Harper announcing the approval of the takeover bids today. Photo by Fred Chartrand/ Canadian Press
The Canadian Press reports, “Prime Minister Stephen Harper ended months of market uncertainty by approving the foreign takeovers of Calgary-based Nexen Inc. and Progress Energy Resources Corp… China’s CNOOC and Malaysia’s Petronas, both Asian state-controlled enterprises, received the OK late Friday as part of a wide-ranging update of foreign-takeover rules.”
“The Council of Canadians criticized Friday’s decisions, partly on environmental grounds. ‘We are deeply concerned by the takeover because investment, foreign or otherwise, is the last thing we need more of in the tar sands and shale gas,’ said chairwoman Maude Barlow. ‘We need to be phasing out dirty energy, not handing over huge concessions to multinational corporations.'”
The article adds, “The federal government (also) made three major changes to the foreign investment guidelines Friday. First, they increased the threshold for review under the Investment Canada Act for takeovers by foreign private investors to $1 billion from $330 million. But the $330-million threshold will remain in place for state-owned enterprises. (Secondly), they gave the minister of industry the ability to extend the time available to conduct a national-security review of proposed investments. …(And thirdly), they set out five specific elements that investors will need to demonstrate in order for the government to consider approving a proposal. At the top of the list is that the investment is commercially oriented and that the investor is free from political influence.”
That said, the Globe and Mail has noted, “(Since 1985), Industry Canada has received 1,664 applications for foreign takeovers of Canadian companies, leading to a foreign-ownership stake of $915-billion. So far, it has formally rejected only one.”
More commentary on the implications of these takeovers can be read at http://canadians.org/blog/?p=18373.
