It doesn't need to say it in the law. As far as I understand you cannot be put under arrested if you cannot be charged. (Although they could probably detain her, but that's a different thing).
The police can arrest and charge prostitutes under this bill. They can do so because section 286(1) makes no distinction between client and provider. However, a person can be exempted from prosecution, but until now, it is the prerogative of the Crown Prosecutor only, under the Provincial Attorney Genreal, to prosecute or to grant immunity. Section 286(5) grants that immunity but, strictly speaking, it is not up to police to invoke that section, as they do not have the prerogative of the Crown Prosecutor.
The law says effectively that they are always innocent because they can never be found guilty. When the Canadian Bar Association testified this week they made it clear that they considered the sale to still be a lawful act. This is the national association of lawyers with more then 35 000 members including prosecutors and defense attorneys.
But you are always innocent until proven guilty. In this case, you will never be found guilty. But it is not up to police to find someine guilty, its for the courts. The Law Society can say all they want, but the text says that it's illegal, including for prostitutes. Their conclusion is based on a matter of principle. That could be the basis to argue in front of the court that the law is unconstitutional, but before they do that, the law is quite clear: selling sex is as illegal as buying it.
Some people are arguing that because of the way the law is worded, then prostitutes are criminals that are just not prosecuted. And that therefore they do not have the right of safety in their activity as found in Bedford. I do not agree with this position, because as I said they are always innocent. The law describes a crime, and then says effectively that those who sell their own sex are not guilty of this crime.
MacKay himself said that prostitutes would be breaking the law, but that they are immune from prosecution. The law doesn't say that they are innocent; indeed, everybody is always innocent until proven guilty in a court of law. A person is a criminal only when convicted, not arrested. Police always arrest innocent people because arrested people are always innocent until proven guilty. But they can be arrested, processed and locked up in the meantime until the Crown Prosecutor decides to invoke their immunity from prosecution. While being under arrest, they can be entered into the Canadian Police Information Centre and that information can be used to harass them in the future, across the country, including crossing the US border because the CPIC is shared with US authorities, including Homeland Security.
Normally these ''we will not prosecute you'' are decided by the provinces on a case by case basis. In that context the activity is a crime at the federal level and police can make arrests. In bill C-36 the criminal code says out of hand that these people are not guilty, therefore their own actions are legal.
Young said exactly that: that only Provinces could grant immunity, and it is on a case-by-case basis. That's one reason he says that the law is unconstitutional. Something about encroaching on Provincial jurisdiction. In any case, he says that this has never happened before, where a law arbitrarily exempts a certain class of people from its application: hence, discrimination and a Charter challenge. The bill doesn't say that they will are not guilty; it says that they will never be prosecuted, so that it will never be known whether they were guilty, or remain innocent. Your statement that their actions are legal is merely a conclusion to an argument that invalidates the law. That argument has to be made in court in order to invalidate that law. The law is subject to wide interpretation, therefore unsafe.
"286.2 (1) Everyone who receives a financial or other material benefit, knowing that it is obtained by or derived directly or indirectly from the commission of an offence under subsection 286.1(1), is guilty of an indictable offence and liable to imprisonment for a term of not more than 10 years."
There is no disctinction here between clients and prostitutes.
"286.5 (1) No person shall be prosecuted for
(a) an offence under section 286.2 if the benefit is derived from the provision of their own sexual services; or"
A prosecution is undertaken by the Crown Prosecutor, not the police.
There is noting in precedence or statute that prevents people from being arrested because they are exempt from prosecution. That's because this situation has never happened before. If you have such information, I would be interested to see it.
It would be logical for police not to charge someone because they will never be prosecuted. But some police forces are not known for their logic when it has to do with loopholes. That loophole in the law would allow less scrupulous police departments to undertake an abuse of process. Police exploit loopholes all the time, and that's why we have courts to limit their actions. This is potentially such a situation where the courts will have to make explicitly clear the application of what is the intent.