Joly calls lawyers over Stelco owner’s remarks

OTTAWA: Industry Minister Mélanie Joly said Wednesday she called the government’s lawyers to learn the possible consequences for Cleveland-Cliffs, the U.S. parent of Stelco, after its chief executive said he bought the Hamilton steelmaker to stop it undercutting his U.S. operations, CBC News reported.

“The last words by the president of Stelco definitely made us contact our lawyers to see what could be the consequences of such confessions,” Joly said.

Cleveland-Cliffs CEO Lourenco Goncalves told CBC’s Power & Politics on Tuesday that Stelco was “undercutting our prices in the United States.” He said he bought the company because he could not afford to have it flooding the U.S. market.

The government says that when Cleveland-Cliffs bought Stelco in 2024 it agreed under the Investment Canada Act to keep the number of unionized employees at 2024 levels through 2029. Joly wrote to the company last week demanding it reverse layoffs announced last month. She said Ottawa would seek a remedy in court if it did not, which could include financial penalties or an order to sell Stelco.

Goncalves has said the company is in full compliance with its commitments. In a letter to The Canadian Press, he said he hopes to bring back laid-off workers before Christmas if a plan to increase Canadian sales succeeds. He told Power & Politics the company is not for sale for now, but said he would sell after operating it for a while, adding he is now “persona non grata in Canada.”

Sandy Walker, a lawyer who specializes in competition and Investment Canada Act matters, told CBC the Federal Court can order a company to divest and impose penalties of up to $10,000 a day. She said Goncalves’s comments raise the question of whether the company signed the undertakings in good faith, but that the case is not straightforward. Canada would still have to prove the layoffs were not caused by conditions beyond the company’s control, she said.

Walker said no Canadian court has ever made an order against a company under the act.

Earlier coverage: Joly gave the owner 15 days to comply or face court, and the owner said it is in full compliance and wants talks. Ottawa also unveiled an $8.7-billion plan for steel, autos and mining.

Source: CBC News.

If you find reporting like this useful, consider supporting Canada News Media, an independent Canadian newsroom with no corporate parent.