Russia“Canada continues to condemn Russia’s brutal and illegal invasion of Ukraine in the strongest possible terms. Canada will continue to support Ukraine’s economic resilience and stand in solidarity with the people of Ukraine, who are fighting for their lives, their sovereignty, and for democracy.” – Department of Finance Canada, May 8 2022
In response to Russia’s invasion of Ukraine in February of this year, many countries have enacted sanctions against Russia with the intent of hobbling the Russian economy and bringing pressure on the Russian government to end the invasion. The attack has been widely condemned by the international community. In a statement announcing Canadian sanctions against Russia, the Government of Canada said of the invasion: “This egregious step is a blatant violation of international law and the rules-based international order. The attacks have caused widespread devastation of Ukrainian infrastructure and property, and unnecessary deaths of Ukrainians, particularly civilians.“
The Canadian sanctions against Russia were enacted by the Special Economic Measures (Russia) Regulations. Many of the sanctions are special provisions that will not affect most importers. The sanctions include a list of individuals, mostly Russian oligarchs and people known to be close to Russian President Vladimir Putin, with whom Canadians can no longer transact any financial business. These individuals have also had their Canadian assets frozen and can no longer legally enter Canada. The Special Economic Measures also prohibit the purchase by Canadians of Russian oil or petroleum products; prohibit Russian vessels from entering Canadian waters; and prohibit the sale of prescribed goods, including luxury goods, weapons, and supplies for use the aeronautic and petroleum industries to Russian entities.
As one of the very few countries that has supported Russian actions, Belarus is also subject to sanctions from the Canadian government. These were enacted under the Special Economic Measures (Belarus) Regulations and are basically similar to the Russian sanctions.
In March, Canada became the first country to subject Russian goods to additional import duties. Effective March 2, 2022, Canada has revoked Most Favoured Nation status from both Russia and Belarus. This means that all goods being imported from Russia will be subject to the General Tariff rate of customs duty, which is 35% on all goods. The General Tariff rate will also apply to goods of Russian or Belarusian origin, regardless of where they are shipped from. For example, if a Canadian importer purchases goods from a vendor in the USA that were originally manufactured in Russia, the goods will be subject to 35% duty when they cross the border into Canada.
The only other country which is currently subject to the General Tariff rate is North Korea.
Canada has also proposed to remove customs duty on all goods made in Ukraine. Most goods from Ukraine already enter Canada duty-free as a result of the Canada-Ukraine Free Trade Agreement, but some goods are excluded from that agreement or are still slowly being phased in. Canada has proposed to extend the agreement to cover all goods from Ukraine for a one-year period. If the proposal is adopted, it will be ratified by an Order in Council and CBSA will then issue a notice informing importers of how to claim relief.
In a backgrounder, the Department of Finance said: “From 2019 to 2021, Ukrainian exports to Canada averaged $170.8 million annually, and Canada collected about $2.6 million in duties from these goods. By removing tariffs for a one year period, Canada would continue to support Ukraine’s economy by ensuring that Ukrainian goods are able to enter Canada duty-free.“
Historically, Canada has not been a major trading partner of either Russia or Ukraine. While the sanctions against Russia and Belarus and the trade action in favour of Ukraine are unlikely to have an outsized impact on the course of the war, the measures are also intended as a public condemnation of the actions of President Vladimir Putin and as a statement of support for the embattled people of Ukraine.
By Robin Smith, M.A., CCS
– Robin is a trade industry professional based in Victoria, BC.
“Canada continues to condemn Russia’s brutal and illegal invasion of Ukraine in the strongest possible terms. Canada will continue to support Ukraine’s economic resilience and stand in solidarity with the people of Ukraine, who are fighting for their lives, their sovereignty, and for democracy.” – Department of Finance Canada, May 8 2022
In response to Russia’s invasion of Ukraine in February of this year, many countries have enacted sanctions against Russia with the intent of hobbling the Russian economy and bringing pressure on the Russian government to end the invasion. The attack has been widely condemned by the international community. In a statement announcing Canadian sanctions against Russia, the Government of Canada said of the invasion: “This egregious step is a blatant violation of international law and the rules-based international order. The attacks have caused widespread devastation of Ukrainian infrastructure and property, and unnecessary deaths of Ukrainians, particularly civilians.“
The Canadian sanctions against Russia were enacted by the Special Economic Measures (Russia) Regulations. Many of the sanctions are special provisions that will not affect most importers. The sanctions include a list of individuals, mostly Russian oligarchs and people known to be close to Russian President Vladimir Putin, with whom Canadians can no longer transact any financial business. These individuals have also had their Canadian assets frozen and can no longer legally enter Canada. The Special Economic Measures also prohibit the purchase by Canadians of Russian oil or petroleum products; prohibit Russian vessels from entering Canadian waters; and prohibit the sale of prescribed goods, including luxury goods, weapons, and supplies for use the aeronautic and petroleum industries to Russian entities.
As one of the very few countries that has supported Russian actions, Belarus is also subject to sanctions from the Canadian government. These were enacted under the Special Economic Measures (Belarus) Regulations and are basically similar to the Russian sanctions.
In March, Canada became the first country to subject Russian goods to additional import duties. Effective March 2, 2022, Canada has revoked Most Favoured Nation status from both Russia and Belarus. This means that all goods being imported from Russia will be subject to the General Tariff rate of customs duty, which is 35% on all goods. The General Tariff rate will also apply to goods of Russian or Belarusian origin, regardless of where they are shipped from. For example, if a Canadian importer purchases goods from a vendor in the USA that were originally manufactured in Russia, the goods will be subject to 35% duty when they cross the border into Canada.
The only other country which is currently subject to the General Tariff rate is North Korea.
Canada has also proposed to remove customs duty on all goods made in Ukraine. Most goods from Ukraine already enter Canada duty-free as a result of the Canada-Ukraine Free Trade Agreement, but some goods are excluded from that agreement or are still slowly being phased in. Canada has proposed to extend the agreement to cover all goods from Ukraine for a one-year period. If the proposal is adopted, it will be ratified by an Order in Council and CBSA will then issue a notice informing importers of how to claim relief.
In a backgrounder, the Department of Finance said: “From 2019 to 2021, Ukrainian exports to Canada averaged $170.8 million annually, and Canada collected about $2.6 million in duties from these goods. By removing tariffs for a one year period, Canada would continue to support Ukraine’s economy by ensuring that Ukrainian goods are able to enter Canada duty-free.“
Historically, Canada has not been a major trading partner of either Russia or Ukraine. While the sanctions against Russia and Belarus and the trade action in favour of Ukraine are unlikely to have an outsized impact on the course of the war, the measures are also intended as a public condemnation of the actions of President Vladimir Putin and as a statement of support for the embattled people of Ukraine.
By Robin Smith, M.A., CCS
– Robin is a trade industry professional based in Victoria, BC.
