Investment Canada policy on foreign investment in the Canadian film distribution sector

[Text of "Fact Sheet" issued by Communications Canada FS-88-3844E]

The Investment Canada Act requires that foreign investments in the production, distribution and exhibition sector of the film and video industries be compatible with national cultural policies.

As part of the measures to support an indigenous Canadian distribution industry, the government has also announced new Investment Canada policy on foreign investment in the Canadian film distribution sector:

  • takeovers of Canadian owned and controlled distribution businesses will not be allowed;
  • investments to establish new distribution businesses in Canada will only be allowed to importation and distribution activities related to proprietary products (the importer owns world rights or is a major investor);
  • indirect and direct takeovers of foreign distribution businesses operating in Canada will be allowed only if the investor undertakes to reinvest a portion of its Canadian earnings in accordance with national and cultural policies;
  • all applications to Investment Canada made after February 13, 1987 will be subject to the new policy.

These criteria conform with the policy goals announced on February 13, 1987, and with the cultural exemptions provided for in the Canada/U.S. Free Trade Agreement. The new policy reaffirms the Government's commitment to develop a stronger Canadian film industry.

FS-88-3844E

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