National Security Review Scope and Process The federal Cabinet may, on the recommendation of the Minister of Industry (after consultation with the Minister of Public Safety and Emergency Preparedness), order an NSR when there has been or is proposed to be – a n establishment of a new Canadian business or a Canadian-linked entity; – a n acquisition of control of a Canadian business; or – a n acquisition, “in whole or in part,” of a Canadian-linked entity. Once recent amendments to the ICA are proclaimed in force, – the ICA will expressly provide that an NSR is available for an investment to acquire, in whole orin part, the assets of a Canadian-linked entity; and – a n NSR may be ordered in respect of an acquisition by a non-Canadian SOE of any of the assets of a Canadian business. An investment does not need to exceed any monetary threshold for the government to conduct an NSR. NSR Timing An NSR is carried out by the Minister of Industry (the Minister) in consultation with the Minister of Public Safety. They consult with a wide range of other federal government departments with security, intelligence and investigative perspectives. The Minister has 45 days following the filing of a mandatory or voluntary notification or an application for an NBR, or up to five years following the implementation of a transaction not subject to notification or an NBR (e.g., minority investments for which no voluntary notification was filed), to issue a notice to a non- Canadian that its proposed investment may be subject to an NSR. Alternatively, the Minister may simply initiate an NSR within that same time period without first sending a notice of a potential NSR. The entire NSR process can take up to 200 days, or more if the review period is extended. If the Minister issues a notice of a potential or actual NSR in respect of a proposed investment that has not yet been implemented, the proposed investment cannot be implemented until the NSR process is terminated, or closing is approved. NSR Resolution Three outcomes are possible in the event of an NSR. First, the Minister may determine that the investment will not be injurious to national security, in which case the NSR will terminate or lapse, and a proposed investment can proceed. Second, the Minister may negotiate binding
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