Policy On Multi-Jurisdictional Licenses

A. Purpose

This policy sets out the various elements to be considered in reviewing a trustee's application to extend his or her licence to a province in which he or she does not maintain a resident office, as well as the procedures to follow in dealing with such an application. The policy is intended to ensure consistency in the application of the rules for extending licences to other districts.

B. Sources and general principles

Sections 40 and 42 of the Licensing Directive state: 

40. A licence is issued for the bankruptcy district or part thereof in which the trustee maintains a resident office.

42. The Superintendent may, upon written request, extend the licence of an individual trustee to another district or part thereof, provided the trustee satisfies the Superintendent that: 

1. the trustee has sufficient knowledge of the relevant legislation which applies in that district;
   
   
2. this extension will not adversely affect the performance of professional engagements.

Subsections 13.1 and 13.2(5)b) of the Bankruptcy and Insolvency Act read as follows:

13.1 A licence shall (a) be in the prescribed form; (b) specify the bankruptcy district or part thereof in which the trustee is entitled to act and (c) be subject to such conditions and limitations as the Superintendent considers appropriate and may specify therein.

13.2(5) A licence may be suspended or cancelled by the Superintendent

b) if the trustee has failed to comply with any of the conditions or limitations to which the licence is subject.

In reviewing the trustee's application, the Superintendent will consider the various elements set out below. He may then refuse the extension, grant it without conditions, or require that certain conditions be met before it is granted.

If the extension is accorded, it will remain at all times conditional on the trustee complying with the requirements set out at the time of the extension.

In accordance with subsection 13.2(5) of the Act, the extension privilege may be revoked if the trustee fails to meet his/her obligations, or if his/her performance or the quality of his/her administration is no longer satisfactory, either with respect to files opened in the district for which the extension was given or in the district for which the licence was initially issued.

C. Factors to be considered

Factors to be considered relate to the trustee's knowledge of relevant legislation and performance of professional engagements.

1. Knowledge of relevant legislation (subsection 42(a) of the Licensing Directive)
   
   
   1. Provincial Legislation
      
      The trustee must have sufficient knowledge of provincial legislation pertaining to insolvency. While not necessarily exhaustive, the list in Appendix "A" identifies various areas with which the trustee must be very familiar.
      
      
   2. Board of Examination
      
      Where a trustee requests an extension from a Common Law province to a Civil Law province or vice versa, he or she will be required to appear before a Board of Examination. The Superintendent may also require that the trustee appear before a Board of Examination where the trustee does not have sufficient knowledge of the applicable legislation in the new region.
      
      
2. The requested extension must not adversely affect the performance of the trustee's professional engagements (subsection 42(b) of the Licensing Directive)
   
   Without limiting the generality of this statement, the following criteria will be considered: 
   
   
   1. Trustee compliance and performance, particularly with regard to:
      
      
      • the Bankruptcy and Insolvency Act, and the Bankruptcy and Insolvency Rules;
      • the Superintendent's Directives;
      • the closing of files, the number of files open, and the age of these files;
      • the number and type of complaints against the trustee.
      
      
   2. Quality of service provided by the trustee, including: 
      
      
      • the trustee's facilities and office;
      • access to files;
      • access to the trustee, e.g. assessment in person;
      • access to the trustee's personnel, on-site or not, permanently or occasionally.
      
      
   3. Cost of services
      
      Trustee fees and disbursements claimed against the estate should not be higher by reason of distance from the resident office.
      
      
   4. Continuity in the administration of files
      
      The trustee must conclude a succession agreement in case of death, incapacity or other factors that could prevent him/her from performing engagements. He or she must ensure at all times that there is a successor for the files being administered. This criterion is mandatory in view of the risks inherent in leaving estate files without a trustee.
      
      With the exception of the succession agreement, no one of the criteria set out above will be determinant. Each case will be considered on its merits based on the entire set of circumstances.

   D. Conditions for issuing an extension

   Before being granted an extension, the trustee must commit in writing: 

   1. to maintain satisfactory performance and the same level of service as that which was represented to the Superintendent when he or she applied for the licence extension;
      
      
   2. to submit to the Superintendent for prior approval
      
      
      1. any significant change in the level of service which he or she represented to the Superintendent;
         
         
      2. any significant change in the succession agreement.

   E. Process

   • The trustee makes an application in writing demonstrating that he/she meets the requirements of this policy.
   • A copy of the succession agreement(s) for the files he or she administers is attached to the application.
   • The entire application is reviewed by the Assistant Superintendent, Licensing in consultation with the Division Assistant Superintendent (DAS) and the National Director, Compliance and Investigations.
   • The Assistant Superintendent, Licensing makes a recommendation and forwards it to the Superintendent of Bankruptcy for a decision.
   • This recommendation is not binding on the Superintendent.

F. Coming into force

The present policy comes into force on July 1^st, 2002. It applies to all requests for the extension of a licence made on or after July 1^st, 2002.

Appendix "A"

The trustee should have general knowledge as to the application of relevant provincial legislation in a bankruptcy situation. Generally, the trustee should be very familiar with the following areas of provincial legislation: