Lexpert magazine features articles and columns on developments in legal practice management, deals and lawsuits of interest in Canada, the law and business issues of interest to legal professionals and businesses that purchase legal services.
Issue link: https://digital.carswellmedia.com/i/1544329
10 www.lexpert.ca Feature Mallia-Dare, a partner at Dentons Canada LLP whose practice focuses on mergers and acquisitions, private equity, and emerging companies. He adds that the government's strategy is expected to fuel deal activity nationwide: "I think we're going to see a lot of domestic consolidations first, allied part- nerships – so non-Canadian entities that are allies – and then foreign acquisitions when we've seen that meaningful reinvestment." According to the government, imple- menting the defence industrial strategy over 10 years will involve an estimated $180 billion investment in defence procurement. As a result of this investment, "You're going to see a pipeline of M&A activity across sovereign capability areas such as aero- space, digital systems, ammunition, sensors, and infrastructure," says Mallia-Dare. Building Canada Act Another development that's slated to have a big impact on transactional activity is the other benefits to Canada; advancing the interests of Indigenous peoples; having a high likelihood of successful execution; and contributing to the country's climate- change goals. When a project receives a "national interest" designation, it can bypass a range of federal requirements, including the planning phase that is typi- cally mandatory for certain projects under the Impact Assessment Act. Jeremy Fraiberg, a partner at Osler, Hoskin & Harcourt LLP and co-chair of the firm's M&A group, says he expects the BCA to ramp up transactional activity across the country. "By streamlining the regulatory approval process, the BCA should spur additional investment in designated 'national interest projects,'" Fraiberg says. Mahdi Shams, a partner at MLT Aikins LLP whose practice primarily involves corporate and securities law, notes that many of the ventures the federal govern- ment has identified as national interest projects to date involve mining and critical minerals. While he agrees with the federal government's argument that the BCA paves the way for beneficial nation-building, Shams says the legislation's removal of regulatory barriers to project development also raises potential issues. "In Canada, and especially in BC … we've had a very rigorous review process [for projects], which takes multiple years some- times," Shams says, adding that part of the process involves consulting with Indigenous communities about the impact of the proj- ects. Under s. 35 of the Constitution Act, 1982, the Crown has a duty to consult Indigenous groups about matters that could impact their rights – a duty that cannot be overridden by legislation. However, the accelerated review process introduced by the BCA has prompted concerns that consultation processes will also be accelerated or shortened, leading to less meaningful dialogue with Indigenous groups and potential litigation that could further stall projects. KEY LAWS AND LEGISLATIVE CHANGES "BY STREAMLINING THE REGULATORY APPROVAL PROCESS, THE [BUILDING CANADA ACT] SHOULD SPUR ADDITIONAL INVESTMENT IN DESIGNATED 'NATIONAL INTEREST PROJECTS'" Jeremy Fraiberg OSLER, HOSKIN & HARCOURT LLP Building Canada Act. Passed by federal legislators last year as an explicit response to US tariffs, the law aims to fast-track major infrastructure projects and grow the Canadian economy by lifting some of the red tape that can prevent projects from developing efficiently. The BCA was one of the components of Bill C-5, which received Royal Assent in June and contained a second component that removed federal barriers to interprovincial trade. According to the federal government, the slew of unilateral tariffs the US levied on Canada after President Donald Trump took office underscored the need for Canada to diversify its trading partners and strengthen its economy. The BCA contributes to the cause by empowering the government to classify infrastructure projects as being in the national interest if they meet certain criteria, like strengthening Canada's autonomy, resil- ience, and security; providing economic or Defence Industrial Strategy – A blueprint for boosting Canada's security and economic growth Building Canada Act (BCA) – Lets Ottawa fast-track "national interest" infrastructure projects Bill C-5 – Enacts the BCA and cuts federal barriers to interprovincial trade Impact Assessment Act – Outlines the process for assessing the impact of projects carried out on federal lands or outside of Canada Bill C-34 (Investment Canada Act amendments) – Gives the federal government broader authority to address national security concerns in foreign investments