Chinese-controlled firm loses court bid to pause Ottawa’s divestment order

OTTAWA — The Federal Court has dismissed state-owned China Mobile’s motion for a temporary stay of Ottawa’s order that its Canadian affiliate be divested or wound up.

The court says in a tweet that it found the harms to the public interest posed by China Mobile International Canada’s ongoing operations outweigh the harms it would suffer in the absence of a stay.

The court has yet to release a public version of the classified reasons for its decision, which followed a hearing last month.

In January, the federal government informed CMI Canada of a review on security grounds, saying the business could be leveraged by the Chinese state for foreign interference and the compromise of critical infrastructure.

The government issued an order in August directing parent company China Mobile to either wind up or divest the Canadian business within 90 days, though an extension has since been granted.

CMI Canada says the government has no grounds to believe the company would compromise security or engage in espionage on behalf of Beijing, and it wanted a pause on the federal order while the full arguments play out in court next year.

This report by The Canadian Press was first published Dec. 7, 2021.

The Canadian Press

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