Mr. Speaker, I congratulate my colleague, the member for Burlington, for doing an excellent job of laying out the criteria under which net benefit is assessed, the specific guidelines that govern evaluations of proposed investments by state-owned enterprises, and the way in which that net benefit test has evolved under the government and been improved under the government. It is important for Canadians to understand that, especially after the very important historic announcement by the Prime Minister on Friday.
I will now take a few minutes to explain the review process under the Investment Canada Act. As part of the review process, the investment review division of Industry Canada consults with various federal government departments that have policy responsibility for the industrial sector involved in a proposed acquisition. It also consults with the Competition Bureau and with all the provinces and territories in which the Canadian business has substantial activities or assets.
We should not underestimate the importance of these consultations. The member for Burnaby—New Westminster keeps challenging us publicly to consult with Canadians. He clearly has no familiarity with the existing mechanism for consultation that the Investment Canada Act provides for. Any person or group who has a view on a specific investment proposal may provide that view in writing to the minister, as provided for in the Guidelines — Administrative Procedures that we have today.
These guidelines state that where unsolicited representations are received that could have an adverse bearing on the determination of net benefit, investors will be advised of the substance of those representations and given ample opportunity to respond to them.
This is very important because we value the principle of fairness. We value the integrity of our consultation process. We want it to deliver a good result for Canadians, a result whereby investments do generate benefit for this country, and that means we need to sequence both the receipt of representations and, where warranted, their publication in a very careful and deliberate way.
Once the consulted parties have provided their input, discussions take place with the investor and legally enforceable undertakings are discussed with the investor.
The investment review division staff also perform an independent analysis of the acquisition in light of the six net benefit factors that are in section 20 of the act, very ably described by my colleague. In performing the review, the minister establishes a baseline against which to review a proposed transaction.
The minister looks at the Canadian business that the investor proposes to acquire and takes into account the business' likely prospects on a stand-alone basis if the investment did not take place. The minister assesses whether the business is a healthy company with good prospects or whether it is in financial distress. Different sectors are moving in different directions in today's economy and this is an important context for any decision.
The minister also takes into account the Canadian business' key strengths, areas requiring improvement and the key business challenges it is facing. The minister also takes into account what the foreign investor brings to the investment, for instance, whether the investor is bringing capital or expertise that is not accessible to the Canadian business.
We need to be clear, as the member for Burnaby—New Westminster was, about the different contexts in which acquisitions takes place: Stelco or Dofasco; the oil sands or some branches of manufacturing; advanced manufacturing or the manufacturing that has not changed since the middle of the last century. These contexts help to determine the calculation that the minister has to make on the basis of consultation and on the basis of the review process that I am describing.
The bottom line is that this review process is rigorous. Where an investment is subject to review, the minister must approve an investor's application for review even before the investor can implement the acquisition. The minister only approves applications where he or she is satisfied, based on the plans, undertakings and other representations, that the investment is likely to be of net benefit.
The investors generally need to provide plans and undertakings to support their view that their investments are likely to be of benefit. In 2011, the investment review division received and processed 634 notifications. As well, the Minister of Industry approved 15 applications for review. All approved investments are subject to monitoring and an evaluation of the implementation of the plans and undertakings of the investors, ordinarily performed a year and a half after the acquisition. The act provides for remedies where the minister is not satisfied that an investor is meeting its obligations.
The decision to take enforcement measures under the act is based on the overall performance of the investor in implementing plans and undertakings, but, obviously, these decisions are made on a case-by-case basis. Decisions can, however, include the dramatic step in which the government seeks an order from a Superior Court for the imposition of fines of up to $10,000 per day or the full or partial dissolution of an investment.
With reference to the transactions the minister approved on Friday, the minister stated that the investors satisfied him under the Investment Canada Act and that, under state-owned enterprise guidelines which existed at the time of the review, their proposed transactions are likely to be of net benefit to Canada. In making this determination, the minister carefully considered plans, undertakings and other information submitted by the investors.
The minister also stated that to demonstrate that the transaction is likely to be of net benefit, the investors have made significant commitments to Canada. For instance, with regard to the recent proposed transactions, the investors have provided undertakings on matters such as: governance, including commitments to transparency and disclosure; commercial orientation, including an adherence to Canadian laws and practices, as well as free-market principles; and employment in capital investments, which demonstrate a long-term commitment to the development of the Canadian economy.
Our government has applied the rules responsibly. We have revised the guidelines to ensure a clear and rigorous approach to the new context of state-owned enterprises.
I will note a certain irony in today's debate. The opposition motion before us relates to a resolution of the Calgary Chamber of Commerce. We, like the Calgary Chamber of Commerce, are in favour of investment in this country, investment that is of net benefit and creates jobs. Canada has benefited, as of today, from roughly $608 billion of inward investment. That has allowed Canadian companies, on the basis of reciprocity, to undertake upward of $685 billion of investment outwardly in virtually all countries of the world.
What we have not heard from the members opposite and what their motion today disguises is a reaffirmation of what we know to be their policy, that they are opposed to investment, not just the Nexen and Progress deals and not just closer scrutiny of state-owned enterprises, which is what our government is enacting with the decision on Friday and in which a lot of work happened earlier to bring about those decisions. Opposition members are opposed to something much more dramatic, which is free market, private sector investment in this country, which, in a globalized economy, as we know, is the absolute lifeblood of the jobs, growth and long-term prosperity that Canadians want to continue to develop on the basis of which we have achieved our standard of living over centuries.
It is not just a matter of this decade or century that we have depended on investment from outside our borders and on making investments outside our borders for our prosperity, it happened throughout the 20th century. It certainly was a driver of Canada's success in the 19th century and, for centuries before that, Canada has had an open economy based on global markets where, yes, we have had to determine the net benefit to us, what our national interest was, but where we have thought to not only keep our own economy open but be advocates of an open global economy, one where companies owned by private interests, including Canadians and sometimes not including Canadians, are attracted to our shores by a beneficial tax regime, by a commercially-oriented rule of law, by enforcement and implementation of the rules in this country, something this government has taken absolutely seriously starting in 2006. It is in that spirit that Friday's decision was made.
We will continue to refine the rules and guidelines governing Investment Canada under the Investment Canada Act. We have said again and again that we are not prepared to rubber-stamp every investment in this country, those involving state-owned enterprises need particular scrutiny, nor are we willing to put up a wall the way the NDP has said time and again that it would do should the opportunity ever be given to it.