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Testimonial:

Foreign control over Canada's essential infrastructure poses a potential threat to the nation's sovereignty and economic stability. It is crucial that the country maintains control of its infrastructure to secure its future.

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4 min read
Foreign control over Canada's critical infrastructure is a danger we cannot afford to ignore any...
Foreign control over Canada's critical infrastructure is a danger we cannot afford to ignore any longer. It's high time we reconsider our stance and strive to retain control over our national assets.

Testimonial:

Rewritten Article:

Matthew Mendelsohn and Jon Shell spearhead Social Capital Partners, a nonprofit organization tackling economic issues for the working population.

Last week, Prime Minister Mark Carney graced the White House to interact with President Donald Trump, marking his first significant challenge. Generally, everyone agreed he passed with flying colors, impressing with his smart humor and true Canadian spirit. But now, he's faced with a completely different kind of test.

Sunoco, an energy powerhouse based in Dallas, led by Trump ally Ray Washburne, is pushing to acquire Alberta-based Parkland Corporation. This deal would merge U.S. infrastructure with Canadian retail and refining assets, creating the most substantial independent fuel distributor in the Americas, predominantly owned by an American company.

At this critical juncture in Canadian history, where prolonged globalization and continental integration seem to have reached their end, our "elbows up" approach is now butting heads with practical policy decisions.

In the past, a deal like Sunoco's would be a no-brainer: a buyer offering a lucrative price for a Canadian company, which, if approved by the board and shareholders, should have no roadblocks from the government. The market would produce value and favorable outcomes.

But Canadians are now grappling with a new reality, needing to decide the best way to navigate this new world. It's crucial to remember the lessons from our past to avoid repeating history's mistakes.

Decades ago, Canada shed its mining leaders to foreign giants following the acquisitions of Inco, Falconbridge, and Alcan. We are left with a dismal reality, where instead of owning the world's leading mining companies and generating wealth in Canada, Canadians are working for foreign entities. This tale has been spun repeatedly.

While short-term benefits for shareholders are appealing, these deals denied Canadians the chance to build global enterprises. We've also learned that the age of taking free trade for granted has ended, and that state power in the U.S. and elsewhere is being leveraged more extensively to protect national sovereignty.

It's detrimental for Canadians to have an economy controlled by others. It's detrimental for Canadians to have an economy restricted to a "branch plant," lacking ownership or control over natural resource companies.

As Mendelsohn and Shell predicted earlier this year, American investors would soon eye Canadian businesses and assets. This development threatens our national security and economic sovereignty, as we warned. And here we are. Do we want to be controlled by American billionaires, working under their command and seeing our wealth dwindle away to line pockets in New York and Dallas?

Resisting predators is difficult. It comes with risks. But we must start resisting anyway. As the prime minister stated, Trump aims to weaken us in order to control us. Invasion is the least likely way for him to achieve this goal — it's much easier to buy up Canadian assets.

In March, the government amended the Investment Canada Act to fortify its ability to review foreign acquisitions. The government's history suggests that the Sunoco deal is exactly the type of foreign investment that would endanger Canada's long-term economic competitiveness.

As the transaction undergoes Canadian regulatory review, Champagne's commitment to protect Canada's national and economic security must be upheld. The government should block the Sunoco deal through the ICA review process. To be sure, some shareholders would miss out on a bump to their portfolios. However, we are in the midst of an economic war, and we cannot surrender control of our infrastructure or accept more high-value talent leaving Canada for the United States.

In the Oval Office last week, the prime minister presented Canadians to the president as the "owners of Canada," stating that the country would never be for sale. If we truly want it to remain ours, then we need to think and act like it.

We have the tools. Now, let's utilize them to safeguard our sovereignty.

Matthew Mendelsohn and Jon Shell are the CEO and chair of Social Capital Partners, a non-profit organization addressing economic issues affecting working people.

Opinion articles are shaped by the author's interpretations and judgments of facts, data, and events. Further Reading

  • The government's efforts to review and potentially block foreign takeovers of Canadian companies can be traced back to various measures implemented under the Investment Canada Act (ICA).
  • Foreign acquisitions are subject to review if the enterprise value exceeds specific financial thresholds, with a net benefit to Canada required for approval.
  • In addition to financial thresholds, the government can review any foreign acquisition based on national security grounds, regardless of whether it meets financial criteria.
  • National security is broadly defined, allowing the government broad discretion over review. sectors like oil sands, critical minerals, defense, and other protected industries are likely to face increased scrutiny.
  • Economic security is a new factor explicitly incorporated into national security reviews. This decision aims to protect Canadian firms from opportunistic or predatory acquisitions, especially when trade wars or tariffs cause valuation drops.
  • The government maintains a list of sensitive technologies subject to closer scrutiny and specifically flags any investment from entities with direct or indirect ties to Russia, or foreign state-owned enterprises targeting critical mineral sectors, as automatically triggering national security reviews.
  • The government's approach combines financial thresholds for net benefit assessments with broad national security reviews that now explicitly include economic security concerns, giving the government the power to more thoroughly scrutinize and potentially block foreign takeovers that may threaten Canada’s economic and national security interests.
  1. The Sunoco deal, with potential ownership shifting towards an American company, presents a new challenge to Canada's economic security, as Prime Minister Mark Carney grapples with practical policy decisions.
  2. In the past, the Canadian economy was susceptible to acquisitions by foreign giants, which led to a dismal reality of Canadians working for foreign entities.
  3. The government, acknowledging the need for safeguarding economic sovereignty, amended the Investment Canada Act to fortify its ability to review foreign acquisitions.
  4. As the Sunoco transaction undergoes review, it is essential to block the deal through the ICA review process, to protect Canada's national and economic security, according to Matthew Mendelsohn and Jon Shell of Social Capital Partners.
  5. The prime minister's assertion that Canada would never be for sale resonates in the ongoing discourse on the country's economic policy and media coverage.
  6. If the government is serious about retaining control of Canada's infrastructure and natural resource companies, it must exercise this power through active engagement and careful, resolute reviews of foreign acquisitions.

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