Industry Committee on Sept. 19th, 2023

[Brian Masse, NDP, Windsor West, ON]

No.

[The Chair, Liberal, Joël Lightbound]

Does Mr. Perkins have unanimous consent to get back to clause 7?

[Brian Masse, NDP, Windsor West, ON]

Yes.

(On clause 7)

[Iqwinder Gaheer, Liberal, Mississauga—Malton, ON]

Can I just say something on...?

[The Chair, Liberal, Joël Lightbound]

Now I'm at clause 7, Mr. Gaheer, so we'll deal with clause 7. I'll yield the floor back to you afterwards.

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

Thank you, Mr. Chair and committee members.

I'll refer you back to the motion. I don't mean to prolong it, because I know we're getting a little short on time.

With Bill C-34, while the current legislative framework already enables the federal government to examine strategic industries, witnesses like Professor Patrick Leblond from the University of Ottawa have argued that letting the federal government choose to systematically review investments creates an issue in which investments are reviewed individually, rather than through a sector-wide approach. According to testimony from Professor Leblond in the 2021 INDU report on the Investment Canada Act, not listing specific industries necessary for national security would prevent the review system from:

...devolving into an entirely political exercise in which stakeholders representing different regions and sectors of activity evoke national security concerns to protect their own economic interest. This would include stakeholders perhaps testifying (perhaps wrongly) that an asset or sector is not critical to Canada's national security in order to attract and facilitate foreign investments.

The summary of our change is that the amendment seeks to rectify this issue by responding to recommendation 4 of the 2021 INDU report—which I believe was unanimous, and many of the members here were on that committee—on the Investment Canada Act by listing specific sectors necessary to preserve Canada's national security, rather than applying the systematic approach. We've listed in that amendment “high-technology, health care, pharmaceutical, agri-food, natural resources and energy industries”.

Obviously, if there are other committee members who feel that some industries should be specifically listed under these terms, we'd be open to that.

[The Chair, Liberal, Joël Lightbound]

Thank you, Mr. Perkins.

To make sure that we're all on the same page, the amendment you're proposing to clause 7 is the one with reference number 12566060.

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

Yes.

[The Chair, Liberal, Joël Lightbound]

Are there any comments?

Go ahead, Mr. Turnbull.

[Ryan Turnbull, Liberal, Whitby, ON]

I just wanted to ask officials for some comments on this.

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

I would ask you to wait a moment to give the interpreters time to find the references, please.

[The Chair, Liberal, Joël Lightbound]

Thank you.

Go ahead, Mr. Turnbull.

[Ryan Turnbull, Liberal, Whitby, ON]

My understanding is that this amendment amends section 15 and would provide the power to review SOE transactions regardless of threshold.

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

You already passed that in your earlier amendment.

[Ryan Turnbull, Liberal, Whitby, ON]

That's right. Then I guess the question is what impact that has on this particular.... I think the definition of strategic Canadian industries might be quite challenging in terms of general coverage, and then we're specifying strategic Canadian industries. I think this might create some challenges, so I want to ask officials, if they agree, to speak to that.

[Mark Schaan]

I thank the member for the question.

Amendment CPC-2 adopted by the committee is specific in its application in the sense that it applies to SOEs except for those that are from within a trade agreement country. This is opening up to a much broader category and again to some of the things we talked about in June, to constructs that are potentially quite open to subjectivity, particularly the construct of strategic Canadian industries.

Part of our goal is, obviously, to try to ensure we have a certain amount of what we call high fences in small yards, where we have been very clear about that which the act is seeking to contain. This would, in our view, probably significantly expand the potential for consideration that you would fall within that and potentially provide risk to foreign investment, particularly by those who we might not want to deter.

I will leave it there.

[The Chair, Liberal, Joël Lightbound]

Mr. Perkins, go ahead.

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

The list comes from some of the statements by the Minister of Industry regarding strategic industries, but does the U.S. not already have in law or regulation a list of strategic industries that are automatically protected there for review under a number of U.S. statutes—everything from the regulations of their CRTC equivalent—the Federal Communications...?

[Mark Schaan]

It's the FCC.

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

No, it's the U.S. federal telecommunications....

[Mark Schaan]

It's the FTC.

The U.S. has not enshrined their list in law. We would propose operating a list, similar to what we have discussed before, that would isolate strategic industries that would be subject to further scrutiny, but the U.S. has not allowed for that so as to allow for the dynamism of the changing nature of industry, including that which is considered strategic.

[The Chair, Liberal, Joël Lightbound]

Thank you.

Are there any other comments on the proposed amendment by Mr. Perkins to clause 7?

Seeing none, we will move it to a vote.

(Amendment negatived: nays 6; yeas 5 [See Minutes of Proceedings])

[The Chair, Liberal, Joël Lightbound]

Is there any further discussion?

Mr. Gaheer, I believe you want to speak.

We are done with clause 7.

I believe you wanted to seek unanimous consent for another clause.

[Iqwinder Gaheer, Liberal, Mississauga—Malton, ON]

Do we need it for clause 8?

[The Chair, Liberal, Joël Lightbound]

We need it for clause 8 as well, yes.