Wednesday, December 13, 2023

Federal Court concludes that a “virtual presence” in Canada is enough to be ordered to assist CSIS

Decision follows trend starting in BC that a virtual presence in Canada is enough to be ordered to produce records

The Federal Court of Canada, in connection with an application for a warrant and an assistance order under the Canadian Security Intelligence Service Act, was required to consider whether an assistance order under s. 22.3(1) of that Act could be issued to order a legal person with no physical presence in Canada to assist CSIS with giving effect to a warrant. The order would have extra-territorial effect.

In a redacted decision, Re Canadian Security Intelligence Service Act (Can), the court concluded that it can, provided that the subject of the assistance order has a “virtual presence” in Canada. The decision notes that the foreign company involved was willing to assist, but needed to see a court order to manage their possible legal liability:

[3]       The affiant explained that [REDACTED] is incorporated and headquartered in [REDACTED] does not have physical offices or employees in Canada. It has a virtual presence in Canada that consists of [_some physical presence in Canada_]. It solicits business from Canadians and [REDACTED].


[4]       The affiant also explained that [REDACTED] has been fully cooperative in providing assistance to CSIS to date, but has advised CSIS that it requires a judicial authorization from a Canadian court to minimize its legal risk in the event that CSIS uses the collected intelligence beyond analysis; [REDACTED]. [REDACTED] advised that it would continue to be cooperative pending and upon receipt of an Assistance Order.

The company’s willingness to comply wasn’t particularly material to the Court’s decision.

At the urging of the government and largely supported by a court-appointed amicus, the Court followed a trend of cases that have dealt with similar questions but involving production orders under the Criminal Code. The first of these cases is British Columbia (Attorney General) v. Brecknell, where the Royal Canadian Mounted Police were seeking to obtain a production order naming Craigslist. As with this CSIS case, Craigslist said they’d cooperate but needed to see a court order. The British Columbia Court of Appeal, influenced by the Equustek case from the Supreme  Court of Canada, concluded that a court has jurisdiction to issue a production order naming an entity physically beyond the court’s jurisdiction provided they had a “virtual presence” within the jurisdiction.

The Court concluded:

[49]     I find that the jurisprudence in the context of production orders issued pursuant to section 487.014 of the Criminal Code provides a good analogy and support for finding that this Court has the jurisdiction to issue an Assistance Order where in personam jurisdiction can be established. The two provisions are similar in purpose, albeit in different contexts, both are directed to a person, which includes an organization or entity that is a legal person, and similar considerations arise in determining whether the order should be issued where the subject has only a virtual presence in Canada.

[50]     The considerations noted by the SCC in Equustek lend further support to taking an approach that reflects the realities of the internet dominated storage and transmission of documents and information. As noted in Brecknell, document control may exist in one jurisdiction, and the documents in another or in several others and “formalistic distinctions” between virtual and physical presence defeat the purpose of the legislation.

[51]     Whether an organization or entity with only a virtual presence in Canada can establish a real and substantial connection with Canada sufficient to constitute presence in Canada will be a case-by-case determination. Where such in personam jurisdiction is established, the organization or entity that is subject to the Assistance Order and required to provide documents in their possession or control is considered to be in Canada although the documents may be stored elsewhere.

As with a number of the cases following Brecknell, the Court concluded that its ability to issue the order does not turn on whether it would be able to enforce the order, though that is a relevant consideration:

[53]      I have considered the issue of enforcement of the Assistance Order on [REDACTED]. I note that they have been cooperative to date and indicate their ongoing intention to cooperate. However, I also agree with the submissions of the AGC and amicus and the jurisprudence, that the enforcement of the Order is a separate issue from whether the Court has jurisdiction to issue the Order, but remains a relevant consideration with respect to whether the Order should be issued based on the particular circumstances.

Consistent with the previous production order cases cited, the intended recipient was not a party to the hearing. All were ex parte, but some included amici.

Note: I believe that Brecknell was wrongly-decided, but because all of these orders have not been ex parte and unopposed, it'll be some time before these arguments will be made in court.   See: David T Fraser, "British Columbia (Attorney General) v. Brecknell", Case Comment, (2020) 18:1 CJLT 135.

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