Lithium Chile Inc. and China Union Holdings Ltd. have received a formal notice under the Investment Canada Act that could trigger a deeper national security review of their pending US$175 million transaction.

The Director of Investments issued a notice stating there are reasonable grounds to believe the proposed sale of Lithium Chile subsidiary Argentum Lithium S.A., which holds the Salar de Arizaro project in Argentina, could be injurious to national security. The notice indicates that an order for further review may be made under subsection 25.3(1) of the legislation.

Lithium Chile initially announced the definitive agreement to sell the Arizaro project subsidiary to China Union for US$175 million on December 22, 2025. Company shareholders subsequently voted 96% in favour of the proposed transaction at an annual general and special meeting on May 15, 2026.

The parties previously extended the transaction drop-dead date by 60 days on June 18, 2026, setting a revised target completion date of August 20, 2026. Rather than closing, the latest development brings a regulatory hurdle involving Canadian federal oversight.

Lithium Chile and China Union are reviewing the notice with their respective legal advisors to consider available options. Lithium Chile maintains that the sale of a foreign asset falls outside the jurisdiction of Innovation, Science and Economic Development Canada, pointing out that Argentum is not a Canadian company, holds no Canadian assets, and maintains no employees or place of business in the country. The company stated it intends to press that position and pursue all available remedies as the regulatory review process continues toward the August 20 deadline.

Read the full announcement: China Union and Lithium Chile Receive Notice Under The Investment Canada Act