No More Loopholes Act (Private Members Bill C-233)

The No More Loopholes Act (Private Members Bill C-233), sponsored by NDP Member of Parliament Jenny Kwan, proposes amendments to the Government of Canada Export and Import Permits Act. This bill seeks to change how Canada regulates the export of defence related goods, drastically broaden permitting requirements and severely restrict Canadian opportunities for international trade.

Bill C-233 is focused on the conflict between the state of Israel and the terrorist organization Hamas in Gaza and is based on the false claim that Canada’s export control system contains a loophole that allows military goods to be exported without oversight.

In fact, Canada already maintains one of the world’s strictest export control systems where every military export permit is assessed against human rights, international humanitarian law, and national security considerations. Since joining the Arms Trade Treaty in 2019, Canada has further tightened enforcement, reporting, and oversight mechanisms.

The No More Loopholes Act (Private Members Bill C-233) would introduce extensive new permitting requirements that would hinder Canada’s ability to maintain military readiness, support our allies, and sustain our defence manufacturing base.

Canada’s Current Actions Supporting Palestinians and Gaza

The Government of Canada has already taken several steps to respond to the humanitarian crisis in Gaza while maintaining its broader foreign policy commitments.

Humanitarian Assistance

Canada has provided significant humanitarian aid to civilians affected by the conflict in Gaza. This support includes funding for food, medical care, shelter, and emergency services delivered through international organizations and humanitarian partners operating in the region.

Arms Export Restrictions

Canada has already restricted military exports related to the conflict in Gaza. Since January 2024, Canada has refused new permits for military goods that could be used by Israel in the war against Hamas. The government has also frozen existing permits that could allow Canadian military components to be used in the conflict.

Support for Palestinian Statehood

Canada continues to support the establishment of an independent Palestinian state as part of a negotiated peace process. The Government of Canada has reaffirmed its support for recognition of a Palestinian state within a broader two-state solution framework.

Support for Israel’s Security

Canada continues to reaffirm that Israel has the right to defend itself against terrorism and attacks. Canadian policy states that both Israelis and Palestinians deserve to live in peace, security, and dignity.

Key Issues With the No More Loopholes Act (Private Members Bill C-233)

The Government of Canada has several concerns about the No More Loopholes Act (Private Members Bill C-233).

1. Bill C-233 is based on the claim that Canada’s export control system contains a loophole that allows military goods to move without oversight. This claim is false as Canada already applies strict human rights criteria to every export permit.

2. Bill C-233 would significantly expand the definition of “military goods.” The proposed definition would include basic materials such as steel, aluminum, components, electronics, textiles, fasteners and general industrial parts used anywhere in defence supply chains. This would severely restrict Canadian defense industry suppliers from access to international markets.

3. Bill C-233 would introduce expanded reporting requirements, requiring the disclosure of sensitive commercial and/or national security information.

4. Canada currently uses general export permits to allow certain goods to move between trusted partners under strict conditions. Bill C-233 would significantly limit Canada's ability to use these permits, particularly for exports to the United States. Defence components often cross the Canada–United States border multiple times during production. The new permit requirements proposed would effectively eliminate Canada's defense industry trade with the United States of America.

5. Canada’s defence industry is closely integrated with the United States and NATO allies. Additional permit requirements would delay supply chains and affect Canada’s ability to support allied military operations and defence production. In the context of growing global uncertainty and conflict, it is critical for Canada to maintain support for allied nations around the world, including our NATO partners and Ukraine.

Parliamentary Debate and Vote

As the NDP is not an official party, Bill C-233 was introduced by an NDP member as a Private Member’s Bill and advanced to second reading in the House of Commons.

Following debate, the House of Commons voted on the legislation. The bill did not receive sufficient support to proceed further and was defeated. As a result, Canada’s existing robust export control system under the Export and Import Permits Act remains unchanged.