An Act to amend the Special Economic Measures Act (disposal of foreign state assets)

This bill changes how the government can deal with foreign state property that has been seized or frozen under Canada's Special Economic Measures Act, which is the law used to impose sanctions on other countries. Currently, courts play a role in forfeiting seized property. Under this bill, when the seized or frozen property belongs to, or is held or controlled by, a foreign state, that property can no longer be forfeited through the existing court-based process. Instead, the Governor in Council (essentially the federal cabinet) gets a new power to order the forfeiture of such foreign state property directly, without needing a judicial order.

The bill also updates related provisions to reflect this new process: it clarifies who is responsible for costs related to seizing, freezing, or disposing of such property (the property's owner bears those costs, which can be recovered as a debt to the government), and it allows proceeds from disposing of forfeited property, including property forfeited under this new cabinet process, to be paid out for approved purposes following consultation with the Ministers of Finance and Foreign Affairs. It also updates the RCMP Commissioner's authority to assist with this new cabinet-ordered forfeiture process, alongside the existing court-based one.

In short, the bill gives the federal cabinet a faster, non-judicial route to permanently take ownership of sanctioned foreign states' seized assets in Canada, separate from the court process that still applies to other seized property.

This bill amends the Special Economic Measures Act to let the Governor in Council (Cabinet) order the forfeiture of foreign state assets that were seized without a judicial order, and to direct how the proceeds of forfeited property are used.

• New forfeiture power — Cabinet may, by order, forfeit to the Crown any property that is subject to a seizure/restraint order under paragraph 4(1)(b) and that is owned, held, or controlled — directly or indirectly — by a foreign state, without requiring a court-ordered forfeiture process.
• Exception created elsewhere in the Act — the existing judicial forfeiture route under section 5.4 is now barred from applying to property owned or controlled by a foreign state, meaning that route and the new Cabinet route apply to different categories of property.
• Costs and debt recovery — costs incurred by the Crown in seizing, restraining, or disposing of property (including under the new section 5.41) become a debt owed by the property's owner, recoverable through any court of competent jurisdiction.
• Discretion over proceeds — the Minister, after consulting the Minister of Finance and the Minister of Foreign Affairs, may pay amounts from the Proceeds Account out of the net proceeds of property forfeited under section 5.4 or the new section 5.41, on terms and timing the Minister considers appropriate, but only for purposes listed elsewhere in the Act.
• RCMP role — the RCMP Commissioner may assist the Minister with matters related to seizure orders, forfeiture applications under section 5.4, and forfeiture orders under the new section 5.41, including collecting and disclosing information to specified persons.
• Oversight — the bill does not specify any additional reporting, review, appeal mechanism, or sunset clause for the new Cabinet forfeiture power beyond what already exists in the Act.