The Government of Canada recently announced the 2021 thresholds for a mandatory, pre-closing economic “net benefit” review and approval under the Investment Canada Act (ICA). The new thresholds will be published in the Canada Gazette in February 2021.

Updated thresholds 2021

In most cases these thresholds will decrease for the first time on a year-to-year basis since the introduction of regulatory amendments in 2015 (which established an “enterprise value” calculation for certain private sector investments). The 2021 thresholds for investments in Canadian businesses are as follows.

  • Direct investments by private investors from WTO member states: CAD 1.043 billion based on enterprise value (compared to CAD 1.075 billion in 2020 and CAD 1.045 billion in 2019).
  • Direct investments by private investors from countries having a trade agreement with Canada: CAD 1.565 billion  based on enterprise value (compared to CAD 1.613 billion in 2020 and 1.568 billion in 2019).
  • Direct investments by investors from WTO member states that are state-owned enterprises (SOEs): CAD 415 million based on book value of assets (compared to CAD 428 million in 2020 and CAD 416 million in 2019).

Thresholds for investments by non-WTO investors or involving Canadian “cultural businesses” have not changed. These are CAD 5 million and CAD 50 million based on book value of assets for direct and indirect investments respectively. There is also no change to the mandatory (post-close) notification requirement, which applies to investments within the jurisdiction of the ICA that do not meet the applicable criteria and thresholds for “reviewable” transactions. Additionally, as was previously the case there are no value thresholds for screening any investment on national security grounds.

Implications of COVID-19

The decrease in certain thresholds, which under the ICA are indexed annually, reflect a drop in Canada’s gross domestic product (GDP) – which in turn is likely a reflection of the impact of COVID-19 on the national economy.

This is only the latest of various implications of the global pandemic on the ICA regime. Pursuant to a policy announced in April 2020 in light of COVID-19, the Government indicated that it would “scrutinize with particular attention” foreign direct investments of any value in Canadian businesses related to public health or involved in the supply of critical goods and services to Canadians or Government, and similarly would apply “enhanced scrutiny” to all investments by SOEs or parties closely tied to foreign governments. The Government also temporarily (31 July-31 December 2020) extended the time lines for national security reviews.


Eva Massai Warden is an associate in Baker McKenzie's Global Antitrust & Competition Group. She joined the Firm’s Toronto office as an associate in 2013 and is now based in the Firm's London office with the EU, Competition & Trade Practice Group. Eva regularly advises clients in a variety of industries on Canadian and international merger control, foreign investment and national security in corporate and commercial transactions.