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ESPIONAGE IN CANADA

CAUTION
THIS REPORT IS ISSUED UNDER THE AUTHORITY OF THE DIRECTOR, CANADIAN SECURITY INTELLIGENCE SERVICE. IT IS PROVIDED FOR THE INFORMATION OF THE RECIPIENTAND THOSE OF THE RECIPIENT’S DEPARTMENT ORAGENCY WHO HAVE THE APPROPRIATE SECURITY CLEARANCE AND MAY BENEFIT FROM KNOWLEDGE OF ITS CONTENTS. THIS REPORT MAY BE PARAPHRASED AND USED IN INTERNAL DEPARTMENTAL OR AGENCY CORRESPONDENCE. NEITHER THE REPORT NOR ANY OF ITS CONTENTS SHOULD BE DISSEMINATED OUTSIDE THE RECIPIENT’S DEPARTMENT OR AGENCY WITHOUT PRIOR CONSULTATION WITH CS IS. THE DIRECTOR, CSIS, SHOULD BE INFORMED OF ANY ACTION TAKEN BY A DEPARTMENT OR AGENCY BASED ON ITS CONTENTS. THIS DOCUMENT CONSTITUTES A RECORD WHICH MAY BE SUBJECT TO MANDATORY EXEMPTION UNDER THE ACCESS TO INFORMATION ACT OR THE PRIVACY ACT. THE INFORMATION OR INTELLIGENCE MAY ALSO BE PROTECTED BY THE PROVISIONS OF THE CANADA EVIDENCE ACT THE INFORMATION OR INTELLIGENCE MUST NOT BE DISCLOSED OR USED AS EVIDENCE WITHOUT PRIOR CONSULTATION WITH THE CANADIAN SECURITY INTELLIGENCE SERVICE.

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SUMMARY

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Canada remains an appealing target for foreign powers whose goal is to steal secrets in order to advance their own interests.

Foreign governments have

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Canadian interests are increasingly vulnerable to Internet (cyber) clandestine and deceptive
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based attacks, which are
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Canad is also facing an increasing threat from economic espionage, which has had serious ramifiçatiops for Canada, including lost jobs, corporate and tax revenues, and a diminished competitive advantage.

There is also growing concern about foreign powers which have engaged in espionage operations on Canadian soil in order to support their political agenda or a cause linked to a “homeland conflict” They have collected information in an unauthorized manner, so as to advance their own interests related to that conflict.

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Regional conflicts have spawned aggressive intelligence-gathering and foreign-influence activities in Canada.

Espionage is a time-tested tradecraft that serves political, military, strategic and economic ends, and for these reasons it is not about to disappear.

Foreign states will be engaged in activities directed at gathering information from the public and private sectors in Canada and elsewhere.

Global economic competition and the evolving economic I strategic requirements of emerging and existing powers will spur aggressive economic espionage operations in Canada.

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1. Canada remains an attractive target for foreign government-sponsored espionage activities. Although espionage is often thought of as a relic of the Cold War, in reality it has continued, and in many ways intensified, over the past 15 years. Whether we understand espionage in its traditional or new and evolving forms such activities pose an ongoing threat to Canadian security and economic interests.

What is Espionage?

2. The basic and overriding goal of espionage is to steal secrets. The methods and means by which these operations are carried out, as well as the type of information procured, can vary widely. Espionage is defined as any activity aimed at acquiring, by unlawful or unauthorized means, information or assets relating to sensitive political, economic, scientific or military matters, or for the purpose of their unauthorized communication to a foreign state or foreign entity.

3. The primary aim of espionage operations in Canala is to procure classified or proprietary information related to Government of Canada (GoC) policies and procedures, critical infrastructure, advanced technologies and other sensitive areas, Espionage furthers the strategic, political, or economic agendas of a foreign power which, by other (legitimate) means, may be unable to collect the information or material required to advance its interests. Espionage supports foreign national or organizational interests at a time when global strategic and economic competition is more intense than ever.
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4 The majority oféspionage activities on Canadian soil are conducted by foreign governments

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5 Espionage cases involving employees of the GoC, or other individuals whose security clearances or circumstances have given them direct or indirect access to classified information, are subject to the provisions of the Security of Information Act (SoIA). The SoJA was passed by the Parliament of Canada in 200112, as a substantially amended version of the former Official Secrets Act. The SoIA reflects amendments to the government’s efforts to address national security concernS. New offences were created to improve and modernize the “spying” provisions of the Act, taking into account new realities, including new players and new threats. These offences focus upon situations-in which it is appropriate for Canada to protect its institutions and citizenry from information-related conduct that is harmful or likely to be harmful to Canada. New actors (other than the governments of traditional states) include governments-in-waiting, governments in exile and other foreign powers, as well a$ terrorist groups. New threats that are being recognized include: threats against ethnocultural communities in Canada; threats to trade secrets; and threats to essential infrastructures, both public and private.
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6. The SoIA does not employ the term “classified information”. Rather, it uses the phrase “information that the Government f.Cn.da or a province is taking measures to safeguard”. This includes “special operational infci *Rz0hich covers a range of information that is protected for various purposes by the GoC. tJ%24. ao introduces a new category of persons under the Offences provisions, who are to be l,)nd to secrecy if they are current or former employees of particular GoC depar ‘éi4 SoJA has created a number of offences both with respect to espionage and O’i,)T 4ô 7. In terms of espionage-related proviroi,p,e owigly or recklessly communicating safeguarded information to a foreign entity or terior4gup the former intending to or being reckless as to whether such disclosure will increase that fpreign group’s capacity to do harm to Canadian interests are liable to prosecution and imprisonment for life. Persons who at the direction of a foreign entity or terrorist group induce or attempt to induce any person to do anything that is likely to harm Canadian interests are also liable to prosecution. Taking into account new political realities, the term “foreign entity” has been redefined to include foreign powers, groups of foreign povers or persons acting on their behalf or in association with them.
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Who-Doesit?

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8. Canada enjoys rare, if not unique, combination of an open and democratic political system; a diversified economy that has exhibited consistent growth and stability; and a multicultural society which draws from a variety of traditions and influences. Canada also
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harbours a vast wealth of natural resources and human talent which continues to generate major tecimological advances. As such, Canada remains an appealing target for foreign
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2 For a more detailed explanation of these and other provisions, see Government of Canada, Security of Information Act (Ottawa, 2002).

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powers whose goal is to steal secrets in order to advance their own interests.

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How Will the Espionage Threat Evolve? 65. The basic goal of espionage is to steal secrets. Espionage is a time-tested tradecraft that serves political, military, strategic and economic ends, and for these reasons it is not about to disappear. Foreign governments have viewed Canada as a particularly appealing target because of its advanced technological achievements its wealth of natural resources diversity of ethnic groups and open political system.

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herging key global actors will be faced with the difficult task of both protecting ways to secure advantages over their competitors, even those from friendly hnological advances, and the imperatives of doing business on a global such as Canada vulnerable to hostile actors.

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