1E9Ct5D

INVESTMENT REVIEW PROCESSFollowing the filing of the application, theInvestment Review Division of IndustryCanada has 45 days to conduct a review. Atthe end of this review period, the investor isnotified whether or not the Minister hasapproved the application. The Minister, aspart of this response, may suggest changesto the acquisition proposal which wouldallow the acquisition to become satisfactory.Alternatively, the investor may be notifiedthat the Minister requires an extra 30 daysto review the proposed investment. Whilethe ICA requires that all reviews occurwithin 105 days of the date the applicationwas completed, the review process isusually completed within six weeks.As part of the review process, the Ministergenerally consults with the province orprovinces that would be significantlyaffected by the investment, as well as theCompetition Bureau and other governmentdepartments with relevant expertise. TheICA preserves the confidentiality of allinformation filed as part of the reviewprocess, and government officialsadministering the ICA are subject to criminalprosecution if such information is illegallydisclosed to third parties.After the review process is complete, thegovernment may either reject or approvethe proposed investment. Most proposedinvestments are ultimately approved basedon undertakings negotiated between theinvestor and the government.There are several exemptions from theapplication of the ICA, including certaintypes of corporate reorganizations andsecurities transactions, certain financingtransactions, and certain transactions withinthe insurance industry.It is worth noting that since the inception ofthe ICA, no investment in Canada by a nonresidenthas been rejected under the reviewprocess, but in several instances applicantshave accepted recommended structuralchanges.OTHER RESTRICTIONS ON FOREIGNOWNERSHIPIn addition to the restrictions set out aboveunder the ICA, there is also other industryspecificlegislation which affects foreignownership in Canada.Both the federal Bank Act and the federalTrust and Loan Companies Act haveregulations which restrict the ability offoreign banks and other non-residents tohold more than 25% of the shares issued bybanks, trust companies and loancompanies.Under the federal Broadcasting Act,broadcasting licences may not be issued tocompanies that are owned or controlleddirectly or indirectly by non-Canadians, or toindividual non-Canadians. Also, the federalTelecommunications Act requires thatcompanies owning telecommunicationstransmission facilities used to offer serviceto the public must have at least 80% of theirvoting shares owned by Canadians, and notless than 80% of the members of theirboard of directors must be Canadians. Inaddition, these Canadian carriers must becontrolled in fact by Canadians at all times.The Insurance Companies Act limits foreignownership in an existing Canadian-ownedRegulation of Foreign Investment 24