Applying for an exemption under the Canada Business Corporations Act

If you are considering applying for an exemption under the Canada Business Corporations Act (CBCA), you should read the information on this page.

On this page

Documents you must submit

To apply for an exemption under the CBCA, you must provide the following:

  1. Cover letter: It should read "In the Matter Concerning the Director appointed Under the Canada Business Corporations Act and The Application of {Name of Corporation}". Review the annexes in any of the exemption policies for specific examples.
  2. Description and details of the exemption sought: You must clearly set out which exemption you are applying for. Therefore, your application should refer to the relevant section of the CBCA (for example, “This application is made under section 156 of the Canada Business Corporations Act to exempt Corporation X from the requirements of subsection 155(1) of the Act.”).
  3. Statement of facts: The information you provide here will vary depending on the type of application you are making. As a rule, you should include enough facts and all information that you think may be relevant, paying particular attention to the test the Director will apply and the factors the Director will consider when making a particular decision.

    Generally, you should set out a description of the corporation's activities, the affected stakeholders, the function and importance of the imposed requirements to these stakeholders, and, if relevant, the corporation's financial situation.

  4. Argument: Arguments must explain why an exemption is required and, when appropriate, why receiving an exemption would not be prejudicial to the interests of security holders or the public interest. Additional details are provided in the specific exemption policies.
  5. Filing fee: You must also include the filing fee (see Services, fees and processing times).

Once you are ready to submit your application, you should consult How to file and pay for an application.

What happens after you apply for an exemption

The following describes what may happen after you have applied for an exemption.

Service standard

The Director will provide a decision within 30 days of receipt of an application unless otherwise stated in a specific policy.

Director requests for additional information

The Director may seek additional information, including requesting information from a third party. The applicant will be given a copy of any information obtained and a reasonable opportunity to respond. There is no legal obligation on the Director, however, to seek additional information at the request of a third party or to allow a third party to make representations regarding an application.

Conditions

The Director may decide that it is in the public interest to include conditions in an exemption. For example, a corporation may be deemed non-distributing, but only on the condition that it continues to meet one or more of the requirements imposed on a distributing corporation.

Effective date and duration

The effective date of an exemption will be the date on which it was granted, unless otherwise indicated, and remains in effect for the full term of the issuance subject to it being modified, revoked or terminated.

Revocation or modification

The Director can revoke or modify an exemption when the circumstances under which it was granted have changed. The Director will not revoke or modify an exemption before providing notice to the applicant and the opportunity to respond.

An exemption ceases to be in effect from the date of revocation.

Termination

An event may trigger the termination of an exemption. A breach of the conditions of an exemption terminates the exemption as of the date of the breach.

Additionally, a substantial change in the situation or facts on which the exemption is based will end the exemption as of the date of the change. Since the exemption ends when an event occurs, there is no prior notice.

Publication

Exemptions granted by the Director are published in Monthly transactions.

Appeal of Director's decision

A person who feels aggrieved by a decision of the Director to grant, or to refuse to grant, an exemption referenced in subsection 246(c) of the CBCA may apply to court for an order requiring the Director to change the decision.

Access to information and offences

The following provides information regarding access to information and offences under the CBCA.

Access to information contained in an application

Any person who pays the required fee may examine and get copies of any document that the CBCA requires to be sent to the Director. The information filed with the Director as part of an application for an exemption is not confidential since the information is required to be filed. Consequently, an application for an exemption is public information.

However, pursuant to paragraph 266(1) of the CBCA, documents regarding applications and decisions under section 21.303 of the CBCA are not available to be examined or copied.

Offences

Section 250 of the CBCA creates an offence with respect to documents required by the CBCA or the Canada Business Corporations Regulations to be sent to the Director, or any other person, that contains a false or misleading statement about a material fact or omit to state a material fact.