Canada's Use Of Its National Security Power

The Government of Canada's decision to reject the proposed acquisition of Aecon, a major Canadian construction services firm, by China Communications Construction Company International Holding Limited. ("CCCI"), while significant, does not reflect a broader protectionist orientation or a retreat from Canada's general openness to foreign investment and trade. In our view, there are three main conclusions to be drawn from the Government's decisions in recent years under the Investment Canada Act ("ICA"). First, intervention in foreign investment transactions is exceedingly rare – each case stands on its own with the Government doing a careful case-by-case review of transactions which raise national security issues. Second, there is no indication that the Canadian process is being applied in a protectionist or political manner. Finally, parties seeking to undertake foreign investment transactions need to develop comprehensive legal and government relations assessments and