Mr. Speaker, it is an honour to speak to Bill C-3 at third reading.
The Canadian economy is still strong, thanks in part to the solid performance of the resource industries.
Canadian companies in that area are proving that they cannot only prosper in the knowledge economy of the 21st century but also contribute to its dynamism and vitality.
However the prosperity of the resource sector should not be taken for granted. The industry must be able to make strategic decisions and to better position itself on domestic and foreign markets.
The changes proposed in Bill C-3 will allow two actors in the natural resources sector, namely Cameco Corporation and Petro-Canada, to continue contributing to the economic growth and environmental stewardship by lifting restrictions that have no more reason to be and which prevent them from attracting new investments and concluding new strategic alliances.
Those two companies used to be crown corporations. The Government of Canada sold all its shares in Cameco in 1995. It has kept an 18% participation in Petro-Canada, but it is a carried interest and the government has no say in the management of the corporation.
At the time of privatization the government imposed restrictions on the proprietary interest of the two companies. It had good reasons to do so, but some restrictions have since outlived their usefulness and only prevent the two companies from taking advantage of new business opportunities.
In particular, Bill C-3 changes the restrictions imposed on share ownership and the disposal of property by the Petro-Canada Public Participation Act. It also amends the share ownership provisions of the Eldorado Nuclear Limited Reorganization and Divestiture Act, which governs Cameco.
With regard to Petro-Canada, Bill C-3 will raise from 10% to 20% the limit on individual shares ownership. Moreover, the 25% limit on the total number of shares that can be owned by non-residents will be eliminated. In other words, there will be no more restriction to the foreign ownership of Petro-Canada's shares, except that an individual, of whatever origin, will not be allowed to own more than 20% of the shares of the company.
Despite the abolition of the limit on foreign ownership, Petro-Canada is likely to remain under predominantly Canadian ownership in the foreseeable future.
First, the 20% limit on individual ownership of voting shares in Petro-Canada prevents any potential takeover by a major multinational.
Second, there is far greaten interest for Petro-Canada among Canadian investors than foreign investors. As a matter of fact the foreign participation in the company does not exceed 16%, while the existing act allows up to 25%.
Third, under the Canada Business Corporations Act corporations subjected to share ownership restrictions like Petro-Canada are still required to be run by a board of directors comprised of a majority of Canadians.
In order to give Petro-Canada more latitude with the management of its assets, the prohibition on the sale, transfer or disposal of all or substantially all of Petro-Canada's upstream and downstream assets will be replaced with a similar prohibition which makes no distinction between upstream and downstream assets. The bill maintains just the level of prohibition necessary to prevent the company from shutting down operations through the sale of all its assets.
In the case of Cameco, Bill C-3 eases restrictions currently imposed on foreign ownership without eliminating them completely. The limit on individual non-resident share ownership will be raised from 5% to 15%. The limit on collective non-resident share ownership will increase from 20% to 25%. As for the ownership limit for an individual Canadian shareholder, it will remain at 25%.
In spite of the reduction of the foreign participation restrictions, Cameco will always be controlled by Canadians and the majority of its capital will remain held by Canadians in the foreseeable future.
First, the 15% individual non-resident share ownership restriction rules out any possibility of takeover by a major multinational.
Second, with the 25% limit on collective non-resident share ownership, control over Cameco cannot fall into foreign hands.
Third, Cameco generates much more interest among Canadian investors than among foreign investors. Indeed, foreign participation in the corporation does not exceed 6% right now, whereas the current legislation allows a 20% participation.
Fourth, under the Canada Business Corporations Act, corporations such as Petro-Canada which are subjected to share ownership restrictions are still required to be run by a board of directors comprised of a majority of Canadians.
Bill C-3 has the support of both corporations, which see the current restrictions as unfair in that they do not apply to other corporations in their respective sectors of activity.
In my opinion the legislation will be well received by all investors both in Canada and abroad. At the same time it will protect the Canadian status of Petro-Canada and Cameco. The headquarters will remain in Canada and the majority of the board of directors will be made up of Canadians.
I can assure my colleagues that in the case of Petro-Canada the proposed amendments will have no impact on the price of refined petroleum products. A recent study carried out by the Conference Board of Canada confirmed that the price of gasoline is established mainly according to supply and demand and has nothing to do with property rules governing one company of the Canadian petroleum industry.
I can also assure the House that the proposed amendments will have absolutely no impact on the competitiveness of the Canadian oil and gas industry.
Also, this bill is not a prelude to the sale of the government's shares in Petro-Canada. Although its holdings in Petro-Canada no longer serve any of its political purposes, the government is waiting for the right time to sell off its shares. In other words, it will wait until the market conditions ensure optimal yield for Canadian taxpayers.
I also want to inform hon. members that the proposed changes to the Cameco legislation will not change anything in the commitment Canada made toward non-proliferation of nuclear weapons or nuclear security.
Uranium is a regulated substance of strategic importance. The Canadian policy concerning uranium exportation is subject to the support regulations of the Nuclear Safety and Control Act and to permits delivered under the Export and Import Permits Act. Canadian substances, equipment and technology cannot be used to manufacture nuclear explosive devices.
The Government of Canada has not only urged its trading partners to ratify the non-proliferation treaty but it has also entered into nuclear co-operation agreements providing an additional control mechanism.
The Government of Canada, and hon. members can rest assured of this, thinks that it is still necessary to impose restrictions on the foreign ownership of uranium. Bill C-3 gives Cameco better access to foreign capital and allows it to develop new strategic alliances, but it does not in any way compromise the Canadian control of the company.
I would like also to underline that Cameco has the support of another element of the public sector, and I am referring obviously to the government of Saskatchewan. It has indicated that it totally supported the proposed amendments to Bill C-3.
Obviously the bill is consistent with sound management of public affairs. During the discussions in committee there were no serious objections. In fact, hon. members of most parties have expressed their support for the bill.
This bill is good for Petro-Canada, good for Cameco and good for all Canadians. I urge my colleagues to adopt the legislation.