Industry Committee on April 26th, 2023

[Sébastien Lemire, Bloc, Abitibi—Témiscamingue, QC]

With respect, you've overloaded the committee calendar for the coming months, but we'll keep your suggestion in mind. We have three bills coming.

Thank you.

[François-Philippe Champagne, Liberal, Saint-Maurice—Champlain, QC]

You're working hard.

[The Chair, Liberal, Joël Lightbound]

Thank you.

I'm now giving the floor to Mr. Masse.

[Brian Masse, NDP, Windsor West, ON]

Thank you, Mr. Chair.

It's true that we work hard

A previous minister of industry—I won't say who—now has a job with one of the largest telco providers in Canada. They announced some money for what was a Mexican company on the surface, but there was a holding company in the U.S. that owned it. The innovation was done, and then the company moved that innovation to another country, to Mexico. It was Nemak. Then, we had to fight to get the workers' pensions.

I won't get into all the details, but I'm concerned about what types of thresholds there are and how vulnerable Parliament is depending upon who sits in the minister of industry's seat in terms of evaluating when we have government supports for research and development, SR & ED tax credits and so forth, for Canadian companies. How do we evaluate that in terms of saying yes or no when they're bought by foreign entities? How does this bill relate to that? It's a little bit tricky again, but—

[François-Philippe Champagne, Liberal, Saint-Maurice—Champlain, QC]

No, I appreciate your question.

I think colleagues would appreciate that this is all about providing more tools in the tool box. I can tell you that, in my experience as Minister of Industry, I feel constraint sometimes to meet the high level of ambition of the committee and Canadians in terms of protecting national security with respect to foreign investment with the tools in the tool box. Why? I would say that the situation has evolved. We want to go at the speed of business. Intellectual property has been taking on more importance and tangible assets. The fact is that we cannot seek undertakings under national security, while the Americans do that all the time. There are pre-filing requirements like having a stand-still period, if you want, during the review. To me, they're all pretty common sense.

Maybe the committee will think that there's more that we could do, but my desire for future ministers is not to be necessarily in the position that I've been in, which is trying to do as much as I can with the very limited set of tools that I have. I think that, as the situation evolves, you will want to vest in the Minister of Industry...subject to a number of safeguards. It would be in consultation with Public Safety. As colleagues have said, there's the Governor in Council, and there are going to be a number of checks and balances. However, for future ministers, I would hope that they have more tools in their tool box.

[Brian Masse, NDP, Windsor West, ON]

Thank you.

[The Chair, Liberal, Joël Lightbound]

Thank you very much.

We'll now turn to Mr. Williams for five minutes.

[Ryan Williams, Conservative, Bay of Quinte, ON]

Thank you very much.

Mr. Minister, thank you for being here again. It's always a pleasure.

I want to talk a little bit about some numbers we had last week when it came to Medicago and Novavax. You talked about IP protection. We want to protect the IP that came out of these companies. Did we ever get any of the IP from Novavax or from Medicago?

[François-Philippe Champagne, Liberal, Saint-Maurice—Champlain, QC]

Allow me to go back to your question, and I think it will make you happy. I'm happy to talk to the Trillium Network to see what they can provide to the committee.

[Ryan Williams, Conservative, Bay of Quinte, ON]

Is that the report specific to Volkswagen?

[François-Philippe Champagne, Liberal, Saint-Maurice—Champlain, QC]

To be honest, I would have to go back to them and see what they can share with you.

[Ryan Williams, Conservative, Bay of Quinte, ON]

There is a public report from September that talks about the EV industry.

[François-Philippe Champagne, Liberal, Saint-Maurice—Champlain, QC]

Yes. On this, I want the committee to see that I want to be transparent. If it's their information, what I'm committing to you today is that I'll call them after the committee meeting and see what they're willing to share with the committee. I just wanted to say that.

[Ryan Williams, Conservative, Bay of Quinte, ON]

I would appreciate that. In the name of transparency, we appreciate that.

[François-Philippe Champagne, Liberal, Saint-Maurice—Champlain, QC]

Exactly. No, I want.... Since it's their information, I have to talk to them first, but I commit to the committee that, after I leave, I will talk to them and see what they're willing to make available to the committee.

To your question on Medicago, you know Medicago is a challenging situation. I have three objectives: maintaining jobs, maintaining IP and trying to keep the company as a going concern. What we have been talking with the CEO of Mitsubishi in Japan about was really to achieve that.

At the time when we invested in Medicago—and I know that now people can look back and say that maybe we should have and maybe we shouldn't have—we wanted to invest in the five families of vaccines, because no one knew which would one would work. Actually, for Medicago, when you talk to the WHO, they will tell you that plant-based vaccines have a lot of potential to be able to cure future pandemics we could have.

My main mission to you, sir, today is to protect the IP and keep that in Canada, using our contractual provision that we have to lock the IP in Canada. That's what I'm doing.

That's why, to go back to Volkswagen, I like to do that in a contract, because a contract gives the government far more tools when we want to do certain things than if you just do it like the United States, for example, with the tax credit. That, I think, is the smart answer of Canada to the IRA.

[Ryan Williams, Conservative, Bay of Quinte, ON]

In terms of Novavax, where are we with that company right now and that investment?

[François-Philippe Champagne, Liberal, Saint-Maurice—Champlain, QC]

I cannot tell you.... As Minister of Industry, what we're doing with the facility in Montreal is that we want to qualify the NRC facility as a good manufacturing practice facility. We had selected Novavax at the time.

The latest word I have, sir, is that it's working, but I'll be talking to the CEO of Novavax. As a matter of fact, I think I'm talking to him early next week to inquire.

[Ryan Williams, Conservative, Bay of Quinte, ON]

I'm wondering if you could answer a question we had the other day. In a report from ISED, it did say that we had nine million doses of vaccines from Novavax, but there have been zero produced in the Novavax facility here in Canada. Where did those come from?

[François-Philippe Champagne, Liberal, Saint-Maurice—Champlain, QC]

Sir, I would like.... I don't have the details of that, but I'm sure the officials—

[Ryan Williams, Conservative, Bay of Quinte, ON]

If you don't mind, yes, your officials....

[François-Philippe Champagne, Liberal, Saint-Maurice—Champlain, QC]

It might not be at ISED. There may be other officials at other departments, but we'll endeavour to provide you the answer.

[Ryan Williams, Conservative, Bay of Quinte, ON]

Okay. If Novavax does fail, do we have any IP provisions to hold onto what's been produced there? They were supposed to do a different vaccine. Is that correct?

[François-Philippe Champagne, Liberal, Saint-Maurice—Champlain, QC]

Yes, exactly. Medicago is plant-based. The one they have in Novavax is different from the mRNA we have with Moderna, so that's why we have different families of vaccines.

I think our fill and finish capacity when I started was around 30 million, and now it's around 610 million. Whatever may happen to Canadians, we would be in a much better.... We're probably closer to a billion by now in terms of fill and finish capacity.

With respect to Novavax, I'll have a bit more to report if the committee is interested, because I'm talking to the CEO next week, as I said, because I have not talked to.... It's the new CEO, I should say, because the former CEO I've talked to in the past. I'm talking to the new CEO next week, so we may have more details.

[Ryan Williams, Conservative, Bay of Quinte, ON]

I guess what I'm getting at is that we've had a couple of failures. When we take risks, that's going to happen. Businesses know that. We've had Medicago, Novavax and CanSino with certain procurements for vaccines.

When it comes to the Volkswagen deal, how are Canadians protected from any kind of failure? What specifically is there if, let's say, something were to happen to critical minerals or if consumer behaviour in five years is that they've decided not to buy complete EVs? What are we in for and what happens if that deal falls through?

[François-Philippe Champagne, Liberal, Saint-Maurice—Champlain, QC]

I'm happy you asked the question, because I think the purpose of the committee should be to provide clarity to Canadians.

The safeguard for Canadians is that, when you refer to the $8 billion to $13 billion I referred to, any of these amounts—it's called production support—would only come into play, first, if you have the facility, and then you start producing and you're selling batteries retroactively. None of that amount today is payable. That only comes if and when the plant is built, when they start production not for inventory but for sale retroactively subject to all the conditions of the IRA, on the same schedule. If the IRA were to say that it's not up to 2032 but it's up to 2030, the amount would be reduced in the same way. The—