The House resumed consideration of the motion that Bill , be read the second time and referred to a committee.
Mr. Speaker, I am pleased to rise in the House today to speak to Bill C‑34, the national security review of investments modernization act, which was introduced by the .
As the minister, my colleague from Saint‑Maurice—Champlain, mentioned, this bill is an attempt to update and strengthen the Investment Canada Act through seven amendments.
I will not list them all, but I will say that the government is seeking to streamline the minister's ability to investigate national security reviews of investments, strengthen penalties, create a list of industries in which acquisitions would automatically be subject to national security reviews, give the minister the power to impose interim conditions, remove the Governor in Council from the process for making an order for further national security reviews and substitute the minister, and improve coordination with international partners.
The act was last modernized in 2009. It is true that an update is needed. As my colleague from and shadow minister for industry mentioned, I can confirm from the outset that we will be voting in favour of this bill at second reading. We will, however, work to make improvements to it.
If there is one phrase that sums up how we feel about this bill, it is “too little, too late”. After eight years of this Liberal government approving countless acquisitions of Canadian companies by state-owned firms, we are skeptical that protecting our national security interests is important to this government.
There is no shortage of examples of breaches. There have been numerous cases over the past few years where this government failed to take the real threats posed by foreign investments seriously.
I am proud to be a member of the Standing Committee on Industry and Technology. Over the past two years, we have examined several cases of government failures during transactions and contracting processes that had the potential to compromise national security.
I will share a few examples, some of which are very disturbing.
In January 2022, the failed to follow his own guidelines when he fast-tracked the takeover of the Canadian company Neo Lithium by Chinese state-owned Zijin Mining without a national security review.
It seems to me that when a company controlled by the Chinese Communist regime wants to buy a Canadian company, that should raise a red flag. Unfortunately, that did not happen in this case. We are talking about rare materials that are important in dealing with climate change, for making more batteries and such. Lithium is an extremely important element in the production of batteries. A review should have been done.
As I just mentioned, this is a Canadian company specializing in critical minerals, like lithium. Unfortunately, this government did not sound the alarm or issue warnings. We should already be doing everything we can to protect our companies in such a key sector, but, when the buyer has ties to the Chinese Communist regime, that is stating the obvious. A serious and rigorous review should have automatically been considered.
The Standing Committee on Industry and Technology undertook an urgent study on this subject to investigate this questionable transaction. Following this study, we made three recommendations.
The first recommendation reads as follows: “That the government create a formalized and transparent process...by which government departments provide advice to the Minister...regarding decisions made under the Investment Canada Act”.
The second recommendation reads as follows, “That the Minister issue a notice...for all investments by firms from authoritarian regimes considered to be state-owned enterprises under the Investment Canada Act”.
It is worth noting that in China, the government often controls many companies, either partially or fully, through various means, so we need to have a closer look at that.
The third recommendation reads, “That the Minister release in a timely manner a full and comprehensive Critical Minerals Strategy”.
A year has passed, but it is clear that nothing has been done in that regard, unfortunately.
I will give a second example of a dubious contract. In December 2022, the RCMP awarded a contract for sensitive communications equipment to Sinclair Technologies, which is a subsidiary of Norsat.
It is important to note that Norsat, which was founded and based in Richmond, British Columbia, had itself been acquired by Hytera Communications. Who owns Hytera?
It is headquartered in China and is therefore partly owned by the Communist regime of the People's Republic of China. The company is even a major supplier to China's national security department. The $500,000 contract was awarded without any thorough investigation or verification, even though it is known within the federal public service that China and the companies it controls have attempted to interfere in Canadian affairs.
When the media broke the story, the minister responsible took swift action and cancelled the contract. Still, it is astounding that, once again, no one in government saw this coming, no one realized how dangerous the situation was.
Hytera has been charged with 21 counts of espionage in the United States. President Biden has banned the company from doing business in the U.S., but it is free to operate here, no problem. The trusts everyone. Forgive me for questioning the severity of what the government wanted to do at that time.
I have one final, particularly troubling example that I would like to present here. It was identified by the Standing Committee on Government Operations and Estimates. In 2020, the Minister of Foreign Affairs awarded a contract to the Chinese company Nuctech, founded by the son of the former secretary general of the Chinese Communist Party, to supply X-ray equipment to 170 Canadian embassies and consulates. The contract was worth $6.8 million.
Although it was assured that this equipment would not be connected to embassy networks, the contracts included delivery, installation, and maintenance. Again, this is a question of national security. It is extremely important to verify these things.
During his testimony before the committee, David Mulroney, Canada's former ambassador to China, had some very harsh, but very fair, words for the government. He said that the experience gives us a troubling glimpse into this government's incompetence in dealing with China, considering that it has received clear, daily warnings that China is a strategic challenge to our country. However, there is no sign that the government is any more aware, no sign it has developed a greater sense of urgency to identify and better manage China-related issues. There is no evidence of any efforts to galvanize the government as a whole. All departments and agencies need to make an urgent effort to ensure that this does not happen.
This shows an appalling lack of leadership. Once again, history has repeated itself. We are hoping for changes to the bill. After second reading, it will go to committee, where we will be able to propose amendments.
I could say a lot more about this bill, but it is no different from everything else. Everything is broken.
Mr. Speaker, it is always a pleasure to rise on behalf of my constituents from Kelowna—Lake Country.
I am here today to speak on Bill . Since Confederation, people from all over the world have believed in Canada as a place worth investing in, but an open-door policy for investment will only improve the public good if we keep our eyes wide open to see who comes through our door.
In this, the Liberals have proven far too lax and have been asleep for eight years. It is a different time than it was generations ago and different than even eight years ago. A business that leaves its door open and unattended would swiftly go broke. So, too, would a country that does not recognize the difference between an investing free market ally and untrustworthy regimes.
I am glad, in the name of improving our economic and national security, that this legislation has been put forward in this bill before us today to strengthen the Investment Canada Act, but I cannot hide my disappointment that the Liberals have dragged their feet for eight years to do so and still provide legislation that, if I am being honest, is really only half-finished.
What we have before us is a bill that asks Parliament to protect the security of foreign investment by granting more power to the very ministers who ignored foreign investment threats. Traditionally, when the security guard falls asleep, he does not get a promotion the next day. The laundry list of these instances runs quite long in the eight years of the Liberals in power, so I will only provide a few examples of the government's negligence in the name of time today.
In 2017, the Minister of Industry failed to request a full national security review of the acquisition of B.C.-based telecommunications company Norsat International and its subsidiary, Sinclair Technologies by the China-based Hytera Communications.
In 2019, that minister failed again to request a full national security review when the Chinese Sinomine Resources purchased the Manitoba-based Tantalum Mining Corporation, one of Canada's largest lithium producers.
In 2020, the Minister of Foreign Affairs approved another China-based company in Nuctech to supply security equipment to 170 Canadian embassies and consulates.
In 2022, that same foreign affairs minister then became the Minister of Industry and approved the takeover of Canada's Neo Lithium Corp. by a Chinese state-owned enterprise with no national security review.
To talk about this one for a moment, this undermined Canada's supply chain opportunities. Lithium is classified as a critical mineral in Canada, which Ottawa says are critical to Canada's economy and imperative to battery storage, in particular for the electric vehicle industry. The regime of China is establishing global dominance on securing critical mineral assets and intellectual property, which are imperative to high-tech manufacturing, including electric vehicles. This is a prime example of when the subjective authority is given to one person, a minister, as opposed to having solid laws and policies.
Just last month it was discovered that the allowed the RCMP and the Canada Border Services Agency to sign equipment deals with Hytera Communications despite the United States having banned them from doing business after charging them with 21 counts of espionage. Communications technologies, security equipment and lithium mining are integral parts of Canadian national security and the security of our allies.
Lithium mining and the export of other critical minerals are vital to breaking western reliance on Chinese-made electronics. We are blessed in Canada with some of the continent's greatest quantities of minable minerals. Still, as I have outlined today, the Liberal government has been more receptive to providing access to our natural resources to our foes than to our friends. State-owned enterprises are not operating separately from the interests of their centralized autocratic governments.
Sadly, it has taken until year eight of the Liberal government to realize that. It has also taken it eight years to develop a critical minerals strategy, leaving us behind in supplying ourselves and our allies. I will mention that the Liberal strategy on critical minerals really is not a comprehensive strategy.
The International Energy Agency forecasts that by 2030, the production of electric vehicles could reach 43 million units per year, with production valued at more than $567 billion U.S.
Robin Goad, president and chief executive officer of Fortune Minerals Limited, said that his company has been speaking with the federal government about critical minerals for more than five years but has yet to see substantive action. Their proposed mine would supply Canada with minerals like cobalt, gold and copper, and provide much-needed employment to Canadians in the Northwest Territories. Mr. Goad put it best when he said of the government, on critical minerals, that “it's all smoke and mirrors right now” and “It's time we stop talking about this and actually [start] doing something.”
Mined-in-Canada cobalt, graphite, lithium and nickel could become made-in-Canada batteries supplying our allies' electric needs while improving our environment. Instead, the Liberals chose to drag their feet on clean, green prosperity for Canadians. A Conservative government will do something. We will recognize that our natural resources are Canadians' opportunities for prosperity, not bureaucracy.
I previously sat on the industry committee and some of this work has been done on previous studies, including the critical minerals study and the study on the acquisition of Neo Lithium. The witness testimony during the Neo Lithium study brought out how the discretionary nature of the current legislation has left Canada vulnerable. The informal decision-making process has had little transparency and accountability. As well, testimony stated how having a government department lead a national security review process, instead of those who are security experts, was concerning on how this could protect Canada's assets.
Similarly, Conservatives at the industry committee are prepared to do the hard work in amending this legislation to enforce the precautions the Liberal ministers consistently forgot to take.
To summarize, on these changes to the Investment Canada Act, it is a very difficult world right now, with unstable regimes in the world. The Liberals have been asleep for eight years, and this has left us vulnerable. This has been partially studied already at the industry committee, of which I was formerly a member.
Under the , Canada has failed to conduct full security reviews on acquisitions within Canada by Chinese regime state-owned enterprises. This is at the same time when the Prime Minister cannot find a business case for LNG while Germany and Japan are begging for it.
Conservatives will work hard to create jobs, bolster our allies and protect Canada's intellectual and resource assets. Conservatives want to ensure that this long-overdue update of the Investment Canada Act legislation features an automatic review system, as well as a net benefit analysis of any investment by a state-owned enterprise. This is just plain common sense. We would not wish to allow the entry of foreign state competitors into critical areas of Canada's security and economy.
Similarly, Conservatives will seek to allow the government to list and completely prohibit state-owned enterprises from countries with which Canada should not be doing business at this time. I am sure no constituent of mine would wish to see a Putin-backed enterprise buying into any Canadian company.
Let us ensure that this bill can draw that red line. We cannot have the uncertainty that would be created by selling off our critical mineral assets when we need these minerals for our modern world, including for electric batteries.
After eight years of blindfolds from the government on foreign acquisition of Canadian companies, intellectual property, intangible assets and the data of Canadians, Conservatives at the industry committee will do what we can to ensure that this bill fully protects our economic and national security interests from nations that do not wish us well. We need to encourage investment, while at the same time protecting Canadian interests.
Mr. Speaker, what should the number one job of a federal government be? I have always told my constituents that it is national security, our safety and security.
Last night, as I was preparing my remarks, I asked Dr. Google what the top priority should be for a national government. Lo and behold, up pops a website for Canada's federal government, which states, under “National Security”, “The first priority of the Government of Canada is to protect the safety and security of Canadians both at home and abroad.” That made me feel pretty good at first. I thought to myself that I was on the right track, and I was glad that the Liberal government places safety and security as its top priority. That made me happy. Unfortunately, I then felt disturbed when I started to think about it, because, as we have seen so much with the Liberal government, rhetoric and words are one thing, and doing is another.
Members might ask why. It is because I feel that so much of what the Liberal government and the do actually undermines the safety, security and protection of Canadians at home, within our borders.
The Liberals are weakening our justice system by removing mandatory minimums. There was a report recently in Vancouver that 40 or so criminals have done 6,000 crimes. That is the Liberal method, to catch and release. That is okay, I suppose, for fishing stocks, to catch a fish and let it go, but it is not good when it comes to criminals, when we have increased problems on transit with random attacks on people, and when a killer who is out on bail murders a police officer. This is not right. Canadians are not feeling protected at home by their justice system. It is a shame and a disgrace. It is not fulfilling the government's priority with respect to our security.
With respect to our national security, we have let our hair grow. Maybe that was okay back in the 1960s, but we have just let it go. We are thousands of troops short. We have obsolete equipment. The Liberal government said that it was not going to buy the F-35 fighter jets and instead decided to buy older planes, the F-18s, from the Australian air force. It has now decided that this is not working out so well and it had better get some new equipment. The has let things go with respect to our military.
I was also watching reports on Twitter and, big deal, Canada sent one tank to Ukraine. That was brought up in the House and the response was that it was actually four tanks, because three more are on the way. Meanwhile, the Ukrainians are losing hundreds of tanks over there, but Canada does not have much to send because our cupboards are bare.
This is personal for me, because I was raised in a Royal Canadian Air Force family. I was born in Germany and lived in bases all throughout Canada. Even from a young age, my mind was on the military and our national defence. I also served in the military after finishing high school.
Our national defence is not a priority. I will say that categorically.
Bill is an attempt to address an important national security risk, namely identifying and responding to economic security threats from foreign investments. I think this is good. The Conservatives will be supporting its moving to second reading because it needs a lot more teeth.
Much of what we have seen, and what I have seen since being elected in 2019, is just rhetoric. It is smoke and mirrors to make it look like the Liberals are doing something when they are not.
November 9, 1989, is a day that I remember well, along with the months and years that followed. What happened? The Berlin Wall that separated East and West Germany began to be dismantled. Numerous countries had been under communist regimes. Many are now part of NATO. There have been great changes. It was quite amazing. People were set free from communism without shots being fired in Europe. There was euphoria. It seemed miraculous, and maybe it was.
I found, as I have gone in my communities and talked to people, that those who are most concerned about what is happening in Canada in terms of freedom and security are those from eastern Europe who used to be under communist regimes. They are very concerned about what they see. They can see through the bluster of the Liberal government.
The United States became the only undisputed superpower. Western countries, including Canada, let our militaries go to pot. However, the world has changed in the past 30 years. Russia has armed itself to the teeth, and we have seen an invasion. We are coming to the first anniversary of the Russian invasion of Ukraine, and Conservatives support the efforts to oppose it, as do the other parties.
There is even more of a danger happening, and this has emerged in Communist China. China is an economic and military superpower that wants to extend its economic, military and political power and influence. It is threatening its neighbours. It is expanding control.
I have been to China, and it is a beautiful country, but its autocratic communist government is suppressing its own population. There is a lot of concern worldwide and among our military partners, whether it be Five Eyes, the United States, the U.K. or other countries, about what we are doing in Canada.
China has a larger navy than the United States. Our military partners are wondering why we are giving a country, a military and economic superpower like China, full access to secrets, our people and surveillance. It is a problem. My other colleagues have mentioned some of the problems we have had, such as Huawei, which actually used technology from Nortel, a Canadian company.
It is a big concern. This just came out a few hours ago in The Globe and Mail. It said, “China employed a sophisticated strategy to disrupt Canada's democracy in the 2021 federal election campaign as Chinese diplomats and their proxies backed the re-election of Justin Trudeau's Liberals...and worked to defeat Conservative politicians”.
Mr. Speaker, I am not challenging the authority of your chair. How this ties into the Republic of China is that it is influencing our elections, and the bill is about stopping the influence of countries like that in our economy. That is the connection. It is as clear as day.
The member across the way is engaging in distraction, suggesting that it is somehow wrong to talk about the influence China has had on two elections. Eleven candidates received illegal donations, and we have yet to find out who these individuals are. Who is protecting those 11 individuals? What are they hiding? We know this is coming from a country we have concerns with.
The bill would try to stop the undue influence on our economy, and there are reports out today saying that this country went one step further. We know that the People's Republic of China is influencing other countries through economic purchases in their economies. However, it just bypassed it all and bought a government with illegal donations, hiring people to work in elections and then sending those volunteers off to work on Liberal-friendly campaigns. Those are the reports in The Globe and Mail that are so troubling. It goes to the root of why we are are here.
Why does this all matter? We are supposed to be making choices for the benefit of this country, not for a foreign country that is, for the time being, in bed with one of the parties in Canada.
The bill needs to be strengthened. We need to do a net analysis on all transactions from the People's Republic of China. We have to bring the threshold down to zero. These are recommendations we heard at committee, and when the bill does finally get to committee, I hope we do add that. We need to add teeth to the bill.
There are a couple of things that are done well in the bill so far. One is the increase in penalties, because of inflation of all things. Everything is getting hurt by inflation. However, the bill would increase the penalties given to companies that would break this proposed act, and we are happy to note that increase. There are other common-sense things we can do to protect our economy from being bought out by the People's Republic of China.
Mr. Speaker, the world has changed in recent years. It is a reality that all people in this place need to confront themselves with on behalf of their constituents. What I mean by saying that the world has changed is that there are more state actors or other countries that are becoming increasingly hostile to the interests of our country and our constituents.
As this is happening, we need to remind ourselves that our duty in this place is to protect our national sovereignty so that our constituents have bright, prosperous and safe futures, free from persecution, free from the influence of other nations that do not share our country's values of freedom, liberty, personal opportunity and diversity. These are all things we have to work really hard to maintain.
Maintaining and defending Canada's national sovereignty is a big job. There are a lot of different aspects. There is maintaining our national defence and our defensive capacity. The government really has not done a good job of that, frankly.
What we are debating today is whether we have adequate protections for our economy, in terms of protecting our national sovereignty.
When we think about hostile nation-states wanting to exert influence on our country, sometimes we are tempted to think about that problem in really Hollywood-like terms, with planes coming in and invading our country. We have, in recent days, had incursions into our airspace, which sort of proves my point further.
One of the big ways our national sovereignty has been threatened is by the lack of a legal framework and tools that prevent hostile state actors from influencing our economy in negative ways.
What I mean by that are things like being able to purchase major components of Canada's natural resources, particularly critical minerals like lithium, or even hostile state actors being able to own intellectual property on really important things for protecting national sovereignty in the future like, let us say, quantum computing.
We have a duty in this place to ensure that, with respect to nations that do not share our values but, in fact, show hostility, aggression and a desire to erode Canada's sovereignty, we put in place safeguards to prevent them from doing so.
What I think this Liberal government has done with this bill is to try to distract Canadians. They are trying to say “oh, here is a bill that might do some things”, but it really does not get to the heart of the fact that, as I have said, the world has changed and that, given that, we need to have very strong protections to ensure our sovereignty is protected. It needs protection in terms of hostile state actors influencing our economy or, in fact, even taking resources, intellectual property or other things back to their nations that could, in turn, be used to threaten our country and the people we all represent.
I do not think this bill is adequate at all. I want to talk about why, and what the government should be doing to protect our sovereignty, in terms of these economic measures.
Right now, if a state-owned enterprise, a company that is owned, in part or wholly, by another government, another country, wants to buy, let us say, a mine or something like that, that transaction should be subject to a review, both in terms of national security and in terms of whether this transaction is in the best interests of Canadians.
What this bill wants to do is take away the weak, inadequate process that exists right now, and instead of having it go through a cabinet process, where there are people from across the country, different portfolios, different lenses, looking at this, to put all that power into one minister.
I have a big concern with the government, given what it did with SNC-Lavalin. When the was confronted with a cabinet minister who did her job and said, “Whoa, I am not doing this”, he just shunted her aside and replaced her with a minister who was more acquiescent.
I am very hesitant to give the government, and particularly the , power here. Let us say he is under the influence of other nations or under lobbying influence, as we saw in the SNC-Lavalin scandal. If he is faced with that type of pressure again, I do not think he has the chops to stand firm in the best interests of Canadians because he has proven otherwise.
With this bill, the fact that issues would not go to cabinet waters down the process, which should be of grave concern to all Canadians. Certainly an amendment should be considered to remove that process. They should go to cabinet. I cannot understand why they would not.
The other thing to note is that because the world has changed, we know there are countries and state actors that employ this type of capital, like state-owned enterprises, to try to purchase major parts of the Canadian economy. There is a really high threshold in terms of dollar value for what would trigger a review under the current process. For certain countries, I feel that threshold should be zero.
There are some countries that we know are acting against the interests of Canadians and are arguably challenging our sovereignty. Any time those countries want to buy up some of our critical resources or critical intellectual property, there should be an automatic national security review to review whether this is in the best interests of the country. Then parliamentarians and the government can show accountability to our constituents and show that we are not just letting countries be hostile to our country by buying up parts of it. I think that threshold should be zero, and it should be amended in this bill.
There should also be a list of countries that have shown aggression and hostility to this country or to our allies so that they automatically get a review. If they are on this list, there is automatically a review for this type of transaction. That should also be an amendment in this bill.
The other thing to note is that the bill talks about just looking at acquisitions of companies. It is not looking at the acquisition of assets. What do I mean by that? I know there have been a lot of concerns about certain countries that have been hostile to Canada buying up farmland in Canada or buying up critical mines that produce things like lithium. This is of course a substance used in really important things like batteries. It is a really rare earth mineral, and it is important we retain sovereignty of it. If these hostile state actors are trying to avoid scrutiny by our government through a back door, there should be an asset review.
I want to circle back to why I do not think power should be consolidated in the hands of the minister. This week, our Ethics Commissioner said in an article, “The act has been there for 17 years for God’s sake”. He essentially talks about the , the cabinet and a lot of members in the Liberal Party not having a moral compass to know what is right and wrong, not holding the cabinet to account and letting this leader continue.
This is why the bill needs to be amended. There is too much power concentrated in a group of people who think they can get away with things that are in their best interest. When we are talking about maintaining national sovereignty, we need more safeguards and not less for these types of economic transactions.
In closing, I want to talk about what my colleague from said. This morning, there was a report that said the Chinese Communist Party was directly influencing elections here in Canada. Our sovereignty is under threat, and we should be ensuring strict safeguards. We should be acknowledging the world has changed and that our constituents deserve greater levels of protection, and should be looking at how assets might be produced or taken from Canada and potentially used against us in the future.
I am worried that because this bill does so little and waters down the fiduciary authority of cabinet to look at these transactions, we are putting ourselves in a more precarious position as opposed to a stronger position, particularly given the ethical lapses of the government and particularly given the inability of the Liberal backbenchers to stand up and hold their ministers, who give contracts to their friends, to account. The has had two ethics violations. How is he still the leader of their party? Because of the lack of moral compass the Ethics Commissioner talked about, there need to be amendments to this bill.