drafted, however, SEMA can permit the seizure of individual and private assets through a process involving the courts, but it cannot authorize the seizure of state assets. The bill debated here today extends this by creating a legal pathway for state assets to be seized.

Let me explain: As it currently operates, SEMA does not permit the seizure of state assets through court process. That is because state assets are bound by the principle of sovereign immunity, which is a precedent under international law which says, “. . . one sovereign state cannot be sued before the courts of another sovereign state without its consent.”

In Canada, this principle is embodied in the State Immunity Act, which limits court action with respect to seizing the assets or property of a foreign state which are located in Canada. This immunity applies broadly unless specific exceptions are met.

While the State Immunity Act limits court action against another state, its reach does not extend to executive actions such as cabinet orders. As such, state assets are shielded from legal proceedings in court, but they are not shielded from executive actions. The bill before you amends SEMA to allow for the confiscation of state assets by executive action, thereby creating two paths for seizure: one through the courts for individual assets and another through executive action by the Governor-in-Council. We can think of it as two highways with different routes but the same destination.

Of course, SEMA can only be used if any of its four underlying conditions have been met. Thus, there must be a grave breach of international peace and security, gross and systematic human rights violations, acts of significant corruption and/or requests for action from an international group which Canada belongs to.

To be clear, SEMA already provides for the seizure of state assets, but the mechanism is flawed. This bill simply provides for amending the mechanism so that the law can fulfill its stated purposes, should Canada choose to seize and repurpose sovereign state assets.

Colleagues, why are we contemplating such extraordinary actions as seizing the state assets of a foreign country? We are contemplating extraordinary actions because we are faced with extraordinary circumstances, in particular the illegal and immoral invasion by Russia of the free, independent and democratic nation of Ukraine. As a matter of justice and based on our values and our interests, we must continue to take action. The funds seized under this act and similar actions by other Western nations can assist Ukraine in rebuilding after the devastation of war.

Let’s consider the destruction that Russia has perpetrated with its illegal invasion of Ukraine. First, there are the lives lost. According to a report published on January 27 of this year from the Center for Strategic and International Studies, Russia has lost 1.2 million troops through deaths, wounded and missing, including approximately 325,000 troop deaths since the full-scale invasion of Ukraine began in February 2022. In fact, NATO Secretary General Mark Rutte recently noted that Russia was losing 1,000 people every day as of December 2025.

The same study estimated that Ukraine has suffered very high losses as well, with Ukrainian forces suffering between 500,000 and 600,000 troop casualties, including between 100,000 and 140,000 fatalities since February 2022.

And then there are the civilian casualties. According to the UN Human Rights Office, 15,000 Ukrainian civilians have been killed and 40,000 have been wounded — as of last December — since the war began.

As of early 2026, Russia’s invasion has triggered Europe’s largest forced migration since World War II, with over 10 million Ukrainians displaced — about 7 million as refugees globally, while the remainder have been displaced internally.

There is also evidence of multiple crimes and violations committed by Russia and Russian troops. A paper prepared by investigator Rodrigue Demeuse for the NATO Parliamentary Assembly examined these violations and presented evidence in three areas.

First, there are violations of international humanitarian law — the so-called laws of war — established by the Geneva Conventions, the Hague Convention and others. Russia has violated these laws. It has deliberately killed civilians and used arbitrary detentions, torture, forced disappearances and human shields, and it has used sexual violence, especially against women. Russia has targeted or destroyed civilian infrastructure, including energy sources, especially this winter. It has denied humanitarian assistance and perpetrated the forced deportation of civilians, including children.

In March of last year, Ukraine alleged 150,000 possible Russian war crimes. The UN — through December of last year — has been reporting on Russia’s systematic torture of Ukrainian prisoners of war.

Russia has also violated international human rights law, based on several international treaties and covenants. These include violations of the right to life, freedom, security, expression and assembly, as well as economic, social and cultural rights, such as the right to education, the right to health care, food and water rights and many others.

Finally, there are breaches of international criminal law. There is the crime of aggression committed when Russia invaded the sovereign and independent nation of Ukraine with no justification, which is a clear violation of the UN charter. There is even evidence of genocide.

The destruction brought about by Russia in Ukraine has been massive. The humanitarian losses, including deaths, injuries and displacements, will deeply affect the physical and mental health of the Ukrainian people for years to come.

On November 14, 2022, the UN General Assembly adopted Resolution ES-11/5, recognizing that Russia must bear the legal consequences, including reparations, for its internationally wrongful acts and aggression against Ukraine.

The World Bank’s updated damage assessment as of December 31 estimated that Ukraine requires US$588 billion for recovery over the next decade, and this figure is considered to be an underestimation.

The UN report also highlights a 93% surge in damage in the energy sector this winter, where damaged or destroyed assets now include power generation.

So, recognizing that Russia must bear consequences and pay reparations for their illegal acts, the frozen Russian assets represent an important potential source of funds for Ukraine. As I mentioned at the beginning of my comments, after the Russian invasion of Ukraine, Western nations moved quickly to freeze Russian assets held abroad, including Russian state assets and the property of Russian oligarchs. These frozen assets are currently valued at approximately €210 billion of Russia’s state assets and approximately €28 billion of privately held assets. Euroclear, a Belgian financial securities depository, holds around €180 billion of these state assets.

Since all of these funds were frozen in 2022, there has been an active international debate concerning the viability and legality of seizing and transferring these assets to Ukraine, either to fund its current needs or to fund post-war reconstruction.

Canada has taken concrete steps already toward seizing and forfeiting privately held assets to support Ukraine, including seizing the Antonov cargo plane in 2023, which still sits at Pearson Airport. I see it as I drive home. It has done this using its sanction powers, which were legislated by the government here in 2022.

But it’s the frozen state assets that have attracted the most attention and debate. That’s where the big money lies.

In 2024, instead of direct seizure, the G7 countries agreed to use the interest from frozen Russian state assets for a $50-billion loan to Ukraine, not touching the principal assets.

Throughout 2025, Western nations debated the legality of outright confiscation, largely fearing legal challenges and instability in the global financial system if they were to confiscate the funds outright. But just last December, there was finally movement on Russian state assets. The EU states agreed to indefinitely freeze the assets. They were having difficulty doing so, but they were able to freeze the assets in December, which, in turn, paved the way for a loan arrangement of €90 billion to Ukraine, backed by these assets, without undertaking actual outright confiscation.

It will work the following way: Ukraine will repay the loan to the Europeans if Russia pays war reparations to Ukraine. But if Russia does not pay reparations — and most observers think it will not — then the EU maintains the right to use the frozen Russian assets to repay this loan. The funds that are to be forwarded to Ukraine, apparently within the next month, will be used for Ukraine’s military and budgetary needs.

While Canada is not party to this particular initiative, the federal government has taken important steps in a related direction. In the budget implementation act, Bill C-15, Division 18 of Part 5 — which is in debate in this chamber even as we speak — the government proposes amendments to SEMA that would require Canadian financial institutions to provide information to the government on any property they control that is owned or controlled by a sanctioned person or foreign state, and on any profits the institution may have realized from this property. The Minister of Finance may then direct the financial institution to pay the government the profits generated from the foreign property.

Among other benefits, these amendments to SEMA in the current budget implementation act may help us to unlock the location of approximately $22 billion that Euroclear is holding related to Russian frozen assets, which Euroclear has reported.

We are building these arrangements piece by piece. Now the only piece that is missing is to provide the government with the ability to seize foreign state assets under the SEMA sanction, which was intended in the 2022 legislation but not fully realized for reasons that I have explained.

Bill S-214 provides a clear domestic legal framework permitting the seizure of state assets. It’s a framework that allows us to act with allies or independently if multilateral arrangements falter or are delayed. It is another mechanism to hold Russia to account for its actions. Canada can, if needed, repurpose frozen assets directly for Ukrainian support or reparations without waiting for unanimous international agreement. And it’s there to hold other nations — not just Russia — to account for their illegal actions. It is country-agnostic. It is not specifically intended for Russia. It can be used for other related situations as well.

By advancing this bill, Canada strengthens the broader global sanctions architecture and provides a model for other countries should they wish to take this step. We will create a legal avenue for Canada to seize state assets, and we will create a legal precedent that can be followed by other like-minded jurisdictions. We can again show leadership in this area.

Certainly, Canadians are onside with this initiative. In a national public opinion survey commissioned by myself and Senator Omidvar and conducted in October 2023, we found that a strong majority of Canadians support Canada seizing the Canadian assets of foreign states that are violating human rights and using these assets to help victims. The poll shows that 81% of Canadians support Canada seizing the state assets of the Russian government that are held in Canada and using those assets to help the victims of the war against Ukraine.

From the beginning, Canada has shown leadership on these issues, and by moving ahead with this legislation, we can continue to lead by example. I ask for your support for this bill.

To conclude, I want to thank my advisory group of international and Canadian experts who have assisted me on this very demanding subject matter. They are academics, foreign policy experts and international lawyers.

As a third-generation Ukrainian Canadian, I’m especially motivated to see this bill pass, and I’m especially proud of Canada’s vast and steadfast embrace of Ukraine in its time of greatest need. I know that this support will continue into the future, however long it takes.

Colleagues, thank you.

Yes, senator, I will take a question.

That is an excellent question, senator.

According to testimony at our Foreign Affairs Committee in December with respect to the budget implementation act, or BIA, that is now on the table, which I mentioned earlier, the RCMP has reported C$185 million that has been frozen or immobilized in Canada, and those are Russian assets. However, they will not break out the state assets from the privately immobilized assets, so we don’t actually know the number of Russian state assets in Canada.

We do know, however, that just before the invasion of Ukraine, the Central Bank of the Russian Federation actually reported $16 billion of Russian state assets in Canada. Those disappeared after the war. Presumably, they removed them from Canada and put them in Europe or wherever. So there is a bit of a mystery.

The RCMP will not — I’m not sure why — break out the private assets from the state assets, so we don’t actually know the value of Russian state assets in Canada today.