Selling Canadian Earth Observation Technology to U.S. Arms Maker

This is the final post in my series about RADARSAT-2. Thus far, I’ve looked at the history of the satellite, the relevant Canadian Arctic Sovereignty issues, and the military potential of the satellite.

The importance of the satellite to the interests of Canada can not be overstated. It is commonly recognized as the crown jewel of Canada’s domestic space technology industry and NASA said it made Canada “world renowned.” Yet after having been in operation for less than a month it was almost sold to Alliant Techsystems (ATK), a U.S. aerospace and defence company, and the largest ammunition manufacturing entity in the world.

RADARSAT-2 was launched on December 14th of 2007 by MacDonald, Dettwiler and Associates (MDA) in partnership with the Government of Canada. On January 8th of 2008 ATK announced they had “negotiated definitive agreements” with MDA “to acquire its Information Systems and Geospatial Information systems for $1.325 billion CAD.” The announcement was met with outrage in Canada from politicians to scientists to labor leaders. Even Marc Garneau, the first Canadian in space, spoke out against the selling of the satellite saying, “We lead the world in this technology” and the proposed sale “threatens Canada’s sovereignty.”

The main concern presented by critics, besides the loss of home-developed technology, was the potential reversal of the terms for Canadian tax payer investment in the project – namely ‘shutter control’ – once ATK took over. As Liberal MP Scott Brison and Michael Byers pointed out in a National Post article, “… shutter control and priority access is now at stake. Once the satellite is sold to Alliant Techsystems, Ottawa will lose the ability to control the satellite and commandeer it in emergencies. And the equipment could then be used in ways that contradict our interests: suppose that the United States sends a ship into the Northwest Passage without Canada’s consent, relying on RADARSAT-2 imagery and, perhaps, denying us access to it?”

MDA President Daniel Friedman told the House of Commons industry committee that Ottawa will have access to the imagery data as stipulated in the contract. But once the satellite was in the hands of the U.S. what would stop them from claiming “national security” as a reason not to provide Canada with the data, or using it for purposes contrary to the interests and policies of Canada? And there is no dispute that the future generations of RADARSAT under ATK ownership will be firmly controlled by the U.S.

After months of debate, then Industry Minister Jim Prentice sent a letter to ATK rejecting the sale. He told the press he made his decision based on Section 20 of the Investment Canada Act, which requires him to review such transactions to ensure Canada’s interests are met. Section 20 lists a number of economic and industrial factors which may be considered under the net benefit test, including “the compatibility of the investment with national industrial, economic and cultural policies.” Prentice told reporters: “At this point I’ve made it very clear to ATK the transaction as proposed does not meet the net benefits test … A lot of work has been put into it and it’s important that we welcome foreign investment to Canada, so a decision like this is a unique case that has to be dealt with carefully.” Then NDP industry critic Peggy Nash said it’s the first time Canada has ever blocked the sale of a domestic company to a foreign buyer. “We believe the minister has made the right call here,” she said.

Mr. Prentice seemed to confirm that sovereignty issues influenced the decision when he said, “The jurisdictional aspect in relation to the satellite is a relevant consideration and specifically, where jurisdictional law would sit for the satellite, post transaction, is a relevant consideration.”

In the end this valuable piece of Canadian technology remained under domestic ownership and control. What amazed me about the entire ordeal was the relative lack of public and media interest or discussion. Granted there was some coverage and discourse, but nowhere near equivalent to the importance of the issue. Even now I believe you would be met with blank stares when you ask Canadians:

How much do you know about RADARSAT-2?


This is part 4 of a 4 part series. Part 1 is here, Part 2 is here, Part 3 is here.

For more reading material:

‘Intent for a Nation: What Is Canada For?’ by Michael Byers


About brent

Motorcycles, movies, music, photography, politics. These are a few of my favourite things.
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3 Responses to Selling Canadian Earth Observation Technology to U.S. Arms Maker

  1. Pingback: How much do you know about RADARSAT-2? « made in Canada

  2. Pingback: Military Satellite available from Canadian Taxpayers? « made in Canada

  3. Pingback: Arctic Sovereignty in Orbit « made in Canada

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