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Notice

EXTRA Vol. 136, No. 15

Canada Gazette Part II

OTTAWA, TUESDAY, NOVEMBER 26, 2002

Registration
SOR/2002-412 21 November, 2002

PROCEEDS OF CRIME (MONEY LAUNDERING) AND TERRORIST FINANCING ACT

Cross-border Currency and Monetary Instruments Reporting Regulations

P.C. 2002-1945 21 November, 2002

Her Excellency the Governor General in Council, on the recommendation of the Minister of Finance, pursuant to subsection 73(1) (see footnote a)  of the Proceeds of Crime (Money Laundering) and Terrorist Financing Act (see footnote b) , hereby makes the annexed Cross-border Currency and Monetary Instruments Reporting Regulations.

CROSS-BORDER CURRENCY AND MONETARY INSTRUMENTS REPORTING REGULATIONS

INTERPRETATION

1. (1) The following definitions apply in the Act and these Regulations.

"courier" means a commercial carrier that is engaged in scheduled international transportation of shipments of goods other than goods imported or exported as mail. (messager)

"monetary instruments" means the following instruments in bearer form or in such other form as title to them passes on delivery, namely,

    (a) securities, including stocks, bonds, debentures and treasury bills; and
    (b) negotiable instruments, including bank drafts, cheques, promissory notes, travellers' cheques and money orders, other than
      (i) warehouse receipts or bills of lading, and
      (ii) negotiable instruments that bear restrictive endorsements or a stamp for the purposes of clearing or are made payable to a named person and have not been endorsed. (effets)

(2) The following definitions apply in these Regulations.

"Act" means the Proceeds of Crime (Money Laundering) and Terrorist Financing Act. (Loi)

"commercial passenger conveyance" means a conveyance that is used to carry passengers who have paid for passage. (moyen de transport commercial de passagers)

"conveyance" means any vehicle, aircraft or water-borne craft, or other contrivance that is used to move persons, goods, currency or monetary instruments. (moyen de transport)

"emergency" means a medical emergency, fire, flood or other disaster that threatens life, property or the environment. (urgence)

"non-commercial passenger conveyance" means a conveyance that does not have aboard any person who has paid for passage and includes corporate aircraft, private aircraft and marine pleasure craft. (moyen de transport non commercial de passagers)

REPORTING OF IMPORTATIONS AND EXPORTATIONS

Minimum Value of Currency or Monetary Instruments

2. (1) For the purposes of reporting the importation or exportation of currency or monetary instruments of a certain value under subsection 12(1) of the Act, the prescribed amount is $10,000.

(2) The prescribed amount is in Canadian dollars or its equivalent in a foreign currency, based on

    (a) the official conversion rate of the Bank of Canada as published in the Bank of Canada's Daily Memorandum of Exchange Rates that is in effect at the time of importation or exportation; or
    (b) if no official conversion rate is set out in that publication for that currency, the conversion rate that the person or entity would use for that currency in the normal course of business at the time of the importation or exportation.

General Manner of Reporting

3. Subject to subsections 4(3) and section 8, a report with respect to the importation or exportation of currency or monetary instruments shall

    (a) be made in writing;
    (b) contain the information referred to
      (i) in Schedule 1, in the case of a report made by the person described in paragraph 12(3)(a) of the Act, if that person is not transporting on behalf of an entity or other person,
      (ii) in Schedule 2, in the case of a report made by the person described in paragraph 12(3)(a) of the Act, if that person is transporting on behalf of an entity or other person,
      (iii) in Schedule 2, in the case of a report made by the person or entity described in paragraph 12(3)(b), (c) or (e) of the Act, and
      (iv) in Schedule 3, in the case of a report made by the person described in paragraph 12(3)(d) of the Act;
    (c) contain a declaration that the statements made in the report are true, accurate and complete; and
    (d) be signed and dated by the person or entity described in paragraph 12(3)(a), (b), (c), (d) or (e) of the Act, as applicable.

Importation Reporting

4. (1) Subject to subsections (2) to (5) and section 9, a report with respect to currency or monetary instruments transported by a person arriving in Canada shall be submitted without delay by the person at the customs office located at the place of importation or, if it is not open for business at the time of importation, at the nearest customs office that is open for business at that time.

(2) A report with respect to currency or monetary instruments transported by a person arriving in Canada on board a commercial passenger conveyance who has as their destination another place in Canada at which there is a customs office may be submitted without delay by the person at that customs office or, if it is not open for business at the time of importation, at the nearest customs office that is open for business at that time, on condition that

    (a) the person does not disembark from the conveyance at the place of arrival in Canada and the currency or monetary instruments are not removed from the conveyance at that place, other than to be transferred under customs control directly to a commercial passenger conveyance for departure to the other place in Canada or directly to a holding area designated as such for the purposes of the Presentation of Persons (Customs) Regulations; and
    (b) if the person and currency or monetary instruments are transferred under customs control directly to a designated holding area, the person does not leave and the currency or monetary instruments are not removed from that area, other than to board or to be loaded on board a commercial passenger conveyance for departure to the other place in Canada.

(3) A report with respect to currency or monetary instruments transported by a person arriving in Canada on board a non-commercial passenger conveyance at a customs office where, under the Customs Act, customs reporting may be done by radio or telephone may be submitted by radio or telephone to an officer by that person or the person in charge of the conveyance at that location, on condition that

    (a) when the person informs the officer of their arrival for the purposes of section 11 of the Customs Act, they provide the information referred to in Schedule 1, 2 or 3, as applicable; and
    (b) on the officer's request, they present themselves and make available for examination the currency or monetary instruments at the time and place specified by the officer.

(4) A report with respect to currency or monetary instruments transported by a freight train crew member arriving in Canada on board the freight train shall be submitted without delay by the crew member at the customs office specified by the officer when the crew member presents himself or herself in accordance with section 11 of the Customs Act.

(5) A report with respect to currency or monetary instruments that are transported by courier into Canada on board an aircraft and that have as their destination another place in Canada at which there is a customs office, shall be submitted at the customs office located at the airport of destination shown on the air waybill, on condition that

    (a) the currency or monetary instruments are not removed from the aircraft at the place of arrival, other than to be transferred under customs control directly to a holding area designated as such for the purposes of the Presentation of Persons (Customs) Regulations; and
    (b) if the currency or monetary instruments are transferred under customs control directly to a designated holding area, they are not removed from that area, other than to be loaded on board an aircraft for departure to the other place in Canada.

5. Subject to section 10, a report made by an exporter with respect to the importation of currency or monetary instruments by mail shall be made by

    (a) including inside the mail item an importation report with respect to the currency or monetary instruments; and
    (b) affixing the customs declaration form required by the Universal Postal Convention, as amended from time to time, to the outside of the mail item and indicating that it contains currency or monetary instruments.

6. A report made with respect to the importation of currency or monetary instruments that have been retained under section 14 of the Act shall be submitted by the person or entity to whom the notice was given at the customs office indicated on the notice.

7. A report with respect to the importation of currency or monetary instruments, other than one referred to in sections 4 to 6, shall be submitted without delay at the customs office that is open for business at the time of the importation and that is nearest to the place of importation.

8. In an emergency, the person in charge of a conveyance who must unload currency or monetary instruments from the conveyance before being able to make or submit an importation report in accordance with these Regulations may submit the importation report by telephone or other expedient means and, as soon as possible after that, shall make or submit a report in accordance with these Regulations.

Exceptions to Importation Reporting

9. (1) Subject to subsection (2), currency or monetary instruments transported by a person arriving in Canada on board a commercial passenger conveyance who has as their destination a place outside Canada are not required to be reported under subsection 12(1) of the Act, on condition that

    (a) the person does not disembark from the conveyance in Canada and the currency or monetary instruments are not removed from the conveyance in Canada other than to be transferred under customs control directly to a commercial passenger conveyance for departure to the place outside Canada or directly to a holding area designated as such for the purposes of the Presentation of Persons (Customs) Regulations; and
    (b) if the person and currency or monetary instruments are transferred under customs control directly to a designated holding area, the person does not leave and the currency or monetary instruments are not removed from that area other than to board or be loaded on board a commercial passenger conveyance for departure to the place outside Canada.

(2) Currency or monetary instruments that are transported by courier into Canada on board a conveyance and that have as their destination a place outside Canada, are not required to be reported under subsection 12(1) of the Act, on condition that

    (a) the currency or monetary instruments are not removed from the conveyance at the place of arrival, other than to be transferred under customs control directly to a holding area designated as such for the purposes of the Presentation of Persons (Customs) Regulations; and
    (b) if the currency or monetary instruments are transferred under customs control directly to a designated holding area, they are not removed from that area, other than to be loaded on board a conveyance for departure to the place outside of Canada.

10. A person or entity is not required to make a report under subsection 12(1) of the Act with respect to the importation of currency or monetary instruments that are mailed from a location outside Canada to a destination outside Canada but that transit through Canada in the course of post, on condition that they will not leave the course of post until after they have left Canada.

Exportation Reporting

11. A report with respect to currency or monetary instruments transported by a person departing from Canada shall be submitted without delay by the person at the customs office located at the place of exportation or, if it is not open for business at the time of exportation, at the nearest customs office that is open for business at that time.

12. A report required to be made by an exporter with respect to the exportation by mail of currency or monetary instruments shall be made by

    (a) including an exportation report inside the mail item; and
    (b) mailing or submitting, at or before the time when the currency or monetary instruments are mailed, a copy of the exportation report to the customs office that is located nearest to the point at which the item was mailed.

13. A report made with respect to the exportation of currency or monetary instruments that have been retained under section 14 of the Act shall be submitted by the person or entity to whom the notice was given at the customs office indicated on the notice.

14. A report with respect to the exportation of currency or monetary instruments, other than one referred to in sections 11 to 13, shall be submitted without delay at the customs office that is open for business at the time of exportation and that is nearest to the place of exportation.

EXCEPTION APPLICABLE TO THE BANK OF CANADA

15. A person or entity is not required to make a report under subsection 12(1) of the Act with respect to the importation or exportation of currency by or on behalf of the Bank of Canada for the purposes of the distribution, processing, or testing of banknotes intended for circulation in Canada.

RETENTION

16. (1) For the purposes of subsection 14(1) of the Act, an officer shall give the person or entity written notice in person or, if the person is not present, shall send the notice by registered mail to the person's latest known address.

(2) For the purposes of subsection 14(2) of the Act, the notice is to be given within 60 days after the day on which the currency or monetary instruments are imported or exported, as the case may be.

17. The prescribed retention period, for the purposes of subsection 14(1) of Act, is

    (a) in the case of importation or exportation by courier or as mail, 30 days after the day on which the retention notice is given or sent; and
    (b) in any other case, seven days after the day on which the retention notice is given or sent.

PENALTIES

18. For the purposes of subsection 18(2) of the Act, the prescribed amount of the penalty is

    (a) $250, in the case of a person or entity who
      (i) has not concealed the currency or monetary instruments,
      (ii) has made a full disclosure of the facts concerning the currency or monetary instruments on their discovery, and
      (iii) has no previous seizures under the Act;
    (b) $2,500, in the case of a person or entity who
      (i) has concealed the currency or monetary instruments, other than by means of using a false compartment in a conveyance, or who has made a false statement with respect to the currency or monetary instruments, or
      (ii) has a previous seizure under the Act, other than in respect of any type of concealment or for making false statements with respect to the currency or monetary instruments; and
    (c) $5,000, in the case of a person or entity who
      (i) has concealed the currency or monetary instruments by using a false compartment in a conveyance, or
      (ii) has a previous seizure under the Act for any type of concealment or for making a false statement with respect to the currency or monetary instruments.

AMENDMENTS TO THESE REGULATIONS

19. The portion of section 3 of these Regulations before paragraph (a) is replaced by the following:

3. Subject to subsections 4(3) and (3.1) and section 8, a report with respect to the importation or exportation of currency or monetary instruments shall

20. Section 4 of these Regulations is amended by adding the following after subsection (3):

(3.1) A report with respect to currency or monetary instruments transported by a person arriving in Canada on board a non-commercial passenger conveyance, at a customs office where the person is authorized in accordance with the Presentation of Persons (2003) Regulations to present in an alternative manner, may be submitted to an officer by telephone, by that person or the person in charge of the conveyance before arriving in Canada, on condition that

    (a) when the person informs the officer of their arrival for the purposes of section 11 of the Customs Act, they provide the information referred to in Schedule 1, 2 or 3, as applicable; and
    (b) on the officer's request, they present themselves and make available for examination the currency or monetary instruments on arrival in Canada at the time and place specified by the officer.

21. Schedule 1 to these Regulations is amended by replacing the references "(Subparagraph 3(b)(i) and paragraph 4(3)(a))" after the heading "SCHEDULE 1" with the references "(Subparagraph 3(b)(i) and paragraphs 4(3)(a) and (3.1)(a))".

22. Schedule 2 to these Regulations is amended by replacing the references "(Subparagraphs 3(b)(ii) and (iii) and paragraph 4(3)(a))" after the heading "SCHEDULE 2" with the references "(Subparagraphs 3(b)(ii) and (iii) and paragraphs 4(3)(a) and (3.1)(a))".

23. Schedule 3 to these Regulations is amended by replacing the references "(Subparagraph 3(b)(iv) and paragraph 4(3)(a))" after the heading "SCHEDULE 3" with the references "(Subparagraph 3(b)(iv) and paragraphs 4(3)(a) and (3.1)(a))".

COMING INTO FORCE

24. (1) Subject to subsection (2), these Regulations come into force on January 6, 2003.

(2) Sections 19 to 23 come into force on the day on which the Presentation of Persons (2003) Regulations come into force.

SCHEDULE 1 (Subparagraph 3(b)(i) and paragraph 4(3)(a))

INFORMATION TO BE GIVEN BY PERSON DESCRIBED IN PARAGRAPH 12(3)(a) OF ACT, IF NOT TRANSPORTING ON BEHALF OF ENTITY OR OTHER PERSON

PART A — Information on Person Described in Paragraph 12(3)(a) of Act

1. Person's full name

2. Person's full permanent address

3. Person's citizenship

4. Person's date of birth

5. Person's personal telephone number

6. Type of document confirming person's identity (e.g., driver's licence, birth certificate, certificate of Indian status, passport, Record of Landing or permanent resident card) and the number of that document

7. Place of issue of document confirming person's identity (province or state, country)

PART B — Information on Importation or Exportation

1. Departure point of person making the report (country, city)

2. Person's arrival point (country, city)

PART C — Information on Currency or Monetary Instruments Being Imported or Exported

1. Currency name

2. Country

3. Amount

4. Monetary instruments (type, amount, issuer, date, serial or other identifying number)

SCHEDULE 2 (Subparagraphs 3(b)(ii) and (iii) and paragraph 4(3)(a))

INFORMATION TO BE GIVEN BY PERSON DESCRIBED IN PARAGRAPH 12(3)(a) OF ACT (IF TRANSPORTING ON BEHALF OF ENTITY OR OTHER PERSON) OR BY PERSON OR ENTITY DESCRIBED IN PARAGRAPH 12(3)(b), (c) OR (e) OF ACT

PART A — Information on Person on Whose Behalf Person Described in Paragraph 12(3)(a) of Act is Transporting or on Person Described in Paragraph 12(3)(b), (c) or (e) of Act, If Applicable

1. Person's full name

2. Person's full permanent address

3. Person's citizenship

4. Person's date of birth

5. Person's personal telephone number

6. Type of document confirming person's identity (e.g., driver's licence, birth certificate, certificate of Indian status, passport, Record of Landing or permanent resident card) and the number of that document

7. Place of issue of document confirming person's identity (province or state, country)

PART B — Information on Entity on Whose Behalf Person Described in Paragraph 12(3)(a) of Act is Transporting or on Entity Described in Paragraph 12(3)(b) or (c) of Act, If Applicable

1. Full name of entity

2. Full permanent address of entity

3. Telephone number of entity

4. Type of activity of entity

5. Name and title of contact person of entity

PART C — Information on Importation or Exportation

1. Date of shipment

2. Method of shipment (courier, mail or other)

3. Full name and permanent address of person or entity shipped to

4. Full name of courier, if applicable

5. Full permanent address of courier, if applicable

6. Telephone number of courier, if applicable

7. Name and title of contact person of courier, if applicable

PART D — Information on Person Described in Paragraph 12(3)(a) of Act or on Person Acting on Behalf of Person or Entity Described in Paragraph 12(3)(b), (c) or (e) of Act, If Applicable

1. Person's full name

2. Person's full permanent address

3. Person's citizenship

4. Person's date of birth

5. Person's personal telephone number

6. Type of document confirming person's identity (e.g., driver's licence, birth certificate, certificate of Indian status, passport, Record of Landing or permanent resident card) and the number of that document

7. Place of issue of document confirming person's identity (province or state, country)

PART E — Information on Currency or Monetary Instruments Being Imported or Exported

1. Currency name

2. Country

3. Amount

4. Monetary instruments (type, amount, issuer, date, serial or other identifying number)

SCHEDULE 3 (Subparagraph 3(b)(iv) and paragraph 4(3)(a))

INFORMATION TO BE GIVEN BY PERSON DESCRIBED IN PARAGRAPH 12(3)(d) OF ACT

PART A — Information on Person Described in Paragraph 12(3)(d) of Act

1. Person's full name

2. Person's full permanent address

3. Person's citizenship

4. Person's date of birth

5. Person's personal telephone number

6. Type of document confirming person's identity (e.g., driver's licence, birth certificate, certificate of Indian status, passport, Record of Landing or permanent resident card) and the number of that document

7. Place of issue of document confirming person's identity (province or state, country)

8. Full name of person's employer

9. Full permanent address of person's employer

10. Telephone number of person's employer

11. Name and title of employer's contact person

PART B — Information on Shipments of Currency or Monetary Instruments

1. Name of importer or exporter

2. Total value of currency or monetary instruments

REGULATORY IMPACT ANALYSIS STATEMENT

(This statement is not part of the Regulations.)

Description

Cross-border Currency and Monetary Instruments Reporting Regulations

Domestic law enforcement agencies and the international community have called on Canada to implement strong measures to detect, deter and prevent money laundering and terrorist financing. Since the events of September 11, 2001 in the United States, it has become increasingly important that Canada's domestic actions in this area contribute to preventing abuses of the financial system.

The federal government passed the Proceeds of Crime (Money Laundering) Act (PCMLA), which came into force on June 29, 2000. The PCMLA, which was subsequently re-named as the Proceeds of Crime (Money Laundering) and Terrorist Financing Act (PCMLTFA), sets out a regulation making authority for carrying out the purposes and provisions of the PCMLTFA, including the implementation of the record-keeping and client identification requirements and the requirements to report suspicious and prescribed transactions as well as the cross-border movement of large amounts of currency and monetary instruments. To date, regulations have been finalized to implement these requirements, except for the requirement to report the importation or exportation of currency or monetary instruments.

The Cross-border Currency and Monetary Instruments Reporting Regulations were pre-published in the Canada Gazette, Part I, on June 22, 2002 for a 30-day public comment period. These Regulations implement Part II of the PCMLTFA, which requires persons to report to Canada Customs and Revenue Agency (CCRA) customs officers the importation or exportation of large amounts of currency and monetary instruments. The requirements apply whether the currency or monetary instruments are brought across the border by the importer/exporter himself or herself (e.g., carried in baggage) or they are imported or exported by mail, courier or by any other means. An individual carrying a large amount of currency or monetary instruments will therefore have to file a report to Canadian customs when he or she enters or leaves Canada. The regulations will come into force on January 6, 2003.

The regulations define the term "monetary instruments" as including, among other things, stocks, bonds, bank drafts and traveller's cheques. They prescribe the reporting threshold, which is set at $10,000 and the form and manner for reporting to CCRA. They also provide for exceptions from reporting (e.g., where currency or monetary instruments are brought into Canada aboard a commercial passenger conveyance, and Canada is a transit point rather than the final destination).

The regulations also set at 30 days the maximum period for which a customs officer is authorized to retain currency or monetary instruments that a person has declared, but in respect of which a report has not yet been completed. They also prescribe penalties from $250 to $5,000 to retrieve seized currency or monetary instruments, provided they are not suspected of being linked to money laundering or terrorist financing.

Regulations Amending the Proceeds of Crime (Money Laundering) and Terrorist Financing Regulations

The regulations also include technical amendments to the Proceeds of Crime (Money Laundering) and Terrorist Financing Regulations, which were published in the Canada Gazette, Part II, on May 14, 2002. The amendments eliminate duplicate provisions and thereby clarify the coming into force date of certain provisions of these Regulations.

No comments on these amendments were received during the comment period. However, a number of financial institutions and intermediaries have recently expressed concerns to the Department of Finance regarding their ability to start reporting large cash transactions and large international non-SWIFT electronic funds transfers (EFTs) on November 30, 2002, as is currently required by the regulations.

The Regulations Amending the Proceeds of Crime (Money Laundering) and Terrorist Financing Regulations therefore extend the coming into force date for reporting large cash transactions from November 30, 2002 to January 31, 2003 in order to give all reporting entities additional preparation time.

The regulations also extend the coming into force date for reporting non-SWIFT EFTs from November 30, 2002 to March 31, 2003. The regulations are also amended to:

•  Allow certain mandatory information on incoming non-SWIFT EFT reports to be provided instead on a "reasonable efforts" basis, recognizing the practical difficulties in obtaining this information.

•  Allow certain mandatory information on outgoing non-SWIFT EFTs to be provided on a "reasonable efforts" basis until November 30, 2003. This will provide reporting entities with more time to resolve their processing problems.

These extensions will give financial institutions and other intermediaries more time to prepare and test their reporting systems and provide appropriate training to their employees. It will reduce the amount of manual processing required from reporting entities and the level of inconvenience to their customers.

Use of Information

CCRA is responsible for administering the Cross-border Currency and Monetary Instruments Reporting Regulations. Customs officers must send the reports submitted to them to the Financial Transactions and Reports Analysis Centre of Canada (FINTRAC). Furthermore, if a customs officer has reasonable grounds to suspect that information obtained while enforcing the PCMLTFA would be of assistance in the detection, prevention or deterrence of money laundering or of the financing of terrorist activities, he or she may disclose it to FINTRAC. A customs officer can also disclose such information to law enforcement authorities if the officer has reasonable grounds to suspect the information would be relevant to investigating or prosecuting money laundering or the financing of terrorist activities.

Alternatives

The Department of Finance December 1999 Consultation Paper proposed setting the threshold for reporting the cross-border movement of currency or monetary instruments at $15,000. Some stakeholders, notably the Canadian Bankers Association, indicated a strong preference for uniform thresholds for all reporting requirements, i.e., large cash transactions, international electronic funds transfers and cross-border movement of currency or monetary instruments. They indicated that uniform thresholds would facilitate training and compliance. As such, the regulations require reporting of all importations and exportations of currency and monetary instruments of $10,000 or more, which is consistent with other PCMLTFA reporting requirements.

The regulatory regime is similar to the cross-border reporting requirements in the United States, and will complement current Canadian and U.S. efforts to detect and deter money laundering and terrorist financing.

Benefits and Costs

The regulations will contribute to the government's objective of detecting, preventing and deterring money laundering and terrorist financing. Based on the U.S. experience, CCRA estimates that it will receive some 40,000 currency and monetary instruments reports each year. As a result of CCRA enforcement activities under the PCMLTFA, it is anticipated that approximately 150 seizures of non-reported currency and monetary instruments suspected to be proceeds of crime will be made each year, resulting in forfeitures of approximately $15 million.

The reporting requirements will parallel and, to the extent possible, be integrated into existing customs procedures. In light of existing customs reporting requirements for the importation and exportation of goods, it is not anticipated that these Regulations will place an undue compliance burden on those required to report.

Consultation

In December 1999, the Department of Finance issued a Consultation Paper on the regulations to the PCMLA for public comment. Further consultations in respect of the regulations were held with a number of stakeholders in the fall of 2001, including the Canadian Bankers Association, Brinks Canada Inc., Securicor, the Canadian Couriers Association and Canada Post Corporation. Other stakeholders, including Canada Bank Note, B.A. Banknote, the Canadian Mint, the Canadian Society of Customs Brokers, the Canadian Trucking Alliance and the Privacy Commissioner of Canada were also consulted. Aside from the reporting threshold issue, which is addressed in the regulations, stakeholders did not raise any major concerns.

Following the pre-publication of the regulations in the Canada Gazette, Part I, on June 22, 2002, the government contacted the above stakeholders to request comments on the proposed regulations. Comments were also requested from the Canadian International Freight Forwarders Association, the Tourism Industry Association of Canada, the Railway Association of Canada, the Canadian Retail Shippers Association, the Frontier Duty Free Association, the Canadian/American Border Trade Alliance, the Canadian Association of Importers and Exporters, the Private Motor Truck Council, the Ontario Trucking Association, the Canadian Business Aircraft Association, the authorities of major Canadian airports, the Shipping Federation of Canada, and the Canadian Tourism Commission.

The government received only a few comments on the proposed regulations. The Shipping Federation of Canada and the Chamber of Shipping of British Columbia, requested an exemption from reporting for funds held by the vessel master for safekeeping or for the vessel's operation. In August 2002, both associations were informed that there were insufficient grounds at this time to support a reporting exemption for the shipping sector. The Canadian Bankers Association (CBA) expressed concerns that the reporting requirements would apply to the receiver of currency or monetary instruments shipped from outside Canada. The CBA was informed that the reporting requirements will not apply in these circumstances. The CBA also indicated that it would prefer that these Regulations come into force after November 30, 2002, the date at which the requirements to report large cash transactions and certain international electronic funds transfers will also come into force. The coming into force date was therefore set to January 6, 2003 to address the CBA's concern. The regulations were also streamlined.

Compliance and Enforcement

CCRA is responsible for administering the cross-border currency reporting regime, including monitoring compliance. Part II of the PCMLTFA provides that non-reported currency or monetary instruments are forfeited to the Crown. Where there is no suspicion that the funds are linked to money laundering or terrorist financing, the owner may choose to retrieve the forfeited funds after payment of penalties from $250 to $5,000 set out in the regulations.

The PCMLTFA provides for a maximum fine of $500,000 and a maximum jail term of five years for failure to cooperate with the customs officer when a report is submitted, such as not answering truthfully any questions that the customs officer asks or failing to open any package or container that the officer wishes to examine.

Penalty provisions under Part II of the PCMLTFA and its regulations are consistent with the administrative penalty mechanisms under the Customs Act. CCRA will provide information and guidance on the reporting obligations and the penalties for non compliance via fact sheets, press releases, brochures, posters, and postings on the CCRA Website.

Contact

Chief Financial
Crimes Section
Financial Sector Division
Department of Finance
L'Esplanade Laurier
140 O'Connor Street, 20th Floor, East Tower
Ottawa, Ontario
K1A 0G5
Telephone: (613) 995-1814
FAX: (613) 943-8436
E-mail: fcs-scf@fin.gc.ca

Footnote a 

S.C. 2001, c. 41, s. 73

Footnote b 

S.C. 2001, c. 17; S.C. 2001, c. 41, s. 48

 

NOTICE:
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