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51-471: On April 26, 2002, the Authority became a Schedule III, Part I parent Crown corporation . It was not required to pay taxes and not eligible to receive appropriations. In September 2007, in accordance with Federal Identity Program requirements, the organization was officially titled Blue Water Bridge Canada . On February 1, 2015, via House Government Bill C-4 Section 8 (assented to on December 12, 2013),

102-424: A distinct legal structure, with financial and developmental goals, like making services more accessible while earning profit (such as a state railway). They can be considered as government-affiliated entities designed to meet commercial and state capitalist objectives. The terminology around the term state-owned enterprise is murky. All three words in the term are challenged and subject to interpretation. First, it

153-612: A fully privatized company. The first Crown corporation was the Board of Works, established in 1841 by the Province of Canada to construct shipping canals. The first major Canadian experience with directly state-owned enterprises came during the early growth of the railways . The first Canadian Crown corporation after confederation was the Canadian National Railway Company , created in 1922. During

204-546: A mandate (by royal charter) to govern a specific territory called a charter colony , and the head of this colony, called a proprietary governor , was both a business manager and the governing authority in the area. The first colonies on the island of Newfoundland were founded in this manner, between 1610 and 1728. Canada's most famous and influential chartered company was the Hudson's Bay Company (HBC), founded on May 2, 1670, by royal charter of King Charles II . The HBC became

255-661: A public objective. For that reason, SOEs primarily operate in the domain of infrastructure (e.g., railway companies), strategic goods and services (e.g., postal services, arms manufacturing and procurement), natural resources and energy (e.g., nuclear facilities, alternative energy delivery), politically sensitive business, broadcasting, banking, demerit goods (e.g., alcoholic beverages ), and merit goods (healthcare). SOEs can also help foster industries that are "considered economically desirable and that would otherwise not be developed through private investments". When nascent or 'infant' industries have difficulty getting investments from

306-495: A regular enterprise, state-owned enterprises are typically expected to be less efficient due to political interference, but unlike profit-driven enterprises they are more likely to focus on government objectives. In Eastern Europe and Western Europe , there was a massive nationalization throughout the 20th century, especially after World War II . In the Eastern Bloc , countries adopted very similar policies and models to

357-613: A relevant minister for the conduct of its affairs. Although these corporations are owned by the Crown, they are operated with much greater managerial autonomy than government departments. While they report to Parliament via the relevant minister in Cabinet , they are "shielded from constant government intervention and legislative oversight" and thus "generally enjoy greater freedom from direct political control than government departments." Direct control over operations are only exerted over

408-573: A specific form of state-owned enterprise . Each corporation is ultimately accountable to (federal or provincial) Parliament through a relevant minister for the conduct of its affairs. They are established by an Act of Parliament and report to that body via the relevant minister in Cabinet , though they are "shielded from constant government intervention and legislative oversight" and thus "generally enjoy greater freedom from direct political control than government departments." Crown corporations are distinct from "departmental corporations" such as

459-545: A symbol of modern Quebec, helping to create the Quiet Revolution of the 1960s where French-speakers in Quebec rose to positions of influence in the industrial economy for the first time, and Quebec nationalism emerged as a political force. This model followed by SaskPower in 1944 and BC Hydro in 1961. Other areas provinces were active in included insurance ( Saskatchewan Government Insurance , 1945) In Alberta,

510-419: Is a business entity created or owned by a national or local government, either through an executive order or legislation. SOEs aim to generate profit for the government, prevent private sector monopolies, provide goods at lower prices, implement government policies, or serve remote areas where private businesses are scarce. The government typically holds full or majority ownership and oversees operations. SOEs have

561-562: Is a viable argument for SOEs is debated. SOEs are also frequently employed in areas where the government wants to levy user fees , but finds it politically difficult to introduce new taxation. Next, SOEs can be used to improve efficiency of public service delivery or as a step towards (partial) privatization or hybridization. SOEs can also be a means to alleviate fiscal stress, as SOEs may not count towards states' budgets. Compared to government bureaucracy, state owned enterprises might be beneficial because they reduce politicians' influence over

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612-764: Is approximately 70% of total employment. State-owned enterprises are thus a major factor behind Belarus's high employment rate and a source of stable employment. In most OPEC countries, the governments own the oil companies operating on their soil. A notable example is the Saudi Arabian national oil company , Saudi Aramco , which the Saudi government bought in 1988, changing its name from Arabian American Oil Company to Saudi Arabian Oil Company. The Saudi government also owns and operates Saudi Arabian Airlines , and owns 70% of SABIC as well as many other companies. China's state-owned enterprises are owned and managed by

663-542: Is debatable what the term "state" implies (e.g., it is unclear whether municipally owned corporations and enterprises held by regional public bodies are considered state-owned). Next, it is contestable under what circumstances a SOE qualifies as "owned" by a state (SOEs can be fully owned or partially owned; it is difficult to determine categorically what level of state ownership would qualify an entity to be considered as state-owned since governments can also own regular stock , without implying any special interference). Finally,

714-849: Is established or operated by the King in Right of Ontario or the Government of Ontario , or under the authority of the Legislature or the Lieutenant Governor -in-Council. Finances Quebec published a list 60 Quebec Crown corporations ( French : sociétés d'État ) in June 2017. The following entities were among those listed: Several private Canadian companies were once Crown corporations, while others have gone defunct. State-owned enterprise A state-owned enterprise ( SOE )

765-617: Is highlighted in the predominant local terminology, with SOEs in Canada referred to as a " Crown corporation ", and in New Zealand as a " Crown entity ". The term " government-linked company " (GLC) is sometimes used, for example in Malaysia , to refer to private or public (listed on a stock exchange) corporate entities in which the government acquires a stake using a holding company . The two main definitions of GLCs are dependent on

816-651: The Blue Water Bridge , a twin-span bridge over the St. Clair River at the mouth of Lake Huron . It sits on 98 acres (40 ha) of land in the village of Point Edward, Ontario . The American half of the bridge is separately owned and maintained by the Michigan Department of Transportation . There are several buildings and operations underneath the bridge on the Canadian side, collectively known as

867-760: The Canada Revenue Agency . Crown corporations have a long-standing presence in the country and have been instrumental in its formation. They can provide services required by the public that otherwise would not be economically viable as a private enterprise or that do not fit exactly within the scope of any ministry. They are involved in everything from the distribution, use, and price of certain goods and services to energy development, resource extraction, public transportation, cultural promotion, and property management . As of 2022 , there were 47 federal Crown corporations in Canada. Provinces and territories operate their own Crown corporations independently of

918-715: The State-owned Asset Supervision and Administration Commission (SASAC) . China's state-owned enterprises generally own and operate public services, resource extraction or defense. As of 2017 , China has more SOEs than any other country, and the most SOEs among large national companies. China's SOEs perform functions such as: contributing to central and local governments revenues through dividends and taxes, supporting urban employment, keeping key input prices low, channeling capital towards targeted industries and technologies, supporting sub-national redistribution to poorer interior and western provinces, and aiding

969-551: The Blue Water Bridge Authority was amalgamated with St. Mary's River Bridge Company and Federal Bridge Corporation Limited to form a new corporate entity, Federal Bridge Corporation Limited , which currently owns and maintains the Canadian side of the Blue Water Bridge along with three other international bridges in Canada. The Blue Water Bridge Authority was responsible for the Canadian half of

1020-895: The Bridge has been identified as archaeologically sensitive according to the Cemeteries Act (Ontario) , due to aboriginal burial sites in the area. The land on which the bridge was built was once a hub for the Anishinaabe trade network that spanned the continent, and a place of celebration and ceremony. Today, responsibility for preserving the burial sites is held by the Aamjiwnaang First Nation band in Sarnia, Ontario . Blue Water Bridge Canada and Aamjiwnaang First Nation have historically maintained an excellent working relationship, yielding conflict-free construction of

1071-562: The Bridge independently vary their rates based on fluctuating traffic conditions, trade agreements between Canada and the United States, foreign exchange rates between the two countries' currencies, and other factors. Other sources of revenue include Duty Free Store sales, currency exchange fees, and interest on cash and investments. Expenses include salaries and benefits, general and administrative expenses, and maintenance costs. Approximately 38.5 acres (15.6 ha) of land owned by

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1122-686: The Canadian Plaza. Among these are: The main source of revenue for Bridge operations on the Canadian side is the exclusive right, granted by the Canada Transportation Act (1996) , to collect tolls from westbound traffic crossing the bridge from Canada into the United States . Toll revenue from eastbound traffic into Canada from the United States is levied by and belongs to the Michigan Department of Transportation . Toll rates are reviewed regularly, and both sides of

1173-500: The East to create Canadian National Railways (CNR) in 1918 as a transcontinental system . The CNR was unique in that it was a conglomerate , and besides passenger and freight rail, it had inherited major business interests in shipping, hotels, and telegraphy and was able create new lines of business in broadcasting and air travel. Many of the components of this business empire were later spun off into new Crown corporations including some

1224-882: The Minister of Finance II, the Minister in the Prime Minister's Department in charge of the Economic Planning Unit, the Chief Secretary to the Government, Secretary General of Treasury and the heads of each of the GLICs (the Employees Provident Fund, Khazanah Nasional Berhad , Lembaga Tabung Angkatan Tentera (the armed forces pension fund), Lembaga Tabung Haji and Permodalan Nasional Berhad . Khazanah Nasional Berhad provided

1275-1019: The USSR. Governments in Western Europe, both left and right of centre, saw state intervention as necessary to rebuild economies shattered by war. Government control over natural monopolies like industry was the norm. Typical sectors included telephones , electric power , fossil fuels , iron ore , railways , airlines , media , postal services , banks , and water . Many large industrial corporations were also nationalized or created as government corporations, including, among many others: British Steel Corporation , Equinor , and Águas de Portugal . A state-run enterprise may operate differently from an ordinary limited liability corporation. For example, in Finland, state-run enterprises ( liikelaitos ) are governed by separate laws. Even though responsible for their own finances, they cannot be declared bankrupt ;

1326-614: The actions of these organizations. The Crown is not liable for Crown corporations with non-agent status, except for actions of that corporation carried out on instruction from the government, though there may be "moral obligations" on the part of the Crown in other circumstances. Crown corporations are generally formed to fill a need that the federal or provincial government deems in the national interest or not profitable for private industry. Some Crown corporations are expected to be profitable organizations, while others are non-commercial and rely entirely on public funds to operate. Prior to

1377-513: The bridge on June 21, 2003, hand-carved by Anishinaabe artist and sculptor Dennis Henry-Shawnoo from a single piece of sandstone. In October 2013, in order to streamline governance of the four separate Crown corporations that owned international crossings, the federal government announced its intention to amalgamate them under a single Crown corporation, the Federal Bridge Corporation Limited . Bill C-4 Section 8

1428-599: The construction of the Intercolonial Railway between them was one of the terms of the new constitution. The first section of this entirely government-owned railway was completed in 1872. Western Canada 's early railways were all run by privately owned companies backed by government subsidies and loans. By the early twentieth century, however, many of these had become bankrupt . The federal government nationalised several failing Western railways and combined them with its existing Intercolonial and other line in

1479-401: The corporation's budget and the appointment of its senior leadership through Orders-in-Council . Further, in the federal sphere, certain Crown corporations can be an agent or non-agent of the Crown. One with agent status is entitled to the same constitutional prerogatives, privileges, and immunities held by the Crown and can bind the Crown by its acts. The Crown is thus entirely responsible for

1530-496: The earlier part of the century, many British North American colonies that now comprise the Canadian federation had Crown corporations, often in the form of railways, such as the Nova Scotia Railway , since there was limited private capital available for such endeavours. When three British colonies joined to create the Canadian federation in 1867, these railways were transferred to the new central government. As well,

1581-591: The excesses of the previous open market which had led to calls for prohibition in the first place. Virtually all the provinces used this system at one point. The largest of these government liquor businesses, the Liquor Control Board of Ontario (founded 1927), was by 2008 one of the world's largest alcohol retailers. Resource and utility crown corporations also emerged at this time, notably Ontario Hydro and Alberta Government Telephones in 1906, and SaskTel in 1908. Provincial governments also re-entered

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1632-418: The federal government. In Canada, Crown corporations within either the federal or provincial level are owned by the Crown as the institution's sole legal shareholder . This follows the legal premise that the monarch , as the personification of Canada , owns all state property. Established by an Act of Parliament , each corporation is ultimately accountable to (federal or provincial) Parliament through

1683-414: The federal level. Not only the federal government was involved, but also the provinces, who were in engaged in an era of " province building " (expanding the reach and importance of the provincial governments) around this time. The prototypical example is Hydro-Québec , founded in 1944 and now Canada's largest electricity generator and the world's largest producer of hydro-electricity. It is widely seen as

1734-507: The form of Public Sector Undertakings (PSUs). The Malaysian government launched a GLC Transformation Programme for its linked companies and linked investment companies ("GLICs") on 29 July 2005, aiming over a ten-year period to transform these businesses "into high-performing entities". The Putrajaya Committee on GLC High Performance ("PCG"), which oversaw this programme, was chaired by the Prime Minister , and membership included

1785-551: The formation of Crown corporations as presently understood, much of what later became Canada was settled and governed by a similar type of entity called a chartered company . These companies were established by a royal charter by the Scottish , English , or French crown, but were owned by private investors. They fulfilled the dual roles of promoting government policy abroad and making a return for shareholders. Certain companies were mainly trading businesses, but some were given

1836-412: The leading application of the incomplete contract theory to the issue of state-owned enterprises. These authors compare a situation in which the government is in control of a firm to a situation in which a private manager is in control. The manager can invest to come up with cost-reducing and quality-enhancing innovations. The government and the manager bargain over the implementation of the innovations. If

1887-482: The mid-century. The federal Post Office Department became a Crown corporation as Canada Post Corporation in 1981, and Canada's export credit agency , Export Development Canada , was created in 1985. Perhaps the most controversial was Petro-Canada , Canada's short-lived attempt to create a national oil Crown corporation , founded in 1975. The heyday of Crown corporations ended in the late 1980s, and there has been much privatisation since that time, particularly at

1938-500: The most important businesses in the mid-20th-century economy of Canada, such Air Canada , the Canadian Broadcasting Corporation (CBC), Via Rail , and Marine Atlantic . Provincial Crown corporations also re-emerged in the early 20th century, most notably in the selling of alcohol. Government monopoly liquor stores were seen as a compromise between the recently ended era of Prohibition in Canada and

1989-592: The negotiations fail, the owner can decide about the implementation. It turns out that when cost-reducing innovations do not harm quality significantly, then private firms are to be preferred. Yet, when cost-reductions may strongly reduce quality, state-owned enterprises are superior. Hoppe and Schmitz (2010) have extended this theory in order to allow for a richer set of governance structures, including different forms of public-private partnerships . SOEs are common with natural monopolies , because they allow capturing economies of scale while they can simultaneously achieve

2040-399: The private sector (perhaps because the good that is being produced requires very risky investments, when patenting is difficult, or when spillover effects exist), the government can help these industries get on the market with positive economic effects. However, the government cannot necessarily predict which industries would qualify as such 'infant industries', and so the extent to which this

2091-428: The proportion of the corporate entity a government owns. One definition purports that a company is classified as a GLC if a government owns an effective controlling interest (more than 50%), while the second definition suggests that any corporate entity that has a government as a shareholder is a GLC. The act of turning a part of government bureaucracy into a SOE is called corporatization . In economic theory ,

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2142-451: The question of whether a firm should be owned by the state or by the private sector is studied in the theory of incomplete contracts developed by Oliver Hart and his co-authors. In a world in which complete contracts were feasible, ownership would not matter because the same incentive structure that prevails under one ownership structure could be replicated under the other ownership structure. Hart, Shleifer, and Vishny (1997) have developed

2193-494: The railway business as in Northern Alberta Railways in 1925 and what later became BC Rail in 1918. A notable anomaly of this era is Canada's only provincially owned "bank" (though not called that for legal reasons) Alberta Treasury Branches , created in 1937. The Bank of Canada , originally privately owned, became a Crown corporation in 1938. New crown Corporations were also created throughout much of

2244-489: The second bridge span, expanded parking lots, and other on-site development despite taking place on archaeologically sensitive land. Officials from the Bridge and Aamjiwnaang First Nation continue to meet yearly to explore current and future issues of mutual interest. As a symbol of co-operation and respect between the Blue Water Bridge and the Aamjiwnaang First Nation, a statue was unveiled just south of

2295-469: The service. Conversely, they might be detrimental because they reduce oversight and increase transaction costs (such as monitoring costs, i.e., it is more difficult and costly to govern and regulate an autonomous SOE than it is the public bureaucracy). Evidence suggests that existing SOEs are typically more efficient than government bureaucracy, but that this benefit diminishes as services get more technical and have less overt public objectives. Compared to

2346-465: The state answers for the liabilities. Stocks of the corporation are not sold and loans have to be government-approved, as they are government liabilities. State-owned enterprises are a major component of the economy of Belarus . The Belarusian state-owned economy includes enterprises that are fully state-owned, as well as others which are joint-stock companies with partial ownership by the state. Employment in state-owned or state-controlled enterprises

2397-497: The state's response to natural disasters, financial crises and social instability. China's SOEs are at the forefront of global seaport-building, and most new ports constructed by them are done within the auspices of the Belt and Road Initiative . As of at least 2024, an Ethiopian SOE is Africa's largest and most profitable airline, as well as Ethiopia's largest earner of foreign exchange. In India , government enterprises exist in

2448-549: The term public agency is used to describe "boards, commissions, tribunals or other organizations established by government, but not part of a government department." Crown corporations in Manitoba are supported by Manitoba Crown Services . Crown corporations in Ontario are referred to as Crown agencies . A Crown agency includes any board, commission, railway, public utility, university, factory, company or agency that

2499-657: The term "enterprise" is challenged, as it implies statutes in private law which may not always be present, and so the term "corporations" is frequently used instead. Thus, SOEs are known under many other terms: state-owned company, state-owned entity, state enterprise, publicly owned corporation, government business enterprise, government-owned company, government controlled company, government controlled enterprise, government-owned corporation, government-sponsored enterprise , commercial government agency, state-privatised industry public sector undertaking, or parastatal, among others. In some Commonwealth realms , ownership by The Crown

2550-575: The world's largest land owner, at one point overseeing 7,770,000 km (3,000,000 sq mi), territories that today incorporate the provinces of Manitoba , Saskatchewan and Alberta , as well as Nunavut , the Northwest Territories , and Yukon . The HBC were often the point of first contact between the colonial government and First Nations . By the late 19th century, however, the HBC lost its monopoly over Rupert's Land and became

2601-424: Was passed into law December 12, 2013, and was fully in effect as of February 1, 2015. Crown corporations of Canada Crown corporations ( French : Société de la Couronne ) are government organizations in Canada with a mixture of commercial and public-policy objectives. They are directly and wholly owned by the Crown (i.e. the government of Canada or a province). Crown corporations represent

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