Canada urged to ease foreign investment rules

Thu Jun 26, 2008 3:41pm EDT
 
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By Louise Egan

OTTAWA (Reuters) - Canada should lower barriers to foreign investment in telecommunications, uranium mining and air transport, and lift a ban on domestic bank mergers, an expert panel commissioned by the government said on Thursday.

In a report that was prompted by widespread concerns that home-grown businesses were being gobbled up by foreign interests at an unprecedented rate, the Competition Policy Review Panel warned against greater protectionism.

"We decided it would not be in Canada's interest to try to erect more barriers, to play defense," the panel's chairman, Lynton "Red" Wilson, told reporters after releasing the report.

Canada can only start "participating in international consolidations in its own right" if it opens up its doors to foreign capital and streamlines the approval process for investment and takeovers, the five-member panel concluded.

"We would prefer to see the game go to the other end of the rink," said Wilson, a well-known businessman and the former chief executive of BCE Inc (BCE.TO: Quote), parent of Bell Canada.

The Conservative government commissioned the panel in July 2007. The report contained 61 recommendations.

Big business was supportive of the proposals, but many wondered whether the minority government would let the proposals die on paper, especially if there is an election soon.

"The key now is to make sure that the government addresses the report's recommendations with the seriousness they deserve," said Perrin Beatty, head of the Canadian Chamber of Commerce. "I'm optimistic. I'm hopeful," he said   Continued...

 
<p>Lynton "Red" Wilson (R), chair of the Competition Policy Review Panel, delivers the panel's report to Canada's Industry Minister Jim Prentice during an event on Parliament Hill in Ottawa June 26, 2008. REUTERS/Chris Wattie</p>