May 09, 2013
Drawing from many of the themes from his recent study on federal policy on foreign state-owned investment in Canada, partner Dany Assaf writes on federal policy in his recent op-ed featured in current events website iPolitics. Below is an excerpt.
The federal government’s recent budget implementation bill reflects, among other things, policy changes to the Investment Canada Act announced last December as part of the approval of proposed foreign takeovers at Nexen and Progress Energy Resources.
These and other changes introduced by the government over the last several years help answer certain questions — while raising new ones. For example, new investment review guidelines state that investments involving a state-owned enterprise (SOE) wishing to acquire control of a business in the Canadian oilsands sector will now be approved only on an "exceptional" basis. What will "exceptional" mean in practice? Not clear.
Since the government effectively turned down BHP Billiton’s proposed takeover of Saskatchewan’s Potash Corporation in 2010, investors and Canadians alike have been seeking greater clarity about the rules and policy behind foreign direct investment (FDI) in Canada. As global markets shift and the domestic economy changes, there is still a need for a more comprehensive and forward-looking review of our objectives.
The time to start this broader process is now — not when we are facing the next big transaction.
For the full article, click here.
For more about current issues in Canada’s foreign investment policy, Dany Assaf and Rory McGillis have written a comprehensive study on the subject, “Foreign Direct Investment and the National Interest: A Way Forward”, available here.