DEFENCE
PRODUCTION ACT

The Controlled Goods Directorate (CGD) enforces the Defence Production Act (DPA), which, in addition to registration, provides for the exemption or exclusion of certain persons. Anyone that deals with controlled goods and/or controlled technology in Canada is required to register with the CGD.

1. Responsibilities of the CGD:

Registration and administration of the Program is the responsibility of the Minister of Public Works and Government Services Canada. The Minister has authorized the CGD to act on his behalf. In accordance with the regulations and on the basis of a security assessment prescribed by regulation, the CGD has the authority to register any person or, to deny, suspend, amend or revoke a registration. The CGD may also exempt an individual from registration or, deny, suspend, amend or revoke an exemption. Furthermore, for the purpose of registration or exemption, the CGD may request any information, which deems necessary for a mandatory security assessment.

2. Consequences:

The CGD has the authority to inspect companies to ensure compliance. Companies must be ready for inspection at all times and produce all required records. The CGD also has the authority to detain or remove any controlled good and/or controlled technology, until it is convinced that the requirements of the DPA are met. Anyone who is not registered, excluded or exempt from registration with the CGD is not permitted to examine, possess or transfer controlled goods and/or technology within Canada.

Companies that fail to comply with this Act can have their registration revoked and they can, as well as individuals, be prosecuted for failing to comply with the CGD. As per the DPA, fines vary from $25,000 to $2,000,000 daily or an imprisonment not exceeding 10 years, or both.