The sections below thematically present the issues under consideration for amendment. Discussion and commentary on each outlined proposal and rationale is welcomed. Part A consists of proposed amendaments to four corporate law statutes, while Part B sets out proposed amendments to two insolvency frameworks.
Table of contents
- Part A: Proposed adjustments to Canada's federal corporate law statutes
- Part B: Proposed amendments to insolvency law
Part A: Proposed adjustments to Canada's federal corporate law statutes
Part A1: Proposed amendments to the Canada Business Corporations Act (CBCA)
A1.1 Virtual & hybrid meetings
Proposal
Amend the CBCA to permit full and partial electronic meetings of members and of directors by default, but subject to any restrictions stipulated in the articles of incorporation or bylaws and ensure meeting notification materials set out all necessary logistics for accessing, participating in and voting at virtual and hybrid meetings.
For meetings of directors, amend the CBCA to remove the requirement for unanimous consent for electronic participation, where applicable.
Consequential amendments would be made to provisions relating to methods of voting, place and/or means of attending meetings, and the content of meeting notices, to ensure information regarding the type of meeting is clear, including instructions to access, participate in and vote at the meeting.
Rationale
The current provisions were drafted at a time when the costs to enable conference call capabilities were expensive for corporations. Restricting or permitting the use of such facilities was necessary to respect budget constraints, particularly for smaller corporations.
In light of the advancement and proliferation of electronic communications platforms, and the comfort which most Canadians have acquired using them, virtual and hybrid meetings have become more prevalent. Accordingly, they should be available by default, rather than only being permitted if stipulated by a corporation's bylaws or where unanimous consent is provided.
Similarly, meeting notices, participation and voting platforms should provide clear instructions to ensure ease of access, full and adequate participation and voting capability of attendees.
A1.2 Name change
Proposal
Change the name of the Annual Return to the Annual Update Statement in the CBCA.
Rationale
The amendment is intended to reduce confusion with Canada Revenue Agency's Annual Tax Return tax filing requirements and unintended non-compliance with Corporations Canada's annual filing obligations leading to potential administrative dissolution.
This amendment was included in Bill S-6 which was introduced in the 44th Parliament but died on the order paper.
Part A2: Proposed amendments to the Canada Not-for-profit Corporations Act (CNCA)
A2.1 Virtual & hybrid meetings
Proposal
Amend the CNCA to permit full and partial electronic meetings of members and of directors by default, but subject to any restrictions stipulated in the articles of incorporation or bylaws, and ensure meeting notification materials set out all necessary logistics for accessing, participating in and voting at virtual and hybrid meetings.
For meetings of directors, amend the CNCA to remove the requirement for unanimous consent for electronic participation, where applicable.
Consequential amendments would be made to provisions relating to methods of voting, place and/or means of attending meetings, and the content of meeting notices, to ensure information regarding the type of meeting is clear, including instructions to access, participate in and vote at the meeting.
Rationale
The current provisions were drafted at a time when the costs to enable conference call capabilities were expensive for corporations. Restricting or permitting the use of such facilities was necessary to respect budget constraints, particularly for smaller corporations.
In light of the advancement and proliferation of electronic communications platforms, and the comfort which most Canadians have acquired using them, virtual and hybrid meetings have become more prevalent. Accordingly, they should be available by default, rather than only being permitted if stipulated by a corporation's bylaws or where unanimous consent is provided.
Similarly, meeting notices, participation and voting platforms should provide clear instructions to ensure ease of access, full and adequate participation and voting capability of attendees.
A2.2 Name change
Proposal
Change the name of the Annual Return to the Annual Update Statement in the CNCA.
Rationale
The amendment is intended to reduce confusion with Canada Revenue Agency's Annual Tax Return tax filing requirements and unintended non-compliance with Corporations Canada's annual filing obligations leading to potential administrative dissolution.
This amendment was included in Bill S-6 which was introduced in the 44th Parliament but died on the order paper.
A2.3 1/3 Director appointment rule
Proposal
Amend section 128(2) of the CNCA to clarify that the total number of directors that may be appointed by the board may not exceed one-third of the number of active directors that have been elected by members and that any directors appointed by the board shall stand for confirmation by the members at the next meeting of the members.
Amend 128(8) to remove the requirement that this flexibility be stipulated in the articles of incorporation in order to extend this to all CNCA regulated corporations.
Rationale
The 1/3 rule exists to increase the number of directors when business requirements so dictate, while preventing the board of a not-for-profit from appointing the majority of directors to ensure boards remain accountable to their members.
The amendment decouples the confirmation of appointed directors from annual member meetings to concord with other flexibilities within the CNCA that accommodate organizations that adopt multi-year mandates.
The amendment adds further flexibility by allowing the appointment of interim board directors to be the default and not be limited to non-profits that so provide in their articles of incorporation.
A2.4 Ex officio director
Proposal
Amend the CNCA to allow non-profits to amend their bylaws to allow for the appointment of an ex officio director or a director by virtue of their office, on the condition that the individual:
- accepts the nomination
- complies with all obligations that otherwise apply to directors
- be subject to removal like other directors
Rationale
Ex officio directors can hold institutional or historical knowledge necessary for the continuity of the corporation or ensure alignment with parent or partner organizations.
Ex officio directors were formally recognized in legislation that pre-dated the CNCA and were removed to protect the integrity of a governance framework built on members' rights. Nonetheless, ex officio directors remain a widespread practice in many corporations, notably through director elections limited to a single candidate.
Many stakeholders have called on the Government to formally re-recognize this long-standing practice by re-establishing ex officio directors in the CNCA. These amendments would do so in a way that is compatible with good governance principles.
A2.5 Delegate voting
Proposal
Amend the CNCA to expressly allow a non-profit to amend their bylaws to permit the election of delegates to represent a group or class of members.
The bylaws could, as required, set out the qualification of delegates, their powers and the authority bestowed on delegates, and requirements for the holding of meetings of delegates. The bylaws may also prescribe any restrictions on delegate voting by proxy.
Rationale
Delegate voting is a common practice among NFPs – particularly large ones – that have regional or local associations. Although subsection 7(1)(c) of the CNCA currently allows corporations to create classes and any voting rights attached to them, it doesn't expressly stipulate that a class can elect a delegate to act on behalf of a class of members. Many stakeholders use, or would like to use, delegated voting models within their CNCA corporations, and have sought legal clarification in support of the practice.
A2.6 Non-voting members
Proposal
Amend the CNCA to eliminate the voting rights currently conferred on non-voting members in instances of fundamental changes to the organization such as in cases of a sale or lease, a continuance or amalgamation, as well as in instances of liquidation and dissolution. Allow corporations to preserve voting rights for non-voting members via their bylaws.
Rationale
The mandatory rule that gives votes to non-voting members in instances where fundamental changes are made to member rights or the corporation's structure, can have the unintended consequence of preventing such decisions from happening at member meetings. This occurs in cases where non-voting members do not attend member meetings because, as non-voting members, they are not interested or did not expect to have a role in the governance of the corporation. When non-voting members fail to attend member meetings when such decisions are on the agenda, the quorum necessary to constitute the meeting is not achieved which prevents such measures from moving forward in a timely manner.
Making these amendments aligns with the approach taken for non-voting members in several provinces within Canada.
A2.7 Treatment of proxies
Proposal
Amend the CNCA to require proxyholders of non-profits to deposit their proxies with the corporation 48 hours ahead of a member meeting.
Rationale
Depositing proxies in advance of the meeting allows corporations to manage their meetings more efficiently. It also protects the interest of members and is considered a good governance best practice.
A2.8 Membership reimbursement
Proposal
Amend the CNCA to clarify that non-profits can reimburse the cost of a member's membership fee pursuant to a canceled membership.
Rationale
Section 34(1) stipulates that a corporation's profits, property or accretions may not be distributed directly or indirectly to a member, director or officer of the corporation, except in furtherance of its activities or as otherwise permitted in the Act. Some non-profits have interpreted this provision as preventing them from reimbursing a member their membership fees even in circumstances where reimbursement is reasonable and appropriate.
Part A3: Proposed Amendments to the Canada Cooperatives Act (CCA)
A3.1 Virtual & hybrid meetings
Proposal
Amend the CCA to permit full and partial electronic meetings of shareholders, members, and of directors by default, but subject to any restrictions stipulated in the articles of incorporation or bylaws and ensure meeting notification materials set out all necessary logistics for accessing, participating in and voting at virtual and hybrid meetings.
Consequential amendments would be made to provisions relating to methods of voting, place and/or means of attending meetings, and the content of meeting notices, to ensure information regarding the type of meeting is clear, including instructions to access, participate in and vote at the meeting.
Rationale
The current provisions were drafted at a time when the costs to enable conference call capabilities were expensive for corporations. Restricting or permitting the use of such facilities was necessary to respect budget constraints, particularly for smaller corporations.
In light of the advancement and proliferation of electronic communications platforms, and the comfort which most Canadians have acquired using them, virtual and hybrid meetings have become more prevalent. Accordingly, they should be available by default, rather than only being permitted if stipulated by a corporation's bylaws or where unanimous consent is provided.
Similarly, meeting notices, participation and voting platforms should provide clear instructions to ensure ease of access, full and adequate participation and voting capability of attendees.
A3.2 Name change
Proposal
Change the name of the Annual Return to the Annual Update Statement in the CCA.
Rationale
The amendment is intended to reduce confusion with Canada Revenue Agency's Annual Tax Return tax filing requirements and unintended non-compliance with Corporations Canada's annual filing obligations leading to potential administrative dissolution.
This amendment was included in Bill S-6 which was introduced in the 44th Parliament but died on the order paper.
Part A4: Proposed amendments to the Boards Of Trade Act (BOTA)
A4.1 Quarterly meetings
Proposal
Amend the BOTA to replace the requirement to hold quarterly member meetings with the requirement to hold one annual member meeting.
Rationale
This measure will help reduce the costs and the administrative burden of holding quarterly meetings. Such an amendment also aligns with other corporate law statutes.
A4.2 Size of council
Proposal
Amend the BOTA to allow boards of trade to limit the size of their council to not less than seven members rather than not less than eleven members.
Rationale
This measure recognizes that boards and chambers of commerce are expected to represent the businesses within their district, but that some districts – and thus boards – can be smaller in size.
A4.3 Notices in newspapers
Proposal
Amend the BOTA to remove the requirement that notices of meetings must be published in one or several newspapers and allow for other electronic means of notification.
Rationale
Publishing notices of meetings in local newspapers is costly and is no longer the optimal or standard mechanism to reach members.
A4.4 Council term
Proposal
Amend the BOTA to allow council members to serve a term of up to three years.
Rationale
This measure provides more flexibility by enabling staggered terms, in general alignment with other corporate statutes.
A4.5 Financial review flexibility for boards of trade
Proposal
Amend the BOTA to provide boards with the flexibility to undertake different levels of financial review depending on their annual revenues.
Retain the default that boards of trade should hire a public accountant who should conduct an audit. But allow boards of trade to conduct a review engagement if approved by 2/3 of their membership if revenues are below a certain threshold as aligned with the CNCA.
Amend the BOTA to add definitions and requirements of a public accountant as well as to define a review engagement.
Rationale
Currently, the BOTA requires that boards of trade create a memorandum of understanding that sets out, among other things, arrangements for the auditing of its accounts and the appointment of auditors.
Many boards have interpreted this requirement as limiting them from employing other less costly forms of financial review engagement.
Similarly, the BOTA only envisions the appointment of auditors, not public accountants. While both have similar skills sets auditors can charge higher fees.
Since the enactment of the BOTA other types of financial reviews have been introduced and have become widely accepted for use by small corporations, including federally regulated not for profit corporations.
A4.6 Swearing an oath
Proposal
Amend the BOTA to repeal the requirement to swear an oath of office before the mayor or justice of the peace. Replace with a fiduciary duty.
Rationale
This is an outdated requirement that imposes both cost and burden but provides no measurable benefit to boards of trade or its members.
A4.7 Outdated professions
Proposal
Amend the BOTA to update the references in section 3(1) to replace outdated professions with a simple reference to businesses and organizations that are resident and operating in the district or serving area.
Rationale
This measure is designed to remove outdated language when referring to businesses and organizations that may form a board of trade while retaining the general principle that those that may form a board must be resident in the district.
A4.8 Name change publications
Proposal
Amend section 40 to repeal the obligation that the Government publish a change of name in the Canada Gazette.
Rationale
Repealing this requirement would remove burden and costs to both government and boards of trade. This publication requirement is no longer necessary given that changes in name are available and displayed under "Corporate Name History" in Corporations Canada's "Search for a federal corporation" and can be found in monthly transaction reporting.
A4.9 Weighers and grain elevators
Proposal
Repeal sections 36 and 37 to remove provisions relating to the oversight of weighers and grain elevators.
Rationale
The Canadian Grain Commission (CGC), under the Canada Grain Act, regulates weighing standards and licensing at most grain elevators across Canada. In addition, scales at grain elevators must be examined annually by Measurement Canada or its authorized service providers, ensuring accuracy and adherence to the federal Weights and Measures Act and Regulations. These BOTA provisions are no longer operable as they have been supplanted by other legislation.
A4.10 Annual summary in duplicate
Proposal
Amend the BOTA to repeal the requirement to file an annual summary, memorandum of agreement and other records in duplicate form 42(2) & (3) & 45.
Rationale
This is an outdated requirement dating from the paper transaction era. The amendment will reduce the risk of receiving two applications for the same type of request that are not identical and reduces client expectations of receiving a stamped confirmation of the receipt and processing of their request.
A4.11 GIC decision making authority
Proposal
Amend the BOTA to transfer approval granting powers from the Governor in Council (GIC) to the Minister of Industry (who may further delegate such powers as ordinarily permitted) including those that are administrative or operational in nature such as changes to the corporate name, changes to the district's boundaries, for approval of overlapping jurisdictions and where dissolution is warranted.
Rationale
The requirement for GIC decisions on matters considered to be largely operational in nature is a legacy of an outdated statute that has not been updated in decades and involves a significant and unnecessary amount of time and expense. Similar provisions were formerly in the Canada Business Corporations Act (CBCA) and Canada Not-for-profit Corporations Act (NFP Act) and have since been modernized, allowing these tasks to be handled administratively.
A4.12 Bylaw approvals – Part II
Proposal
Amend the BOTA to repeal the section 46(2) requirement that bylaws be approved by the Minister. Replace with an inquiry power.
Rationale
This requirement causes significant delays and does not align with the self-governing nature of other corporate law statutes that generally require bylaw approvals to come from the members or shareholders rather than the Government.
A4.13 BOT imports
Proposal
Repeal section 47 to remove the option that allows existing boards of trade that are regulated under any Act of Parliament of Canada or of a province to continue in or be imported in and subject to the requirements set out the Boards of Trade Act.
Rationale
This provision originates from the creation of the Boards of Trade Act in 1874 and was meant to enable pre-existing organizations to continue under the new legislation. This transition has long since been completed.
Moreover, several other member-based federal and provincial statutes have since been enacted and used to incorporated new Boards of Trade and chambers of commerce; these statutes generally prohibit continuance under BOTA, rendering the provision obsolete.
A4.14 Annual summary filings – default
Proposal
Amend the BOTA to repeal subsections 42(4) and 42(5) which sets out the penalties for non-compliance with the annual filing obligation set out in section 42. Replace these provisions with an administrative dissolution power.
Rationale
Boards of trade are currently required to file their annual summary on or by June 1 every year, reflecting their fiscal year ending March 31st. Although monetary penalties can be issued for non-compliance, applying such a penalty requires a court process and a summary conviction. Under other federal corporate law statutes, failure to provide documents or records required under these federal corporate statutes can lead to administrative dissolution power.
A4.15 Administrative dissolution
Proposal
Amend the BOTA to add a provision that grants the Minister or their delegate the right to administratively dissolve a corporation that is in default for one year of sending to the Director its annual summary or other notice or document required by the BOTA.
Add a provision that clarifies that the Minister or their delegate may not dissolve unless notice of dissolution has been provided to the corporation and the corporation is given a reasonable opportunity to remedy any default and that protections are in place to protect the rights of members and creditors.
Rationale
This measure is designed to align with administrative powers generally accorded under other corporate law statutes. The measure is proposed in order to ensure that BOTA regulated boards of trade remain in compliance with the obligation to file their annual summary with Corporations Canada.
A4.16 Administrative revival
Proposal
Add a provision that allows the Minister or their delegate and any interested person to apply to the Minister to have an administratively dissolved board of trade or other body corporate revived as a corporation under the Boards of Trade Act.
Revival would be subject to the discretion of the Minister or their delegate, and any conditions imposed on the revival.
Rationale
This measure is designed to allow the Minister to re-instate a board of trade that may have been dissolved in error or for failure to comply with the requirements of the BOTA. This measure aligns with administrative powers generally accorded to the Minister or their delegate under other corporate law statutes.
A4.17 Fiduciary duty of council members
Proposal
Add in provisions that align with standard language setting out a duty of care and duty of loyalty.
Rationale
This provision will act in the place of the oath of office and aligns with general governance required in other corporate law statutes.
A4.18 General inquiry
Proposal
Add in a provision that permits the Minister or their delegate to make an inquiry to requisition information.
Rationale
The amendment provides the Minister or their delegate the authority to obtain records from any person in order to verify compliance with the BOTA. The Minister or their delegate can effectively deem a non-response to be a failure to comply with the BOTA.
A4.19 Definition of books
Proposal
Add a definition of books that clarifies the records include the member list (subject to certain protections) and financial statement of the corporation.
Rationale
This amendment seeks to align with general corporate governance requirements that require transparency (with appropriate protections) of certain information, including member lists and financial statements.
Part B: Proposed amendments to insolvency law
Part B1: Proposed amendments to the Bankruptcy and Insolvency Act (BIA)
B1.1 Streamlined time extensions for proposal meetings
Proposal
Amend the BIA to authorize Official Receivers (ORs) to extend the time to hold the first meeting of creditors in a Division II proposal, mirroring their authority in bankruptcies.
Rationale
This would remove the need for unnecessary court applications when short administrative delays occur, reducing cost and improving efficiency. It aligns procedural powers across BIA regimes, giving the OR flexibility to manage routine scheduling without compromising creditor rights or transparency.
B1.2 Streamlined small business proceedings
Proposal
Amend the BIA to create simplified liquidation and restructuring procedures for prescribed micro and small enterprises (MSEs).
A new MSE liquidation Summary Administration model would cover individual or corporate debtors with unsecured liabilities below a prescribed threshold and a prescribed maximum number of employees at filing. The proceedings would have streamlined features, such as requiring a first meeting of creditors only if creditors representing at least 50 percent in value of proven claims request it within 20 days of notice from the Licensed Insolvency Trustee (LIT) and a flat, CPI-indexed tariff plus disbursements. The amendments would also allow an MSE corporation's bankruptcy and the bankruptcy of an individual proprietor or guarantor to be administered together, though as separate proceedings, at the LIT's discretion where prescribed conditions are met.
For restructuring, the amendments would create a new "MSE Proposal," establishing a simplified restructuring process for the same debtor class as an alternative to a Division I proposal. MSE proposals would be filed directly, without a Notice of Intention delay period, and trigger an automatic stay lasting 90 days, unless lifted by the court on creditor objection, with further extension possible with court approval. No meeting of creditors would be required unless requested by creditors with at least 50 per cent of proven claims within 45 days of filing the proposal. If no meeting of creditors is requested, the proposal is deemed accepted, subject to court approval if requested by 25 per cent of proven creditor claims. Defaults of three missed payments would cause automatic annulment, while other defaults would allow a 60-day cure period.
Rationale
These amendments would modernize the BIA framework for small enterprises, lowering costs, reducing complexity, and ensuring viable businesses can restructure rather than liquidate. They would also align Canada with international best practices, as expert bodies and international organizations have recommended streamlined MSE insolvency proceedings, and peer countries have implemented similar measures.
B1.3 BIA notice by Superintendent's directive
Proposal
Amend the BIA to replace the requirement to publish certain bankruptcy notices in local newspapers with a requirement to publish them in accordance with directives issued by the Superintendent of Bankruptcy.
Rationale
This reform would modernize the insolvency regime to reflect the changing media landscape. More flexible publication options can enhance the reach of notices while reducing costs.
This amendment was included in Bill S-6 which was introduced in the 44th Parliament but died on the order paper.
B1.4 Authorize LITs to administer oaths for the BIA
Proposal
Amend the BIA to authorize LITs to administer oaths for BIA-related matters. LITs already perform statutory declarations and affidavits integral to BIA administration, but provincial rules require redundant appointments.
Rationale
This amendment would standardize authority nationwide, eliminate duplication, and improve efficiency in insolvency administration.
B1.5 Technology adoption and remote participation
Proposal
Amend the BIA to clarify that:
- creditors may vote by videoconference in meetings
- Official Receiver examinations of debtors may be conducted remotely
- oaths and affirmations may be sworn by videoconference where permitted
- certain prescribed reports may be transmitted electronically
Rationale
Codifying these practices would confirm the legal validity of remote and electronic procedures widely adopted since 2020, reducing costs and travel time while maintaining procedural integrity and accessibility across Canada.
B1.6 Court leave for second consumer proposals
Proposal
Amend the BIA to require a debtor with an active consumer proposal to obtain court approval before filing a new one and to deem the first proposal annulled upon such approval.
Rationale
This prevents "cascading" proposals, where debtors file successive proposals to extend repayment beyond the five-year limit or omit creditors. Judicial oversight preserves the principle that only one insolvency proceeding may exist at a time, ensuring fairness and consistency in proposal administration.
B1.7 Extend limitation periods for BIA offences
Proposal
Amend section 208 of the BIA to increase the limitation for summary convictions from three to eight years and remove the five-year limit for indictable offences.
Rationale
This reflects the complexity and duration of OSB investigations into financial fraud and asset concealment, which often surface years after filing. It aligns the BIA with other federal statutes, strengthens deterrence, and gives prosecutors time to bring forward evidence, protecting the integrity of the insolvency system.
B1.8 Withdraw mediation applications upon agreement
Proposal
Amend the BIA to allow LITs to withdraw a mediation application and issue an absolute or conditional discharge when the bankrupt and LIT have reached agreement before mediation.
Rationale
Currently, there is no mechanism to withdraw a mediation application, which can lead to delays and administrative burden associated with carrying out unnecessary mediations. This amendment will help reduce administrative costs and processing times for both LITs and Official Receivers and ensure debtors receive a timelier resolution to their bankruptcy. The new amendment avoids potential abuse by delaying issuance until the debtor has met all conditions and the normal discharge date has passed, while also requiring the agreement to be filed with the Official Receiver for oversight.
This amendment was included in Bill S-6 which was introduced in the 44th Parliament but died on the order paper.
B1.9 Superintendent appointment of Official Receivers
Proposal
Amend section 12 of the BIA to transfer authority to appoint and revoke Official Receivers (ORs) from the Governor in Council to the Superintendent of Bankruptcy. ORs are OSB employees performing operational functions under the Superintendent's supervision.
Rationale
This change seeks to modernize the process, remove unnecessary steps, and ensure operational needs are met promptly, aligning with modern government processes and reducing administrative burden.
Part B2: Proposed amendments to the Companies' Creditors Arrangement Act (CCAA)
B2.1 CCAA court discretion on notice
Proposal
Amend the CCAA to replace the requirement to publish notices in newspapers with a provision granting the court discretion to determine appropriate publication methods.
Rationale
This recognizes that stakeholders in large restructurings may be industry-specific or international, making newspaper publication less effective. Allowing courts to tailor communication methods will improve reach, maintain transparency, and align the CCAA with its flexible, court-supervised framework.
B2.2 Limited CCAA directive-making power for the Superintendent of Bankruptcy
Proposal
Amend the CCAA to authorize the Superintendent to issue directives on administrative matters such as forms, notice methods, and procedural timelines.
Rationale
This aligns the CCAA with the BIA framework and allows the OSB to adapt procedures without lengthy regulatory amendments. Standardized directives would enhance consistency across restructurings and reduce regulatory lag, improving predictability and efficiency.