The Canadian government announced a new
policy on October 28, 2022 (the Policy) under
the Investment Canada Act (ICA) governing
investments by state-owned enterprises (SOEs) in Canada's
critical minerals sector. The government followed the issuance of
the Policy with an
announcement on November 2, 2022 that it had ordered three
Chinese investors to divest their interests in Canadian
incorporated junior mining companies involved in critical
minerals.
The Policy, which is described in more detail below, provides
that foreign SOEs and related parties investing in Canadian
critical minerals businesses will be able to obtain "net
benefit" approval only "on an exceptional basis"
where such approval may be required, and can expect to face a full
national security review for any such investments. This marks an
important and tougher shift in the Canadian government's
attitude toward foreign SOE investment in Canada's critical
minerals sector. The government's subsequent
