Copyright 2012, Blake, Cassels & Graydon LLP
Originally published in Blakes Bulletin on Competition, Antitrust & Foreign Investment, January 2012
The Investment Canada Act (ICA) is a federal statute of broad application regulating the establishment and acquisition of control of Canadian businesses by non-Canadians. For the purposes of the ICA, a "Canadian business" means a business carried on in Canada that has (a) a place of business in Canada, (b) an individual or individuals in Canada who are employed or self-employed in connection with the business, and (c) assets in Canada used in carrying on the business.
Direct acquisitions of control of Canadian businesses by non-Canadians are reviewable under the ICA where certain financial thresholds are met. With respect to a direct acquisition by a "WTO investor" (that is, an investor controlled by persons who are citizens of WTO member countries), Industry Canada has announced an increase in the book value of assets threshold which triggers a review requirement. The new threshold, which is effective for 2012, is C$330-million. The previous threshold was C$312-million.
The threshold for acquisitions by non-WTO investors and for acquisitions by non-Canadians of Canadian cultural businesses remains unchanged at C$5-million.
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