Investments by SOEs and other investors from China and Russia have been subject to particular scrutiny under the NSR framework. A 2022 policy statement on foreign direct investment in Canada by Russian entities or investors (Russia Policy) was issued in response to the Russian invasion of Ukraine. The policy states that direct or indirect ties between an investment and individuals or entities associated with, controlled by or subject to the influence of the Russian state will support a finding by the Minister that reasonable grounds exist to believe that the investment could be injurious to Canada’s national security. A 2022 policy statement on critical minerals indicates that the participation by a foreign SOE in an investment in the critical mineral sector in Canada, regardless of value or ownership interest, will support a finding that the investment could be injurious to Canada’s national security. Under that policy, the Canadian government has blocked or unwound at least six investments by Chinese SOEs in the critical minerals sector. Although the discretionary nature of the NSR provisions, including the lack of a definition of “national security” and the potentially long time frames for review, may create considerable uncertainty regarding the application of the ICA for certain foreign investments in Canada, some recent developments signal a relatively greater flexibility and pragmatism in NSR reviews. – In early 2026, the government announced a new strategic partnership with China with a view to accelerating Chinese investment opportunities in Canada. The Minister of Energy also publicly commented that the government is open to more investment by China in the oil sands sector. While national security reviews are likely to remain rigorous and important, including for Chinese SOE investments, the government may be relatively more inclined to grant ICA clearance of Chinese minority investment alongside other investors. – T he government’s 2026 decision to permit TikTok to continue to operate in Canada, reversing a 2024 NSR order to wind up TikTok’s Canadian operations, may indicate that the government is relatively more amenable to allowing investments to proceed with commitments to address NSR concerns rather than blocking the investment or requiring divestiture or cessation of operations. (That said, a 2025 order that Hikvision, a Chinese manufacturer of video surveillance equipment, wind up its Canadian operations appears to remain in effect.) Voluntary Notifications under the NSR Framework In 2022, the government introduced a voluntary NSR preclearance filing mechanism for investments that are not captured by the mandatory NBR process (including minority investments). Following receipt of a complete voluntary notification, the Minister has an initial 45 days to determine whether to pursue a full NSR (subject to a right to extend this period by a further 45 days). If the non-Canadian investor does not utilize the voluntary filing option, the Minister may commence an NSR at any time prior to closing and for up to five years after the implementation of the investment. As a result, non-Canadian investors who are not otherwise required to submit an application for an NBR or a notification of an investment in a Canadian business may voluntarily notify FIRES if they want to obtain certainty that an NSR process will not be subsequently undertaken.
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