September 27, 2010
The big business news lately has been BHP Billiton's hostile bid for Potash. So far, it is not clear whether the bid will succeed or if other viable suitors will emerge to outdo BHP. But one thing is obvious: the Canadian government will almost certainly demand commitments aimed at ensuring that the transaction is of net benefit to Canada from any successful bidder.
The Federal Court decision in June in Canada (Attorney General) v. United States Steel Corp. goes a long way to consolidating the government's power to enforce such undertakings.
"The ruling is a reminder not only that the government considers Canada's foreign investment review regime to be important, but that it is both willing and able to enforce undertakings in cases involving material non-compliance, despite the fact that it has never resorted to court proceedings in the past, says Omar Wakil.
Read the full article here.