Industry Minister Tony Clement speaks during Question Period in the House of Commons on Nov. 18, 2010.CHRIS WATTIE/Reuters
Industry Minister Tony Clement appears wary of making "strategic resource" a yardstick for measuring future foreign takeovers even though the Conservatives' political minister in Saskatchewan used this rationale to justify blocking a bid for Potash Corp.
Mr. Clement is preparing to clarify in a matter of days how he intends to interpret the legislation for screening non-Canadian takeovers in the wake of the Harper government's early November decision to turn down Australian miner BHP Billiton's unfriendly bid for Potash Corp.
The day after the rejection was announced, the Harper government put up Agriculture Minister Gerry Ritz, the Tory Party's point man in Saskatchewan, as the main spokesman to explain why Ottawa did what it did on an issue that had threatened to cost Conservatives seats in that province.
Mr. Ritz used a much-watched speech in the Commons Nov. 4 to defend the decision as an attempt to preserve international clout for Canada. Potash Corp. is a dominant producer of a key ingredient in fertilizer that's much in demand around the world. "From a strategic standpoint, I think we have it in spades here," Mr. Ritz told Parliament.
The Agriculture Minister's statement suggested the Tories have essentially changed the rules for screening outside investment while reviewing the Potash decision because existing guidelines do not mention "strategic resource" as a reason for rejecting bids.
But Mr. Clement, who is eager to dispel the impression Canada is unfriendly to global investment now that the Tories have blocked two controversial foreign takeovers, noted Thursday he has not been using the word "strategic" to discuss investment screening.
"The facts of the matter are that 'strategic' is not mentioned in the Investment Canada Act. It's not a concept that has a home in the nomenclature of that particular piece of legislation.
"I myself have never used the word 'strategic,'" the Industry Minister added.
He said he based his decision solely on the "black letter of the law" found within the existing legislation.
Mr. Clement did not directly answer whether he felt Ottawa needs to designate "strategic resource" as a new criteria for reviewing future foreign takeovers.
"I think I will stand on my comment that it's not specifically mentioned in the act. The act has six fairly long clauses that deal with the factors through which one must assess a potential bid and I actually think that worked rather well in the BHP Billiton process."
Steven Chase