May 29, 2013
Sean Silcoff, Report on Business, The Globe and Mail
If Shuanghui were to bid for Maple Leaf, Canada’s pork leader, it could very well be labelled an SOE by the Canadian government, and the deal would face greater scrutiny and uncertainty at a political level.
Under the government’s proposed amendments to the Investment Canada Act, a company can be labelled an SOE if it is deemed to be acting under the direction or influence of a foreign government – even if it is “not controlled in law or fact by foreign governments,” law firm Osler, Hoskin & Harcourt wrote in a recent briefing. So long as the company “may have minority government investment, commercial relationships with foreign governments or significant relationships with officials within government” it runs the risk of being labelled a state enterprise, the law firm says. All of a sudden, Shuanghui becomes an SOE, given that chairman Wan Long is a long-time member of China’s National People’s Congress and has strong political connections – like every other Chinese business leader.
To read the Osler Update, by Michelle Lally, Peter Glossop, Peter Franklyn, Shuli Rodal and Matthew Anderson, please click here.
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