Foreign direct investment and the national interest

Since the rejection of the proposed takeover of MacDonald Dettwiler in 2008 and the effective rejection of the proposed takeover of Potash Corporation of Saskatchewan (Potash Corp.) in 2010,2 Canadians have been subjected to many views on the potential benefits and detriments of foreign investment. [...] The ICA and the net benefit test Foreign investment reviews under the ICA are handled by Industry Canada or, in the case of investments in the cultural sector, by the Department of Canadian Heritage. [...] The most official publicly available discussion of the meaning of the term comes from the testimony of Industry Canada officials before the Senate committee hearing that considered the proposed national security review amendments to the statute. [...] Regarding the commercial orientation of an SOE, the minister will assess whether the Can- adian business to be acquired can continue to operate on a commercial basis with respect to the destination of its exports; place of processing; the participation of Canadians in its oper- ations in Canada and elsewhere; support of ongoing innovation, research and development in Canada; the appropriate level [...] The guidelines sug- gest that the review of such investments will cover whether (1) the investor’s operations are independent of the relevant foreign government; (2) the investor is subject to and adheres to the law and observes common standards of business behaviour; (3) the investment may hinder competition or lead to undue concentration or control in the industry or sectors concerned; IRPP Stud