Court denies stay to US Steel
On July 23, 2010, the Federal Court of Appeal dismissed US Steel’s application for a stay of the Attorney General of Canada’s proceeding against it to enforce Investment Canada Act (ICA) undertakings with respect to Ontario steel mills it acquired in 2007. The Minister is seeking enforcement of undertakings regarding employment and production levels, and a fine for non-compliance.
The court decided that while US Steel could show that its appeal from a trial level dismissal of its constitutional challenge of the enforcement provision in the Investment Canada Act was not frivolous or vexatious, it had not shown irreparable harm or that the balance of convenience favoured a stay of the enforcement proceeding.
With respect to the issue of irreparable harm, the court stated that if US Steel was ultimately successful in its appeal and was granted a declaration of invalidity, it could use that declaration in an application to set aside any order that was made against it in the ICA enforcement proceeding.
When discussing the issue of the balance of convenience, the court said that the ICA has a public interest dimension because it is aimed at encouraging investment, economic growth and employment opportunities for Canadians. The court therefore found that it must proceed on the basis that the ICA is directed to the public good and serves a valid public purpose. Delaying the commencement of the enforcement proceeding would, the court said, effectively suspend the application of the legislation.
