OTTAWA – The federal government’s decision to more quickly loosen rules on foreign investment in Canadian companies is a signal that the country is more open to international money and more changes are on the way, Finance Minister Bill Morneau said Thursday.
He didn’t detail what further changes could be coming, or what protected industries — telecommunications and cultural companies, for example — the government may open to foreign investors.
Morneau said that whatever rules the government lays down on foreign investment will protect Canadians and national interests, while giving investors clarity so they can consider making investments here.
“If we’re able to do things that create excellent jobs for Canadians, those are things we should be doing,” Morneau said in an interview with The Canadian Press.
Prime Minister Justin Trudeau and other cabinet ministers have been trying to sell investors on the idea of Canada as a great investment destination and this week they loosened rules about foreign takeovers of domestic companies and foreign investment levels in airlines.
The federal foreign investment law gives the government enormous powers to review takeovers or mergers involving domestic and foreign companies and block those that don’t provide a net benefit to the country.
Cabinet can also block deals that may raise national security issues, but the act doesn’t clearly define national security.
The Liberals loosened the rules for reviews of foreign investment in their fall economic update, raising the threshold for review to $1 billion from $600 million and doing so more than two years sooner than previously planned. The government also promised to publish guidelines by the end of the year to explain which investments would be subject to national security reviews.
On Thursday, Transport Minister Marc Garneau announced that international companies will soon be able to own 49 per cent of an airline in Canada — a jump from the current 25 per cent — once the government makes the necessary legislative amendments. In the meantime, Garneau granted exemptions to allow aspiring discount airlines Canada Jetlines and Enerjet to land more international investors, giving the airlines something they have long requested.
“We think that these things demonstrate that we want investments in Canada,” Morneau said.
“They demonstrate that we know that investors in Canada like the ones that have come in this year — GM, GE, Microsoft, Thomson Reuters — can create good, long-term paying jobs for Canadians.
“That’s what we’re trying to achieve. We’re going to remain focused on that.”