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Advancements in technology and changing market conditions have led to greater internationalization of the corporate world. Canada’s competitive economy, with its natural resources, skilled labour force and high quality of life, offers attractive investment opportunities to business leaders abroad. Foreign firms gain access to the Canadian economy in primarily three ways—by establishing branches or new business, through direct investment in Canadian enterprises or through mergers and acquisitions of Canadian firms. More than ever, information on the trans-national aspects of the economy is important to understanding this new economic era. That is the purpose of this report.
The Corporations Returns Act (CRA) is a key instrument for measuring foreign control. The CRA is administered by Statistics Canada under the authority of the Minister of Industry. The purpose of the Act is to collect financial and ownership information on corporations conducting business in Canada, and to use this information to evaluate the extent of non-resident control in the Canadian economy.
This report details foreign control for all corporations conducting business in Canada, excluding enterprises classified as Management of Companies and Enterprises. These enterprises are typically holding companies whose most significant assets are investments in affiliated enterprises, and are therefore excluded to avoid double counting of assets. The information in the report is obtained from a number of sources, including Ownership Schedules filed under the Act and administrative data from the Canada Revenue Agency.
The financial statistics used in this report are obtained from a number of sources, outlined in the Methodology Section, and are compiled based on the 2007 version of the North American Industry Classification System (NAICS). The NAICS was developed by the statistical agencies of Canada, Mexico and the United States to provide a consistent framework for the collection, analysis and dissemination of industrial statistics across the three countries.
The Corporations Returns Act requires that an annual report be submitted to Parliament summarizing the extent to which foreign control is prevalent in Canada. This is the report for reference year 2007.
Jean Leduc
Director, Industrial Organization and Finance Division
