Vol. 141, No. 26 — December 26, 2007

Registration
SOR/2007-293 December 13, 2007

PROCEEDS OF CRIME (MONEY LAUNDERING) AND
TERRORIST FINANCING ACT

Regulations Amending Certain Regulations Made Under the Proceeds of Crime (Money Laundering) and Terrorist Financing Act (2007-2)

P.C. 2007-1922 December 13, 2007

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 Regulations Amending Certain Regulations Made Under the Proceeds of Crime (Money Laundering) and Terrorist Financing Act (2007-2).

REGULATIONS AMENDING CERTAIN REGULATIONS MADE
UNDER THE PROCEEDS OF CRIME (MONEY LAUNDERING)
AND TERRORIST FINANCING ACT (2007-2)

PROCEEDS OF CRIME (MONEY LAUNDERING) AND
TERRORIST FINANCING SUSPICIOUS TRANSACTION
REPORTING REGULATIONS

1. Subsection 1(2) of the Proceeds of Crime (Money Laundering) and Terrorist Financing Suspicious Transaction Reporting Regulations (see footnote 1) is amended by adding the following in alphabetical order:

"British Columbia notary corporation" means an entity that carries on the business of providing notary services to the public in the province of British Columbia in accordance with the Notaries Act, R.S.B.C. 1996, c. 334. (société de notaires de la Colombie-Britannique)

"British Columbia notary public" means a person who is a member of the Society of Notaries Public of British Columbia. (notaire public de la Colombie-Britannique)

"dealer in precious metals and stones" means a person or an entity that, in the course of its business activities, buys or sells precious metals, precious stones or jewellery. It includes a department or agent of Her Majesty in right of Canada or of a province when the department or agent is carrying out the activity, referred to in section 5, of selling precious metals to the public. (négociant en métaux précieux et pierres précieuses)

"jewellery" means objects that are made of gold, silver, palladium, platinum, pearls or precious stones and that are intended to be worn as a personal adornment. (bijou)

"precious metal" means gold, silver, palladium or platinum in the form of coins, bars, ingots or granules or in any other similar form. (métal précieux)

"precious stones" means diamonds, sapphires, emeralds, tanzanite, rubies or alexandrite. (pierre précieuse)

2. The Regulations are amended by adding the following after section 1.1:

1.2 The prescribed precious metals for the purpose of paragraph 5(l) of the Act are precious metals as defined in subsection 1(2).

3. The Regulations are amended by adding the following after section 3:

4. (1) Subject to subsection (2), every British Columbia notary public and every British Columbia notary corporation is subject to Part 1 of the Act when they engage in any of the following activities on behalf of any person or entity, including the giving of instructions on behalf of any person or entity in respect of those activities:

(a) receiving or paying funds, other than those received or paid in respect of professional fees, disbursements, expenses or bail;

(b) purchasing or selling securities, real estate or business assets or entities; or

(c) transferring funds or securities by any means.

(2) Subsection (1) does not apply in respect of a British Columbia notary public when they engage in any of the activities referred to in that subsection on behalf of their employer.

5. Every dealer in precious metals and stones that engages in the purchase or sale of precious metals, precious stones or jewellery in an amount of $10,000 or more in a single transaction, other than such a purchase or sale that is carried out in the course of, in connection with or for the purpose of manufacturing jewellery, extracting precious metals or precious stones from a mine or polishing or cutting precious stones, is subject to Part 1 of the Act.

4. The Regulations are amended by adding the following after section 12.1:

12.2 The copy referred to in section 12.1 may be kept in a machine-readable form or in an electronic form, if a paper copy can be readily produced from it.

12.3 (1) Subject to subsection (2), every person or entity that is required by section 12.1 to keep a copy of the report referred to in that section shall retain that copy for a period of at least five years following the day on which the report was made.

(2) Where the copy that is required by section 12.1 to be kept by a person is the property of their employer or a person or entity with which they are in a contractual relationship, they are not required to retain the copy after their employment or that contractual relationship ends.

PROCEEDS OF CRIME (MONEY LAUNDERING) AND
TERRORIST FINANCING REGULATIONS

5. The heading before section 1 of the French version of the Proceeds of Crime (Money Laundering) and Terrorist Financing Regulations (see footnote 2) is replaced by the following:

DÉFINITIONS ET DISPOSITIONS INTERPRÉTATIVES

6. (1) The definition "client information record" in subsection 1(2) of the Regulations is replaced by the following:

"client information record" means a record that sets out a client's name and address and

(a) if the client is a person, their date of birth and the nature of their principal business or their occupation, as applicable; and

(b) if the client is an entity, the nature of their principal business. (dossier-client)

(2) Paragraphs (e) to (g) of the definition "large cash transaction record" in subsection 1(2) of the Regulations are replaced by the following:

(e) the purpose and details of the transaction, including other persons or entities involved and the type of transaction (such as cash, electronic funds transfer, deposit, currency exchange , the purchase or cashing of a cheque, money order, traveller's cheque or banker's draft or the purchase of precious metals, precious stones or jewellery);

(f) whether the cash is received by armoured car, in person, by mail or in any other way;

(g) the amount and currency of the cash received; and

(h) where the amount is received by a dealer in precious metals and stones for the sale of precious metals, precious stones or jewellery,

(3) Paragraph (c) of the definition "transaction ticket" in subsection 1(2) of the Regulations is replaced by the following:

(c) in the case of a transaction of $3,000 or more that is carried out by a person, their name, address and date of birth. (fiche d'opération)

(4) Subsection 1(2) of the Regulations is amended by adding the following in alphabetical order:

"British Columbia notary corporation" means an entity that carries on the business of providing notary services to the public in the province of British Columbia in accordance with the Notaries Act, R.S.B.C. 1996, c. 334. (société de notaires de la Colombie-Britannique)

"British Columbia notary public" means a person who is a member of the Society of Notaries Public of British Columbia. (notaire public de la Colombie-Britannique)

"dealer in precious metals and stones" means a person or an entity that, in the course of its business activities, buys or sells precious metals, precious stones or jewellery. It includes a department or agent of Her Majesty in right of Canada or of a province when the department or agent is carrying out the activity, referred to in section 39.1, of selling precious metals to the public. (négociant en métaux précieux et pierres précieuses)

"jewellery" means objects that are made of gold, silver, palladium, platinum, pearls or precious stones and that are intended to be worn as a personal adornment. (bijou)

"legal firm" means an entity that is engaged in the business of providing legal services to the public. (cabinet d'avocats)

"precious metal" means gold, silver, palladium or platinum in the form of coins, bars, ingots or granules or in any other similar form. (métal précieux)

"precious stones" means diamonds, sapphires, emeralds, tanzanite, rubies or alexandrite. (pierre précieuse)

7. The Regulations are amended by adding the following after section 1.1:

1.11 The prescribed precious metals for the purpose of paragraph 5(l) of the Act are precious metals as defined in subsection 1(2).

8. Section 11 of the Regulations is replaced by the following:

11. A trust company that is required to keep a record in respect of an inter vivos trust in accordance with these Regulations shall keep a record that sets out the name and address of each of the beneficiaries that are known at the time that the trust company becomes a trustee for the trust and

(a) if the beneficiary is a person, their date of birth and the nature of their principal business or their occupation, as applicable; and

(b) if the beneficiary is an entity, the nature of their principal business.

9. The portion of subsection 11.1(1) of the Regulations before paragraph (a) is replaced by the following:

11.1 (1) Every financial entity or securities dealer that is required to confirm the existence of an entity in accordance with these Regulations when it opens an account in respect of that entity, every life insurance company, life insurance broker or agent or legal counsel or legal firm that is required to confirm the existence of an entity in accordance with these Regulations and every money services business that is required to confirm the existence of an entity in accordance with these Regulations when it enters into an ongoing electronic funds transfer, fund remittance or foreign exchange service agreement with that entity, or a service agreement for the issuance or redemption of money orders, traveller's cheques or other similar negotiable instruments, shall, at the time the existence of the entity is confirmed, take reasonable measures to obtain and, if obtained, keep a record of

10. The portion of section 14 of the Regulations before paragraph (a), as enacted by subsection 27(1) of the Regulations Amending Certain Regulations Made Under the Proceeds of Crime (Money Laundering) and Terrorist Financing Act (2007-1), registered as SOR/2007-122, is replaced by the following:

14. Subject to subsection 62(2), every financial entity shall keep the following records in respect of a transaction or the opening of an account other than a credit card account:

11. Paragraph 15(1)(b) of the Regulations is replaced by the following:

(b) a record of the settlor's name and address and

12. The portion of section 20.1 of the Regulations before paragraph (a), as enacted by section 32 of the Regulations Amending Certain Regulations Made Under the Proceeds of Crime (Money Laundering) and Terrorist Financing Act (2007-1), registered as SOR/2007-122, is replaced by the following:

20.1 Subject to section 20.2 and subsection 62(2), every life insurance company or life insurance broker or agent shall keep a record of the following information when a transaction is reviewed under subsection 67.2(2):

13. (1) Paragraph 23(1)(c) of the Regulations is replaced by the following:

(c) where the securities dealer opens an account in the name of a person or of an entity other than a corporation, a record of the name and address of the client and

(2) The portion of paragraph 23(1)(f) of the Regulations before subparagraph (i), as enacted by subsection 33(4) of the Regulations Amending Certain Regulations Made Under the Proceeds of Crime (Money Laundering) and Terrorist Financing Act (2007-1), registered as SOR/2007-122, is replaced by the following:

(f) where it has obtained approval under paragraph 67.1(1)(b) to keep the account of a person that has been determined to be a politically exposed foreign person open

14. The Regulations are amended by adding the following after section 32:

BRITISH COLUMBIA NOTARIES PUBLIC
AND NOTARY CORPORATIONS

33. (1) Subject to subsection (2), every British Columbia notary public and every British Columbia notary corporation is subject to Part 1 of the Act when they engage in any of the following activities on behalf of any person or entity, including the giving of instructions on behalf of any person or entity in respect of those activities:

(a) receiving or paying funds, other than those received or paid in respect of professional fees, disbursements, expenses or bail;

(b) purchasing or selling securities, real estate or business assets or entities; or

(c) transferring funds or securities by any means.

(2) Subsection (1) does not apply in respect of a British Columbia notary public when they engage in any of the activities referred to in that subsection on behalf of their employer.

33.1 Subject to subsection 52(1), every British Columbia notary public and every British Columbia notary corporation that, when engaging in an activity described in section 33, receives an amount in cash of $10,000 or more in the course of a single transaction shall report the transaction to the Centre, together with the information set out in Schedule 1, unless the cash is received from a financial entity or a public body.

33.2 (1) Subject to subsections (3) and 62(2), every British Columbia notary public and every British Columbia notary corporation shall, when engaging in an activity described in section 33, keep the following records:

(a) a receipt of funds record in respect of every amount of $3,000 or more that they receive in the course of a single transaction, unless the amount is received from a financial entity or a public body; and

(b) where the receipt of funds record is in respect of a client that is a corporation, a copy of the part of official corporate records that contains any provision relating to the power to bind the corporation in respect of transactions with the British Columbia notary public or British Columbia notary corporation.

(2) Subject to subsection 52(2), every British Columbia notary public and every British Columbia notary corporation shall, when engaging in an activity described in section 33, keep a large cash transaction record in respect of every amount in cash of $10,000 or more that they receive in the course of a single transaction, unless the cash is received from a financial entity or a public body.

(3) Subsection (1) does not apply in respect of a transaction if a large cash transaction record is required by subsection (2) to be kept in respect of that same transaction.

LEGAL COUNSEL AND LEGAL FIRMS

33.3 (1) Subject to subsection (2), every legal counsel and every legal firm is subject to Part 1 of the Act when they engage in any of the following activities on behalf of any person or entity:

(a) receiving or paying funds, other than those received or paid in respect of professional fees, disbursements, expenses or bail; or

(b) giving instructions in respect of any activity referred to in paragraph (a).

(2) Subsection (1) does not apply in respect of legal counsel when they engage in any of the activities referred to in that subsection on behalf of their employer.

33.4 Subject to subsection 62(2), every legal counsel and every legal firm shall, when engaging in an activity described in section 33.3, keep the following records:

(a) a receipt of funds record in respect of every amount of $3,000 or more that they receive in the course of a single transaction, unless the amount is received from a financial entity or a public body; and

(b) where the receipt of funds record is in respect of a client that is a corporation, a copy of the part of official corporate records that contains any provision relating to the power to bind the corporation in respect of transactions with the legal counsel or legal firm.

33.5 A legal counsel or legal firm that, in connection with a transaction, receives funds from the trust account of a legal firm or from the trust account of a legal counsel who is not acting on behalf of their employer,

(a) must keep and retain a record of that fact; and

(b) is not required to include in the receipt of funds record that is kept in respect of those funds

15. The portion of subsection 36(1) of the Regulations before paragraph (a), as enacted by section 40 of the Regulations Amending Certain Regulations Made Under the Proceeds of Crime (Money Laundering) and Terrorist Financing Act (2007-1), registered as SOR/2007-122, is replaced by the following:

36. (1) Subject to subsection 62(2), every accountant and every accounting firm shall, when engaging in an activity described in section 34, keep the following records:

16. The portion of subsection 39(1) of the Regulations before paragraph (a), as enacted by section 42 of the Regulations Amending Certain Regulations Made Under the Proceeds of Crime (Money Laundering) and Terrorist Financing Act (2007-1), registered as SOR/2007-122, is replaced by the following:

39. (1) Subject to subsections (3),52(2) and 62(2), every real estate broker or sales representative shall, when engaging in an activity described in section 37, keep the following records:

17. The Regulations are amended by adding the following after section 39:

DEALERS IN PRECIOUS METALS AND STONES

39.1 Every dealer in precious metals and stones that engages in the purchase or sale of precious metals, precious stones or jewellery in an amount of $10,000 or more in a single transaction, other than such a purchase or sale that is carried out in the course of, in connection with or for the purpose of manufacturing jewellery, extracting precious metals or precious stones from a mine or cutting or polishing precious stones, is subject to Part 1 of the Act.

39.2 Subject to subsection 52(1), every dealer in precious metals and stones that is subject to Part 1 of the Act and that receives an amount in cash of $10,000 or more in the course of a single transaction shall report the transaction to the Centre, together with the information set out in Schedule 1, unless the cash is received from a financial entity or a public body.

39.3 Subject to subsection 52(2), every dealer in precious metals and stones that is subject to Part 1 of the Act shall keep a large cash transaction record in respect of every amount in cash of $10,000 or more that they receive in the course of a single transaction, unless the cash is received from a financial entity or a public body.

39.4 (1) For greater certainty, a transaction referred to in sections 39.2 and 39.3 includes the sale of precious metals, precious stones or jewellery that are left on consignment with a dealer in precious metals and stones.

(2) For the purpose of subsection (1), goods left with an auctioneer for sale at auction are not considered to be left with the auctioneer on consignment.

18. (1) The portion of section 43 of the Regulations before paragraph (a) is replaced by the following:

43. Subject to subsection 62(2), every casino shall keep the following records:

(2) Paragraph 43(c) of the Regulations is replaced by the following:

(c) where it opens a client account in the name of a person or of an entity other than a corporation, a record of the name and address of the client and

(3) Subparagraph 43(d)(i) of the Regulations is replaced by the following:

19. The portion of section 49 of the Regulations before paragraph (a) is replaced by the following:

49. Subject to subsection 62(2), every department and agent of Her Majesty in right of Canada or of a province that engages in an activity referred to in section 46 shall keep the following records in respect of that activity:

20. Subsection 59(6) of the Regulations, as enacted by section 57 of the Regulations Amending Certain Regulations Made Under the Proceeds of Crime (Money Laundering) and Terrorist Financing Act (2007-1), registered as SOR/2007-122, is replaced by the following:

(6) Subsections (2) and (3) do not apply in respect of an entity referred to in paragraph 62(2)(m) or (n) with which the money service business has entered into a service agreement referred to in section 32.

21. The portion of section 59.1 of the Regulations before paragraph (a), as enacted by section 57 of the Regulations Amending Certain Regulations Made Under the Proceeds of Crime (Money Laundering) and Terrorist Financing Act (2007-1), registered as SOR/2007-122, is replaced by the following:

59.1 Subject to subsection 62(2) and section 63, every accountant and every accounting firm shall, in respect of a transaction for which a record is required to be kept under subsection 36(1),

22. The portion of subsection 59.2(1) of the Regulations before paragraph (a), as enacted by section 57 of the Regulations Amending Certain Regulations Made Under the Proceeds of Crime (Money Laundering) and Terrorist Financing Act (2007-1), registered as SOR/2007-122, is replaced by the following:

59.2 (1) Subject to subsection 62(2) and section 63, every real estate broker or sales representative shall, in respect of a transaction for which a record is required to be kept under subsection 39(1),

23. The Regulations are amended by adding the following after section 59.2:

BRITISH COLUMBIA NOTARIES PUBLIC
AND NOTARY CORPORATIONS

59.3 Subject to subsection 62(2) and section 63, every British Columbia notary public and every British Columbia notary corporation shall, in respect of a transaction for which a record is required to be kept under subsection 33.2(1),

(a) in accordance with subsection 64(1), ascertain the identity of every person who conducts the transaction;

(b) in accordance with section 65, confirm the existence of and ascertain the name and address of every corporation on whose behalf the transaction is conducted and the names of the corporation's directors; and

(c) in accordance with section 66, confirm the existence of every entity, other than a corporation, on whose behalf the transaction is conducted.

LEGAL COUNSEL AND LEGAL FIRMS

59.4 (1) Subject to subsections (2) and 62(2) and section 63, every legal counsel and every legal firm shall, in respect of a transaction for which a record is required to be kept under section 33.4,

(a) in accordance with subsection 64(1), ascertain the identity of every person who conducts the transaction;

(b) in accordance with section 65, confirm the existence of and ascertain the name and address of every corporation on whose behalf the transaction is conducted and the names of the corporation's directors; and

(c) in accordance with section 66, confirm the existence of every entity, other than a corporation, on whose behalf the transaction is conducted.

(2) Subsection (1) does not apply in respect of a transaction for which funds are received by a legal counsel or legal firm from the trust account of a legal firm or from the trust account of a legal counsel who is not acting on behalf of their employer.

24. The portion of section 60 of the Regulations before paragraph (a), as enacted by section 58 of the Regulations Amending Certain Regulations Made Under the Proceeds of Crime (Money Laundering) and Terrorist Financing Act (2007-1), registered as SOR/2007-122, is replaced by the following:

60. Subject to subsections 62(1) and (2) and section 63, every casino shall

25. The portion of section 61 of the Regulations before paragraph (a) is replaced by the following:

61. Subject to subsection 62(2) and section 63, a department or agent of Her Majesty in right of Canada or of a province that engages in an activity referred to in section 46 shall

26. (1) The portion of subsection 62(1) of the Regulations before paragraph (a), as enacted by section 60 of the Regulations Amending Certain Regulations Made Under the Proceeds of Crime (Money Laundering) and Terrorist Financing Act (2007-1), registered as SOR/2007-122, is replaced by the following:

62. (1) Paragraphs 54(1)(a) and (b), 54.1(a), 54.2(a) and 55(a) and (e), subsections 57(1) and 57.1(1) and paragraphs 60(a) and (b) do not apply in respect of

(2) The portion of subsection 62(2) of the Regulations before paragraph (a), as enacted by section 60 of the Regulations Amending Certain Regulations Made Under the Proceeds of Crime (Money Laundering) and Terrorist Financing Act (2007-1), registered as SOR/2007-122, is replaced by the following:

(2) Sections 14, 14.1, 19, 20.1 and 23, subsections 36(1) and 39(1), sections 43, 49, 54, 54.1, 54.2, 55, 56, 56.1, 57, 57.1 and 59.1, subsection 59.2(1) and sections 60 and 61 do not apply in respect of

(3) The portion of subsection 62(2) of the Regulations before paragraph (a), as enacted by subsection (2), is replaced by the following:

(2) Sections 14, 14.1, 19, 20.1 and 23, subsection 33.2(1), section 33.4, subsections 36(1) and 39(1), sections 43, 49, 54, 54.1, 54.2, 55, 56, 56.1, 57, 57.1, and 59.1, subsection 59.2(1) and sections 59.3, 59.4, 60 and 61 do not apply in respect of

(4) Paragraphs 62(2)(m) and (n) of the Regulations, as enacted by section 60 of the Regulations Amending Certain Regulations Made Under the Proceeds of Crime (Money Laundering) and Terrorist Financing Act (2007-1), registered as SOR/2007-122, are replaced by the following:

(m) instances where the entity in respect of which a record is otherwise required to be kept is a public body, or a corporation that has minimum net assets of $75 million on its last audited balance sheet and whose shares are traded on a Canadian stock exchange or a stock exchange that is prescribed by section 3201 of the Income Tax Regulations, and operates in a country that is a member of the Financial Action Task Force;

(n) instances where the entity in respect of which a record is otherwise required to be kept is a subsidiary of a public body or a corporation referred to in paragraph (m) and the financial statements of the entity are consolidated with the financial statements of that public body or corporation; or

27. (1) The portion of subsection 64(1) of the Regulations before paragraph (a) is replaced by the following:

64. (1) In the cases referred to in sections 53, 53.1, 54, 55, 56, 57, 59, 59.1, 59.2, 59.3, 59.4, 60 and 61, the identity of a person shall be ascertained, at the time referred to in subsection (2) and in accordance with subsection (3),

(2) Paragraph 64(2)(b) of the Regulations is replaced by the following:

(b) in the cases referred to in section 53, paragraph 54(1)(b), subsection 59(1) and paragraphs 59.3(a), 59.4(1)(a), 60(b) and 61(b), at the time of the transaction;

28. Paragraph 65(2)(e) of the Regulations is replaced by the following:

(e) in the cases referred to in paragraphs 59.1(b), 59.2(1)(b), 59.3(b) and 59.4(1)(b), within 30 days after the transaction.

29. Paragraph 66(2)(e) of the Regulations is replaced by the following:

(e) in the cases referred to in paragraphs 59.1(c), 59.2(1)(c), 59.3(c), and 59.4(1)(c), within 30 days after the transaction.

30. The section references after the heading "SCHEDULE 1" in Schedule 1 to the Regulations are replaced by the following:

(Paragraph 12(1)(a), sections 17 and 21, paragraph 28(1)(a), sections 33.1, 35, 38 and 39.2, paragraph 40(1)(a), section 47 and subsections 52(1) and (3))

REGULATIONS AMENDING CERTAIN REGULATIONS
MADE UNDER THE PROCEEDS OF CRIME
(MONEY LAUNDERING) AND TERRORIST
FINANCING ACT (2007-1)

31. (1) Paragraph 76(a) of the Regulations Amending Certain Regulations Made Under the Proceeds of Crime (Money Laundering) and Terrorist Financing Act (2007-1) (see footnote 3) is repealed.

(2) Paragraphs 76(e) to (g) of the Regulations are repealed.

(3) Section 76 of the Regulations is amended by adding the word "and" at the end of paragraph (h) and by repealing paragraphs (i) and (j).

COMING INTO FORCE

32. (1) Subject to subsections (2) and (3), these Regulations come into force on the day on which they are registered.

(2) Sections 4 and 5, subsections 6(1) and (3), sections 8 and 11, subsection 13(1) and sections 18, 19 and 25 come into force on June 23, 2008.

(3) Sections 1 to 3, subsections 6(2) and (4), sections 7, 9, 14, 17 and 23, subsection 26(3) and sections 27 to 30 come into force on December 30, 2008.

N.B. The Regulatory Impact Analysis Statement for these Regulations appears at page 2718, following SOR/2007-292.

Footnote a

S.C. 2006, c. 12, s. 39

Footnote b

S.C. 2000, c. 17; 2001, c. 41, s. 48

Footnote 1

SOR/2001-317; SOR/2002-185

Footnote 2

SOR/2002-184

Footnote 3

SOR/2007-122

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