National Security Review of Investments Modernization Act

An Act to amend the Investment Canada Act

This bill is from the 44th Parliament, 1st session, which ended in January 2025.

Sponsor

Status

This bill has received Royal Assent and is now law.

Summary

This is from the published bill. The Library of Parliament has also written a full legislative summary of the bill.

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.

Elsewhere

All sorts of information on this bill is available at LEGISinfo, an excellent resource from Parliament. You can also read the full text of the bill.

Bill numbers are reused for different bills each new session. Perhaps you were looking for one of these other C-34s:

C-34 (2021) Law Appropriation Act No. 3, 2021-22
C-34 (2016) An Act to amend the Public Service Labour Relations Act and other Acts
C-34 (2014) Law Tla'amin Final Agreement Act
C-34 (2012) Law Appropriation Act No. 4 2011-12

Votes

Nov. 20, 2023 Passed 3rd reading and adoption of Bill C-34, An Act to amend the Investment Canada Act
Nov. 7, 2023 Passed Concurrence at report stage of Bill C-34, An Act to amend the Investment Canada Act
Nov. 7, 2023 Failed Bill C-34, An Act to amend the Investment Canada Act (report stage amendment) (Motion 3)
Nov. 7, 2023 Passed Bill C-34, An Act to amend the Investment Canada Act (report stage amendment) (Motion 1)
Nov. 6, 2023 Passed Time allocation for Bill C-34, An Act to amend the Investment Canada Act
April 17, 2023 Passed 2nd reading of Bill C-34, An Act to amend the Investment Canada Act

Debate Summary

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This is a computer-generated summary of the speeches below. Usually it’s accurate, but every now and then it’ll contain inaccuracies or total fabrications.

Bill C-34 aims to modernize the Investment Canada Act by strengthening the government's ability to review foreign investments that may pose a threat to national security or economic interests. The bill introduces measures such as pre-implementation filing requirements, ministerial authority to impose interim conditions on investments, harsher penalties for non-compliance, and improved information sharing with international partners. While the bill has received broad support, concerns have been raised regarding the scope of the reviews and whether the bill goes far enough to protect Canadian assets, intellectual property, and economic sovereignty from hostile foreign actors.

Liberal

  • Modernizing Investment Canada Act: The Liberals support modernizing the Investment Canada Act to address changes such as technological advancements and foreign interference, especially concerning ownership of Canadian companies and assets. The aim is to protect Canadian industries and ensure investments align with Canada's best interests.
  • Protecting national security: The legislation is intended to allow rapid government intervention if foreign investment harms Canada's national security, adapting to the speed of innovation and addressing geopolitical risks. It aims to prevent hostile actors from exploiting Canada’s expertise and capacity for innovation.
  • Balancing economic growth: The Liberals aim to balance welcoming foreign investment with protecting Canada's economic interests and national security. The goal is to attract investment while safeguarding intangible assets like intellectual property and trade secrets, ensuring economic growth and job opportunities without compromising sovereignty.
  • Aligning with international partners: The amendments in Bill C-34 would better align Canada with international partners and allies by introducing requirements for prior notification of certain investments, the authority to impose interim conditions, and the ability to share case-specific information to support national security assessments.

Conservative

  • Inadequate to address threats: The Conservatives believe the bill does not go far enough to address acquisitions by hostile states. Members noted that it has been 14 years since the act was amended and that state-owned enterprises have become extraterritorial in taking over companies globally for their own economic interests. The Conservatives feel the bill is too limited in scope to address the new challenges of a globalized economy.
  • Missed opportunities identified: Conservatives believe the bill does not adequately protect Canadian assets, companies, and sovereignty. They proposed several amendments that were rejected, including modifying the definition of “state-owned enterprises”, listing specific sectors necessary to preserve Canada's national security, and exempting non-Canadian Five Eyes intelligence state-owned enterprises from the national security review process.
  • Cabinet decision-making is essential: The Conservatives are concerned about removing cabinet from the decision-making process, as it eliminates regional perspectives and the breadth of experience from various ministers. An amendment was proposed to ensure that cabinet continues to play an active role in major decisions about foreign investment.
  • Acknowledges positive amendments: Conservatives highlight some amendments that were adopted, including reducing the threshold to trigger a national security review to zero for any investment by a state-owned enterprise and ensuring that items reviewable include acquisitions of any assets by state-owned enterprises. They also included ensuring a review if a company had previously been convicted of corruption charges.

NDP

  • Supports updating the Act: The NDP supports updating the Investment Canada Act (ICA) to reflect changes since 2009. Members believe that the bill creates more tools to ensure foreign investments align with Canada's best interests and national security.
  • Focus on intellectual property: The NDP emphasizes the need to protect intellectual property in a knowledge-based economy, supporting amendments to capture potential investments or acquisitions by foreign actors. They argue that thresholds should consider the economic value of intellectual property to ensure sensitive IP is reviewed appropriately.
  • Weaknesses remain in legislation: NDP members express concerns about the government's willingness to prioritize corporate interests over Canadian interests, citing the Rogers-Shaw merger as an example. They suggest that changing the act is insufficient without the political will to conduct thorough reviews and reject investments that do not benefit Canada.
  • State-owned enterprises: The NDP argues that the act should mandate review of acquisitions by state-owned enterprises of companies previously reviewed by the ICA. They cite the example of Anbang's acquisition of Retirement Concepts and the subsequent seizure by the Chinese government as a reason.

Bloc

  • Supports bill overall: Bloc Québécois supports Bill C-34, which amends the Investment Canada Act to strengthen the government's ability to monitor foreign investments that could compromise Canada's national security. They see it as a necessary first step in an increasingly interconnected world.
  • Protecting Quebec's economy: The Bloc emphasizes the importance of protecting Quebec's economy from potentially detrimental foreign interests. They are concerned about the impact of foreign investment on Quebec's aerospace industry and intellectual property.
  • Coordination with U.S.: The Bloc recognizes that Bill C-34 aligns Canadian security policies with those of the United States. This alignment is essential for Canada to be included in the U.S. industrial modernization strategy.
  • Review threshold too high: The Bloc believes that the bill is incomplete and that the government needs to go further in scrutinizing foreign investment. They advocate for lowering the review threshold so that more investment projects are subject to review.
  • Need economic security: While national security is important, the Bloc emphasizes the need for economic security and long-term prosperity. They caution against the harmful effects of ill-advised foreign investments on the Canadian economy.

Green

  • Bill C-34 concerns: The speaker regrets the limited opportunity for the Green Party to participate in the debate on Bill C-34. There are concerns that cabinet decision-making is too discretionary and worries about foreign investments affecting national security and sovereignty.
  • Aecon takeover concern: The speaker raised concerns about the proposed takeover of Aecon, a large Canadian engineering firm, by a company from the People's Republic of China. They questioned the need for a national security review and highlighted the implications of the Foreign Investment Promotion and Protection Agreement (FIPA) with China.
  • Paper Excellence worries: The speaker is alarmed by the takeover of Canada's pulp and paper production by Paper Excellence, owned by an Indonesian billionaire. They question whether this poses a national security threat and express concern that the acquisition happened without a foreign investment review.
Was this summary helpful and accurate?

Motions in AmendmentNational Security Review of Investments Modernization ActGovernment Orders

October 26th, 2023 / 1:45 p.m.

Conservative

Rick Perkins Conservative South Shore—St. Margarets, NS

Mr. Speaker, one of my colleagues, in response to that, asked, “What year?” That is funny.

Yes, absolutely, the principle of the bill originally was an improvement of the current Investment Canada Act. We have improved it dramatically over what the government presented, so obviously we will be voting for the amendments we made to improve the bill. We will have a robust debate at both report stage and third reading to give members a chance to speak about this important strategic issue for Canada.

I hope government members will support my amendment today to ensure that we return to cabinet decision-making processes.

Motions in AmendmentNational Security Review of Investments Modernization ActGovernment Orders

October 26th, 2023 / 1:45 p.m.

Bloc

Sébastien Lemire Bloc Abitibi—Témiscamingue, QC

Mr. Speaker, I thank my colleague from South Shore—St. Margarets, who is my Standing Committee on Industry and Technology co-chair. I have to say that I am liking him more and more. We have been working together for a good year now, and I appreciate how thorough he is and how creative he can be. He stands up for small businesses, and he has a good understanding of Quebec's economy.

The member proposed an amendment. My immediate reaction is that I am in favour of the minister having enough time to really think things through if necessary. It is no good announcing public consequences before doing due diligence. I would like to give him a chance to go into more detail about his amendment. Maybe I will give him one last chance to convince me that, from a Quebec point of view, this amendment makes sense.

Motions in AmendmentNational Security Review of Investments Modernization ActGovernment Orders

October 26th, 2023 / 1:50 p.m.

Conservative

Rick Perkins Conservative South Shore—St. Margarets, NS

Mr. Speaker, my colleague from Abitibi—Témiscamingue provides a lot of great input at the industry committee, and I appreciate that we have a lot of thoughtful discussions.

I agree that we should not create artificial time when we are dealing with very critical acquisitions. Whether it is a private sector company from around the world taking over Rona, for example, or a state-owned enterprise, the minister needs to not be restricted by arbitrary timelines so we can get the adequate national security net benefit and can analyze whether they have been convicted of corruption or bribery, thanks to the Conservatives, who put that in. Those are considerations the government should review in a thorough manner, not necessarily feeling that it has to rush things through.

Motions in AmendmentNational Security Review of Investments Modernization ActGovernment Orders

October 26th, 2023 / 1:50 p.m.

NDP

Brian Masse NDP Windsor West, ON

Mr. Speaker, my colleague works really hard at committee and comes well prepared.

I understand the amendment the member is putting forth right now with regard to the consolidation of the minister's powers and not having secondary support from cabinet. Maybe the member wants to elaborate more on that. Is this because of the previous Conservative industry minister, Maxime Bernier? Is that what this amendment is about? Is it a Maxime Bernier amendment?

Motions in AmendmentNational Security Review of Investments Modernization ActGovernment Orders

October 26th, 2023 / 1:50 p.m.

Conservative

Rick Perkins Conservative South Shore—St. Margarets, NS

Mr. Speaker, no, I named this the Navdeep Bains amendment, as he did not review anything that went before him, and particularly not large companies from China. He approved them all without national security briefs. Now we know why Navdeep Bains did that: It was so he could secure himself a big, fat job on Bay Street, first with CIBC and now with the most expensive telephone provider in the world, Rogers, where he sits atop the tower talking about the things he used to regulate and let through. It is shocking, really, that Liberals would sell themselves for a job.

Motions in AmendmentNational Security Review of Investments Modernization ActGovernment Orders

October 26th, 2023 / 1:50 p.m.

Green

Elizabeth May Green Saanich—Gulf Islands, BC

Mr. Speaker, one of the acquisitions that I wish had been reviewed, which I do not think Bill C-34, even with amendments, would catch, was Paper Excellence buying up the pulp and paper mills of this country: all of Catalyst, all of Resolute and, in the member's home province, starting with Northern Pulp. It looks like it was all financed by the China Development Bank. What does the member think about that?

Motions in AmendmentNational Security Review of Investments Modernization ActGovernment Orders

October 26th, 2023 / 1:50 p.m.

Conservative

Rick Perkins Conservative South Shore—St. Margarets, NS

Mr. Speaker, if an acquisition is financed or controlled by a Chinese entity, thanks to the Conservatives, there is now a change to the act that says anything over zero dollars is reviewable by Investment Canada.

I appreciate the hon. member for bringing that up. It gave me the opportunity to once again explain how important our amendment and improvement of the act are when looking out for those things.

Motions in AmendmentNational Security Review of Investments Modernization ActGovernment Orders

October 26th, 2023 / 1:50 p.m.

Bloc

Sébastien Lemire Bloc Abitibi—Témiscamingue, QC

Mr. Speaker, I would like to begin by telling the interpreters that I will not try to fit my speech into the six minutes, although I think I could. The fact that I will not have to take questions immediately afterwards may save me from getting a question like the one my colleague from Windsor West asked. I will prepare accordingly.

I rise today to speak to Bill C‑34, which has just passed an important milestone. I understand that my colleagues have identified other amendments at this stage, and I will inform the House of the Bloc Québécois's position in due course.

This bill represents the first substantial review of the Investment Canada Act since 2009, when the government introduced a mechanism for assessing the national security implications of foreign investments. Essentially, it aims to strengthen the government's powers to monitor foreign investments that could compromise Canada's national security.

Bill C‑34 introduces seven major changes: a new requirement to provide notice of certain investments prior to their implementation in designated sectors; ministerial authorization to extend national security reviews of investments; harsher penalties for contraventions; ministerial authorization to impose conditions prior to the national security review period; ministerial authorization to allow undertakings that mitigate national security risks; improved information disclosure with international counterparts; and new rules to protect information in the course of judicial reviews.

These undeniably necessary changes reflect the logical evolution of an increasingly interconnected world. Foreign investment plays a vital role in economic development, not only in Canada, but also, and especially, in Quebec.

Over the past few months, the members of the Standing Committee on Industry and Technology examined several important issues related to these foreign investments. We held no less than 12 meetings, during which we heard from nearly 20 witnesses. Their testimony informed our debates and contributed to our collective understanding. We heard valid concerns about the potential vulnerability of our businesses and our sovereignty to ill-intentioned foreign investments. This strengthened our conviction that Bill C‑34 is an important first step.

When it came time to consider each member's amendments, we each addressed aspects that seemed important to us. I was particularly anxious to ensure that Quebec's economy would not be hurt. I thought about several situations where investments shaped Quebec. I wish the federal government had done some thinking as well, in response to the recommendations of the Bélanger-Campeau commission, and that it had opened up certain sections of the act to make amendments to better protect Quebec's leading companies.

The Conservatives tried to make changes that probably would have had disastrous consequences for Quebec's aerospace industry. They suggested drastically limiting the ability of foreign state-owned enterprises to invest in critical sectors and authorizing such operations only with the members of the anglophone Five Eyes, meaning the United States, Canada, Great Britain, Australia and New Zealand.

Let us look at the practical consequences of the Conservatives' proposal. Take, for example, the takeover of Bombardier's C Series by Airbus. That transaction, which was completed successfully, is critical to our aerospace cluster. Airbus is a company owned by the French and German governments, which are neither American nor anglophone. If amendments CPC-5 and CPC-6 had been in effect at the time, that transaction would have been prohibited, which would have had disastrous consequences for our aerospace sector. That is what the Conservatives' aerospace policies are like at times.

I appreciated the government's openness to considering clarifying that purchasing a company's assets is the same as purchasing the company itself, and so the transaction is subject to the act. This clarification was necessary, especially when it comes to intangible assets such as intellectual property patents, where there was a gap in the previous legislation. It is crucial that our laws protect the national interest, including intellectual property.

On some amendments, our position was more nuanced. I supported the idea of taking intellectual property into account during reviews of transactions, because it enhances our national security and protects our strategic assets.

However, we must keep in mind that Bill C‑34 seeks mainly to align our security policies with those of the United States, an essential prerequisite for Canada to be included in the U.S. industrial modernization strategy, in particular the development of electrification.

The proof is that, immediately after Bill C-34 was introduced, the Americans lifted the most protectionist measures through the Inflation Reduction Act, which Joe Biden announced just before his visit to Ottawa.

Restrictions remain in future incentives for the purchase of electric vehicles, but these provisions will only come into effect later, when current investments have increased the supply of cars enough to meet demand. There is every indication that they will harmonize this with the industrial component.

As a result, Canada's agreements with the U.S. include specific provisions on personal information in the defence sector, allowing Canadian companies to bid on Pentagon contracts for the first time since 1956. Since these contracts give access to U.S. defence secrets, the U.S. government asks for information on our companies' personnel in order to conduct security checks. We have to be careful not to lose this privilege.

I would like to take this opportunity to inform the House that other ideas emerged during our work on the Standing Committee on Industry and Technology.

I will continue my speech after question period.

The House resumed consideration of Bill C‑34, An Act to amend the Investment Canada Act, as reported (with amendments) from the committee, and of the motions in Group No. 1.

National Security Review of Investments Modernization ActGovernment Orders

October 26th, 2023 / 3:35 p.m.

Bloc

Sébastien Lemire Bloc Abitibi—Témiscamingue, QC

Mr. Speaker, I would like to take this opportunity to share with my colleagues some of the other ideas that emerged during the work of the Standing Committee on Industry and Technology. One of the most important changes for which the Bloc Québécois vigorously advocated involves transparency provisions.

I know how important transparency is to you, Mr. Speaker. We could have included other provisions, but I sense that you are particularly attentive to transparency. It is an important concern that witnesses have mentioned, and it has been reflected in the technical documents that have been presented to us.

I stressed the need for greater transparency in the national security decision-making mechanisms. I went to the right school, some might say, and I think I have colleagues who have influenced me, in particular the member for Joliette, whom I would like to recognize.

This includes more information from agencies responsible for decisions related to national security. It is a legitimate request to want to understand how the decisions are made and what criteria are taken into account.

The minister's obligation to publicly present his or her decisions is significant progress in fostering public understanding. This will allow citizens, businesses and stakeholders to better understand the process and the motivations underlying national security decisions.

We remain firmly committed to acting in the best interest of the Quebec nation, ensuring that our national interests are preserved in harmony with our democratic values and our quest for an open and transparent governance.

We think it is a shame that the government restricted and limited the amendments to Bill C‑34 to the single issue of national security related to foreign investments.

I think there was some consensus around the table with respect to the fact that the government missed an opportunity to review the thresholds for mergers and acquisitions, especially when it comes to guaranteeing that the foreign investments have a net benefit for Canada.

We therefore support this bill and will continue to demand loud and clear that the government introduce a new bill to also review the other sections of the Investment Canada Act.

That said, it was high time to address national security issues related to foreign investment.

National Security Review of Investments Modernization ActGovernment Orders

October 26th, 2023 / 3:35 p.m.

Winnipeg North Manitoba

Liberal

Kevin Lamoureux LiberalParliamentary Secretary to the Leader of the Government in the House of Commons

Mr. Speaker, I listened to the member just now and before question period, and my primary concern is dealing with foreign interference, which, as I said previously, takes many different forms. What we are debating today is from an investor's perspective, and that is the reason we need to modernize the act after 14 years, given AI and technology, to protect our industries here in Canada and to make sure that interests here are served, first and foremost.

I wonder whether the member could provide his thoughts with regard to the passage of the legislation. Would the Bloc like to see any other things in the bill apart from the amendments we are debating today?

National Security Review of Investments Modernization ActGovernment Orders

October 26th, 2023 / 3:40 p.m.

Bloc

Sébastien Lemire Bloc Abitibi—Témiscamingue, QC

Mr. Speaker, as I mentioned, the Bloc Québécois intends to vote in support of the bill. However, the main amendments that we wanted to include were not compatible with the bill. From the outset, when we were talking about modernizing the Investment Canada Act, the Liberals should have included this notion of revising thresholds.

Let us take COVID‑19, for example, with our airlines. When the value of our airlines plummeted to the point where they finally fell below the mandatory review threshold, which was triggered, foreign companies—Chinese, American and others—were able to buy up flagships like Air Transat for a song.

The consequences would have been disastrous. What we need to do with the Investment Canada Act is to go deeper into the issue of thresholds. All the same, I am delighted that transparency has increased. Let us take the example of Lowe's, a classic in Quebec, with the sale of Rona. We never knew what the compromises were. Five years on, we realize that these compromises may not have been respected.

National Security Review of Investments Modernization ActGovernment Orders

October 26th, 2023 / 3:40 p.m.

Conservative

Marilyn Gladu Conservative Sarnia—Lambton, ON

Mr. Speaker, that was a good speech.

Before question period, the Parliamentary Secretary to the Leader of the Government said that Canada was a good place for investors.

However, investors keep leaving. There are a lot of rules, like those arising from the passage of Bill C‑69, the carbon tax is too high, and we have measures that do not exist in other countries.

Why is there nothing in this bill to deal with that problem?

National Security Review of Investments Modernization ActGovernment Orders

October 26th, 2023 / 3:40 p.m.

Bloc

Sébastien Lemire Bloc Abitibi—Témiscamingue, QC

Mr. Speaker, I thank my colleague from Sarnia—Lambton for speaking French and for the effort that she makes. I commend her for that.

That is indeed a major problem. How can we bring in foreign capital to grow our economy? What was of particular interest to me in the context, and I had the support of my Conservative colleagues in that regard, was how to regulate critical and strategic minerals, particularly when it comes to the electrification of transport. How can we be sure to maintain ownership of our critical resources for the sake of national security? About 30 of them were targeted, including lithium.

Imagine if our companies had to depend on Chinese lithium. In theory, there have been acquisitions by Canadian companies, but they were overseas and bought back by the Chinese. We were told that that was of no value, so there was no need to conduct a review under the Investment Canada Act. Imagine that this happens and we do not take action. I think that we would want to protect our interests in such a situation.

When it comes to the electrification of transport in the new economy, we need ownership of our resources. If we want people to invest here, then we need to own our resources.

National Security Review of Investments Modernization ActGovernment Orders

October 26th, 2023 / 3:40 p.m.

NDP

Brian Masse NDP Windsor West, ON

Mr. Speaker, my colleague brought up excellent points. I wonder what he thinks about the fact that, in natural resources, we have had Vale, Rio Tinto, Xstrata and United States Steel take over the Canadian companies Inco, Alcan, Falconbridge and Stelco. What happened? We gave up all of our natural resources to foreign companies.