Caterpillar and the Investment Canada Act

Caterpillar's February 3rd announcement that it will close the Electro-Motive Diesel facility in London has renewed calls to overhaul the Investment Canada Act.  The CAW, CEP, USW and CLC among others have pressed for expanding the criteria for approving foreign takeovers to include the impact of the investment on employment, wages and conditions, and the livelihood of workers, retirees and communities affected.  Unions have also pointed to the lack of transparency and public participation in the review process, calling on the government to make public all commitments made by companies under the Act.

Some in the media have also questioned why companies like Electro-Motive (Caterpillar), which benefited from tax breaks and incentives announced in 2008, are not required to return the money if they close plants and lay off workers.  In a similar vein, the CLC recently urged the federal government to require companies benefitting from corporate income tax cuts, but stockpiling cash, raising executive compensation, and boosting shareholder dividends instead of increasing real investment and employment, to pay back the money to taxpayers.