Evidence of meeting #63 for Industry, Science and Technology in the 40th Parliament, 3rd Session. (The original version is on Parliament’s site, as are the minutes.) The winning word was witnesses.
A recording is available from Parliament.
Partner, Fraser Milner Casgrain LLP, As an Individual
I'd like to see explanations that do not give away confidential information—we have to be very sensitive to that—but ones that provide some guidance, so that we don't have to rely on broad statements made in the media about why certain decisions were made, because that's a source of concern for investors.
Liberal
Siobhan Coady Liberal St. John's South—Mount Pearl, NL
One of the things you talked about was the need for understanding both the rules and the reasoning. How would investors use this report, when we get to having one, and how would Canadians? Is this a tool for people who are entering Canada thinking about foreign investment, as well as giving you some guidelines to encourage people who want to come—
Partner, Fraser Milner Casgrain LLP, As an Individual
Generally foreign investors look to people who are involved in the area, so it would help to give counsellors--foreign investment lawyers--the information they need to quell any anxiety that an investor might have that a transaction or investment they are about to make would be halted for any reason.
Conservative
Conservative
The Chair Conservative David Sweet
We'll go on to the Bloc Québécois.
Monsieur Bouchard, vous disposez de sept minutes.
Bloc
Robert Bouchard Bloc Chicoutimi—Le Fjord, QC
Thank you, Mr. Chair.
Good afternoon, Ms. Walker.
My first question is simply about the approval. Since 1985, there has been a single…
Partner, Fraser Milner Casgrain LLP, As an Individual
Can I interrupt for one minute? I don't have translation. I actually can, probably, but I may not perfectly understand....
Partner, Fraser Milner Casgrain LLP, As an Individual
Yes, I'm going to put it up a little bit.
Bloc
Robert Bouchard Bloc Chicoutimi—Le Fjord, QC
The act has been in place since 1985. Do you not you find it surprising that, since then, there has been only one case where a minister has opposed the transaction? Does it not seem surprising to you that there has been a single case, when there have been a number of proposals to acquire Canadian companies?
Partner, Fraser Milner Casgrain LLP, As an Individual
The investment review process requires that the investor go through a back-and-forth discussion with the government, figuring out what commitments they will make to the government. Through that process the investor is making its case for why the investment is good for Canada.
It's not as if the act has done nothing. You don't need a prohibition of a transaction in order to increase benefit to Canada. In a way it might be surprising, looking at bald numbers, but considering the fact that the investor goes through this process and gives undertakings to the government, I don't think it's incredibly surprising. In the cultural sector, investors have decided not to proceed with the transaction because they know the government won't allow it, etc.
Bloc
Robert Bouchard Bloc Chicoutimi—Le Fjord, QC
I understand that you aren't surprised.
As far as the minister's refusal in the case of potash, do you think this will have an impact or send out a message to foreign investors that may want to acquire Canadian companies?
Partner, Fraser Milner Casgrain LLP, As an Individual
There was also the MDA-ATK deal that was refused in 2008, but I think the PotashCorp decision was surprising for the foreign investment community. It wasn't expected within the bar that I practise in with Investment Canada practitioners.
On the other hand, when I describe that transaction to my clients and in discussions with colleagues, we are able to see that in some ways it may be the exceptional transaction. It may not indicate that the government intends to make a lot of additional refusals, but it's a wake-up call telling you that you have to take Investment Canada seriously. If you want to get your transaction through, you have to do it properly. You have to pay attention to lots of different angles, economic angles, and you have to look at who the stakeholders are in the process and get them on your side.
Bloc
Robert Bouchard Bloc Chicoutimi—Le Fjord, QC
So we can say that the negotiations take place in private between the minister and the company in each case. Once the minister approves the transaction, what happens with the follow-up? I'm sure conditions have been set and noted, right? Can you comment on follow-up and application over the years?
Partner, Fraser Milner Casgrain LLP, As an Individual
The follow-up process involves a monitoring process. I think you've heard from other Industry Canada officials that there's a review process that usually occurs at the 18-month mark; it may also occur at the three-year mark for three-year undertakings, so there is ongoing monitoring. A lot of the times undertakings have a notice provision whereby you have to give advance notice to Industry Canada if you intend to implement a decision that may be non-compliant with undertakings.
Bloc
Robert Bouchard Bloc Chicoutimi—Le Fjord, QC
Do you think there should be more transparency? When the minister or the department negotiates or discusses with the company wanting to acquire Canadian interests, should there be more transparency? Should the public and the workers be given more information?
Partner, Fraser Milner Casgrain LLP, As an Individual
After the undertakings are negotiated and the deal has been approved, in a lot of cases, particularly high-profile cases, there will be the issuance of a press release that will contain a high-level summary of the undertakings. The question is, what level of detail do you provide? You can't provide so much detail that you'll actually put competitively sensitive information out in the public arena, so you have to be careful about that.
Bloc
Robert Bouchard Bloc Chicoutimi—Le Fjord, QC
I thought you said that you thought a time limit of 45 days with an extension of 30 days was a little too long. What timeline would you suggest, a month?
Partner, Fraser Milner Casgrain LLP, As an Individual
The 45 days I was referring to was the period of time within which the minister issues an opinion under the act. An opinion is not a decision; an opinion relates to an interpretation issue, such as what the Investment Canada Act covers, because there have been inconsistencies in how Industry Canada has interpreted that over the years. I was referring to ministerial written opinions in response to a request for an interpretation of the act and how it applies to a particular transaction.
Conservative
The Chair Conservative David Sweet
Thank you, Madam Walker.
Merci beaucoup, monsieur Bouchard.
We now go to Mr. Wallace for seven minutes.
Conservative
Mike Wallace Conservative Burlington, ON
Thank you, Mr. Chair.
I want to thank our witness for being here today.
I have just a few questions. Your law firm was not involved with the Potash Corporation deal, or was it?