Proceeds of Crime (Money Laundering) and Terrorist Financing Act

authorized foreign banks within the meaning of section 2 of the Bank Act in respect of their business in Canada, or banks to which that Act applies;

cooperative credit societies, savings and credit unions and caisses populaires regulated by a provincial Act and associations regulated by the Cooperative Credit Associations Act;

life companies or foreign life companies to which the Insurance Companies Act applies or life insurance companies regulated by a provincial Act;

companies to which the Trust and Loan Companies Act applies;

trust companies regulated by a provincial Act;

trust companies incorporated or formed by or under a provincial Act that are not regulated by a provincial Act;

loan companies regulated by a provincial Act;

persons and entities authorized under provincial legislation to engage in the business of dealing in securities or any other financial instruments or to provide portfolio management or investment advising services, other than persons who act exclusively on behalf of such an authorized person or entity;

persons and entities that have a place of business in Canada and that are engaged in the business of providing at least one of the following services:

persons and entities that do not have a place of business in Canada, that are engaged in the business of providing at least one of the following services that is directed at persons or entities in Canada, and that provide those services to their clients in Canada:

persons and entities engaged in a prescribed business, profession or activity;

persons and entities engaged in a prescribed business or profession, while carrying out a prescribed activity;

the government of a province that, in accordance with paragraph 207(1)(a) of the Criminal Code,

the government of a province that, in accordance with paragraph 207(1)(a) of the Criminal Code, conducts and manages a lottery scheme, other than bingo or the sale of lottery tickets, that is accessible to the public through the Internet or other digital network, except if the network is an internal network within an establishment described in subparagraph (k)(ii);

an organization that, in accordance with paragraph 207(1)(b) of the Criminal Code, in a permanent establishment that is held out to be a casino, conducts and manages a lottery scheme that includes games of roulette or card games, unless the organization is a registered charity, as defined in subsection 248(1) of the Income Tax Act, and the lottery scheme is conducted or managed for a period of not more than two consecutive days at a time;

the board of a fair or of an exhibition, or the operator of a concession leased by such a board, that, in accordance with paragraph 207(1)(c) of the Criminal Code, in a permanent establishment that is held out to be a casino, conducts and manages a lottery scheme that includes games of roulette or card games;

departments and agents or mandataries of Her Majesty in right of Canada or of a province that are engaged in the business of accepting deposit liabilities, that issue or sell money orders to, or redeem them from, the public or that sell prescribed precious metals, while carrying out a prescribed activity; and

for the purposes of section 7, employees of a person or entity referred to in any of paragraphs (a) to (l).

the transaction is related to the commission or the attempted commission of a money laundering offence;

the transaction is related to the commission or the attempted commission of a terrorist activity financing offence; or

the transaction is related to the commission or the attempted commission of a sanctions evasion offence.

Every person or entity referred to in section 5 shall report to the Centre in accordance with the regulations if the person or entity is required to make a disclosure under

Limitation

Subsection (1) does not apply to prescribed persons or entities, or prescribed classes of persons or entities, in respect of prescribed transactions or property, or classes of transactions or property, if the prescribed conditions are met.

Subject to section 10.1, every person or entity referred to in section 5 shall report to the Centre, in accordance with the regulations,

Limitation

Subsection (1) does not apply to prescribed persons or entities, or prescribed classes of persons or entities, in respect of prescribed transactions, classes of transactions, clients or classes of clients, if the prescribed conditions are met.

List of persons

Every person or entity referred to in section 5 shall establish and maintain a list, in the prescribed form and manner, of their clients in respect of whom a report would have been required under subsection (1) were it not for subsection (2). However, a person or an entity may choose to report a client’s transactions under subsection (1) instead of maintaining the list in respect of that client.

Every person or entity that is referred to in section 5 and that is prescribed shall determine, in the prescribed circumstances and in accordance with the regulations, whether it is dealing with

Measures — politically exposed foreign persons

If the person or entity determines that it is dealing with a person described in paragraph (1)(a), the person or entity shall take the measures referred to in the regulations.

Measures — other persons

If the person or entity determines that it is dealing with a person described in paragraph (1)(b) or (c) and considers, based on an assessment referred to in subsection 9.6(2), that there is a high risk of a money laundering offence or a terrorist activity financing offence being committed, the person or entity shall take the measures referred to in the regulations.

Definitions

The following definitions apply in this section.

No entity referred to in paragraph 5(a), (b), (d), (e) or (e.1) and no other entity that is referred to in section 5 and that is prescribed shall open or maintain an account for, or have a correspondent banking relationship with, a person or entity referred to in paragraph 5(h.1) unless that person or entity is registered with the Centre under section 11.1.

Definition of correspondent banking relationship

For the purposes of this section, correspondent banking relationship means a relationship created by an agreement or arrangement under which an entity referred to in paragraph 5(a), (b), (d), (e) or (e.1) or an entity that is referred to in section 5 and that is prescribed undertakes to provide to a person or entity referred to in paragraph 5(h.1) prescribed services or international electronic funds transfers, cash management or cheque clearing services.

Every entity referred to in any of paragraphs 5(a), , , and (e.1) and every other entity that is referred to in section 5 and that is prescribed shall take the measures referred to in the regulations in respect of any correspondent banking relationship it enters into with a prescribed foreign entity and shall take the following measures before entering into such a correspondent banking relationship:

Prohibition — shell bank

No person or entity shall have a correspondent banking relationship with a shell bank as defined in the regulations.

Definition of correspondent banking relationship

For the purposes of this section, correspondent banking relationship means a relationship created by an agreement or arrangement under which an entity referred to in any of paragraphs 5(a), (b), (d), (e) and (e.1) or an entity that is referred to in section 5 and that is prescribed undertakes to provide to a prescribed foreign entity prescribed services or international electronic funds transfers, cash management or cheque clearing services.

include with the transfer any prescribed information and, as the case may be,

take reasonable measures to ensure that any transfer that the person or entity receives includes that information; and

take any prescribed measures.

Every person or entity referred to in section 5 shall establish and implement, in accordance with the regulations, a program intended to ensure their compliance with this Part and Part 1.1.

Risk assessment

The program shall include the development and application of policies and procedures for the person or entity to assess, in the course of their activities, the risk of a money laundering offence or a terrorist activity financing offence.

Special measures

If, at any time, the person or entity considers that the risk referred to in subsection (2) is high, or in the prescribed circumstances, the person or entity shall take the special measures referred to in the regulations.

Every entity referred to in paragraph 5(e.1) shall take the prescribed measures related to the program referred to in subsection 9.6(1) and shall provide the prescribed information to the Centre in the prescribed circumstances.

Service

An entity referred to in paragraph 5(e.1) must provide to the Centre the name and address for service of a person who resides in Canada and who is authorized to accept, on behalf of the entity, notices that are served or caused to be served by the Centre under this Act.

Authorized person

The service of a notice by or on behalf of the Centre on an entity referred to in paragraph 5(e.1) is sufficient if it is served on the person whose name is provided under subsection (2).

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, in respect of its foreign branches, and in respect of 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, develop policies that establish requirements similar to the requirements of sections 6, 6.1 and 9.6 and ensure that those branches and subsidiaries apply those policies 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.

Board approval of policies

Before the policies referred to in subsection (1) are applied, the entity’s board of directors, if there is one, shall approve them.

Exceptions

Subsection (1) does not apply to

Records and reporting

If the application by a foreign branch or a foreign subsidiary of a policy referred to in subsection (1) 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.

Every entity referred to in any of paragraphs 5(a) to (g) that is affiliated with an entity referred to in those paragraphs or with a foreign entity that carries out activities similar to those of entities referred to in those paragraphs shall develop and apply policies and procedures related to the exchange of information between the entity and those affiliated entities for the purpose of detecting or deterring a money laundering offence or a terrorist activity financing offence or of assessing the risk of such an offence.

Affiliation

For the purposes of subsection (1), an entity is affiliated with another entity if one of them is wholly owned by the other, if both are wholly owned by the same entity or if their financial statements are consolidated.

not engage a person or entity who is referred to in any of paragraphs 11.11(1)(a) to (f) as an agent or mandatary; and

cease engaging an agent or mandatary if they are a person or entity referred to in any of those paragraphs.

before engaging an agent or mandatary, verify whether they are a person or entity referred to in any of paragraphs 11.11(1)(a) to (f); and

within 30 days after the second anniversary of the most recent verification of an agent or mandatary under this section, verify whether the agent or mandatary, if they are acting on behalf of the person or entity on that anniversary, is a person or entity referred to in any of those paragraphs.

A person or entity referred to in paragraph 5(h) shall, in respect of an agent or mandatary, obtain and review the documents referred to in subsection (2)

Documents

The documents to be obtained and reviewed are the following:

Translation

If any document referred to in this section is made in a language other than English or French, the person or entity shall also obtain and review a translation of it into one of those languages that is attested to by a person who is recognized as a certified translator either by a provincial organization or body that is competent under provincial law to issue such certifications or by an organization or body in a foreign state that is competent under the laws of that state to do so.

Retention

The person or entity shall retain, for a prescribed period and in the prescribed manner, any document obtained under this section as well as any prescribed information.

A person or entity referred to in section 5 may disclose an individual’s personal information to another person or entity referred to in that section without the individual’s knowledge or consent if

Collection and use

A person or entity referred to in section 5 may collect or use an individual’s personal information without their knowledge or consent if the information was disclosed to the person or entity under subsection (1) and the collection or use is carried out in accordance with the regulations.

Immunity

No criminal or civil proceedings lie against a person or an entity that, in good faith, discloses information under subsection (1) or collects or uses information under subsection (2).

The following persons or entities are not eligible for registration with the Centre:

Revocation of registration

If a person or entity referred to in subsection (1) is registered with the Centre, its registration is revoked as of the day the person or entity becomes ineligible to register under that subsection. If the Centre becomes aware that a person’s or entity’s registration was revoked under this subsection, it must provide, without delay, a written notice of the revocation to that person or entity.

An application for registration shall be submitted to the Centre in the prescribed form and manner and shall include

Translation

If a document referred to in paragraph (1)(b) or (c) is made in a language other than English or French, the application shall include a translation of it into one of those languages attested to by a person who is recognized as a certified translator either by a provincial organization or body that is competent under provincial law to issue such certifications or by an organization or body in a foreign state that this competent under the laws of that state to do so.

Agents, mandataries and branches

Any agent, mandatary or branch included on the list is not required to register with the Centre when they are acting in that capacity.

An applicant or a person or entity registered with the Centre shall notify the Centre, in the prescribed form and manner, of any change to the information provided in the application or of any newly obtained information that should have been included in the application within 30 days after the day on which the applicant or the registered person or entity becomes aware of the change or obtains the new information.

Denial or revocation

If the name or address for service of a person referred to in paragraph 11.12(1)(c.1) changes, and an applicant or registered person or entity who is or was required to provide the information described in that paragraph does not, within the period referred to in subsection (1), provide the Centre with the new name or address for service, the Centre shall without delay after becoming aware of that fact deny the application, or revoke the registration, as the case may be, and shall, without delay, inform the applicant or registered person or entity of the denial or revocation.

An applicant shall provide the Centre, in the prescribed form and manner, with any clarifications that the Centre may request in respect of the information described in subsection 11.12(1) within 30 days after the day on which the request is made.

Denial of application

If the applicant does not provide the Centre with the clarifications within the 30 days, the Centre may deny the application and shall, without delay, inform the applicant of the denial.

A registered person or entity shall provide the Centre, in the prescribed form and manner, with any clarifications that the Centre may request in respect of the information described in subsection 11.12(1) within 30 days after the day on which the request is made.

Revocation of registration

If the registered person or entity does not provide the Centre with the clarifications within the 30 days, the Centre may revoke the registration and shall, without delay, inform the person or entity of the revocation.

Within 30 days after the day on which the person or entity receives a decision to deny their application or revoke their registration, the person or entity may apply in writing to the Director of the Centre for a review of the decision and may provide any information in support of their application for review.

Review by Director

The Director shall review the decision as soon as possible and shall take into consideration any information that the Director deems relevant.

Decision of Director

The Director may either confirm the decision or substitute his or her own decision, and shall, without delay, serve notice of the decision with reasons on the person or entity, together with notice of the right of appeal under subsection 11.4(1).

A person or entity that applied for a review under subsection 11.3(1) may appeal the Director’s decision to the Federal Court within 30 days after the day on which the decision is served, or within any longer period that the Court allows.

Appeal

If the Director does not make a decision within 90 days after the day on which the Director received the application for review, the applicant may appeal to the Federal Court, within 30 days after the day on which the 90-day period expires, the decision to deny the application for registration or revoke the registration.

Precautions against disclosure

In an appeal, the Court shall take every reasonable precaution, including, when appropriate, conducting hearings in private, to avoid the disclosure by the Court or any person or entity of information referred to in subsection 55(1). However, the Court is not required to take those precautions with respect to the appellant’s name and operating name.