The National Security Review of Investments Modernization Act receives royal assent
Significant changes to the Investment Canada Act will address evolving national security concerns while ensuring economic prosperity
OTTAWA, ON, March 27, 2024 /CNW/ - Canada is a destination of choice for foreign investment as a result of its technologically advanced and open economy, its skilled workforce and its world-class research community. While foreign investment is essential to economic prosperity, the Investment Canada Act is a key lever that allows the Government of Canada to act quickly and decisively when foreign investment would threaten national security. As the world changes and threats evolve, Canada needs new tools to continue protecting the economy and keeping Canadians safe.
Last week, Bill C-34, An Act to amend the Investment Canada Act, also known as the National Security Review of Investments Modernization Act, received royal assent. The changes to the Investment Canada Act provide the government with new tools to ensure Canada can continue to address evolving threats that can arise from foreign investments, while making the regulatory regime clearer and more efficient and predictable for investors.
The modernization of the Investment Canada Act will bolster Canada's visibility on investments, enhance transparency and ensure Canada has strong authorities to take action quickly and where required. Included in the changes are updated penalties to strengthen deterrence, improvements to information sharing between partner countries and new rules for the protection of information during judicial reviews. Additional amendments strengthen both the national security review and the net benefit review.
The government is determined to continue working with Canadian businesses to attract foreign investment that advances Canada's long-term economic competitiveness and is consistent with our national security interests.
"Canada is one of the top destinations for foreign investments worldwide. While our government is committed to working with businesses to attract investments and to create greater economic opportunity for all Canadians, we will not hesitate to take action on transactions that could harm Canada's national and economic security. By modernizing the Investment Canada Act, we are making sure we have the right tools to protect Canada's interests and economy, while bringing the foreign investment review regime in line with today's reality."
? The Honourable François-Philippe Champagne, Minister of Innovation, Science and Industry
- The Investment Canada Act provides for:
- the review of significant investments in Canada by non-Canadians in a manner that encourages investment, economic growth and employment opportunities in Canada; and
- the review of investments in Canada by non-Canadians that could be injurious to national security.
- Bill C-34, An Act to amend the Investment Canada Act, was introduced as part of the Minister of Innovation, Science and Industry's mandate to modernize the Act.
- Now that the bill has received royal assent, the Governor in Council will set a near-term coming-into-force date for the majority of the Bill's elements. This includes the Minister's authority to accept binding undertakings to mitigate risks in transactions. Certain other elements require regulations and will come into force following public consultations and appropriate regulatory approvals.
- In fiscal year 2022?23, 32 investments were subject to extended national security reviews. Three investments were divested under the Investment Canada Act, while investors withdrew proposed investments in eight other cases.
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