All foreign investments in Canada, regardless of dollar value, are subject to the national security provisions of the Investment Canada Act (the "ICA"), including greenfield investments.
On March 25, 2021, the Minister of Innovation, Science and Industry, François-Philippe Champagne, released updated guidelines for national security reviews of foreign investments in Canada. It is the first time that the Guidelines on the National Security Review of Investments (the "Guidelines") have been updated since being introduced in 2016.
The Guidelines provide helpful insight into the factors that are considered when evaluating whether a proposed investment warrants a national security review. Further, the Guidelines also set out procedures that will be followed should a national security review be initiated.
Of note, the updated Guidelines expand the list of investment attributes that heighten national security risks, which may lead to enhanced scrutiny, namely:
- investments that provide investors access to sensitive personal data, including identifiable health or genetic information, biometrics, financial information, geolocation, etc.;
- investments in certain sensitive technologies, including aerospace, biotechnology, artificial intelligence, energy generation, storage and transmission, medical technology, and robotics and autonomous systems, among others; and
- investments that may impact Canada's critical minerals, including copper, helium and potash, among several others, and related supply chains.
These changes are indicative of the Government's efforts to protect and bolster Canada's economic and national security. Accordingly, potential implications of the ICA's national security provisions should be considered early when contemplating a proposed investment in Canada.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
