OTTAWA — Stephen Harper wants to review the secretive manner in which foreign takeover bids are evaluated and approved in Canada.
The prime minister called Thursday for a review of the Investment Canada Act, one day after his government rejected a bid by Anglo-Australian mining firm BHP Billiton to take over Saskatchewan-based PotashCorp.
Under provisions of the act, Industry Minister Tony Clement has been unable to disclose why he concluded the BHP bid is unlikely to produce a net benefit for Canada. He must keep his reasons to himself for 30-days, giving BHP a chance to respond.
That and other closed-door aspects of the process infuriate opposition parties, which are demanding a more open and transparent process for assessing foreign investment proposals in future.
The NDP moved a motion Thursday calling on the government to overhaul the Investment Canada Act. Among other things, the motion calls for:
l Mandatory public hearings.
l Public disclosure of conditions attached to approval of a takeover, subsequent monitoring of corporate performance and enforceable penalties.
NDP Leader Jack Layton called on Harper to support the motion, arguing that “the culture of secrecy that is associated with this whole process has gone too far.”
Harper chided the NDP for what he characterized as its antipathy toward foreign investment in general, a position he called “out of step with the realities of the global economy.”
Nevertheless, he added: “While I do not agree with all things in the NDP motion, the act should be reviewed.”
Clement later said he believes the act could be tweaked “a little bit” to ensure that commitments made by a foreign bidder are public knowledge.
“Those kinds of things I think we should look at, quite frankly, and I’d be quite prepared to do so,” Clement said.
Clement has been frustrated in the past by his inability to publicly talk in detail about the conditions agreed to by foreign companies that have won approval to take over Canadian operations.
He’s complained that U.S. Steel has not lived up to its undertakings when it took over Stelco in 2007 and that Brazilian miner Vale similarly reneged on its undertakings when it bought Canadian nickel mining giant Inco in 2006.
Clement said there are already penalties in the act, pointing out that he’s taken U.S. Steel to court to ensure penalties are imposed in that case.
Still, he added: “I’m not averse to looking at the act to make sure it suits the needs of Canadians in a better way. Why not?”
In Regina, Saskatchewan Premier Brad Wall — who campaigned vehemently against the BHP takeover — offered to help the federal government in reviewing the foreign investment process.
He suggested the act requires a clearer definition of what constitutes a strategic national asset.
“I think it goes to the amount of reserves and we’ll have to talk about what amount of reserves or known quantity of a natural resource constitutes a strategic interest,” Wall said.
Deputy Liberal leader Ralph Goodale said Harper’s support for a review of the act amounts to “a pretty clear admission on his part that what’s gone on here in the last six or eight weeks has been chaotic.”
Goodale said it’s evident Harper wanted to say yes to BHP but was forced to back down at the last minute by public opinion and the threat of losing all 13 Tory seats in Saskatchewan.