Ottawa did nothing to capture the millions from the Russian oligarch

Secretary of State Melanie Jolie two years later announced She was taking unprecedented steps to confiscate millions of dollars in assets of Russian oligarchs allowed in Canada, and the government had not even started the court process, let alone handing over the money to the reconstruction of Ukraine. It never happens.

The federal government announced on December 19, 2022 that it has ordered the freezing of $26 million held in Canadian bank accounts by offshore investment funds. Vladimir Putin.

It was the first time Ottawa was used. New statutory powers Not just sanctioning certain people and companies, but confiscating their money and selling their assets based on those sanctions – something no other major Western economy has attempted.

The government promised that Abramovich’s alleged funds would be used for “the reconstruction of Ukraine and compensation for the victims of the illegal and unjustified invasion of Putin’s regime.” He was already an oligarch who owned the Chelsea soccer team in the English Premier League and had a stake in a steel company with plants in the Prairies. Hit with sanctions In Canada as early as 2022.

But more than two years later, the Liberal government has not taken the necessary steps, including an application to the High Court, to de facto confiscate the $26 million it claims is sitting in an account at Citico Bank Canada.

“We haven’t seen anything since then, and it’s definitely a mystery. I wish I knew what’s going on,” said independent Senator Donna Dasco, who is the top representative on the issue in the upper house, which has a hand in the Russian sanctions file. Bill S-278, which is now in effect, further expands the government’s sanctions powers.

“It’s taken a long time,” Dasco said, “and we really need some clarity on that.”

Risk Canada may have to compensate oligarch.

Global Affairs Canada would not say why it has not yet taken action to confiscate the money. In a brief emailed statement last month, he said he was under no obligation to do so “within a certain period of time.” Although the department has, citing privacy concerns, it will not provide more information He issued a press release About his plan to take over Abramovich’s assets.

A US law firm representing Abramovich did not respond to emails seeking comment.

Several legal experts specializing in sanctions and international trade said the government may have bitten off more than it could chew when it announced it would take millions.

There is a risk because the money, Ottawa says, is held in an offshore investment fund called Manticore Fund (Cayman) Ltd., so the money cannot be tied directly to Abramovich.

“The issue of ownership and control is difficult,” said Clifford Sosnow of Canada-based Fasken International. “There’s a series of hurdles to work through to take action on this.”

Then Abramovich, as In 1991, there is a possibility that he may oppose any property damage for such reasons. Canada-Russia Investment-Protection AgreementThe terms would require Canada to pay compensation for any “property” or “nationalism” it takes, Sosnow said.

John Boscariol of Canadian law firm McCarthy Tétrault said the fact that Canada is taking unprecedented action means that other countries are “watching to see our success,” which may explain the delay in action.

“I think the Canadian government probably knows that this is a priority and is being very cautious in what they do,” Boscariol said.

Other countries are using Russia’s foreign assets to help Ukraine, but in an indirect way. For example, it has the European Union. channel profit Funds for Ukraine’s military and reconstruction were created by the imprisoned Russian Central Bank, but they have not yet withdrawn the funds themselves.

The G7 countries also have it announced A $50-billion US loan package to Ukraine (68 billion CDN), financed by interest on frozen Russian Central Bank assets. To this end, Canada has provided 3.7 billion dollars (5 billion CDN).

A giant cargo plane won’t be flying anytime soon.

CDN assets worth $140 million in Canada have been frozen by the country’s Russian sanctions. R.M.P In the final consideration.

But the Liberal government has only committed to one more Russian asset loss: in June 2023. He ordered to be arrested It is an Antonov An-124 transport aircraft based at Toronto’s Pearson Airport, owned by Russia’s Volga-Dnep Airlines.

The cargo plane, one of the largest in the world, has been idling on the tarmac for three years now, costing the plane more than a million dollars in parking fees. The government of Ukraine has. He showed interest To get hold of the jet, however, any transfer faces several hurdles, not least of which is that the plane has not flown since 2022 and will no longer be airworthy.

Meanwhile, the Russian-owned company has presented several arguments to the Canadian government. As the first The Toronto Star reported Last week, a judge filed an application in federal court in November to lift sanctions it imposed on the Canadian company, and said it has filed a $100 million U.S. arbitration claim under the Canada-Russia Investment Treaty.

Orest Zakidalsky, a senior policy adviser at the Canadian Congress in Ukraine, said the lack of progress in confiscating these Russian-owned assets is disappointing.

We’re talking about years of government saying this is a priority and then not seeing much movement on it – or any, to be honest. “There was the press conference and not much after that.”