Archived — Annual Report 2014–15

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Message from the Director of Investments to the Minister of Industry

Dear Minister:

I am pleased to present to you the annual report on the Investment Canada Act (ICA or the Act) for fiscal year 2014‑15. This report relates to investments in "non-cultural" Canadian businesses, as the responsibility for the review of foreign investment proposals in cultural businesses was transferred to the Minister of Canadian Heritage in 1999.

During fiscal year 2014‑15, 15 applications were reviewed and approved and 704 notifications were filed under the Act. The value of the Canadian businesses acquired or established in these 719 investment transactions was $42.36 billion in total assets, with applications reviewed accounting for $21.78 billion and investments requiring notification representing $20.58 billion of this total.

The business and services sector continued to attract the majority of investments: 266 investments, totalling $7.58 billion in asset value. The manufacturing sector saw 139 investments ($7.49 billion) and there were 98 investments in the resources sector ($13.22 billion).

The United States continued to lead all countries with 399 investments implemented, representing 55 percent of the total number of investments and totalling $25.6 billion in asset value. The European Union had the second-highest share with 185 investments, totalling $4.56 billion in asset value.

The Government of Canada continued to update the foreign investment review framework in 2014‑15 to reflect changing economic trends, particularly the international investment environment. These measures, elaborated on below in the Policy Development section of this report, included amendments to the Act which were contained the Economic Action Plan 2014 Act, No. 2, as well as amendments to the Investment Canada Regulations and the National Security Review of Investments Regulations.

I trust that this report provides an overview of the administration of the Act. The data on investments subject to the Act show that the Canadian economy is globally integrated and open to investment from around the world.

I look forward to continuing to support you in administering the Act.

Yours sincerely,

John Knubley
Director of Investments


In today’s interconnected world, foreign investment is one of the factors that positively influence Canada's economic success and long‑term prosperity. It can lead to higher living standards through better paying jobs, innovation and increased trade resulting from enhanced global supply chains. Canada has a multifaceted framework approach to promote investment and trade.

The ICA is the primary mechanism for reviewing foreign investments in Canada. Its purpose is twofold: to review significant foreign investments to determine if they are likely to be of economic benefit to Canada and to review investments that could be injurious to national security.

Under the Act, a foreign investor seeking to acquire control of a Canadian business valued at or above an established threshold must apply for review of that acquisition, which is an assessment of the investment's likely net benefit to Canada. In 2014, the threshold for investors from World Trade Organization (WTO) member countries was $354 million in asset value, and in 2015 it was $369 millionFootnote 1. For investments valued below the established threshold, investors must file a notification, which means the investment is not reviewable. A notification also has to be filed when an investor from a WTO member country indirectly acquires control of an existing Canadian business and when a foreign investor establishes a new business in Canada.

In examining the likely net benefit of a proposed investment, the Minister considers six factors that provide predictable guidance for investors while maintaining the flexibility required to protect Canada's economic interestsFootnote 2:

  1. the investment's effect on the level and nature of economic activity in Canada, including employment, resource processing, and the utilization of parts, components and services;
  2. the degree and significance of participation by Canadians in the Canadian business;
  3. the investment's effect on productivity, industrial efficiency, technological development, and product innovation and variety;
  4. the investment's effect on competition;
  5. its compatibility with industrial, economic and cultural policies; and
  6. its contribution to Canada's ability to compete in world markets.

Where an investor is owned, controlled or influenced by a foreign state, the Minister also considers the guidelines on investments by state‑owned enterprisesFootnote 3 (SOE) as part of the net benefit review process. Pursuant to the guidelines, the Minister takes into account the investor's adherence to free enterprise principles, the foreign state's degree of influence over the investor and the likely commercial orientation of the Canadian business.

Policy Developments

Since 2007, to keep Canada’s investment review framework up to date in the changing global investment environment, the Government made important changes to the ICA. For example, in 2009, a national security review mechanism was introduced to enable the Government to safeguard Canada's national security interests. In 2012‑2013, the Government clarified how investments by foreign state‑owned enterprises (SOEs) are assessed under the Act by adding a definition of SOE to the Act and through updates to the 2007 SOE Guidelines.

During the period covered by this report, the Government, on October 23, 2014, introduced amendments to the ICA in the Economic Action Plan 2014 Act, No. 2Footnote 4. These amendments, which received Royal Assent on :

  1. provide the Government with the discretion to allow public disclosure of certain information related to notices sent to the parties at each stage of a national security review;
  2. require foreign investors to file a notification whenever they acquire a Canadian business through the realization of security for a loan or other financial assistance, unless the transaction is subject to approval under another statute; and,
  3. as a housekeeping measure, repealed an unneeded provision that was not yet in force, which would have allowed for an extension to the period in which the Governor‑in‑Council decides to take measures to protect national security.

On , the Government delivered on its commitment to progressively increase the net benefit review threshold for investments in Canadian businesses involving WTO, private‑sector foreign investors from $369 million in asset value to $1 billion in enterprise value, over a four‑year period. On , the net benefit review threshold increased to $600 million in enterprise value and will remain at that level for the next two years. It will then increase to $800 million for the following two years, after which it will go up to $1 billionFootnote 5. The Government has also previously announced this threshold will increase to $1.5 billion for European Union investors as part of the Canada‑European Union Comprehensive Economic and Trade Agreement and will come into force when the Agreement is implemented.

The change to enterprise value captures the increasing importance of people, know‑how, intellectual property and other intangible assets in the valuation of modern, knowledge‑intensive businesses. The review threshold remains unchanged for acquisitions of control by foreign SOEs or foreign acquisitions of control of Canadian cultural businesses. Changes to the net benefit threshold will focus the Government’s reviews on the most significant transactions, while helping to attract beneficial foreign investment to the Canadian economy.

In addition, the National Security Review of Investments RegulationsFootnote 6 were amended in March 2015 to increase the length of certain time periods to carry out national security reviews and give the Minister the flexibility to extend reviews, when necessary, to address complicated national security concerns.

Statistical Information: 2014‑15Footnote 7

Summary of Activity

In fiscal year 2014‑15, there was significant activity under the Act, with 719 investments processed having a total of $42.36 billion in asset valueFootnote 8. There were 15 reviewed and approved applications, up from 11 in 2013‑14. These investments totalled $21.78 billion in asset value, an increase of 41.2 percent compared to 2013‑14. While the total number of notifications filed was 704, up from 655 in 2013‑14, the value of these investments fell by almost half from the previous fiscal year. Investors from the United States made 399 investments, totalling $25.61 billion in asset value. Once again, the business and services sector continued to attract the majority of investments: 266 investments totalling $7.58 billion in asset value.

Total Investments

In 2014‑15, 15 applications for review were approved by the Minister of Industry and 704 notifications were certified by Industry Canada under the Act, compared to 11 approved applications for review and 665 notifications filed in 2013‑14 (Figure 1 and Figure 2). Of the 704 notifications, 180 related to the establishment of a new business by non‑Canadian investors, compared to 177 in 2013‑14.

Figure 1: Applications

Bar chart of Applications (the long description is located below the image)
Description of Figure 1
Year Number of applications
(right axis)
Asset value of applications ($ billions)
(left axis)
2010‑11 16 16.84
2011‑12 15 19.14
2012‑13 18 43.10
2013‑14 11 15.42
2014‑15 15 21.78

Figure 2: Notifications

Bar chart of Notifications (the long description is located below the image)
Description of Figure 2
Year Number of notifications
(right axis)
Asset value of notifications ($ billions)
(left axis)
2010‑11 580 21.15
2011‑12 696 15.26
2012‑13 664 13.11
2013‑14 655 38.56
2014‑15 704 20.58

Review Time

On average, in 2014‑15, the time taken for a net benefit determination to be made was 75.3 days, up from 71.5 days in 2013‑14.

Investment by Asset Value

The total asset value of all applications for review and notifications in 2014‑15 was $42.36 billion (Figure 1 and Figure 2), compared to $53.98 billion in 2013‑14, a decrease of 21.5 percent. The decrease was entirely attributable to the decrease in total asset value from investment transactions requiring notification.

Applications for Review

The total asset value of approved applications for review in 2014‑15 was $21.78 billion, compared to $15.42 billion in 2013‑14, an increase of 41.2 percent. The mean asset value of approved applications was $1.45 billion in 2014‑14, compared to $1.40 billion in 2013‑14. The five largest applications for review in 2014‑15 totalled approximately $13.87 billion in assets, compared to $11.98 billion in 2013‑14. The asset value, as well as the number, of reviewed investments can be expected to vary from year to year.


The total asset value for notifications filed in 2014‑15 was $20.58 billion, which is almost half (46.6% lower) the 2013‑14 level of $38.56 billion. The mean asset value of notifications filed in 2014‑15 was $29.23 million, compared to $58.87 million in 2013‑14. The five largest notifications received in 2014‑15 totalled approximately $3.31 billion in assets, compared to $21.83 billion in 2013‑14. The asset value, as well as the number, of notifications filed under the Act can be expected to vary from year to year.

There were eight investment transactions subject to the Act in 2014‑15 where the Canadian business had assets valued at more than $1 billion, seven of these were reviewable applications. The other investment was not reviewable because it was an indirect investment involving an investor from a WTO member country and therefore only required notification under the Act.

Investment by Sector

For confidentiality reasons, investments subject to the Act are characterized as belonging to one of five broad sectorsFootnote 9. The five sectors, outlined below, are based on Standard Industrial Classification codes and are comprised of numerous subsectors.

Figure 3: Asset Value by Sector ($ billions)

Bar chart of Asset Value by Sector ($ billions) (the long description is located below the image)
Description of Figure 3
Asset Value by Sector ($ billions)
Year Resource Manufacturing Wholesale and retail Business and services Other services Asset value total
(at top of column)
2010‑11 16.51 8.53 5.48 2.51 4.96 37.99
2011‑12 17.11 5.24 1.71 4.98 5.36 34.40
2012‑13 33.31 5.89 10.35 5.22 1.45 56.21
2013‑14 31.54 6.26 1.96 4.75 9.47 53.98
2014‑15 13.22 7.49 2.04 7.58 12.03 42.36

Investment by Country or Region of Origin

In 2014‑15, the United States was the number one source of investments with 399 investments totalling $25.61 billion in asset value. Investments from the United States accounted for 55.5 percent of the total number of investments and 60.5 percent of the total asset value. Investors from the European Union (EU) made 185 investments totalling $4.56 billion in asset value, which represented 25.7 percent of the total number of investments and 10.8 percent of the total asset value.

Figure 4: Investment by Country or Region of Origin

Pie chart of Investment by Country or Region of Origin (the long description is located below the image)
Description of Figure 4
Investment by Country or Region of Origin
Country or region of origin Number of investments
United States 399
European Union 185
BRIC (Brazil, Russia, India and China) 42
Switzerland 17
Japan 15
Australia 12
South Korea 11
Other 38
Breakdown for European Union
United Kingdom 47
France 46
Luxembourg 23
Germany 18
Netherlands 13
Spain 8
Rest of European Union 30

Among the EU member states, the following had the highest level of investment:

The BRIC countries (Brazil, Russia, India and China) made 42 investments in 2014‑15, which totalled $3.99 billion.

Other countries of note in terms of the level of investment in 2014‑15 are as follows:


Interpretive Notes

Data Comparison with Other Statistical Sources

The principal purpose of the ICA is the regulation of investment activity by foreign investors. Industry Canada data on the value of foreign investments for a given period therefore reflect operations under the ICA. Only data on new business proposals and acquisitions of control by foreign investors are collected. The value of "planned investment" is tabulated from new business notifications and the book value of "assets acquired" from transactions requiring notification or review. Aggregated figures are published quarterly.

Industry Canada data cannot be compared with either the foreign direct investment flows or stock figures published by Statistics Canada because the data represent a portion of the value of foreign investment in Canada. For example, the value of major plant expansions by established foreign investors in Canada is not captured.

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