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Summary: Foreign Direct Investment In Canada

Decent Essays

I think the Government requires 25% of directors to be resident Canadians because, like most of the other students have mentioned, “this keeps Canadian businesses, Canadian.” I think this requirement is set in place to help Canadians, giving us a chance to start our own businesses here and providing opportunities to become directors/shareholders of corporations. I think this is very similar to the requirements stated for non-resident Canadians to work in our country. For example, if anyone from anywhere can come to Canada; work and start their companies, this is taking away jobs and opportunities from Canadian residents.

Parliament of Canada states two very important reason as to why 25% of directors are to be resident Canadians. “Enacted in 1975, the directors’ residency provisions were designed to address concerns about the amount of direct foreign investment in Canada. These concerns had been brought forward in a number of studies of foreign investment in Canada, which, among other things, had discussed the need to ensure a Canadian presence on corporate boards.” (Report of the Royal Commission on Canada’s Economic Prospects (1957); Report of the Task Force on the Structure of Canadian Industry (1968); Foreign Direct Investment in …show more content…

It has been suggested that the residency requirements help to promote compliance with the law, particularly statutes that impose liability on directors for the actions of a corporation. Furthermore, if directors must be resident in Canada, there are likely to be local assets from which judgments can be satisfied.” ((n.d.). Retrieved April 14, 2017, from

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