FTC announces increased HSR thresholds for 2019

On February 15, 2019 the Federal Trade Commission (“FTC”) announced the annual increased reporting thresholds under the Hart-Scott-Rodino Antitrust Improvements Act (“HSR Act”) of 1976, as amended.

Under the HSR Act, if certain thresholds are hit, parties proposing a merger or acquisition must file a detailed report with the U.S. FTC and Department of Justice, who will then be tasked with determining whether or not the proposed transaction will negatively impact U.S. commerce under anti-competition laws.

Below are the new thresholds and updated HSR filing fees and penalties.

Threshold 2019 Adjusted Threshold
Minimum Size-of-Transaction US$90 million
Size-of-Persons Test US$18 million and US$180 million
Size-of-Transaction above which Size-of-Persons Test Does Not Apply US$359.9 million

 

2019 Size-of-Transaction Threshold Filing Fee
Greater than $90 million but less than $180 million US$45,000
$180 million or greater but less than $899.8 million US$125,000
$899.8 million or greater US$280,000
25 percent of an issuer’s voting securities if valued in excess of $1,799.5 million US$280,000
50 percent of an issuer’s voting securities if valued at greater than $90 million US$45,000

The FTC separately announced an increase to the maximum penalty for violations of the HSR Act of US$42,530 per day.

These new thresholds are effective on April 3, 2019 and will remain in effect until the next annual adjustment, expected in the first quarter of 2020.

Please check out our legal bulletin for more details.

The author would like to thank Travis Bertrand, articling student, for his assistance in preparing this legal update.

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A pragmatic approach to climate risk

As we reported last year, investors are increasingly pushing for more detailed disclosure on climate change-related issues. According to the Wall Street Journal, companies are expected to face 75 climate-related shareholder proposals this AGM season. Generally, the questions investors are asking can be divided into two categories:

  1. What corporate social responsibility initiatives are you adopting to mitigate your company’s contribution to climate change?
  2. Is your company particularly exposed to any risks that climate change is expected to exacerbate?

Corporate social responsibility initiatives

The first question should not be taking issuers off-guard, as the call to action is obvious and potential mitigative strategies are known, or at least knowable. This risk is principally addressed by engaging with your shareholders which is generally good governance and not necessarily specific to climate risk. Last year, there were reports of significant groups of shareholders pushing their respective companies to release detailed plans on efforts to cut down on waste from single-use packaging and plastics. Although a corporation may well determine that adopting this proposal is not, on balance, in the interests of the corporation, it would be an unambiguous case of mismanagement if the company failed to address the issue altogether.

The best approach to addressing these types of climate related initiatives is to engage with your shareholders. You should know how sensitive your shareholders are to these types of initiatives and have a good understanding of your shareholders’ expectations. Larger firms should keep in mind that both ISS and Glass Lewis are generally in favour of proposals that enhance disclosure of climate related initiatives.[i]  If your shareholders rely on these firms for advice, you may want to make sure your investors are satisfied with your disclosure.

Climate change as a risk to the business

Climate change as a business risk doesn’t have the same headline-grabbing potential as CSR initiatives, but knowing how the changing world is affecting your business is certainly no less important. While some securities regulators are considering adding specific climate-related disclosure requirements, these risks should already be on the radar. By proposing climate-specific disclosure rules, regulators are suggesting that managers are not adequately recognizing potential threats to the business. If that suggestion is true, the implication could be that market values do not accurately reflect the ‘true value’ of a business.  Fundamentally understanding what makes the business valuable is management’s core job. Clearly, understanding specific impacts that climate change can have on the business is much more difficult than responding to a shareholder proposal, but whether a business is public or private, managers who understand risks facing a business are in a better position to deliver value for shareholders.

Increasingly, the impact of climate change is being measured on the financial markets. Investors who trade in weather-linked derivatives are trading broadly in line with climate predictions. As Bloomberg notes, this means that investors are taking climate predictions at face value, or they are independently coming to the same conclusions as climate scientists. All of that is to say, it appears as though the smart money is looking for managers who have a cogent and comprehensive approach to evaluating the impact of climate change on their business. Only time will tell what the right answers are, but managers who are proactively asking the right questions about climate risk will be more likely to come to the right conclusions.

The author would like to thank Daniel Weiss, articling student, for his assistance in preparing this legal update.

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[i] Based on its 2019 Shareholder Initiatives Guidelines, Glass Lewis “will generally recommend in favor of shareholder resolutions requesting that companies in certain extractive or energy-intensive industries that have increased exposure to climate change-related risks provide information to shareholders concerning their climate change scenario analyses and other climate change-related Considerations” but otherwise will review proposals on a case-by-bases basis. ISS recommends that investors “[v]ote for shareholder proposals seeking information on the financial, physical, or regulatory risks it faces related to climate change- on its operations and investments, or on how the company identifies, measures, and manage such risks” in its 2019 Policy Recommendations.

Creating value beyond the deal

In today’s M&A market, dealmakers are increasingly under pressure – resulting from increased disruption, industry convergence, technological change and the need to shift to new business models to stay competitive – to maximize and deliver value from each deal they do. One would think, therefore, that value creation would be a priority for dealmakers. However, a recent report by PwC (prepared in conjunction with Mergermarket and Cass Business School) shows that this may not be the case.

Key findings from the report include:

  • Many acquisitions and divestments do not maximize value – even when some dealmakers think they do. Based on total shareholder return, 53% of buyers and 57% of sellers underperformed their industry peers, on average, over the 24 months following completion of their last deal.
  • Companies that prioritize value creation early on have a better track record of maximizing value in a deal. Acquirers and divestors that prioritize value creation outperform their industry benchmark by 14% and 6%, respectively, on average 24 months after the deal closes.
  • Priorities can be mixed. A significant number of dealmakers (66% of acquirers) say that value creation should have been a priority right from the start, but only 34% of acquirers surveyed said that value creation actually was a priority on Day One (deal closing).

To ensure that value is created beyond the deal, PwC suggests an approach built around 3 core areas:

  1. Stay true to strategic intent: The organization needs to approach deals as part of a clear strategic vision and align deal activity to long-term objectives as opposed to engaging in opportunistic deal-making (which can create value, but not as often).
    • 86% of acquirers say that creating significant value was part of a broader portfolio strategy rather than opportunistic.
    • 93% of organizations who reported significant value creation invested 6% or more of their total deal value in integration.
  2. Be clear on all the elements of a comprehensive value creation plan – it should be a blueprint, not a checklist. There should be a thorough and effective process for conducting the deal with the required diligence and rigour in the value-creation process across all areas of the business.
    • 89% of sellers say there is room for improvement on optimizing the tax and legal structure of the deal.
    • 83% of sellers say there is room for improvement on extracting working capital.
    • 79% of buyers whose deal lost value did not have an integration plan in place at signing.
  3. Put culture at the heart of the deal. Making sure that people and cultural aspects are considered during the planning stage is fundamental. Wide engagement and communication of value creation will help to retain key personnel and build employee buy-in. Failing to plan for cultural change can be significantly detrimental to long-term value creation.
    • 89% of divestors surveyed believe they could drive more value from a sale by engaging with management more closely.
    • 82% of companies who say significant value was destroyed in their latest acquisition lost more than 10% of key employees following the transaction – this can be a problem when an increasing number of deals are “asset light” or made up of predominantly “people-centric” intangibles.

The author would like to thank Scott Thorner, articling student, for his assistance in preparing this legal update.

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eSports: a new MVP for real estate?

As we have previously discussed, the eSports industry has garnered immense popularity and is projected to grow considerably. While this projected growth may present new targets for acquisitions, partnerships, sponsorships and the like, it may also create new real estate opportunities – specifically, in the form of eSports stadiums and arenas. Although likened to traditional sports stadiums and arenas, the infrastructure, facilities and amenities of their eSports counterparts will be quite different. Most notably, these venues will be constructed with an emphasis on the “fan experience” and technology. The eSports stadiums and arenas already in operation throughout the United States appear to reflect this focus.

Additionally, these eSports venues have the potential to be transformative. By equipping players with the technologies required to play and compete, and by providing fans with a physical space to gather, socialize and cheer on their favourite teams and players, video games will no longer only be considered “at-home” experiences but rather, live social events. In fact, as the title of an article recently published by Cushman & Wakefield on the topic suggests, eSports may be “a game changer in real estate”.

According to the same Cushman & Wakefield article, the types of real property where we may expect to see the opening of eSports stadiums and arenas include locations with higher vacancies such as certain malls, older offices located in suburbs proximate to major cities, theme parks and even hotels. Consistent with the foregoing, many of the eSports stadiums and arenas already in existence appear to have been constructed on pre-existing properties previously operated for other purposes such as convention halls, nightclubs, movie theaters and the list goes on. Nevertheless, if the eSports industry continues to grow as anticipated, we will likely see the construction of custom-built venues that are specifically intended to be used for eSports stadiums and arenas. Indeed, later this year, Canada is poised to see the opening of The Gaming Stadium in Richmond, British Columbia, its first ever custom-built eSports stadium. In a press release announcing the stadium, the company behind The Gaming Stadium expressed its goal of providing “a community-driven location that is open for players of all ages and skill levels to watch and participate year-round.”

By stimulating demand for the development of new types of properties – that is, eSports stadiums and arenas, the projected growth of the eSports industry could be a slam dunk for real estate.

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Asset and wealth management M&A activities in 2018 and beyond

Merger and acquisition activities in 2018 in the asset and wealth management sector logged a total of 140 deals, up 5% from last year. According to an overview published by PwC, the total announced value of the M&A deals was US$14.9 billion, which represented a year-over-year increase up 72% – the highest percentage increase since 2009. Interestingly, almost 40% of deals in this sector were made during the last quarter of 2018, totalling US$9.9 billion in deal value. Specifically, there were three mega-deals that exceeded US$1 billion during the fourth quarter. With respect to deal volume, the fourth quarter of 2018 also saw more than twice as many deals than in the third quarter.

There were several drivers behind the growth in M&A activities in the asset and wealth management sector in 2018, many of which will continue to play a role in 2019. Firstly, it is estimated that there are over 10,000 mutual funds and ETFs in the U.S.. In such a crowded space, asset managers tended to consolidate by buying out competitors and strengthening their market positions. Secondly, according to the PwC research, both actively managed mutual funds and passively managed funds face intense fee pressure and are expected to drop their management fees about 20% by 2025.

Furthermore, low cost passive funds and ETFs continue to attract clients and assets and they are not showing signs of slowing down any time soon. This may be because over the long run, ETFs have typically outperformed indices. On the other hand, the vast majority (approximately 85%) of actively managed funds have underperformed their benchmarks over a 10- and 15-year period. As such, asset managers face pressure to deliver value for the hefty management fees that they charge. In addition, there are global opportunities out there for asset managers who are looking to expand their distribution in the international markets. As such, we may see more outbound M&A or joint ventures taking place in the coming year with asset and wealth management firms based outside of the US. Lastly, insurance companies also make deals to complement their line of business and build up their investment capabilities. Insurers will likely continue use deals to grow their client offerings and improve their general account investments in 2019.

The trends above notwithstanding, how are industry executives viewing the outlook in the asset and wealth management space? In an E&Y M&A report, 38% of executives at asset and wealth management firms indicated that they expect to engage in M&A activities in 2019, down from 51% in May 2018. These executives cite regulatory, geopolitical and policy uncertainties as key risk factors that may cause asset wealth managements to hold off on M&A activities in 2019. In addition, more emphasis will be placed on post-deal integration in 2019 as many executives indicate that the deals they made in 2018 achieved lower synergies after the merger than expected. As such, 45% of executives indicated that they will prepare earlier for the post-deal integration whereas 21% of them will be more careful in choosing the right leadership team for the integration process. Furthermore, 57% of executives indicated their optimism for the M&A market in 2019, expecting that private equity will become a dominant player in the market.

Given all the above developments, 2019 will certainly prove to be an interesting year for the asset and wealth management industry. Stay tuned for additional developments.

The author would like to thank Coco Chen, articling student, for her assistance in preparing this legal update.

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Know your worth: should you disclose undisclosed intangibles on financial statements?

Intangible assets are the non-monetary, non-physical assets of a business, including its rights, goodwill, overarching brand, and other intellectual property (IP) (i.e., patents, trademarks, copyrights, trade secrets). These types of assets represented 52% of the global enterprise value in 2018; however, 80% of that value went wholly undisclosed on companies’ balance sheets. Why are businesses’ financial disclosures largely silent with respect to intangible assets? Should companies consider reporting on such resources?

Currently, the International Financial Reporting Standards (IFRS), which are commonly followed in Canada, do not allow for businesses to recognize most internally-generated intangible assets on their financial statements. Only externally-acquired assets (i.e., those obtained through a business consolidation or other M&A transaction) will necessarily crop up in financial reporting documents. As a result, regular and reliable determinations of where intangible value is or is not being generated and utilized are unavailable, frustrating both company and interested stakeholder efforts at evaluating a business’ resources, management, and worth.

In its recent report, Brand Finance suggested a new approach to financial reporting, whereby the fair values of all intangible assets would be annually determined and reported on by management, accompanied by notes expounding on the nature of each asset, any assumptions relied upon in arriving at the values disclosed, and an explanation of the health and maintenance of such assets. Brand Finance would require that boards disclose their opinions on the fair value of their company’s key intangible assets through “living” balance sheets, the practice of which will benefit customers, investors, and other stakeholders.

Some of the potential benefits which could stem from the consistent internal valuation of, and reporting on, intangible assets include:

  • Deal draw: more meaningful and fulsome financial reporting would likely prove attractive for potential investors and partners, as well as other lenders and creditors, by allowing for informed decision-making and fostering trust through transparency. Further, when the time comes for a M&A opportunity, those crucial intangible valuations are already accurately and reliably determined so as to better facilitate information exchange and price assessment.
  • Better informed management: management would have a more comprehensive understanding of the business’ aggregate assets and its overall value if intangible assets were regularly evaluated in-house. Cyclically attributing accurate values to unseen and previously unreported assets will also encourage informed management action directed at bolstering and preserving such assets and their related benefits. Given such information, management personnel will be better equipped to allocate resources and plan into the future.
  • Increased innovative investments: reporting on intangible assets will also likely encourage investments in the same. A consistent awareness of such assets’ value, and the peaks and valleys thereof, will highlight the growing worth of such intangibles, or any notable deficits. Further research and development into innovative and improved IP and other intangibles can benefit individual companies and broader industries alike.

Accordingly, beyond serving as a “big slice” of any M&A deal’s purchase price, the value of a company’s intangible assets could also act as an apt internal marker, encouraging and guiding appropriate action, inventiveness, and allotments. A holistic understanding of any given business necessarily demands familiarity with its key assets, and who better to evaluate and market intangibles information than the company itself?

It may be time to consider the value in regularly reporting on your business’ intangible assets through financial disclosures. If you would like more information or advice in relation to such an inclusion and any potential tax consequences, please contact a member of our team.

The author would like to thank Sarah Pennington, articling student, for her assistance in preparing this legal update.

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Are you a processor of personal information?

The typical business model has significantly expanded in recent years, and often includes an element of collecting, using, storing or modifying personal information (also known as “processing”). If you are involved in processing personal information, you may likely be considered a “processor”. As a processor, it is crucial to understand the principles for processing data as well as the rights of the individuals whose personal information you are processing.

The following are some key principles for processing personal data:

  • Lawful Reason and Consent: Canadian privacy law typically requires processors to obtain consent from individuals in order to process their personal information. Such consent must be informed, i.e. the individual must understand why the data is being collected, how it will be used, etc.
  • Restricted Purpose: Processors are required to disclose the purposes for which the data is being collected. Processors are confined to that purpose, unless additional consent is obtained, or if disclosure is required by law.
  • Proportionality: Proportionality is an overarching principle that requires processors to limit their collection and use of personal information to what a reasonable person would consider appropriate in the circumstances.

Equally important to the principles are the rights that individuals have with respect to the processing of their personal information. Individual rights include:

  • Access Rights: Upon request of the individual, a processor typically must provide access to the individual’s personal information, including a list of all other entities with which such personal information was shared. Processors would also have to provide this information at minimal or no cost to the individual and would need to fulfill these requests within the prescribed time period.
  • Opt-Out and Complaint Procedures: If personal information is being used for marketing purposes, the individual must be made aware of this at the time of collection and processors must provide an easy opt-out option to individuals. Individuals must also be provided with a simple way of reporting monthly complaints and making inquiries in relation to their personal information collected by a processor.
  • Withdrawal of Consent: Individuals must be able to withdraw their consent to the collection and use of their personal information at any time. However, if the processor has entered into a contractual relationship with the individual, then the terms of the contract may prevail.

Employers as processors

In the case of employees, individual rights vary markedly from non-employment relationships. While informed consent is not required if the collection, use and disclosure of personal information is reasonably required to manage an employment relationship, employers must provide notice to employees that their personal information is being used, the means by which such information was collected and the purpose for which it will be used.

The principles of processing mentioned above inform the limitations placed on employers as it relates to monitoring employees. Employers are still required to limit their collection of personal information to what is reasonable in the circumstances. Employers also have to consider whether there is a less invasive way of achieving their goals. For instance, an employer concerned about theft may be required to implement a random bag check policy rather than 24/7 video surveillance.

The author would like to thank Travis Bertrand, articling student, for his assistance in preparing this legal update.

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Certifiably inane: the unnecessary officer’s certificate

In many deals on which we work, it has been customary to deliver certificates of officers. Sometimes the form of them is prescribed by a purchase agreement. Sometimes they are in support of an opinion. Sometimes they are required to bring down certain representations and warranties for closing.

Sometimes, however, they serve none of these functions. Sometimes we’re just giving them because it’s market to give them and it’s not worth a fight. And so we trudge off to compile articles, by-laws, authorizing resolutions and, worst of all, incumbency certificates for people who didn’t even sign anything on the deal, which adds more signatures and slows down the process. Then we swap ours with opposing counsel’s, making sure everyone signed everything correctly, and never look at them again.

If that sounds like a waste of time and fees, we are in agreement, so I had a chat with some of my colleagues about when an officer’s certificate is actually a useful document. Here’s what I found for appropriate times for an officer’s certificate:

  1. When it is in support of an opinion. Nobody likes giving legal opinions. They can cost an extra five figures to do (not a price quote) and they are rarely if ever relied upon for anything. But even when we are giving a legal opinion, we are not giving it without an officer’s certificate that we rely on for the facts of the situation, so if you want an opinion, we need an officer’s certificate. Or we could skip both.
  2. When the closing is happening after the signing of the purchase agreement. We’ve all agreed to a bunch of representations and warranties in the purchase agreement that we’re all happy with. So what happens if something has changed between last month when we signed and now when we’re closing? How do we know everything is still fine? We get folks to sign officer’s certificates saying all of the representations and warranties are still as true as they were at the time of signing.
  3. When we think there is some gap in our public searches. As part of our transaction, do you need to file articles of amendment or something similar? We may ask you to provide a certified copy of that document from an officer of your corporation for our benefit so that we don’t wait three days (or more) to get a certified copy from the ministry.
  4. When we didn’t negotiate it away in the purchase agreement. Now, if I had my way, prescribed officer’s certificates wouldn’t be making appearances in purchase agreements unless it was for one of the above points, which would render this point moot, but the reality is that sometimes they sneak in as a closing deliverable. If so, go ahead and deliver it, as you don’t want to be missing a condition to close, but feel free to grit your teeth while doing so.

I am sure I have missed one or two situation-specific items here, but the main takeaway here is just that: these are situation specific. The general need for an officer’s certificate because it is “market” often ends up being a waste of time and paper, especially if there are sufficient representations and warranties in the purchase agreement, which should be your goal from the outset.

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“Crazy Rich Asia” – record growth in the Asia-Pacific region

The Asia-Pacific region experienced a strong year for mergers and acquisitions (“M&A”) in 2018 and the level of M&A activity in this region is expected to continue in 2019. It was anticipated that 2018 would be a busy year with regards to M&A for Asia-Pacific companies and these predictions proved to be true. In the first six months of 2018 alone, Asia-Pacific companies had announced M&A deals that totalled $734 billion. In particular, Japan had a record year for foreign M&A transactions. Last year, Japanese companies announced 1,000 offshore M&A deals which were worth a total of $191 billion. The most prominent of these deals was the takeover of Shire plc by Takeda Pharmaceutical Company Limited. This takeover was worth $62 billion, making it the largest overseas acquisition ever made by a Japanese company.

Possible Reasons for Japan’s Outward Focus

There are several reasons why Japan has focused its search for opportunities abroad, such as the country’s declining population and relatively static economy. Another reason why there has been a notable increase in overseas deals and why this trend will likely continue in 2019 is due to the strong cash reserves that Japanese companies currently have. It was noted that Japanese companies hold over $890 billion in cash. These substantial reserves are causing companies in Japan to feel pressure from their investors to spend the money carefully. It appears that the preferred method of utilizing these resources is investing in M&A, as opposed to apportioning the money as dividends. The increase in cash and pressure to spend it wisely, in addition to attractive opportunities to grow their businesses abroad, are reasons why there have been greater offshore deals for Japanese companies and why this trend will likely continue. In fact, despite the surge of foreign M&A deals and the banner year that Japan had in 2018, it is predicted that the country will have a new record year for cross-border deals in 2019. Further, as the United States appears to be the largest developing market, it will be a country of particular interest for Japanese offshore investment.

As 2019 has just begun, only time will tell whether Japan’s affinity for foreign deals and the high levels of M&A in the Asia-Pacific region as seen in 2018 will continue.

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2019 merger review thresholds for Competition Act and Investment Canada Act

The threshold for certain pre-closing net benefit reviews under the Investment Canada Act (ICA) and the threshold for a pre-closing merger notification under the Competition Act have been increased for 2019.

Competition Act

Canada uses a two-part test for determining whether a pre-merger notification is necessary. The two-part test is based on the size of the parties and the size of the transaction. The transaction size component can be adjusted annually for inflation. Under the size of the parties test, the parties, together with their affiliates, must have aggregate assets in Canada or annual gross revenues from sales in, from or into Canada, in excess of C$400 million. Under the size of transaction test, the value of the assets in Canada or the annual gross revenue from sales (generated from those assets) in or from Canada of the target operating business and, if applicable, its subsidiaries, must be greater than C$96 million. The 2018 transaction size threshold was C$92 million.

These changes took effect on February 2, 2019.

Investment Canada Act

In general, any acquisition by a “non-Canadian” of control of a “Canadian business” is either notifiable or reviewable under the ICA. Whether an acquisition is notifiable or reviewable depends on the structure of the transaction and the value and nature of the Canadian business being acquired, namely whether the transaction is a direct or an indirect acquisition of control of a Canadian business. With limited exceptions, the federal government must be satisfied that a reviewable transaction “is likely to be of net benefit to Canada” before closing can proceed; notifiable transactions only require that the investor submit a report after closing. Separate and apart from the net benefit review, the ICA also provides that any investment in a Canadian business by a non-Canadian can be subject to a national security review.

The threshold for a pre-closing net benefit review depends on whether the purchaser is: (a) controlled by a person or entity from a member of the World Trade Organization (WTO); (b) a state-owned enterprise (SOE); or (c) from a country considered a “Trade Agreement Investor” under the ICA[1]. A different threshold also applies if the Canadian business carries on a cultural business.

Generally speaking, for a non-SOE from a WTO country (other than a Trade Agreement Investor) directly acquiring a Canadian business that does not carry on a cultural business, the threshold will be whether the Canadian business has an enterprise value of greater than C$1.045 billion.

For a non-SOE from a Trade Agreement Investor directly acquiring a Canadian business that does not carry on a cultural business, the threshold will be whether the Canadian business has an enterprise value of greater than C$1.568 billion.

How enterprise value will be determined will depend on the nature of the transaction:

Publicly traded entity: acquisition of shares Market capitalization plus total liabilities (excluding operating liabilities), minus cash and cash equivalents
Not publicly traded entity: acquisition of shares Total acquisition value, plus total liabilities (excluding operating liabilities), minus cash and cash equivalents
Acquisition of all or substantially all of the assets Total acquisition value, plus assumed liabilities, minus cash and cash equivalents transferred to buyer

The net benefit review threshold for investments by SOEs from WTO member states is based on the book value of the assets of the Canadian business. It increases annually, and for 2019 the threshold will be C$416 million, up from C$398 million in 2018.

The net benefit review threshold for investments by non-WTO investors, or for the direct acquisition of control of a cultural business (regardless of the nationality of the buyer) is C$5 million in book value. The threshold for an indirect acquisition of control is C$50 million in asset value.

It is important to remember that any acquisition, whether of control or even a minority interest, of a Canadian business by a non-Canadian can be reviewed to determine whether it could be harmful to Canada’s national security. Parties to transactions that could raise issues as identified in the Guidelines on the National Security Review of Investments, and that aren’t otherwise subject to a pre-closing net benefit review, should consider submitting their notice of acquisition in advance of closing.

[1]Trade Agreement Investors include investors from the European Union, the United States of America, Korea, Mexico, Chile, Peru, Colombia, Panama, and Honduras.  Effective December 30, 2018 (January 14, 2019 for Vietnam), investors from countries that are party to the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) – Australia, Canada, Japan, Mexico, New Zealand, Singapore and Vietnam – are also Trade Agreement Investors.

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