Harper promises 'clarity' on investment rules
Prime Minister Stephen Harper. (File Photo)
The federal government is working on new rules for firms controlled by foreign governments that want to take over Canadian companies, Prime Minister Stephen Harper said Monday.
It's expected the feds will apply the new regulations to two multibillion-dollar bids from companies controlled by the governments of China and Malaysia.
But neither Harper nor Industry Minister Christian Paradis provided any details about what those rules might be or when the government will say what they will be.
Opposition MPs hammered the government for "mismanaging the economy" by failing to provide details of those rules to foreign investors.
On Friday, at three minutes before midnight (Ottawa time), Paradis issued a statement that a $5 billion bid by Petronas, controlled by the government of Malaysia, for Calgary-based Progress Energy was not a "net benefit" to Canada and, on that basis, he would not approve the deal.
But both Paradis and Harper noted that Petronas has 30 days to re-submit an amended bid. Petronas, in a statement issued Monday, said it was considering that.
In the meantime, the government must decide what to do on a much bigger deal, a $15-billion bid by CNOOC, a firm firm controlled by the government of communist China, to buy Calgary-based oil and gas producer Nexen. The deadline for a decision on that deal is Nov. 10.
Harper had said previously that "one of the issues that does make (the CNOOC-Nexen deal) somewhat different" is "the fact here that we're dealing with state-owned enterprise."
And while Harper on Monday did not specifically refer to "state-owned enterprises," he seemed to lump the CNOOC and Petronas deals - both of which involve foreign state-owned enterprises -- together by referring to them as "these sorts of transactions."
He said, for the first time, that his government "does have an intention to put out a clear and new policy framework regarding these sorts of transactions."
He declined to provide much in the way of detail, though, saying later, "we will give great clarity on our policy framework going forward when we take a couple of decision that are before us at the present time."
Harper's political opponents were not satisfied.
"This is no way to manage one of the world's largest economies," NDP MP Peter Julian told reporters.
"When there is that much uncertainty and that much improvisation on important economic matters, it is not good for the Canadian economy."
It certainly wasn't good for shareholders of both Progress Energy or Nexen.
Shares of Progress were down by as much as 12% on the Toronto Stock Exchange Monday while shares of Nexen slumped as much as 5.25%.
"The whole process is in the dark. It should be transparent," interim Liberal leader Bob Rae told the House of Commons.