Draft Investment Canada Act Regulations Published Providing More Details On Net Benefit Review Thresholds And National Security Review Process

On July 11, 2009, the Government of Canada published draft regulations to give effect to certain amendments to the Investment Canada Act ("ICA") which were enacted in March, 2009. The major focus of the draft regulations is to set out the rules to determine the new thresholds for the net benefit review of investments and to set the time periods for the national security review process under the ICA. The draft regulations also provide for new information requirements for filings under the ICA. The government has allowed for a 30 day period for comments to the draft regulations. It is expected that the regulations will come into effect by this fall.

New Thresholds for Review

The March amendments to the ICA changed the monetary threshold for investments requiring approval by the Industry Minister. The threshold for a direct acquisition of a Canadian business by WTO investors was changed from $312 million of book value to $600 million of "enterprise value", increasing