Canada and the Challenge of Foreign Investment: The First Decade of Foreign Investment Review

The enactment of the Foreign Investment Review Act did not halt the evolution of foreign investment policy, nor did the creation of the Foreign Investment Review Agency (FIRA) end the foreign investment problem. For many, the agency became part of the problem. Now, a decade since its inception, FIRA operates in one of the few areas of government endeavour that has no statutorily developed foreign investment policy. The effectiveness of the agency as an articulator and implementor of foreign investment policy requires evaluation. This paper will review the Canadian government\u27s response to the foreign investment challenge - the development of legislation for the regulation and control of foreign investment. It will explore how the structure of the agency, which puts the task of decision-making in the hands of the political executive, and its failure to develop and publish policy guidelines provide an irritant to relations both between Canada and the United States and between government and business.\u27 The period of divergent radicalism following the Canadian and American elections of 1980 set the stage for the reforms now underway at the agency