Bill C-34 (Historical)

National Security Review of Investments Modernization Act

An Act to amend the Investment Canada Act

This enactment amends the Investment Canada Act to, among other things,
(a) require notice of certain investments to be given prior to their implementation;
(b) authorize the Minister of Industry, after consultation with the Minister of Public Safety and Emergency Preparedness, to impose interim conditions in respect of investments in order to prevent injury to national security that could arise during the review;
(c) require, in certain cases, the Minister of Industry to make an order for the further review of investments under Part IV.1;
(d) allow written undertakings to be submitted to the Minister of Industry to address risks of injury to national security and allow that Minister, with the concurrence of the Minister of Public Safety and Emergency Preparedness, to complete consideration of an investment because of the undertakings;
(e) introduce rules for the protection of information in the course of judicial review proceedings in relation to decisions and orders under Part IV.1;
(f) authorize the Minister of Industry to disclose information that is otherwise privileged under the Act to foreign states for the purposes of foreign investment reviews;
(g) establish a penalty not exceeding the greater of $500,000 and any prescribed amount, for failure to give notice of, or file applications with respect to, certain investments; and
(h) increase the penalty for other contraventions of the Act or the regulations to the greater of $25,000 and any prescribed amount for each day of the contravention.

National Security Review of Investments Modernization Act

[The Assistant Deputy Speaker (Mrs. Alexandra Mendès), Alexandra Mendes]

I apologize to the hon. member, but I must interrupt.

I would ask members to lower their voices and not make a ruckus while the hon. member is answering a question.

The hon. member for Montmagny-L'Islet-Kamouraska-Rivière‑du‑Loup.

[Bernard Généreux, Conservative, Montmagny—L'Islet—Kamouraska—Rivière-du-Loup, QC]

Madam Speaker, what I was saying is that I hope the Bloc will vote with us on this amendment.

The possibility of having two ministers from Ontario or British Columbia who would be responsible for public safety, innovation and industry would mean that no one in cabinet would have any power or say over a decision concerning a company that could be sold in Quebec and acquired by other companies around the world. We therefore fail to understand the Bloc's position on this matter.

[Rachael Thomas, Conservative, Lethbridge, AB]

Madam Speaker, I wonder whether my hon. colleague could comment on the importance of putting the safety and security of Canadian citizens, those who call this nation home, as the primary objective of government. We all know government has competing affections and responsibilities, but of utmost importance is the security and safety of Canadians. If that is not looked after, Canadians are actually not able to prosper in the way they deserve to. It is incumbent, then, upon the government of the day to ensure that decisions are taken with utmost sobriety and with the greatest judgment possible, and that a great deal of attention is given to research. In this case, of course, that has to do with foreign investments, in order to make sure that Canadians are kept safe and secure and that our prosperity is able to be furthered.

I wonder whether my colleague could comment on that and perhaps on where my Liberal government colleagues across the aisle maybe got that right and where they maybe got it wrong in the bill.

[Bernard Généreux, Conservative, Montmagny—L'Islet—Kamouraska—Rivière-du-Loup, QC]

Madam Speaker, that is an important question since, indeed, when we talk about national security and the security of companies that might be acquired or that have a national security interest, it is vital that we ensure that the process is done properly.

Unfortunately, several of the amendments we proposed were rejected. They would have enhanced the quality of the work that the government in place should have done to ensure that we do not get taken for a ride, which is what happened in several cases where the minister approved acquisitions in Canada that never should have happened.

[Rick Perkins, Conservative, South Shore—St. Margarets, NS]

Madam Speaker, an amendment was promised at committee that all companies headquartered in China would be subject to an automatic review. The Liberals defeated that amendment. Could the member explain why?

[Bernard Généreux, Conservative, Montmagny—L'Islet—Kamouraska—Rivière-du-Loup, QC]

Madam Speaker, we know that the current Prime Minister has the utmost admiration for the President of China. Again, when it comes to totalitarian countries like China that want to acquire Canadian technologies, it is vital that we find a way to act. I think that our amendments were designed to help—

[The Assistant Deputy Speaker (Mrs. Alexandra Mendès), Alexandra Mendes]

I must interrupt the member. We have to resume debate.

The hon. member for Lethbridge.

[Rachael Thomas, Conservative, Lethbridge, AB]

Madam Speaker, I rise in the House today to discuss Bill C-34, an act to amend the Investment Canada Act.

Ultimately, at the very heart of this debate is the prosperity of Canadians and their well-being. For Canadians to prosper, the government of the day needs to do three things. It needs to grant freedom to the people: freedom to dream, freedom to take risks and freedom to earn a living. The government of the day needs to facilitate an environment of economic prosperity where folks can dream, take a risk and invest, where red tape is cut and where taxes are decreased so that people can flourish. The government of the day also needs to prioritize the safety and security of Canadians. Without our borders being secure and without the safety of Canadians being front of mind by the government, it is rather difficult to pursue these other things.

That said, we also know that the government needs to get out of the way as much as possible. When looking at this legislation and the amendments made to the Investment Canada Act, one must ask this question: Where does the balance lie between government engagement or involvement and none?

Here in Canada we have incredibly industrious and talented people. We have people who combine their talents with the bounty of the land to prosper, and they make amazing things possible. I think of the farmer who works his land and brings it to harvest. I think of the fisherman who works on dangerous high seas. I think of the miner who works miles underground. I think of the business owner who brings her passion to life through innovation and hard work to create jobs for others and, of course, to earn a living herself.

Because of the greatness of the people who call Canada home, I believe we can participate in a broader global economy as well. That is where the bill comes in. This broader global economy presents amazing opportunities for Canadian businesses and allows us to spur innovation. Our quality of life grows when the Canadian economy can offer so much to the world and to each Canadian. The world in turn, of course, invests in Canada. Our economy then grows even more and Canadians are empowered to live fulfilling lives to an even greater extent.

While the global economy generates many opportunities, it also invites threats, which is again where Bill C-34 comes into play. It is why it is so very important that we as Canadians are vigilant in making sure that the investments we are attracting into our country are ones that we indeed want to attract, ones that are good for Canada. It means that a robust review process is absolutely necessary to ensure this is the case. A thorough and robust review process, I would argue, is an absolute must.

The globe is not made up entirely of governments that desire peace and goodwill for all people. We know that, perhaps more now than many years ago. We know that some states pose a threat to the very way of life we enjoy here in Canada. They do not desire the prosperity of Canada, nor do they approach our market in good faith. In fact, they have other objectives in mind. These countries are not our friends. That is why it so very important that we get legislation like this right.

It is the duty of the government to ensure that Canadians are kept safe and secure, that good decisions are made and that the right investments are drawn into the borders of our land. Certain countries operate with covert agendas and work to undermine the security of our nation and the prosperity of its people. This often happens through the vectors of our international trade and the acquisition of Canadian assets. This is why, again, it is so important for security reviews to be done in a thorough and timely manner. I will use some examples to highlight what I mean.

In 2017, the Minister of Industry failed to request a full national security review of the acquisition of the B.C.-based telecommunications company Norsat International and its subsidiary Sinclair Technologies. The Chinese company Hytera Communications wanted to acquire them. We know that Hytera Communications is partially owned by the People's Republic of China. A careful review should have been done but was not.

Fast-forward then to December 2022, and the RCMP actually awarded a contract for sensitive communications system equipment to this technologies firm. Again, I will remind the House that it is partially owned by Beijing.

This company then, in January, only a month after the contract was awarded to them, was charged with 21 counts of espionage in the United States, and then banned from doing business in the U.S. by President Biden.

This company is one that was given access to all RCMP communications services. Of course, we could imagine what that does to our overall safety and security as a nation and to the confidence that Canadians can place in the RCMP.

Here is another example. In 2020, even more insultingly, the Department of Foreign Affairs actually awarded a contract to a Chinese-based company called Nuctech, founded by the son of a former general secretary of the Chinese Communist Party. They were contracted to supply X-ray equipment to 170 Canadian embassies and consulates. One can quickly imagine what the impact of such a decision would be, in terms of the types of intelligence that could be gathered through doing X-rays, especially in a place like an embassy or a consulate.

It would seem that in some ways it is almost on brand for the Liberal government to turn a blind eye to these important decision-making processes and just allow things to flow the way that they will, which is actually putting Canadians in jeopardy then. This is where responsibility needs to be exercised, and I would even dare say just some basic common sense. We have to take precautions in order to safeguard the people of this country and our economic prosperity as a nation.

Speaking of economic prosperity, what could be more prosperous than people earning a living for themselves and being able to take that money and invest it where it needs to go. What could be more important than government getting out of the way and allowing those Canadians to spend their money as they need to, in order to make ends meet.

In fact, right now, Canadians are actually finding it more difficult than ever before to do that. In large part, that is because of a carbon tax that is applied to everything from home heating to food to the fuel that we put in our vehicles. The Liberal government coming under immense pressure from the Canadian public, knowing that they were having a difficult time being able to afford life, made the decision that it would take the carbon tax off a small portion of people in Canada for a short time. It would hit the pause button and scrap the carbon tax for three years for those who live in Atlantic Canada and use oil heating. However, those who are in my province of Alberta who use natural gas are out of luck. They still have to pay the carbon tax.

We thought we would give the hon. members across from us the opportunity to make this fair for all Canadians, because, of course, choosing a favourite 3% is not fair and it is no way to govern a nation properly. The Conservative Party put forward a motion, and that motion was voted on today. It was a motion that invited all members in this place to vote to scrap the carbon tax for all Canadians, to make it fair from coast to coast to coast, which is what any government should want to do. It should be concerned about the unity of this great country and the economic prosperity of its people.

This place was given an opportunity to vote in favour, with the Conservatives, and to bring that motion into play, which would have saved Canadians thousands of dollars. Instead, the members across the way decided to vote that motion down. They voted to make life more expensive and less affordable for Canadians. They decided that they wanted the carbon tax to be applied to 97% of Canadians, but taken away from 3%. The government across the way determined that its polls were down in Atlantic Canada, and so it needed to show favour to that 3% but the rest could be punished. It is sad.

Parliament, this place, those who sit here were given an opportunity to be on the side of the everyday Canadian person. Instead, Liberals chose to play politics.

The bill that is before us today is yet another opportunity to be on the side of the Canadian people and to make sure that their safety, security and well-being is put first and foremost, which means that more than 10 amendments that were brought forward by Conservative members at committee should have been accepted in order to strengthen this legislation and make it better for all.

Unfortunately, again, the government of the day actually shot those amendments down. While the bill that we debate today makes some minor improvements, and I cannot fault the government for that, I do fault the government for not going all the way and making this bill even stronger. That is very sad. There could have been multipartisan co-operation to strengthen this bill. Again, the government of the day—

[The Assistant Deputy Speaker (Mrs. Alexandra Mendès), Alexandra Mendes]

Questions and comments, the hon. member for South Shore—St. Margarets.

[Rick Perkins, Conservative, South Shore—St. Margarets, NS]

Madam Speaker, I listened with interest to the member for Lethbridge's speech, and I am particularly interested in the example she gave about Hytera. For those who are watching and do not understand, the Chinese-based state-owned company that bought it does not make money; it actually loses money every year. These state-owned enterprises are not only acquiring Canadian companies but also winning contracts by being the lowest bidder for Canadian companies not making money.

Could the member please inform the House what she thinks the motivation might be of a state-owned enterprise if it is not making money in acquiring these businesses?

[Rachael Thomas, Conservative, Lethbridge, AB]

Madam Speaker, the existing committee and the committee of industry before it actually took opportunity to study this issue extensively. In addition to that, there have been other investigations done. What has been found is that at times, there will be state actors that will make an investment in Canada or purchase a business that exists within Canada and do so for the sake of the state actor. It is in their interest, not in the interest of the Canadian people. It is not in the interest in the furtherance of our nation. It is not in the economic interest of Canada. Rather, in this case in particular, it is the Communist Party of China that ultimately will benefit from such a decision. Again, this is where proper review and consultation are so important when we look to allow these foreign investments in Canada.

[Lori Idlout, NDP, Nunavut, NU]

Uqaqtittiji, understanding that in deciding to invest in Canada, there has to be a balance between what will generate prosperity in Canada and protecting national security, I wonder whether the member can comment on whether she thinks this bill would balance more toward the prosperity of Canada or more toward national security.

[Rachael Thomas, Conservative, Lethbridge, AB]

Madam Speaker, if I may, with the deepest respect, I think it is a dichotomy that maybe is not necessary. It is possible to do both. It is possible to look after the safety and security of Canadians, to make sure our nation is put first and foremost, and also to want to cultivate prosperity for the Canadian people. Both can be done, but it comes down to the review process.

For example, in the bill before us, one of the things is that a minister would be able to make a decision on their own, without having to bring it to cabinet. By doing that, the minister would actually be acting unilaterally, and I would say rejecting the collective wisdom cabinet would have to offer in many of these cases. Cabinet is an assortment of individuals from many different ways of life, many different backgrounds and different regions, so its ministers have access to information that could help a robust discussion to take place and an educated decision be made. When cabinet is kept out of that process and the minister makes the decision all by himself or herself, Canadian people are put at a disadvantage.

[Rick Perkins, Conservative, South Shore—St. Margarets, NS]

Madam Speaker, on a point of order, I would like a quorum call.

And the count having been taken:

[The Assistant Deputy Speaker (Mrs. Alexandra Mendès), Alexandra Mendes]

There are 20 members, including me, without the ones who are coming in.