662. The purpose of this Part is to provide for the incorporation, formation and regulation of bank holding companies.

1999, c. 28, s. 61; 2001, c. 9, s. 183.

663. (1) The following definitions apply in this Part.

“complainant”, in relation to a bank holding company or any matter concerning a bank holding company, means

(a) a registered holder or beneficial owner, and a former registered holder or beneficial owner, of a security of a bank holding company or any of its affiliates;

(b) a director or an officer, or a former director or officer, of a bank holding company or any of its affiliates; or

(c) any other person who, in the discretion of a court, is a proper person to make an application under section 334, 338 or 989.

“subordinated indebtedness” means an instrument evidencing an indebtedness of a bank holding company that by its terms provides that the indebtedness will, in the event of the insolvency or winding-up of the bank holding company, be subordinate in right of payment to all liabilities of the bank holding company except those that, by their terms, rank equally with or are subordinate to such indebtedness.

(2) A reference in a provision of this Part to a provision in any other Part is deemed to be a reference to that provision as it has been made applicable by this Part in respect of bank holding companies.

(3) A reference in a provision of another Part to a provision that has been made applicable in respect of bank holding companies by this Part is to be read as including a reference to that provision as it has been made applicable in respect of bank holding companies.

1999, c. 28, s. 61; 2001, c. 9, s. 183.

664. (1) A bank holding company has the capacity of a natural person and, subject to this Act, the rights, powers and privileges of a natural person.

(2) A bank holding company shall not carry on any business or exercise any power that it is restricted by this Act from carrying on or exercising, or exercise any of its powers in a manner contrary to this Act.

(3) A bank holding company may carry on business throughout Canada.

(4) Subject to this Act, a bank holding company has the capacity to carry on its business, conduct its affairs and exercise its powers in any jurisdiction outside Canada to the extent and in the manner that the laws of that jurisdiction permit.

1999, c. 28, s. 61; 2001, c. 9, s. 183.

665. No act of a bank holding company, including any transfer of property to or by a bank holding company, is invalid by reason only that the act or transfer is contrary to the bank holding company’s incorporating instrument or this Act.

1999, c. 28, s. 62; 2001, c. 9, s. 183.

666. It is not necessary for a bank holding company to pass a by-law in order to confer any particular power on the bank holding company or its directors.

1999, c. 28, s. 63; 2001, c. 9, s. 183.

667. The shareholders of a bank holding company are not, as shareholders, liable for any liability, act or default of the bank holding company except as otherwise provided by this Act.

1999, c. 28, s. 63; 2001, c. 9, s. 183.

668. No person is affected by or is deemed to have notice or knowledge of the contents of a document concerning a bank holding company by reason only that the document has been filed with the Superintendent or the Minister or is available for inspection at an office of the bank holding company.

1999, c. 28, s. 64, c. 31, ss. 16(F), 250; 2001, c. 9, s. 183.

669. (1) No bank holding company and no guarantor of an obligation of a bank holding company may assert against a person dealing with the bank holding company or against a person who has acquired rights from the bank holding company that

(a) the bank holding company’s incorporating instrument or any by-laws of the bank holding company have not been complied with;

(b) the persons named as directors of the bank holding company in the most recent return sent to the Superintendent under section 951 are not the directors of the bank holding company;

(c) the place named in the incorporating instrument or by-laws of the bank holding company is not the place where the head office of the bank holding company is situated;

(d) a person held out by the bank holding company as a director, officer or representative of the bank holding company has not been duly appointed or has no authority to exercise the powers and perform the duties that are customary in the business of the bank holding company or usual for a director, officer or representative; or

(e) a document issued by any director, officer or representative of the bank holding company with actual or usual authority to issue the document is not valid or not genuine.

(2) Subsection (1) does not apply in respect of a person who has or ought to have knowledge of a situation described in that subsection by virtue of their relationship to the bank holding company.

1999, c. 28, s. 65; 2001, c. 9, s. 183; 2005, c. 54, s. 83.

670. (1) Subject to subsection (2), bank holding companies shall not carry on business after April 24, 2007, except that if Parliament dissolves on that day or at any time within the three-month period before that day, bank holding companies may continue to carry on business until the day that is one hundred and eighty days after the first day of the first session of the next Parliament.

(2) The Governor in Council may, by order, extend by up to six months the time during which bank holding companies may continue to carry on business. No more than one order may be made under this subsection.

1999, c. 28, s. 65; 2001, c. 9, s. 183; 2006, c. 4, s. 199.1.

671. On the application of one or more persons made in accordance with this Part, the Minister may, subject to this Division, issue letters patent incorporating a bank holding company.

1999, c. 28, s. 66; 2001, c. 9, s. 183.

672. Letters patent incorporating a bank holding company may not be issued if the application therefor is made by or on behalf of

(a) Her Majesty in right of Canada or in right of a province, an agency of Her Majesty in either of those rights, or an entity controlled by Her Majesty in either of those rights;

(b) the government of a foreign country or any political subdivision thereof;

(c) an agency of the government of a foreign country or any political subdivision thereof; or

(d) an entity, other than a foreign institution or any subsidiary of a foreign institution, that is controlled by the government of a foreign country or any political subdivision thereof.

1999, c. 28, s. 66; 2001, c. 9, s. 183.

673. If a proposed bank holding company would be a subsidiary of a foreign bank, within the meaning of any of paragraphs (a) to (f) of the definition “foreign bank” in section 2, letters patent to incorporate the bank holding company may not be issued unless the Minister is satisfied that, if the application is made by a non-WTO Member foreign bank, treatment as favourable for bank holding companies to which this Act applies exists or will be provided in the jurisdiction in which the foreign bank principally carries on business, either directly or through a subsidiary.

1999, c. 28, s. 67; 2001, c. 9, s. 183.

674. An application for letters patent to incorporate a bank holding company setting out the names of the first directors of the bank holding company shall be filed with the Superintendent, together with such other information, material and evidence as the Superintendent may require.

1999, c. 28, s. 68; 2001, c. 9, s. 183.

675. Before issuing letters patent to incorporate a bank holding company, the Minister shall take into account all matters that the Minister considers relevant to the application, including

(a) the nature and sufficiency of the financial resources of the applicant or applicants as a source of continuing financial support for the bank that is proposed to be its subsidiary;

(b) the soundness and feasibility of the plans of the applicant or applicants for the future conduct and development of the business of the bank that is proposed to be its subsidiary;

(c) the business record and experience of the applicant or applicants;

(d) the character and integrity of the applicant or applicants or, if the applicant or any of the applicants is a body corporate, its reputation for being operated in a manner that is consistent with the standards of good character and integrity;

(e) whether the bank holding company will be operated responsibly by persons with the competence and experience suitable for involvement in the operation of a financial institution;

(f) the impact of any integration of the businesses and operations of the applicant or applicants with those of the bank holding company and its affiliates on the conduct of those businesses and operations; and

(g) the best interests of the financial system in Canada.

1999, c. 28, s. 69; 2000, c. 12, s. 6; 2001, c. 9, s. 183.

676. (1) There shall be set out in the letters patent incorporating a bank holding company

(a) the name of the bank holding company;

(b) the province in which the head office of the bank holding company is to be situated; and

(c) the date that the bank holding company came, or is to come, into existence.

(2) The Minister may set out in the letters patent incorporating a bank holding company any provision not contrary to this Act that the Minister considers advisable in order to take into account the particular circumstances of the proposed bank holding company.

(3) The Minister may impose such terms and conditions in respect of the issuance of letters patent incorporating a bank holding company as the Minister considers necessary or appropriate.

1999, c. 28, s. 70; 2001, c. 9, s. 183; 2005, c. 54, s. 84.

677. (1) If, under section 671, the Minister issues letters patent incorporating a bank holding company on the application of a bank, there may, on the request of the bank, and with the approval of the Minister, be included in the letters patent of incorporation of the bank holding company a provision deeming shares of the bank holding company to be issued, on a share for share basis, to all shareholders of the bank in exchange for all the issued and outstanding shares of the bank.

(2) Shares of a bank holding company deemed to be issued under subsection (1) are subject to the same designation, rights, privileges and restrictions or conditions and, subject to any agreement to the contrary, to the same charges, encumbrances and other restrictions as the shares of the bank for which they are exchanged and the shares of the bank, on the issuance of the letters patent, become the property of the bank holding company free and clear of any charge, encumbrance or other restriction.

(3) An exchange of shares of a bank referred to in subsection (1) under a provision included in the letters patent incorporating a bank holding company does not deprive a person who was a holder of shares of the bank immediately before the exchange of any right or privilege with respect to the shares or relieve the person of any liability in respect of the shares, but that right or privilege must be exercised in accordance with this Act.

(4) Despite subsection (3), no share of a bank holding company that is deemed to be issued under a provision included in the letters patent incorporating a bank holding company may subsequently be transferred or voted contrary to this Act.

(5) No provision described in subsection (1) may be included in letters patent issued under section 671 unless the application for the letters patent is accompanied by evidence that the request for the provision was approved by a special resolution of the shareholders of the bank at a shareholders’ meeting called to consider the application.

(6) If, under a provision included in the letters patent incorporating a bank holding company, a share exchange is deemed to have taken place, the bank holding company shall, within ninety days after the issuance of the letters patent, make provision for the issue of share certificates representing shares of the bank holding company and for the exchange of those certificates for share certificates representing the shares of the bank that were outstanding on the effective date of the letters patent.

1999, c. 28, s. 71; 2001, c. 9, s. 183.

678. (1) On application, made in accordance with the regulations, by a bank to give effect to a proposal to incorporate a bank holding company as the holding body corporate of the bank, to continue a body corporate as a bank holding company of the bank or to amalgamate two or more bodies corporate and continue those bodies corporate as a bank holding company of the bank — and to make any other fundamental change to or in respect of the bank, including an exchange of any or all of the shares of the bank for shares of the bank holding company — , the Minister may, to give effect to the proposal,

(a) include in the letters patent of the bank holding company issued under section 671, 684 or 809 any provision the Minister considers necessary; or

(b) despite any provision of the Act specified in regulations made under paragraph 2(e), give any approval that the Minister considers necessary.

(2) The Governor in Council may make regulations

(a) respecting applications referred to in subsection (1), including their form and the information to be contained in them, and authorizing the Superintendent to require additional information in respect of such applications;

(b) respecting proposals to which subsection (1) applies, including the information to be contained in the proposals and the times within which the transactions involved in them must occur;

(c) respecting the procedures to be followed by a bank that makes an application under subsection (1);

(d) respecting the approval, confirmation or authorization, if any, of all or any portion of proposals to which subsection (1) applies, including the approval of shareholders and including the terms and conditions of those approvals, confirmations or authorizations and their effect; and

(e) specifying provisions of the Act for the purpose of paragraph (1)(b).

1999, c. 28, s. 72; 2001, c. 9, s. 183.

679. The Superintendent shall cause to be published in the Canada Gazette a notice of the issuance of letters patent incorporating a bank holding company.

1999, c. 28, s. 73; 2001, c. 9, s. 183.

680. The first directors of a bank holding company are the directors named in the application for letters patent to incorporate the bank holding company.

1999, c. 28, s. 73; 2001, c. 9, s. 183.

681. A bank holding company comes into existence on the date provided therefor in its letters patent.

2001, c. 9, s. 183.

682. (1) A body corporate incorporated under the Canada Business Corporations Act or any other Act of Parliament, including a bank, may apply to the Minister for letters patent continuing the body corporate as a bank holding company under this Part.

(2) A body corporate incorporated otherwise than by or under an Act of Parliament may, if so authorized by the laws of the jurisdiction where it is incorporated, apply to the Minister for letters patent continuing the body corporate as a bank holding company under this Part.

2001, c. 9, s. 183.

683. (1) Where a body corporate applies for letters patent under subsection 682(1) or (2), sections 672 to 675 apply in respect of the application, with such modifications as the circumstances require.

(2) Where a body corporate applies for letters patent under subsection 682(1) or (2), the application must be duly authorized by a special resolution.

(3) A copy of the special resolution referred to in subsection (2) shall be filed with the application.

2001, c. 9, s. 183.

684. (1) On the application of a body corporate under subsection 682(1) or (2), the Minister may, subject to this Division, issue letters patent continuing the body corporate as a bank holding company under this Part.

(2) Where letters patent are issued to a body corporate under subsection (1), section 676 applies in respect of the issue of letters patent, with such modifications as the circumstances require.

2001, c. 9, s. 183.

685. On the day set out in the letters patent continuing a body corporate as a bank holding company under subsection 684(1),

(a) the body corporate becomes a bank holding company as if it had been incorporated under this Part; and

(b) the letters patent are deemed to be the incorporating instrument of the continued bank holding company.

2001, c. 9, s. 183.

686. (1) Where a body corporate is continued as a bank holding company under this Part, the Superintendent shall without delay send a copy of the letters patent to the appropriate official or public body in the jurisdiction in which the body corporate was authorized to apply to be continued under this Part.

(2) The Superintendent shall cause to be published in the Canada Gazette a notice of the issuance of letters patent continuing a body corporate as a bank holding company under this Part.

2001, c. 9, s. 183.

687. Where a body corporate is continued as a bank holding company under this Part,

(a) the property of the body corporate continues to be the property of the bank holding company;

(b) the bank holding company continues to be liable for the obligations of the body corporate;

(c) an existing cause of action or claim by or against the body corporate or any liability of the body corporate to prosecution is unaffected;

(d) a civil, criminal or administrative action or proceeding pending by or against the body corporate may continue to be prosecuted by or against the bank holding company;

(e) a conviction against, or any ruling, order or judgment in favour of or against the body corporate may be enforced by or against the bank holding company;

(f) a person who, on the day the body corporate becomes a bank holding company, was the holder of a security issued by the body corporate is not deprived of any right or privilege available to the person at that time in respect of the security or relieved of any liability in respect thereof, but any such right or privilege may be exercised only in accordance with this Act; and

(g) the by-laws of the body corporate, except those that are in conflict with this Act, continue as the by-laws of the bank holding company.

2001, c. 9, s. 183.

688. (1) Notwithstanding any other provision of this Act or the regulations, the Minister may, on the recommendation of the Superintendent, by order, grant to a bank holding company in respect of which letters patent were issued under subsection 684(1) permission to

(a) engage in a business activity specified in the order that a bank holding company is not otherwise permitted by this Act to engage in and that the body corporate continued as the bank holding company was engaging in at the time the application for the letters patent was made;

(b) continue to have issued and outstanding debt obligations the issue of which is not authorized by this Act if the debt obligations were outstanding at the time the application for the letters patent was made;

(c) hold assets that a bank holding company is not otherwise permitted by this Act to hold if the assets were held by the body corporate continued as the bank holding company at the time the application for the letters patent was made;

(d) acquire and hold assets that a bank holding company is not otherwise permitted by this Act to acquire or hold if the body corporate continued as the bank holding company was obliged, at the time the application for the letters patent was made, to acquire those assets; and

(e) maintain outside Canada any records or registers required by this Act to be maintained in Canada and maintain and process outside Canada information and data relating to the preparation and maintenance of such records or registers.

(2) The permission granted under subsection (1) shall be expressed to be granted for a period specified in the order not exceeding

(a) with respect to any activity described in paragraph (1)(a), thirty days after the effective date of the letters patent or, where the activity is conducted pursuant to an agreement existing on the effective date of the letters patent, the expiration of the agreement;

(b) with respect to any matter described in paragraph (1)(b), ten years; and

(c) with respect to any matter described in any of paragraphs (1)(c) to (e), two years.

(3) Subject to subsection (4), the Minister may, on the recommendation of the Superintendent, by order, renew a permission granted by order under subsection (1) with respect to any matter described in paragraphs (1)(b) to (d) for such further period or periods as the Minister considers necessary.

(4) The Minister shall not grant to a bank holding company any permission

(a) with respect to matters described in paragraph (1)(b), that purports to be effective more than ten years after the effective date of the letters patent, unless the Minister is satisfied on the basis of evidence on oath provided by an officer of the bank holding company that the bank holding company will not be able at law to redeem at the end of the ten years the outstanding debt obligations to which the permission relates; and

(b) with respect to matters described in paragraphs (1)(c) and (d), that purports to be effective more than ten years after the effective date of the letters patent.

2001, c. 9, s. 183.

689. (1) A bank holding company may, with the approval in writing of the Minister, apply to be continued as a body corporate under any other Act of Parliament or any Act of the legislature of a province.

(2) No approval referred to in subsection (1) may be given to a bank holding company unless the Minister is satisfied that the application of the bank holding company has been authorized by a special resolution.

2001, c. 9, s. 183.

690. (1) For the purpose of this section, “bank holding company without a bank subsidiary” means a bank holding company that does not, at any time within one year after it came into existence, have a subsidiary that is a bank or that does not, for a period of one year, have a subsidiary that is a bank.

(2) A bank holding company without a bank subsidiary must, within 30 days after becoming a bank holding company without a bank subsidiary, apply to be continued under subsection 689(1).

(3) Except for the sole purpose of winding up its affairs, a bank holding company without a bank subsidiary that has no other subsidiary that fails to make an application under subsection (2) within the time provided for in that subsection ceases to exist on the expiration of that period.

2001, c. 9, s. 183.

691. On the day specified by the Minister, this Act ceases to apply to the body corporate continued under the other Act of Parliament or under the Act of the legislature of a province.

2001, c. 9, s. 183.

692. Where a special resolution authorizing the application under subsection 689(1) so states, the directors of a bank holding company may, without further approval of the shareholders, withdraw the application before it is acted on.

2001, c. 9, s. 183.

693. A bank holding company may not be incorporated under this Part with a name

(a) that is prohibited by an Act of Parliament;

(b) that is, in the opinion of the Superintendent, deceptively misdescriptive;

(c) that is the same as or, in the opinion of the Superintendent, substantially the same as or confusingly similar to, any existing

(i) trade-mark or trade name, or

(ii) corporate name of a body corporate,

except where the trade-mark or trade name is being changed or the body corporate is being dissolved or is changing its corporate name and consent to the use of the trade-mark, trade name or corporate name is signified to the Superintendent in such manner as the Superintendent may require;

(d) that is the same as or, in the opinion of the Superintendent, substantially the same as or confusingly similar to, the known name under or by which any entity carries on business or is identified; or

(e) that is reserved under section 43 for a bank or an authorized foreign bank or a proposed bank or proposed authorized foreign bank or under section 697 for another bank holding company or a proposed bank holding company.

2001, c. 9, s. 183.

694. Despite section 693 and subject to section 695, a bank holding company that is affiliated with another entity may, with the consent of that entity and the approval of the Superintendent,

(a) be incorporated with, or change its name to, substantially the same name as that of the affiliated entity; or

(b) subject to any terms and conditions that may be prescribed, carry on business under or identify itself by a name, other than its corporate name, that is substantially the same as the corporate name of the affiliated entity or that is another name under which or with which the affiliated entity carries on business or otherwise identifies itself.

2001, c. 9, s. 183.

695. A bank holding company may not be incorporated or continued with, change its name to or carry on business or identify itself by, a name that is substantially similar to that of a bank unless the name contains words that, in the opinion of the Superintendent, indicate to the public that the bank holding company is distinct from any bank that is a subsidiary of the bank holding company.

2001, c. 9, s. 183.

696. (1) The name of a bank holding company may be set out in its letters patent in an English form, a French form, an English form and a French form or in a combined English and French form, and the bank holding company may use and be legally designated by any such form.

(2) Despite any other provision of this Act and subject to the regulations, every bank holding company shall have as part of its name, the abbreviations “bhc” or “spb”.

(3) A bank holding company may identify itself outside Canada by its name in any language and the bank holding company may use and be legally designated by any such form of its name outside Canada.

(4) Subject to subsection (5) and section 832, a bank holding company may carry on business under or identify itself by a name other than its corporate name.

(5) Where a bank holding company is carrying on business under or identifying itself by a name other than its corporate name, the Superintendent may, by order, direct the bank holding company not to use that other name if the Superintendent is of the opinion that that other name is a name referred to in any of paragraphs 693(a) to (e).

(6) The Governor in Council may make regulations respecting the use of the abbreviations “bhc” or “spb” in the name of bank holding companies.

2001, c. 9, s. 183.

697. The Superintendent may, on request, reserve for ninety days a name for a proposed bank holding company or for a bank holding company that intends to change its name.

2001, c. 9, s. 183.

698. (1) If through inadvertence or otherwise a bank holding company

(a) comes into existence or is continued with a name, or

(b) on an application to change its name, is granted a name

that is prohibited by section 693 or 695, the Superintendent may, by order, direct the bank holding company to change its name and the bank holding company shall comply with that direction.

(2) Where a bank holding company has been directed under subsection (1) to change its name and has not, within sixty days after the service of the direction, changed its name to a name that is not prohibited by this Part, the Superintendent may revoke the name of the bank holding company and assign to it a name and, until changed in accordance with section 215 or 217, the name of the bank holding company is thereafter the name so assigned.

2001, c. 9, s. 183.

699. The Superintendent shall, within sixty days after the end of each year, cause a notice to be published in the Canada Gazette, showing

(a) the name of every bank holding company; and

(b) the province in which the head office of the bank holding company is situated.

2001, c. 9, s. 183; 2005, c. 54, s. 85.

700. (1) After letters patent incorporating a bank holding company are issued, a meeting of the directors of the bank holding company shall be held at which the directors may, subject to this Division,

(a) make by-laws;

(b) adopt forms of share certificates and corporate records;

(c) authorize the issue of shares of the bank holding company;

(d) appoint officers;

(e) appoint an auditor to hold office until the first meeting of shareholders;

(f) make banking arrangements; and

(g) deal with any other matters necessary to organize the bank holding company.

(2) An incorporator or a director named in the application for letters patent may call the meeting referred to in subsection (1) by giving, subject to subsection 770(2), no fewer than five days notice of the purpose, time and place of the meeting to each director of the bank holding company.

2001, c. 9, s. 183.

701. (1) After the meeting referred to in subsection 700(1) is held, the directors of the bank holding company shall without delay call a meeting of the shareholders of the bank holding company.

(2) The shareholders of a bank holding company shall, by resolution at the meeting of shareholders called pursuant to subsection (1),

(a) approve, amend or reject any by-law made by the directors of the bank holding company;

(b) subject to section 756, elect directors to hold office for a term expiring not later than the close of the third annual meeting of shareholders following the election; and

(c) appoint an auditor to hold office until the close of the first annual meeting of shareholders.

2001, c. 9, s. 183.

702. A director named in the application for letters patent to incorporate a bank holding company holds office until the election of directors at the meeting of shareholders called pursuant to subsection 701(1).

2001, c. 9, s. 183.