Industry Committee on May 25th, 2020

[Christian Buhagiar]

I appreciate the question. Let me assure you that we actually do a lot of work with Magna Centre, and we thank Don for the great contributions that they've made. Brian Watson, who leads the centre, is a good friend of ours.

I will mention a couple of things. First, let me say that I'll leave it to the great minds in research to think about the great topics. From our perspective, however, the key is around reducing this latency, which requires a digitization of the supply chain. The key there is to determine how we take consumers' market-driven behaviour, predict where consumer behaviour is going to go and be able to feed that much more quickly into the supply chain so that we can shrink that latency.

Does that help?

[Lloyd Longfield, Liberal, Guelph, ON]

It does.

I have a follow-up. Hopefully, I'll have a little time in the next round. Thank you.

[The Chair, Liberal, Sherry Romanado]

Thank you very much.

Our next round goes to Madame Vignola.

Ms. Vignola, you have two and a half minutes.

[Julie Vignola, Bloc, Beauport—Limoilou, QC]

Thank you very much.

I'm going to talk about supply. I find it extremely interesting to hear you talk about innovation and respect for ideas.

Your businesses and customers use the buyandsell.gc.ca website to do procurement business with the government. I believe many of your clients have used this site over the years. Is this site up to date enough to protect the data?

Mr. Balsilie, do you think the buyandsell.gc.ca website is effective, innovative and up-to-date?

[Jim Balsillie]

I haven't used the site, so I can't really provide you with a thoughtful answer. I'm sorry I can't comment on it.

[Julie Vignola, Bloc, Beauport—Limoilou, QC]

Mr. Paterson, your company probably used the site, given the changes in productivity and so on. Is this site innovative?

[David Paterson]

I can tell you that I had occasion to use it just recently, because were participating in a research program that the government put forward to improve the site. They asked users to walk through different scenarios and give feedback on how easy or hard it was to use.

In particular, we looked at PPE. If you were to try to procure masks, visors or other things from the government, we looked at how easy it would be to go in and learn about those things.

I think we found some really good improvements, and we always constantly need to improve.

[Julie Vignola, Bloc, Beauport—Limoilou, QC]

I see.

So the site is not as effective for current needs. Did I understand you correctly?

[David Paterson]

We found some very good ways to improve it. I give the government credit for going out and looking for ways to improve it.

[Julie Vignola, Bloc, Beauport—Limoilou, QC]

Thank you.

[The Chair, Liberal, Sherry Romanado]

Thank you very much.

Our next round goes to MP Masse. You have two and a half minutes.

[Brian Masse, NDP, Windsor West, ON]

Thank you, Madam Chair.

Mr. Balsillie, you mentioned the Investment Canada Act.

I remember when this committee was studying the Nortel sale. RIM actually purchased a Canadian company, but they still had to go through a U.S. security screen even in that acquisition. Meanwhile, in Canada here, we don't have the same types of measures with the Investment Canada Act. In fact, we finally got some issues related to non-democratic governments and a national security screen on it, but it's still pretty fast and loose.

I would like to get something clear from you with regard to what might need improvement. The thresholds for a review have been increased significantly over the years, so there are a lot of start-up companies and other companies that fall under the review process. I think this has to be addressed, especially if we're going to be rolling out some supports in investments from taxpayers. Some of these get gobbled up because they're good deals for somebody else coming in to scoop them up from us.

[Jim Balsillie]

Yes. First of all, we have dozens, if not hundreds, of professors in partnerships, whose early ideas are scooped up in a partnership or a licence that never hits the Investment Canada Act.

On the Nortel thing, which I think is interesting and illustrative to this committee, I had many calls. We were part of the consortium that bought it, and our share of it was about $800 million U.S. I had many calls in the wee hours of the morning—two or three o'clock in the morning—in which the U.S. government, in the form of the Department of Commerce and Department of Justice, were making sure that the structure of the licences and the consortiums did not upset the competitive and fair balance of access to these 5G patents in the economy.

I could literally spend as much time as you want explaining how it's a very hands-on structure even in a single licence acquisition of foreign technology between two rival risk consortiums. It's a very deliberate and organized hands-on abstract construct, and that can apply to all aspects of what we do, whether it's buying a start-up or making more of an investment or a partnership in research and development.

You have to look at what the Austrians, the Germans, the French, the Brits, the Australians—

[Brian Masse, NDP, Windsor West, ON]

Yes.

[Jim Balsillie]

—and the Americans have done, let alone all the Asian tigers. They're very deliberate in their investments and partnerships here, and very hands-on, and it's the second leg of that economy that we just simply need to develop. We should have developed it 20 years ago, but let's start developing it right now.

[Brian Masse, NDP, Windsor West, ON]

Thank you, Madam Chair.

[The Chair, Liberal, Sherry Romanado]

Thank you.

That completes our third round.

We have some time remaining, so we will begin a fourth round of questions.

We will start with MP Rempel Garner. You have the floor for five minutes.

[Michelle Rempel, Conservative, Calgary Nose Hill, AB]

Thank you, Madame Chair. I'll pick up where I left off with Mr. Balsillie.

Again, I think we have to be talking about what the economy looks like going forward. There has been a lot of talk that the stay-at-home restrictions may have accelerated disruptions that were already under way in certain industries, in everything from bricks-and-mortar retail to airlines continuing.

I would argue that this underscores the need for us to get our national policies straight with regard to intellectual property commercialization.

First of all, would you agree that this is a priority for government?

[Jim Balsillie]

Yes.

[Michelle Rempel, Conservative, Calgary Nose Hill, AB]

Okay.

With regard to going forward, you made a comment to my colleague—I believe it was Mr. Patzer—when he was asking about intellectual property. You used the example of Canada funding the Chinese military or an institution associated with the Chinese military to build a vaccine and that being problematic.

Do you want to expand upon that as well? I also have reservations with that approach.

[Jim Balsillie]

I think we have to be honest about the fact that no matter who owns the rights to these technologies, whether it's 5G technology for telecommunications or whether it's a vaccine, if we're concerned about the nature of those countries and companies and geopolitical rivalries, we are now dependent on their benevolence for things that are strategic to us.

If we think a vaccine is strategic, then we're dependent on their benevolence. If we think our telecommunications infrastructure is strategic, then we have dependencies, so this is the issue.

The IP game has moved from economic to non-economic realms that include health and security, so we have to build our country deliberately.

[Michelle Rempel, Conservative, Calgary Nose Hill, AB]

One of the things that struck me over the last 20 years is the patchwork of intellectual property ownership policies in Canadian universities, given the amount of research funding that the Canadian taxpayer pours into those institutions. I don't have an argument against research—

[Jim Balsillie]

No.

[Michelle Rempel, Conservative, Calgary Nose Hill, AB]

—but I also think that this patchwork of policies really does prevent us, as a nation, from capitalizing on our IP or retaining it at home.

Would that be an accurate characterization as well?

[Jim Balsillie]

Yes. I chaired a panel on this issue for the province, and I briefed the ISED deputy ministers and their leadership, who are very receptive to the reality that our system has to change.

What I've also learned is that it takes not only civil service capacity—and we have some very good leaders in the civil service, starting with the leadership of ISED—but also political instruction.