The Asia-Pacific Antitrust Review 2012

Canada: Foreign Investments

Canada’s foreign investment review regime has been the subject of considerable attention over the past two years. Much of this attention has related to BHP Billiton’s abandoned bid for Potash Corporation of Saskatchewan and, more recently, the failed effort by the LSE to merge with the TMX. Despite some perceptions that Canada’s foreign investment review regime reflects a certain hostility towards non-Canadian investors, the reality is that in the 26-year history of the legislation, outside the cultural business arena there has been only one formal rejection of a transaction and only four withdrawals attributable to the legislation. Virtually all transactions secure the requisite clearance, albeit subject to various negotiated undertakings. In other words, Canada is very much open for business. Nonetheless, prospective investors would be well advised to take the review process under the legislation seriously and, in that regard, to engage capable counsel early in the deal process. Public and government relations experts may, on the advice of counsel, also be engaged. The ensuing discussion provides a practical summary of the regime.