Ottawa fears that the China spy

Ottawa craint que la Chine espionne

Investissement Québec has made its investment of$ 30 Million in the company, Flying Whales, even if the controversial project of airships is still blocked by Ottawa, which weighs for months of the risks of industrial espionage, a powerful chinese partner.

Investissement Québec (IQ) has recently confirmed to our Office of investigation, that the sums have been disbursed, without specifying the date.

The State company is thus officially became a minority partner of the mother house, Flying Whales SAS, whose head office is in France, and the quebec subsidiary that will include the research and development for the project of manufacture of airships.

IQ has also confirmed that the federal ministry of Innovation, Science and economic Development (ISDEC) still has not given its authorization for the operation of the quebec subsidiary.

This procedure is mandatory for the start-up of any company which is not majority-owned by canadian capital, as is the case for Flying Whales Quebec. But, the periods are multiplied. (see text below).

Ownership

The door-to-speech, IQ, Isabelle Fontaine, has indicated that the federal authorities are questioning the ownership of the house-French mother, which is part of the company chinese State-owned AVIC, a giant of the aerospace industry.

“[The controls] is the subject of a more extensive study, which was to be expected given the share ownership of the mother house of Flying Whales Quebec, ” said Ms. Fontaine.

In the United States, AVIC is in the crosshairs of the federal government, according to which the powerful conglomerate that is controlled by the chinese military.

The FBI has identified the industrial espionage in china as a recurrent threat to us national security.

IQ has not disclosed what was the date of his application for authorisation has been sent to the ISDEC. The Investment Canada Act provides that a company may make an application prior to placement or within 30 days after the transaction.

The cabinet of the federal minister of Industry, Navdeep Bains, explained that the authorisation procedure, which is confidential, it determines whether the foreign investments are beneficial to the canadian economy.

“The Bill also provides for the review of all foreign investments in order to preserve the national security,” said councillor John Power, by refusing to comment directly to the folder of Flying Whales.

Espionage

In November, the minister of Economy, Pierre Fitzgibbon, was aware of the issues that could give rise to the presence of AVIC.

“It is certain that he would have to look at, as it was mentioned, the whole side industrial espionage “, he said.

He had, however, ruled out any risk that the Chinese recover technologies of Quebec.

“The Chinese are not shareholders of the transaction in quebec,” he decided.

– With Jean-François Gibeault

The time limits of the federal multiply

The analysis extended of Ottawa is casting a “sword of Damocles” on the quebec subsidiary of Flying Whales, recognizes the boss of the company.

Sébastien Bougon, president and ceo of Flying Whales SAS, the parent company of the subsidiary in quebec, explains that the federal authorities have so far extended ” three or four times the original period of 45 days for the review of the project, which also provides for the construction and operation of airships in Quebec.

Ottawa craint que la Chine espionne

Photo courtesy
Sébastien Bougon
CEO Flying Whales

A first authorization of the federal would be allowed, however, for partners to invest when even in the quebec subsidiary, said Mr. Grumpy in an interview.

“We received a first green light, which has helped to unlock the operation, he said. A second procedure provided by law has been launched, and that is to control the issue of the chinese investor in the parent company. “

Wholly waterproof

Mr. Grumpy stated that the federal authorities have requested ” a more detailed explanation on how is structured the shareholding in France “.

The objective is to ensure that the research and development projects planned in Quebec will not be exposed to theft of intellectual property.

“They verify that there is no transfer from Quebec to France and then from France to China,” he said.

Certain to be able to reassure Ottawa, Mr Grumpy reminds us that the Chinese are the only shareholders of the parent company is French.

“Flying Whales Quebec is very tight,” said the CEO.

It has all the same looking forward from Ottawa, which dissipates the recent uncertainty. “Somewhere, it is always a small sword of Damocles, always a small risk,” he acknowledges.

If necessary, Mr. Grumpy is ready to reduce the program of research and development in Québec. “If the federal government told me : “listen, it’s, we don’t really want you to do in Quebec”, it will be in France. “

In February, before the risks associated with the project, the liberal opposition in Quebec was worried about the financial participation of the government.

The prime minister François Legault was then carried a guarantee of results. “The skeptics will be confused,” he started.

The Chinese have lent a hand

The giant chinese aviation AVIC has put its employees and its technical knowledge at the service of the project of aircraft of the Flying Whales.

The company’s expertise has played a key role in the start of the project for transportation of heavy loads by airship to the mother house of Flying Whales SAS.

Of the articles published in 2016 in the chinese media indicate that employees of the giant of the aerospace have been placed at the service of the young French company.

The web site of Huanqiu, a national newspaper printed in 2 million copies, announced that they would go to work in France.

“A group of excellent chinese engineers will also be sent to join the team of the Flying Whales Company in Paris in order to participate in the research and development of the project in a comprehensive manner,” says a French translation of the story.

The news website Qianlong also stated that they would be 25 assigned engineers ” in improving the design, management, joint ventures, post-production and the preparation of the airships “.

According to Huanqiu, the president-director general of the Flying Whales, Sébastien Bougon, stressed the contribution of the Chinese in the field of airships.

“I found the enthusiasm of the engineers from AVIC to participate in the project “, he said in the report.

Know-how

In an exchange with our Office of investigation, Mr. Grumpy has confirmed that the contribution of AVIC, a shareholder minority of the Flying Whales SAS, has been crucial for the French company, whose headquarters is in the suburbs of Paris.

“We had cooperated with the subsidiary airship of AVIC, to acquire their advice and knowledge in the matter, since France had lost the know-how for a long time “, he said.

Mr. Grumpy did not want to specify how many engineers it has received or if they are still within its teams.

Mystery

In addition, Flying Whales leave the mystery to hover over the professional past of a director of its subsidiary in quebec.

Xu Mingxuan is one of the five members of the board of directors of the Flying Whales Quebec.

M. Bougon, member, president and secretary of the board of directors of the quebec subsidiary, said Xu Mingxuan represents his company.

“It is an employee of Flying Whales, absolutely. It is very nice, very intelligent. It has a good scientific culture “, he said.

Mr. Grumpy has not ruled out the possibility that Mr. Mingxuan be an ex-employee of AVIC.

“This is not an employee of AVIC, today “, did it respond.

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