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Summary
Part 4 establishes that a corporation must have a registered office
and must inform the Director appointed under the Act of the location
of that office. The directors may move the registered office within
the province specified in the articles but the Director must be notified
of that move. (Section 20)
The corporation must also maintain records containing the articles
and by-laws of the corporation, minutes of meetings of members or committees
of members, resolutions of meetings of members or committees of members,
a debt obligations register, if any have been issued, a register of
directors, a register of officers and a register of members. (Section
21)
The corporation is required to maintain adequate accounting records
as well as a record of minutes of meetings and of resolutions of the
directors or committees of directors. Record keeping requirements in
other acts are also addressed. (Section 21)
The records must be available for the inspection of the directors.
Accounting records may be kept outside Canada if the criteria in the
Act are met, subject to the requirements of other acts. (Section 21)
Some or all of the records maintained by a corporation are to be available,
subject to the conditions established in the Act, to members or their
personal representatives, a creditor of the corporation or a debt obligation
holder. A corporation may apply to the Director for the right to refuse
access to the records to certain individuals. (Sections 22, 23, 25)
The Director will be able to examine all records of the corporations,
except directors'minutes and accounting records, during regular business
hours without payment of a fee. The Director may also require the corporation
to submit registers of members or debt obligation holders within the
prescribed period and in the prescribed form. (Section 24)
This Part is largely technical. It sets out the records that must
be maintained and who has access to those records and under what circumstances.
Access allows the designated persons to obtain a proper and accurate
view of the corporation's state. The requirements regarding the ability
of various parties to view the documents are in place to ensure that
the right to view the records is not abused, that members'privacy
is protected and does not place the corporation at a disadvantage.
Briefing Book
An Act Respecting Not-for-Profit Corporations and
Other Corporations Without Share Capital
Top
Bill Clause No. 20
Section No. 20
Topic: Registered Office and
Records
Proposed Wording
20. (1) A corporation shall at
all times have a registered office in the province in Canada specified
in its articles.
(2) A notice of registered office in the form that the Director fixes
shall be sent to the Director together with any articles that designate
or change the province where the registered office of the corporation
is to be located.
(3) The directors of a corporation may change its registered office
to another place within the province specified in the articles, in which
case the corporation shall send to the Director a notice of registered
office in the form that the Director fixes
(4) A notice of registered office becomes effective when the Director
accepts it.
Rationale
This section requires that the registered office of the corporation
be situated in a Canadian province or territory that is specified in
the corporation's articles. It also requires the corporation to inform
the Director of the address of the registered office and any changes
made to the location of the corporation's registered office.
Subsection 20(1) requires that the registered office of the corporation
be in Canada.
Subsection 20(2) requires the corporation to send to the Director the
location of its registered office. The corporation must also send to
the Director any articles or amendments to the articles dealing with
the location of its registered office.
Subsection 20(3) allows the directors of the corporation to change the
location of the registered office within the province specified in its
articles. The corporation must also send the Director a notification
of the change in location of its registered office. It should be noted
that for a corporation to change the province of its registered office,
members must pass a special resolution (2/3 majority).
Subsection 20(4) states that any change of address of the corporation's
registered office becomes effective when the Director files the notice
sent by the corporation.
Present Law
Canada Corporations Act:
24. (1) The company shall at all times have a head office in the place
within Canada where the head office is to be situated in accordance with
the letters patent or the provisions of this Part, which head office
is the domicile of the company in Canada; and the company may establish
such other offices and agencies elsewhere within or outside Canada, as
it deems expedient.
(2) The company may, by by-law, change the place where the head office
of the company is to be situated.
(3) No by-law for the purpose of changing the place where the head office
is to be situated is valid or shall be acted upon until it is sanctioned
by at least two-thirds of the votes cast at a special general meeting
of the shareholders duly called for considering the by-law.
(4) A copy of the by-law certified under the seal of the company shall
be forthwith filed with the Minister and shall be available for inspection
at the office thereof during normal business hours.
(5) A notice of the by-law shall be forthwith published in the Canada
Gazette.
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Bill Clause No. 21
Section No. 21
Topic: Registered Office and Records
Proposed Wording
21. (1) A corporation shall prepare
and maintain, at its registered office or at any other place in Canada
designated by the directors, records containing
(a)
the articles and the by-laws, and amendments to them, and a copy of
any unanimous member agreement;
(b) the minutes of meetings
of members and any committee of members;
(c) the resolutions
of members and any committee of members;
(d) if any debt obligation
is issued by the corporation, a debt obligations register that complies
with section 45;
(e) a register of directors;
(f)
a register of officers; and
(g) a register of members. |
(2) The registers referred to in paragraphs (1)(e) to (g)
shall contain the information prescribed by regulation.
(3) A corporation shall prepare and maintain adequate accounting records
and records containing minutes of meetings of the directors and any committee
of directors as well as resolutions adopted by the directors or any committee
of directors.
(4) Subject to any other Act of Parliament or of the legislature of
a province that provides for a longer retention period, a corporation
shall retain the accounting records referred to in subsection (3) for
the prescribed period.
(5) For the purposes of paragraph (1)(b) and (c) and
subsection (3), where a body corporate is continued under this Act, "records" includes
similar records required by law to be maintained by the body corporate
before it was so continued.
(6) The records described in subsection (3) shall be kept at the registered
office of the corporation or at any other place as the directors think
fit.
(7) The records described in subsections (1) and (3) shall at all reasonable
times be open to inspection by the directors. The corporation shall,
at the request of any director, provide them with any extract of the
records free of charge.
(8) If accounting records of a corporation are kept outside Canada,
accounting records adequate to enable the directors to ascertain the
financial position of the corporation with reasonable accuracy on a quarterly
basis shall be kept at the registered office or any other place in Canada
designated by the directors.
(9) Despite subsections (1) and (8), but subject to the Income Tax
Act, the Excise Tax Act, the Customs Act and
any other Act administered by the Minister of National Revenue, a corporation
may keep all or any of its corporate records and accounting records
referred to in subsection (1) or (3) at a place outside Canada, if
(a) the records are available for inspection, by means of any
technology, during regular office hours at the registered office or any
other place in Canada designated by the directors; and
(b) the
corporation provides the technical assistance to facilitate an inspection
referred to in paragraph (a). |
Rationale
This section clearly sets out what kinds of records are required to
be kept by the corporation as well as where they must be kept.
Subsection 21(1) lists the records the corporation must keep at its
registered office or some other designated place in Canada.
Subsection 21(2) states that the list of directors, officers and members
must contain the information required by the regulations. This is proposed
as: the name of each director (officer, member); the address of each
director (officer, member or the member's business address); the email
address of each director (officer, member) if the director (officer,
member) consented to receiving information by electronic means; the date
the director (officer, member) became a director (officer, member); and
the date the director (officer, member) ceased to be a director (officer,
member).
Subsection 21(3) is self-explanatory and mandates that accounting records,
records containing the minutes of meetings of directors and resolutions
passed by the directors must be kept by the corporation.
Subsection 21(4) provides the regulatory authority to specify how long
the records of the corporation referred to in subsection 21(3) must be
held. This is proposed as six years after the end of the financial year
to which the records relate.
Subsection 21(5) deals with the records that must be kept by a corporation
which is continuing (moving from another jurisdiction) into this Act.
Subsection 21(6) requires a corporation to keep its records at its registered
office or at some other place designated by the directors and that they
must be available for the directors to inspect.
Subsection 21(7) provides that the corporation is obliged to allow directors
reasonable access to inspect the corporation's corporate records and
to provide directors, without charge, with any extract of the records
they request.
Subsection 21(8) requires a corporation, if it keeps its records outside
of Canada, to make them available by means of computer terminal or other
technology and to provide technical assistance to facilitate their inspection.
This section is, however, subject to the Income Tax Act and
any other Act administered by the Minister of National Revenue regarding
where corporate records are to be kept.
Present Law
Canada Corporations Act:
109. (1) The company shall cause a book or books to be kept by the secretary,
or some other officer specially charged with that duty, wherein shall
be kept recorded
(a) a copy of the letters patent, all by-laws of the company
and any supplementary letters patent issued to the company and a copy
of the memorandum of agreement of the company, if any;
(b)
the names, alphabetically arranged of all persons who are and have
been shareholders
of the company;
(c) the address and calling of every such
person, while such shareholder, as far as can be ascertained;
(d)
the names, addresses and callings of all persons who are or have been
directors
of the company, with the several dates at which each became or ceased
to be such director; |
[...]
112. (1) Every company shall cause minutes of all proceedings at meetings
of the shareholders and of the directors and of any executive committee
to be entered in books kept for that purpose.
[...]
117. (1) Every company shall cause to be kept proper accounting records
with respect to all financial and other transactions of the company,
and, without limiting the generality of the foregoing, shall cause records
to be kept of
[...]
(2) The accounting records shall be kept at the head office of the company
or at such other place in Canada as the directors think fit, and shall
at all times be open to inspection by the directors.
(3) In case the operating accounts of the company are kept at some place
outside Canada, there shall be kept at the head office of the company
such comprehensive records as will enable the directors to ascertain
with reasonable accuracy the financial position of the company at the
end of each three months period.
Top
Bill Clause No. 22
Section No. 22
Topic: Registered Office and Records
Proposed Wording
22. (1) A member, a member's personal
representative and a creditor of a corporation may examine and, on payment
of any reasonable fee, take
extracts from the records referred to in paragraphs 21(1)(a)
to (f) during the usual business hours of the corporation.
(2) Any person described in subsection (1) who wishes to examine the
debt obligations register of a corporation shall first make a request
to the corporation or its agent or mandatary accompanied by a statutory
declaration referred to in subsection (5). On receipt of the statutory
declaration, the corporation or its agent or mandatary shall allow the
applicant access to the register during the corporation's usual business
hours and, on payment of any reasonable fee, provide the applicant with
an extract from the register.
(3) A member of a corporation is entitled on request and free of charge
to one copy of the articles and by-laws, any amendments to them, and
any unanimous member agreement.
(4) Any person described in subsection (1), on payment of any reasonable
fee and on sending to a corporation or its agent or mandatary the statutory
declaration referred to in subsection (5), may on application require
the corporation or its agent or mandatary to furnish within the prescribed
period a list of debt obligation holders setting out the prescribed information.
The list shall be updated to a prescribed day.
(5) The statutory declaration required under subsection (2) or (4) shall
(a) state the name and address of the applicant and, if the
applicant is a body corporate, its address for service; and
(b)
state that the list of debt obligation holders or the information contained
in the debt obligations register obtained under subsection (2) will
not be used except as permitted under subsection (7). |
(6) If the applicant is a body corporate, the statutory declaration
shall be made by a director or officer of the body corporate.
(7) A list of debt obligation holders or information from a debt obligations
register obtained under this section shall not be used by any person
except in connection with
(a) an effort to influence the voting of debt obligation holders
of the corporation;
(b) an offer to acquire debt obligations
of the corporation; or
(c) any other matter relating to the
debt obligations or affairs of the corporation. |
Rationale
This section sets out the rights of members and creditors with regard
to access to certain corporate records and information pertaining to
holders of debt obligation of the corporation. It is analogous to similar
provisions in the Canada Business Corporation Act. This section
protects information contained in a list of debt obligation holders by
requiring those interested in obtaining the list to sign a statutory
declaration stating that the list will only be used to in connection
with influencing the voting of debt obligation holders, an offer to acquire
a debt obligation or any other matter relating to the debt obligations
or affairs of the corporation.
Subsection 22(1) states that members, their representatives and creditors
of the corporation can access, on the payment of a reasonable fee and
sending a statutory declaration to the corporation, certain corporate
records. These include the corporation's articles, by-laws, and any amendments
to them, as well as a copy of any unanimous member agreement; the minutes
of meetings of members and any committee of members; the resolutions
of members and any committee of members; if any debt obligation is issued
by the corporation, the debt obligations register; and the registers
of directors, officers and members.
Subsection 22(2) states the conditions under which members, their representatives
and creditors can have access to the corporation's debt obligations register.
Subsection 22(3) provides members the right to one free copy of the
corporation's articles, by-laws and any unanimous member agreement. Should
a member request an additional copy, the corporation may require the
member to pay a reasonable fee.
Subsection 22(4) states that members, their representatives and creditors
of the corporation can access the entire list of debt obligation holders
of the corporation, on the payment of a reasonable fee and sending a
statutory declaration to the corporation. The list would include the
names, in alphabetical order, and addresses of the holders of the outstanding
debt obligations; the principal amount of their outstanding debt obligations;
and the aggregate principal amount of the debt obligations.
Subsection 22(5) lists the requirements of the statutory declaration
that must be sent to the corporation by members and creditors wishing
to obtain information regarding debt obligation holders under subsections
22(2) and (4).
Subsection 22(6) indicates that the statutory declaration required under
subsections 22(2) and (4) must be made by a director or officer of the
corporation, if the applicant is a body corporate
Subsection 22(7) places limitations on the use of the list or information
on the debt obligation holders of the corporation obtained under subsections
22(2) and (4).
Present Law
Canada Corporations Act:
73. (1) Every register of holders of debentures of a company shall,
except when closed in accordance with the by-laws of the company or the
provisions of the debentures or the covering deed, if any, during such
period or periods, not exceeding in the whole thirty days in any year,
as may be specified in the said by-laws or provisions, be open to the
inspection of the registered holder of any such debentures, and of any
shareholder, but subject to such reasonable restrictions as the company
may impose, so that at least two hours in each day are appointed for
inspection, and every such holder may require a copy of the register
or any part thereof on payment of ten cents for every hundred words required
to be copied.
[...]
Top
Bill Clause No. 23
Section No. 23
Topic: Registered Office and Records
Proposed Wording
23. (1) A member or a member's personal representative who wishes to
examine the register of members of a corporation shall first make a request
to the corporation or its agent or mandatary accompanied by a statutory
declaration referred to in subsection (5). On receipt of the statutory
declaration, the corporation or its agent or mandatary shall allow the
applicant access to the register during the corporation's usual business
hours and, on payment of any reasonable fee, provide the applicant with
an extract from the register.
(2) Any person described in subsection (1) and debt obligation holders,
on payment of any reasonable fee and on sending to a corporation or its
agent or mandatary the statutory declaration referred to in subsection
(5), may on application require the corporation or its agent or mandatary
to furnish within the prescribed period a list of members setting out
the prescribed information. The list shall be made updated to a prescribed
day.
(3) A person described in subsection (1) may only make an application
under subsection (2) once in each calendar year. In addition, an application
may be made before each special meeting of members of which the person
receives notice.
(4) A debt obligation holder may make an application to obtain a list
of members only after receiving notice of a meeting of members at which
the holder has the right to vote.
(5) The statutory declaration required under subsection (1) or (2) shall
(a) state the name and address of the applicant and, if the
applicant is a body corporate, its address for service; and
(b)
state that the list of members or the information contained in the
register of members obtained under subsection (1) will not be used
except as permitted
under subsection (7) or (8). |
(6) If the applicant is a body corporate, the statutory declaration
shall be made by a director or officer of the body corporate.
(7) A member or a member's personal representative who obtains a list
of members or information from a register of members under this section
shall not use the list or information except in connection with
(a) an effort to influence the voting of members;
(b)
requisitioning a meeting of members; or
(c) any other matter
relating to the affairs of the corporation. |
(8) A debt obligation holder who obtains a list of members under this
section shall not use the list except in connection with an effort to
influence the voting of members on any issue that the holder has a right
to vote on.
Rationale
This section sets out the requirements under which members and the corporation's
debt obligation holders can be granted access to the corporation's membership
information. Making this information available enhances communication
among members regarding the affairs of the corporation. It also protects
members'privacy with respect to personal information by requiring those
interested in obtaining the organization's membership list to sign a
statutory declaration stating that the list will only be used to influence
voting, request a meeting of members or other matters related to the
affairs of the corporation. Limiting access to members and other listed
individuals protects the privacy and interests of members.
Subsection 23(1) states that only members or their representatives can
access the register of members, during regular business hours, if they
provide the corporation with a statutory declaration. Upon the payment
of a reasonable fee, the member can obtain extracts from the registry
of members.
Subsection 23(2) states that members, their representatives or debt
holders of the corporation can obtain a list of members if they send
to the corporation a statutory declaration and upon the payment of a
reasonable fee.
Subsection 23(3) provides that members have the right to the corporation's
membership list once a calendar year or before a meeting of members if
they receive notice of the meeting.
Subsection 23(4) states that debt holders can only obtain a list of
members if they receive a notice of a meeting at which they are entitled
to vote.
Subsection 23(5) lists the requirements of the statutory declaration
that must be sent to the corporation by members and the corporation's
debt holders if they wish to obtain information regarding the corporation's
membership under subsections 23(1) and (2).
Subsection 23(6) states that, if a body corporate is applying for access
to membership information, the statutory declaration required under subsections
23(1) and (2) must be made by a director or officer of that body corporate.
Subsection 23(7) restricts the use of the membership information obtained
by members under subsection 23(1) to the influencing of voting, requesting
a meeting of members or other matters related to the affairs of the corporation.
Subsection 23(8) restricts the use of the membership information obtained
by the corporation's debt holders under subsection 23(2) to the influencing
of voting of members on issues upon which debt holders have a right to
vote.
Present Law
Canada Corporations Act:
111.1 (1) Any person, upon payment of the costs thereof and upon filing
with the company or its transfer agent such declaration as may be prescribed
by regulation, is entitled to obtain from a company, other than a private
company, or its transfer agent within ten days from the filing of such
declaration a list setting out the names of all persons who are shareholders
of the company, the number of shares owned by each such person and the
address of each such person as shown on the books of the company made
up to a date not more than ten days prior to the date of filing the declaration.
(2) Where the applicant is a corporation, the prescribed declaration
shall be made by the president or other officer authorized by resolution
of the board of directors thereof.
[...]
Top
Bill Clause No. 24
Section No. 24
Topic: Registered Office and Records
Proposed Wording
24. (1) The Director may examine
the records described in subsection 21(1) during the usual business hours
of the corporation and may take
extracts from the records free of charge.
(2) The Director may require the corporation or its agent or mandatary
to furnish to the Director within the prescribed period a list of members
or debt obligation holders setting out the prescribed information. The
list shall be updated to a prescribed day.
Rationale
This section provides the Director Appointed Under the Act with access
to the corporation's records as well as access to the lists of members
and debt obligation holders of the corporation. The Director is provided
this access to investigate, for example, a complaint against a corporation.
This discretionary power is not expected to be used as a matter of course
but only in situations where it is warranted. It should be noted that
information obtained by the Director under this section will not be publically
available.
Subsection 24(1) states that the Director can access and may obtain
extracts of the corporation's records free of charge.
Subsection 24(2) states that the Director may request from a corporation
its lists of members and debt holders.
Present Law
None.
Top
Bill Clause No. 25
Section No. 25
Topic: Registered Office and Records
Proposed Wording
25. (1) On the application of a corporation, the Director may authorize
the corporation, on any terms that the Director thinks fit, to refuse,
in whole or in part, to allow access to corporate records or to furnish
information that the corporation is otherwise under this Part obligated
to allow or furnish, if the Director reasonably believes that allowing
the access or furnishing the information would be detrimental to any
member or the corporation.
(2) On the application of any member, the Director may direct the corporation,
on any terms that the Director thinks fit, not to allow, in whole or
in part, access to corporate records or not to furnish, in whole or in
part, information that the corporation is otherwise under this Part obligated
to allow or furnish, if the Director reasonably believes that allowing
the access or furnishing the information would be detrimental to any
member or the corporation.
Rationale
This section allows a corporation to apply to the Director Appointed
Under the Act for an exemption with respect to providing access or copies
of its corporate records and its lists of members and debt obligations
holders. Corporate records and membership and debt obligation holders
lists are essential for the efficient functioning and governance of not-for-profit
corporations. Limiting access to members and other listed individuals
protects the privacy and interests of members and debt obligation holders.
However, in certain circumstances, even limited access and release of
this information may be detrimental to the corporation or its members.
The Director will exercise this discretionary power on a case-by-case
basis and his/her determination will be based on the corporation's circumstances.
It should be noted that the Director's decision can be appealed.
Subsection 25(1) allows the Director, upon an application from a corporation,
to provide an exemption so that the corporation does not have to provide
access to or copies of its records and membership and debt obligation
holders lists. The exemption may be granted when the Director is convinced
that the release of this information would be detrimental to any member
or to the corporation.
Subsection 25(2) allows the Director, upon an application from a member,
to provide an exemption so that the corporation does not have to provide
access or copies of its records and membership and debt obligation holders
lists. The exemption may be granted when the Director is convinced that
the release of this information would be detrimental to any member or
to the corporation.
Present Law
None.
Top
Bill Clause No. 26
Section No. 26
Topic: Registered Office and Records
Proposed Wording
26. (1) All registers and other records required by this Act to be prepared
and maintained may be in any form, provided that the records are capable
of being reproduced in intelligible written form within a reasonable
time.
(2) A corporation and its agents and mandataries shall take reasonable
precautions to prevent the loss or destruction of the registers and other
records required under this Act, to prevent the falsification of entries
in those registers and records and to facilitate the detection and correction
of inaccuracies in them.
Rationale
This section recognizes, subject to the protections required under subsection
26(2), the use of modern techniques for data storage and retrieval as
they relate to the registers and records which are required to be kept
by the corporation.
Subsection 26(1) permits all corporate records to be kept in any form
(i.e., paper form or through electronic methods). However, the corporation
must also be able to reproduce its recorded information in an intelligible
written form within a reasonable time frame.
Subsection 26(2) directs the corporation or its agent to take reasonable
precautions to prevent the loss, destruction or falsification of the
information that the corporation is required to prepare and maintain.
Present Law
None.
Top
Bill Clause No. 27
Section No. 27
Topic: Registered Office and Records
Proposed Wording
27. A document executed on behalf of a corporation is not invalid merely
because a corporate seal is not affixed to it.
Rationale
This section makes it clear that a corporation is permitted but is not
required to use a corporate seal. Documents signed by authorized corporate
directors, officers or agents are valid, even if the corporation's seal
is not affixed to the documents.
Present Law
Canada Corporations Act:
21. [...]
(2) In no case is it necessary to have the seal of the company affixed
to any such contract, agreement, engagement, bargain, bill of exchange,
promissory note or cheque, or to prove that the same was made, drawn,
accepted or endorsed, as the case may be, in pursuance of any by-law
or special vote or order.
[...]
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Corporate and Insolvency Law Policy
