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Chrystia Freeland

Ottawa’s sweeping new emergency powers aimed at ‘Freedom Convoy’ could boost demand for legal advice

Tuesday, February 15, 2022 @ 1:52 PM | By Cristin Schmitz

Canadian lawyers can expect to be in demand today as companies and individuals seek their advice following the federal government’s rollout of novel national emergency powers — including authorizations to freeze commercial and personal bank accounts, suspend motor vehicle insurance policies and “direct” tow truck companies and others to help authorities end the trucker blockades aimed at governments and pandemic health restrictions.

On Feb. 14, the minority Liberal government, supported by some provinces, such as Ontario, but not Quebec and Saskatchewan, invoked the federal Emergencies Act, for the first time since the law was enacted in 1988 to replace the War Measures Act.

Ottawa said its goal in declaring a “public order emergency” is “to end the ongoing illegal blockades and occupations taking place across the country,” including in Ottawa and at Canada-U.S. border crossings, where hundreds of trucks and people have been impeding the free movement of people and goods.

The government said it hopes to revoke the declaration of a public order emergency, which went into effect Feb. 14, earlier than the 30-day (renewable) time frame under the Act. It must bring the declaration for approval by both the House of Commons and Senate within seven sitting days. A negative vote in either chamber immediately revokes the declaration. (The other three kinds of emergencies are public welfare, international and war).

Other safeguards include a requirement that a special joint committee of both the House of Commons and the Senate is established to review the government’s actions under the Act on an ongoing basis, and that the Senate and the Commons can review, and potentially revoke, the declaration and any orders or regulations made under the Act. The declaration expires after 30 days unless both the House of Commons and the Senate confirm the proposed extension within specific timelines.

More details about the government’s new powers were expected to emerge Feb. 15, but according to a Feb. 14 press release from the Department of Public Safety, the declaration of a public order emergency gives the federal government authority to apply temporary measures the government says are Charter-compliant, including:
  • Regulating and prohibiting public assemblies, including blockades, “other than lawful advocacy, protest or dissent”;
  • Regulating the use of specified property, including goods to be used with respect to a blockade;
  • Designating and securing places where blockades are to be prohibited, such as borders, approaches to borders, and other “critical infrastructure”;
  • Directing specified persons (such as tow truck companies) to render essential services to relieve impacts of blockades on Canada’s economy;
  • Authorizing or directing specified financial institutions to render essential services to relieve the impact of blockades, “including by regulating and prohibiting the use of property to fund or support the blockades” and insulating them from civil liability in that regard;
  • Authorizing the RCMP to enforce municipal and provincial laws by means of incorporation by reference; and
  • Imposing (yet unknown) fines or imprisonment for contravening “any of the measures declared under this public order emergency.”

Deputy Prime Minister Chrystia Freeland

Deputy Prime Minister Chrystia Freeland

At a Feb. 14 Ottawa news conference, attended by Prime Minister Justin Trudeau, Justice Minister David Lametti, and other cabinet members, Deputy Prime Minister and Finance Minister Chrystia Freeland told reporters the government is also “broadening the scope” of the federal Proceeds of Crime (Money Laundering) and Terrorist Financing Act rules to encompass crowdfunding platforms, and some of the payment service providers they use which are not currently not fully captured under that Act.

She disclosed the government also intends to introduce legislation to make “permanent” the new authorities for the Financial Transactions and Reports Analysis Centre of Canada (FINTRAC).

“As of today, all crowdfunding platforms, and the payment service providers they use, must register with FINTRAC, and must report large and suspicious transactions to FINTRAC,” Freeland said. “This will help mitigate the risk that these platforms receive illicit funds; increase the quality and quantity of intelligence received by FINTRAC; and make more information available to support investigations by law enforcement into these illegal blockades.”

The changes to Canada’s anti-money laundering and terrorist financing rules cover “all forms of transactions,” including digital assets such as cryptocurrencies, she stipulated.

As well, Freeland said the government was issuing an order under the Emergencies Act, with “immediate effect,” authorizing Canadian financial institutions “to temporarily cease providing financial services” in both personal and corporate accounts “where the institution suspects that an account is being used to further the illegal blockades and occupations.”

The government is also directing Canadian financial institutions “to review their relationships with anyone involved in the illegal blockades and report to the RCMP or CSIS.”

In addition, as of Feb. 14, a bank or other financial service provider “will be able to immediately freeze or suspend an account of an individual or business affiliated with these illegal blockades, without a court order,” she announced. “In doing so, they will be protected against civil liability for actions taken in good faith.”

Freeland also said federal government institutions will have a new broad authority to share “relevant information” with banks and other financial service providers “to ensure that we can all work together to put a stop to the funding of these illegal blockades.”

“This is about following the money,” Freeland said. “We are today serving notice: if your truck is being used in these illegal blockades, your corporate accounts will be frozen. The insurance on your vehicle will be suspended. Send your semi-trailers home. The Canadian economy needs them to be doing legitimate work, not to be illegally making us all poorer.”

Prime Minister Justin Trudeau

Prime Minister Justin Trudeau

In announcing the measures, Trudeau emphasized they are time-limited and geographically targeted, to be used only in the specific areas of the country where and when they are needed. “We cannot and will not allow illegal and dangerous activities to continue,” he said. The new emergency powers will “allow the government to make sure essential services are rendered, for example in order to tow vehicles blocking roads,” he explained. “In addition, financial institutions will be authorized or directed to render essential services to help address the situation, including by regulating and prohibiting the use of property to fund or support illegal blockades.”

“We’re not using the Emergencies Act to call in the military,” Trudeau added. “We’re not suspending fundamental rights or overriding the Charter of Rights and Freedoms. We are not limiting people’s freedom of speech. We are not limiting freedom of peaceful assembly. We are not preventing people from exercising their right to protest legally. We are reinforcing the principles, values and institutions that keep all Canadians free.”

Lametti echoed the prime minister, stating that by declaring a public order emergency under the Emergencies Act, “we are following the law and we are acting within it.”

The justice minister and attorney general of Canada highlighted three “clear conditions” set out in the Emergencies Act in order for a public order emergency to be declared. “First, we must be in a situation that either seriously endangers lives, health or safety of Canadians and exceeds the capacity or authority of a province to deal with it or seriously threatens the ability of the government of Canada to preserve the sovereignty, security and territorial integrity of Canada.”

“Second, the provinces and territories’ capacity to handle the situation must be considered insufficient, or must show gaps,” he said. Third, we must conclude the situation cannot be handled adequately under any other Canadian law including provincial and territorial laws.”

“Our government believes those conditions have been met,” Lametti advised. “Having now declared a public order emergency, we will table the declaration in Parliament as required within seven days.”

Lametti said a parliamentary committee will be struck to provide oversight while the emergency is in effect. “The declaration only lasts for 30 days unless renewed. However, we can, and sincerely hope to, revoke the emergency much sooner. Parliament also has the ability to revoke the declaration of the emergency as set out clearly in the Act,” he said. “Once an emergency is declared the Emergencies Act permits the federal government to make necessary orders or regulations to deal with the emergency.”

He highlighted the six specific measures the government believes are needed to bring the “situation under control.”

He said (in French) that the orders and regulations making it possible to implement the measures “will be drafted shortly” and tabled in Parliament within two sitting days of the date of their adoption, “as required by law.”

He emphasized Parliament has the power to revoke an order or declaration “which ensures that all measures taken will be done in a responsible, measured manner and within established guidelines.”

“These measures are temporary.” he stressed. “We intend to impose them for only as long as needed to restore order across the country.”

He described the six measures as including: the regulation and prohibition of public assemblies that lead to a breach of peace and go beyond lawful protests. “What we are seeing in Ottawa and what we are seeing at the Ambassador Bridge [crossing to the United States] are not lawful protests,” Lametti reiterated.

The other measures, he said, include designating and securing places where blockades are to be prohibited, which may include Ottawa, the borders, approaches to borders and other critical infrastructures; directing persons to render essential services to relieve impacts of blockades on Canada’s economy which “could include tow trucks and their drivers, for compensation of course”; “authorizing or directing” financial institutions “to render essential services to relieve the impact of blockades,” including regulating and prohibiting the use of property to “fund or support the blockade”; enabling the RCMP to enforce municipal bylaws and provincial offences “where required;” and “the imposition of fines or imprisonment for a contravention of any order or regulation made under section 19 of the Emergencies Act.

According to a government backgrounder, in order to declare a public order emergency, the Emergencies Act requires that there be an emergency that arises from threats to the security of Canada that are so serious as to be a national emergency. These may include the threat or use of acts of serious violence against persons or property for the purpose of achieving a political or ideological objective.

A national emergency is “an urgent, temporary and critical situation that seriously endangers the health and safety of Canadians that cannot be effectively dealt with by the provinces or territories, or that seriously threatens the ability of the Government of Canada to preserve the sovereignty, security and territorial integrity of Canada,” the backgrounder said. “It must be a situation that cannot be effectively dealt with by any other law of Canada.“

A declaration of a public order emergency allows the federal government to make orders and regulations “that it believes are necessary for dealing with the emergency, on reasonable and proportional grounds,” the government’s backgrounder states. Any steps taken by the government under the Emergencies Act must be consistent with Charter be “reasonable and proportional”

Initial reaction to the federal government’s move from some premiers and civil liberties groups, for example, challenged the necessity for a national declaration of emergency and whether the statutory test for such a declaration has been met.

However, the government insisted its actions are necessary.

“What we are facing today is a threat to our democratic institutions, to our economy, and to peace, order, and good government in Canada,” Freeland said. “This is unacceptable. It cannot stand and it will not stand.”

The Emergencies Act requires the government to hold an inquiry after the emergency has ended, and report to both the Senate and Commons within 360 days after the emergency expires or the declaration of emergency has expired.

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