Accueil / Federal government announces new policy for investments with Russian ties

Federal government announces new policy for investments with Russian ties

( Disponible en anglais seulement )

10 mars 2022 | Eric Dufour, Reema Mahbubani

The Honourable François-Philippe Champagne, Minister of Innovation, Science and Industry has issued a policy statement indicating that:

  • any proposed investment by direct or indirect Russian investors, where “net benefit” clearance is required under the Investment Canada Act (the “ICA”) will only be provided on an exceptional basis; and
  • any proposed investment (regardless of dollar value) that has ties, direct or indirect, to any individual or entity associated with, controlled by or subject to influence by the Russian state, will lead to a national security review.

This policy is effective immediately and will be in effect until further notice.

It is expected that the implementation of this policy may lead to longer review periods and may require non-Canadian investors to submit detailed information setting out corporate data, structures and financing relationships in connection with direct and indirect investors, beneficial owners and trusts.

It is worthy to note that in respect to investments that raise national security concerns, an update to the Guidelines on the National Security Review of Investments was announced in March 2021.  The update included significant changes to investment criteria subjecting proposed investments to enhanced scrutiny under the ICA.

These cumulative changes are indicative of the Government’s efforts to further bolster Canada’s economic and national security.  Accordingly, potential implications of the ICA’s national security provisions and related guidance should be considered early when contemplating a proposed investment in Canada.

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