Canada plans to seize US$26m from a company owned by the sanctioned Russian oligarch Roman Abramovich, the federal government said on Monday.

The pursuit of Abramovich’s Granite Capital Holdings marks a first attempt by Ottawa to seize assets belonging to a sanctioned individual and reflects a broader strategy to punish Russia and its wealthy elite for the invasion of Ukraine.

Abramovich, the former owner of Chelsea football club, is a close ally of the Russian president, Vladimir Putin.

The foreign minister, Mélanie Joly, will now need to make a court application for the asset forfeiture. If the government is successful in its petition, the proceeds could be used for reconstruction in Ukraine and compensation of victims of Russia’s “illegal and unjustifiable” invasion, the government said, which marks the first time a G7 nation has implemented such a measure.

“From the beginning of the war, we have warned [Vladimir] Putin and his enablers that they would not be able to hide from the consequences of their actions,” Joly said in a statement. “Impunity has never been an option and Canada will continue to pressure the Russian regime and those who have benefited from Putin’s barbaric invasion of Ukraine.”

Canada first passed a law in late spring allowing it to seize the assets of sanctioned oligarchs and their companies, but officials have since struggled to make use of the sweeping powers, largely due to the murky nature of how assets are held.

In October, recognizing the difficulties in effectively sanctioning both Russia and Iran, the government announced C$76m in funding for a new “dedicated bureau” to help the government target and seize assets with greater speed and accuracy.

Canada’s finance minister and deputy prime minister, Chrystia Freeland, said on Monday that Russia’s oligarchs, who command billion-dollar fortunes scattered throughout the globe, would face consequences for their support of Putin’s war.

“Canada will not be a haven for their ill-gotten gains, and today’s announcement demonstrates our determination to ensure that Russia’s elites pay the price for their support of Putin’s brutal regime,” she said in a statement.

Last week, Freeland announced it would use C$115m collected from a 35% tariff on Russian and Belarusian imports to help finance the rebuilding of Kyiv’s electrical grid, criticizing Russia from “attempting to use the cold as a weapon to break the spirit” of Ukrainians.

Since the invasion in late February, Canada has imposed sanctions on more than 1,500 individuals and entities from Russia, Ukraine and Belarus.