MASSE IN THE HOUSE: Foreign Investment and the Sale of Nortel

Mr. Brian Masse (Windsor West, NDP): Mr. Speaker, I am glad to participate in tonight's continued discussion that we are having with the question that I raised in the House of Commons on May 12 related to Nortel and the takeover by Ericsson. Many Canadians know that this iconic company Nortel has struggled in the last couple of years and the end result is it went into bankruptcy and to auction. Sadly, we witnessed the loss of Canadian technology, research and development and with this foreign takeover I asked the minister that day to look at the Foreign Investment Act.
There are a couple of thresholds that are important. There is the threshold of $312 million in terms of net value where the minister must intervene. There is also a new national security clause that was introduced. What is interesting about the national security clause is it was something that I was after since 2002, being here with China Minmetals looking that it was a state government of China buying Canadian oil sands projects and opposed that. Actually we have a non-democratic government buying Canadian companies.
We finally did get a change to the actual legislation, the Foreign Investment Canada Act, but it was done in a budget bill. That meant it did not have the proper parliamentary review that would normally be done for a bill. It did not go through the committee. It did not have witnesses. It did not have debate in the House of Commons aside from that in the budget bill. It is actually quite an Americanization of our legislation here in Canada because they have a similar system where they add riders to a government or spending bill that has legislative changes and this is the way the government had done a couple of things such as the Immigration Act and now this, the Foreign Investment Canada Act.
Unfortunately, it has now even resulted in some weaknesses that we saw evident in this case. In this case it was interesting because Ericsson had purchased the assets from Nortel for $1.13 billion and then turned around later on and said the net value of that is less than the $312 million. To make sure that viewers understand this correctly, it paid over $1 billion for something that it then later on argue is a lot less including under the threshold of the $312 million. So that was a significant departure from the purchase price to what it is saying the net value is. Later on the minister bought that and dismissed it outright.
Second, the minister has dismissed the national security clause. What is interesting is that we had testimony for one day. We as New Democrats would have had more testimony but we were thwarted. I cannot say what happened at in camera meetings, but I can say that Liberals approached me through the leader's office about having more hearings. I cannot say whether I had that support at committee, but we only had one day of hearings, unfortunately, that left the pensioners out.
What is really important is that in the United States a Canadian company, Certicom, based in Canada and bought by RIM in Canada, staying in Canada where the sale was actually reviewed by the United States government. Meanwhile, over here in Canada, LT Technology which is a fourth generation company and is going to move ahead of BlackBerry and other devices through the Internet an exchange of information as being dismissed outright. That was disappointing.
I would like to see the government reverse its position and to examine the national security clause and make sure that this review is going to take place because we have so many workers at risk. Canadians have subsidized this research, development and technology and it needs a thorough review before we give this Canadian technology away.

Mr. Brian Masse: Mr. Speaker, the reality is that we did have a Canadian champion in RIM. This is a testimony from Mr. Lazaridis from RIM. He talks about the national security element and about the situation with LTE technology. He says:
Without question, it is important to understand how important security technology is. The technology that we use, of course, is public key elliptic curve technology. We've been using it for years, and it's been one of the core competitive advantages we've had in the BlackBerry and why it's so widespread in government use, military use, and law enforcement use.
That comes from the experts that actually transform and encrypt information across this globe. It is information that is used by a number of different governments around the planet and by military organizations and civil society groups as well. We have given out the breakthrough technology and patents that will come forward to another country.
What is really important is that the home area of the company is often where the research and development of technology takes place. That is why RIM would have been a much better match and a lease on examination for our research and development.