OTTAWA—Canada consulted with the United States before it decided the takeover of a Vancouver tech firm by a Chinese communications company did not pose any national security concerns, Prime Minister Justin Trudeau says.
But warning flags about the deal are still popping up in the United States, whose military is one of the biggest customers of Norsat International, maker of satellite receivers for security and military use.
A congressional commission warned Canada on June 12 that allowing the takeover puts American national security in jeopardy.
Hytera Communications, a privately owned Chinese communications company that manufactures radio transceivers and radio systems, made a bid to take over Norsat in 2016.
The move triggered a requirement under the Investment Canada Act that the government must examine takeover bids of Canadian companies by foreign-owned firms to determine if the takeover raises national security concerns.
But earlier this month, Norsat said it was told a preliminary review determined there was no need to proceed to a full national security review, paving the way for the takeover to proceed.
The Opposition Conservatives argue that this was a mistake. Conservative MP Peter Kent accused the Liberals of jeopardizing Canada-U.S. relations.
