Canada–China Business Rules Are Changing. Here’s What Companies Need to Know

Sep 22

The takeaways:

Key Canada-China trade measures are coming up for review.
Doing business with China does not automatically mean registering under Ottawa’s new foreign influence registry.
China’s expanded outbound investment rules mean greater scrutiny for Canadian companies with Chinese investors or partners.

By Joanna Chiu, Solarina Ho, and Ai-Men Lau

In our last newsletter, guest expert Rachel Ziemba looked at how economic policy is increasingly being used as a tool of geopolitical competition. Since then, that competition has only intensified. Governments are scrambling to diversify trade, attract investment and build new economic relationships.

Headlines have focused on bold moves in response to U.S. President Donald Trump’s trade war measures, from European Commission President Ursula von der Leyen’s proposal to make Canada the EU’s first “associate member” to countries pursuing new trade agreements, investment partnerships and other ways to diversify their economic relationships.

But alongside these high-profile developments, governments are also introducing practical new rules that directly affect how businesses trade, invest and operate. Some of these changes have received less attention, even though they may have immediate implications for companies.

In this issue, our team takes a closer look at some of these changes in Canada and China — and what they mean for businesses.

In Canada, Prime Minister Mark Carney’s inaugural Canada Investment Summit in Toronto put the country’s push to attract long-term global investment and diversify its trade partnerships in the spotlight, including new tax incentives. At the same time, Canada has recently introduced requirements around foreign influence: The Foreign Influence Transparency and Accountability Act came into effect in August, creating a new registry and disclosure requirements for certain activities involving foreign principals.

China, meanwhile, has introduced a new State Council-level regulation on outbound investment that tightens oversight of investments abroad, with a focus on national security, while adding to existing compliance considerations around export controls, data and cross-border transfers.

This introductory guide focuses on the practical questions businesses need to understand: what is actually changing, who is affected, and what companies may need to do differently.

We explain:

What happens next under the Canada-China trade framework
When Canadian companies may need to register under new foreign influence rules
What China’s new outbound investment rules mean for Canadian companies with Chinese investors, parents or joint-venture partners

Making sense of a shifting regulatory landscape

The Canada-China commercial relationship may be warming again, but the regulatory environment is more complicated than this guide can cover. Chinese firms operating in Canada and their Canadian counterparts also need to understand and navigate new federal lobbying guidances and changes to the Investment Canada Act. This guide provides an overview of some key changes, but there is much more to consider depending on your business and circumstances.

Nüora Global Advisors — backed by a network of expert advisors on the ground across the Asia-Pacific — helps organizations navigate operational uncertainty and assess what new policies and regulations mean for business and strategic decisions. You can get in touch with us here.

This article is intended as general information only and does not constitute legal advice. Companies should seek appropriate professional counsel regarding their specific circumstances.

Canada-China trade is evolving

What does the Preliminary Joint Arrangement mean for Canadian businesses?

Trade disputes over Chinese government subsidies and other non-market practices that Ottawa viewed as distorting competition dominated Canada-China relations throughout 2025. Canada had imposed a 100 percent surtax on Chinese EVs and 25 percent surtaxes on Chinese steel and aluminum in October 2024, prompting China to retaliate with tariffs on Canadian agricultural, pork and seafood products.

An official visit by Carney to China in January 2026 eased tensions and produced the Preliminary Joint Arrangement. It temporarily addressed several key issues, including annual import quotas on Chinese EVs, and lowered or suspended tariffs. The joint arrangement included a review in three years. But with several measures expiring soon, further bilateral discussions will be needed to determine what happens next.

The Canada-China Economic and Trade Cooperation Roadmap is a longer-term agreement that includes continued civil nuclear and uranium cooperation, and incorporates a Ministerial Energy Dialogue and a Financial Working Group.

What happens next?

With Shenzhen, China hosting APEC this November, the two sides will have an opportunity to check in and signal their intentions ahead of the Preliminary Joint Arrangement’s expiry dates. China's suspension of tariffs on Canadian canola meal, peas, lobster, and crab is set to expire on December 31, 2026, while Canada's relief for certain Chinese steel and aluminum products in short supply in Canada is also set to expire at the end of the year (the 25% surtax itself remains). It is also an opportunity to see where things stand on the Roadmap.

Canada is regulating foreign influence

Why did Ottawa introduce a foreign influence registry?

Due to growing concerns about foreign and electoral interference in Canada, the Minister of Public Safety introduced Bill C-70, the Countering Foreign Interference Act, which made significant changes to Canada’s foreign interference and security regimes. The Bill also enacted the Foreign Influence Transparency and Accountability Act, establishing a new foreign influence registry and certain related provisions. On August 4, 2026, the Office of the Foreign Influence Commissioner of Canada launched the Foreign Influence Registry.

The goal of this registry is to enhance transparency around certain foreign influence activities in Canada. Many registrable activities can be legitimate commercial activities.

Under the Foreign Influence Transparency and Accountability Act, an individual or entity must provide information to the Commissioner within 14 days of entering into an arrangement with a foreign principal to carry out specified activities in relation to a political or governmental process in Canada. Arrangements that existed before August 4 must be registered by October 3, 2026.

Activities can include engaging with a public office holder, communicating or disseminating information related to the process, or providing money, services, facilities or items of value.

Most information submitted to the registry is publicly available, although certain personal information is kept private. Changes to a registrable arrangement or the information provided may require an update within 14 days.

Do I need to register if I do business with a Chinese company?

Not necessarily. Doing business with a Chinese company or any company in the Indo-Pacific does not by itself create an obligation to register. FITAA applies to arrangements with a foreign principal, a broad category that can include foreign states, foreign governments, foreign economic entities such as entities controlled or substantially owned by a foreign state, and certain other foreign entities or individuals. It is not specific to certain countries.

Registration is generally required only when all three of the following conditions are met:

There is an arrangement with a foreign principal.
The purpose of the arrangement is to influence a political or governmental process in Canada.
The arrangement involves an influence activity, such as communicating with a Canadian public office holder, communicating or disseminating information to the public, or providing money, services, facilities or other items of value.

The Foreign Influence Transparency Commissioner has also provided this questionnaire to help individuals and entities determine if they need to register.

If you have further questions or require more clarification, the Office of the Foreign Influence Commissioner of Canada periodically hosts information sessions. Nüora Global can also provide a tailored briefing from one of our experts.

What are the penalties?

As defined in the Act, violations or offences include failing to disclose on time, failing to update the required information, and providing false or misleading information to the Commissioner. It is also an offence to obstruct or mislead the Commissioner.

The Commissioner can impose monetary penalties ranging from C$250 to C$1 million. The Commissioner can investigate compliance issues and refer a case to law enforcement if appropriate.

Criminal liability for serious offences under section 23 and 24 includes fines of up to C$5 million on indictment, fines of up to C$200,000 on summary conviction, or up to five years in prison.

The Commissioner will also report publicly on violations.

China is increasing investment coordination

Beijing introduced a new regulation that increases scrutiny of investments made outside the country. Signed on June 1, 2026, the new State Council Decree No. 837 took effect on July 1, 2026 and brings greater oversight around national security, adding another layer of review for companies and investors who do certain types of business outside China.

While key details including scope, procedures and review thresholds are still pending, the new rules bring additional scrutiny to transactions involving sensitive technologies, data, resources, products, and even skilled technical personnel. Decisions originating in China — including capital and technology transfers and certain board-level decisions — may require additional review.

The new rules formalize powers Beijing had already demonstrated in practice. In April, Chinese authorities blocked Meta’s $2 billion acquisition of Manus, an AI startup founded in China and based in Singapore. At the time, Beijing said it was prohibiting the deal in accordance with laws and regulations, and ordered the companies involved to unwind the transaction.

Who could be affected?

The changes are relevant to Canadian companies that:

have a Chinese parent company or controlling investor;
operate through a joint venture with a Chinese partner;
receive investment from Chinese companies or individuals;
transfer technology, data, personnel or other sensitive assets between China and Canada; or
are considering a transaction that requires capital or other resources to move out of China.

The impact may extend beyond large multinational companies. Canadian startups and smaller companies that receive investment from Chinese individuals or companies could face uncertainty over approvals, particularly where the business involves sensitive or strategic resources.

The changes come with enforcement consequences for Chinese investors, including orders to unwind an investment, confiscation of gains, significant fines and bans on future outbound investments. For Canadian firms, risks include greater due diligence on the Chinese side, meaning potential deal delays and longer timelines for transactions, operational constraints, and exit risks.

Norton Rose Fulbright’s review of the new regulation notes that the security review can apply across the investment’s lifecycle, including offshore restructurings, technology transfers through licensing or personnel deployment, and the sale or wind-down of an asset. It recommends that companies and individuals address any past compliance gaps.

The new reforms also create a framework for authorities to investigate barriers encountered by Chinese investors overseas. This means a foreign company complying with restrictions on Chinese investments and investors set by its home country could potentially trigger countermeasures from Beijing.

What changes in practice?

The new rules add a security review to the existing approval process for certain outbound investments. Authorities can examine whether an investment raises national security concerns.

For Canadian companies, the practical effect could be longer transaction timelines, more due diligence and greater uncertainty around whether a proposed investment or corporate decision can proceed as planned. Companies may also need to consider the possibility of an investment or transaction being challenged after the fact.

What should Canadian companies do?

Companies with Chinese investors or partners have always had to navigate approval and review processes in both Canada and China. The key consideration now is whether recent changes in China expand the approvals or scrutiny that may apply, including what information or technology could trigger additional review and whether the transaction structure leaves room for delays or intervention.

Before entering into a new investment or restructuring an existing relationship, Canadian companies should assess:

Who is providing the capital and where is it coming from?
What technology, data, intellectual property or other assets are involved?
Will money, technology, personnel or sensitive information need to move between China and Canada?
Could the transaction trigger Chinese national security, export control or data compliance review?
What happens if approval is delayed or the transaction cannot proceed as originally structured?

For companies already operating with Chinese investors or partners, these questions may also be relevant when considering restructuring, licensing, personnel changes, additional financing or an eventual sale.

The broader takeaway is that Chinese outbound investment is becoming a more heavily regulated process. For Canadian companies, understanding the Chinese regulatory side of a transaction may be as important as understanding the Canadian rules that apply to it.

Additional reading

Decoding Policy Changes: How Nüora Global Can Help

The common thread across these changes is that geopolitical shifts are increasingly showing up as practical business requirements — from tariffs and market access to disclosure, due diligence and investment approvals.

For companies operating across Canada and Asia, understanding the geopolitical context is only the first step. The more immediate question is how new rules affect a specific transaction, investment, partner or market.

Nüora Global helps companies navigate that intersection, combining geopolitical expertise and Asia-Pacific networks with research into the regulatory and legal frameworks shaping business decisions.

This article is intended as general information only and does not constitute legal advice. Companies should seek appropriate professional counsel regarding their specific circumstances.

Joanna Chiu is Managing Partner at Nüora Global Advisors, helping organizations navigate shifting technological, regulatory and geopolitical landscapes. A former award-winning investigative journalist and author of China Unbound, Chiu has spent more than 15 years tracking business developments across the Asia-Pacific and is a frequent analyst for broadcasters and publications in Canada, the U.S. and U.K. She previously served as B.C. bureau chief for the Toronto Star and led coverage of China’s technology sector at Rest of World. She is also the founder of NüVoices, a non-profit organization that elevates diverse expert perspectives on China.

Solarina Ho is Editor of Research and Publications, where she collaborates with the leadership team, showcasing the expertise and insights offered by Nüora Global’s network. Solarina has more than two decades of reporting and research experience across business, technology, health, entertainment and lifestyle, writing for Reuters, The Walrus, The Globe and Mail, CTV, among other publications. She is also a co-host of the NüVoices Podcast.

Ai-Men Lau is a Nüora Global Guest Expert specializing in geopolitical risk and foreign influence policy research and consulting. She served as the social engagement team lead at Taipei-based Doublethink Lab, and Communications Officer at the Macdonald-Laurier Institute think tank in Ottawa. She holds a Master of Public Policy and a Bachelor of Social Work (with Distinction) from the University of Calgary. She is currently based in Calgary, Canada.

Newly launched: Centre for Strategic Statecraft

We wanted to give a shout-out to the newly launched Centre for Strategic Statecraft, co-founded by foreign policy analyst Vina Nadjibulla. CSS is an independent, non-partisan institution established to help Canada think strategically and build the capability to act in a more competitive, divided, and dangerous world. CSS will work across those divides connecting foreign policy with economic security, technology, defence, energy, industrial capacity and the other foundations of national power, with the goal of translating strategy into capability and policy into action — bringing together expertise from government, business, academia and the wider policy community in Canada and abroad.

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