Proceeds of Crime (Money Laundering) and Terrorist Financing Act (S.C. 2000, c. 17)

Act current to 2017-09-14 and last amended on 2017-06-22. Previous Versions

PART 1.1Protection of Canada’s Financial System

Interpretation

Marginal note:Definition of foreign entity

 In this Part, foreign entity means an entity, other than an entity referred to in section 5, that is incorporated or formed by or under the laws of a foreign state, including its subsidiaries, if any, and that does not carry on business in Canada, if it carries out activities similar to those of entities referred to in any of paragraphs 5(a) to (g) or activities referred to in paragraph 5(h) or (h.1).

  • 2010, c. 12, s. 1869;
  • 2014, c. 20, s. 267;
  • 2017, c. 20, s. 422.

Ministerial Directive

Marginal note:Minister’s written directive
  •  (1) In addition to any other measure required by this Act, the Minister may, by written directive, require any person or entity referred to in section 5 to take, in order to safeguard the integrity of Canada’s financial system, any measure specified in the directive with respect to any financial transaction, or any financial transaction within a class of financial transactions, originating from or bound for any foreign state or foreign entity, that occurs or is attempted in the course of their activities, or with respect to any activity that is related to any such financial transaction or class of financial transactions.

  • Marginal note:Measures

    (2) The measures specified in a directive may include provision for the following matters:

    • (a) the verification of the identity of any person or entity;

    • (b) the exercise of customer due diligence, including ascertaining the source of funds in any financial transaction, the purpose of any financial transaction or the beneficial ownership or control of any entity;

    • (c) the monitoring of any financial transaction or any account;

    • (d) the keeping of any records;

    • (e) the reporting of any financial transaction to the Centre; and

    • (f) compliance with this Part and Part 1.

  • Marginal note:Non-application to legal counsel

    (2.1) A requirement in a directive to take a reporting measure as contemplated by paragraph (2)(e) does not apply to persons or entities referred to in paragraph 5(i) or (j) who are, as the case may be, legal counsel or legal firms, when they are providing legal services.

  • Marginal note:Director to communicate directive

    (3) The Minister may require the Director of the Centre to communicate a directive in accordance with the Minister’s instructions.

  • Marginal note:Relevant circumstances

    (4) Before issuing a directive, the Minister may take into account any circumstance that the Minister considers relevant. However, the Minister may only issue a directive if

    • (a) an international organization, body, association or coalition or a grouping of states (such as the Financial Action Task Force) of which Canada is a member has called on its members to take measures in relation to a foreign state or foreign entity on the ground that the state’s or entity’s anti-money laundering or anti-terrorist financing measures are ineffective or insufficient; or

    • (b) the anti-money laundering or anti-terrorist financing measures that a foreign state or a foreign entity has implemented are ineffective or insufficient and, as a result, the Minister is of the opinion that there could be an adverse impact on the integrity of the Canadian financial system or a reputational risk to that system.

  • Marginal note:Terms and conditions

    (5) The Minister may impose any terms and conditions in the directive that the Minister considers appropriate.

  • 2010, c. 12, s. 1869;
  • 2014, c. 20, s. 268;
  • 2017, c. 20, s. 423.
Marginal note:Duty to comply

 The person or entity to which a directive under this Part applies shall comply with it within the time and in the manner specified in the directive.

  • 2010, c. 12, s. 1869.
Marginal note:Foreign branches and subsidiaries
  •  (1) Every entity referred to in any of paragraphs 5(a) to (g), except for authorized foreign banks within the meaning of section 2 of the Bank Act and for foreign companies within the meaning of subsection 2(1) of the Insurance Companies Act, shall ensure that its foreign branches, and that its foreign subsidiaries that carry out activities similar to those of entities referred to in those paragraphs and that are either wholly-owned by the entity or have financial statements that are consolidated with those of the entity, comply with any directive issued under this Part, except with respect to any reporting measure as contemplated by paragraph 11.42(2)(e), to the extent it is permitted by, and does not conflict with, the laws of the foreign state in which the branch or subsidiary is located.

  • Marginal note:Records and reporting

    (2) If compliance with a directive by a branch or a subsidiary is not permitted by or would conflict with the laws of the foreign state in which the branch or subsidiary is located, the entity shall keep, in accordance with section 6, a record of that fact and of the reasons why it is not permitted or it would conflict, and shall, within a reasonable time, notify the Centre, and the principal agency or body that supervises or regulates it under federal or provincial law, of that fact and those reasons.

  • 2010, c. 12, s. 1869;
  • 2014, c. 20, s. 269;
  • 2017, c. 20, s. 424.

 [Repealed, 2014, c. 20, s. 269]

Marginal note:Inconsistency

 In the event of any inconsistency or conflict between a directive issued under this Part and a regulation made under this Act, the directive prevails to the extent of the inconsistency or conflict.

  • 2010, c. 12, s. 1869.
Marginal note:Statutory Instruments Act

 A directive issued under this Part is not a statutory instrument within the meaning of the Statutory Instruments Act. However, it must be published in the Canada Gazette.

  • 2010, c. 12, s. 1869.
Marginal note:Review
  •  (1) The Minister shall, at least every three years after the issuance of a directive under this Part, review that directive to determine whether it is advisable, in the Minister’s opinion, to amend or revoke it.

  • Marginal note:Relevant circumstance

    (2) In reviewing a directive, the Minister may take into account any circumstance that the Minister considers relevant.

  • 2010, c. 12, s. 1869.

Limitation and Prohibition of Financial Transactions

Marginal note:Regulations — limitation and prohibition
  •  (1) The Governor in Council may, on the recommendation of the Minister, make regulations

    • (a) imposing a limitation or a prohibition on any person or entity referred to in section 5, with respect to entering into, undertaking or facilitating, directly or indirectly, any financial transaction, or any financial transaction within a class of financial transactions, originating from or bound for any foreign state or foreign entity;

    • (b) prescribing terms and conditions with respect to a limitation or prohibition referred to in paragraph (a); and

    • (c) excluding any transaction or any class of transactions from a limitation or prohibition imposed under paragraph (a).

  • Marginal note:Consultation with the Minister of Foreign Affairs

    (2) The Minister shall consult with the Minister of Foreign Affairs before making a recommendation.

  • Marginal note:Relevant circumstances

    (3) The Minister may, before making a recommendation, take into account any circumstance that the Minister considers relevant. However, the Minister may only make a recommendation

    • (a) if

      • (i) an international organization, body, association or coalition or a grouping of states (such as the Financial Action Task Force) of which Canada is a member has called on its members to take measures in relation to a foreign state or foreign entity on the ground that the state’s or entity’s anti-money laundering or anti-terrorist financing measures are ineffective or insufficient, and

      • (ii) there is a risk that money laundering activities or terrorist financing activities may be carried out in that foreign state or by means of that foreign entity; or

    • (b) if the anti-money laundering or anti-terrorist financing measures that a foreign state or a foreign entity has implemented are ineffective or insufficient, the risk of money laundering activities or terrorist financing activities being carried out in that foreign state or by means of that foreign entity is significant and, as a result, the Minister is of the opinion that there could be an adverse impact on the integrity of the Canadian financial system or a reputational risk to that system.

  • 2010, c. 12, s. 1869.
 
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