Policy on continuance (export) of a federal corporation

Learn how to prepare a request to continue (export) a corporation from the Canada Business Corporations Act (CBCA) to another corporate legislation.

Note

Although the information provided here will assist you in completing the continuance process quickly and accurately, it is not intended to replace legal advice. Consider consulting a lawyer or another professional to ensure that the particular needs of your corporation are met.

Table of contents

Continuance (export) and effective date

A continuance, or export transaction, allows a CBCA corporation to be governed by legislation other than the CBCA. The corporation continues to exist under a different legislation (referred to as the importing legislation). As a result, the corporation is no longer governed by the CBCA, which becomes the exporting legislation.

An export transaction can also be carried out as part of a bigger corporate transaction, such as an amalgamation that results in a non-CBCA corporation or an arrangement.

A continuance (export) comes into effect on the date shown on the Certificate of Discontinuance issued by Corporations Canada. As of that date, the corporation is no longer governed by the CBCA. Instead, it is governed by the importing legislation as if it had been incorporated under that legislation.

Continuing (export) a corporation into a non-federal jurisdiction (province, territory or another country)

Step 1 – Obtain shareholders' approval of the continuance

Shareholders must approve the continuance by a special resolution.

Each share in the corporation, whether or not it has voting rights, has the right to vote on a continuance. The continuance must be passed by at least two-thirds of the votes cast at a meeting of shareholders in other words, passed by special resolution.

The notice and disclosure materials for the meeting that are sent to shareholders must contain the following information:

  • a description of any major differences between the protections available to shareholders under the CBCA and under the importing legislation (for example, the availability of the oppression remedy)
  • a description of any possible transaction that could follow the export if such a transaction could have major consequences for the shareholders. For example, the corporation, once the export is completed, intends to complete another corporate transaction that would not be permissible under the CBCA. This disclosure should indicate whether or not the proposed subsequent transaction is a major motivating influence for the export transaction, and whether or not a legal commitment has been made to conduct the proposed subsequent transaction after completion of the export transaction
  • the reasons for the export transaction
  • the availability of dissent rights
  • a mention that the continuance must be approved by a special resolution of shareholders and
  • any other material considerations.

When the continuance has been approved by shareholders, the corporation can apply to Corporations Canada for a Letter of Satisfaction.

Step 2 – Apply for a Letter of Satisfaction

Generally, the organization (for example, a provincial registrar) that administers the importing legislation requires that the corporation provide a document stating that Corporations Canada is satisfied with the continuance. This is called a Letter of Satisfaction.

The Letter of Satisfaction states that Corporations Canada is satisfied that the continuance will not be prejudicial to creditors or shareholders of the corporation. The letter also indicates both the jurisdiction into which the corporation will continue and the name of the importing legislation. The Letter of Satisfaction is valid for 90 days from its date of issuance.

What Corporations Canada is looking for in an application for a Letter of Satisfaction

Corporations Canada reviews the application to ensure that:

  • the corporation wishing to continue is in good standing under the CBCA (specifically the corporation is up to date with filings of annual returns and is not the subject of a current investigation for non-compliance)
  • the importing legislation permits the continuance of a CBCA corporation, and
  • the continuance will not adversely affect any of the corporation's shareholders or creditors.

Note

Registered intermediaries can file this application online through the Online Filing Centre.

Requirements to obtain a Letter of Satisfaction

Corporations Canada has pre-approved some importing legislation to make it easier to obtain a Letter of Satisfaction (see Policy on continuance (export) – Legislation pre-approved by Corporations Canada under the Canada Business Corporations Act). When the legislation has been pre-approved, the corporation does not need to provide to Corporations Canada information regarding the importing legislation.

If you are not a registered intermediary, you must file this application by sending a written request to Corporations Canada (see How do I file my application under the Canada Business Corporations Act (CBCA)).

What to include in an application when the legislation has been pre-approved by Corporations Canada

In an application for a pre-approved importing legislation, include the following:

  • the corporate name and corporation number
  • the name and telephone number of the applicant, and details of where the Letter of Satisfaction should be sent
  • the name of the jurisdiction (province, state or country responsible for the importing legislation, for example, Ontario)
  • the title of the importing legislation (for example, Business Corporations Act)
  • the filing fee (see Services, fees and turnaround times - CBCA).

Caution

It is important that you provide the full name of the jurisdiction responsible for the importing legislation as well as the proper title of the importing legislation since they will both appear on the Letter of Satisfaction.  If the name and title provided are not accurate or complete, you may have to apply for another Letter of Satisfaction and pay the filing fees.

What to include in an application when the legislation has not been preapproved by Corporations Canada

In an application for an importing legislation that has not been pre-approved by Corporations Canada, include the following:

  • the corporate name and corporation number
  • the name and telephone number of the applicant, and details of where the Letter of Satisfaction should be sent
  • the jurisdiction (province, state or country responsible for the importing legislation, for example, Delaware)
  • the name of the importing legislation (for example, General Corporations Law of Delaware)
  • an excerpt of the relevant provisions of the importing legislation
  • a statement of a director or an authorized officer of the corporation stating that:
    • shareholders have been given full disclosure of the effect of export on their rights and interests, and
    • the continuance will not adversely affect shareholders or creditors of the corporation
  • a statement, if any shareholders dissented to the continuance, of a director or authorized officer stating that the corporation
    • will undertake to honour the dissent right granted by section 190 of the CBCA, and, if necessary, consult the Canadian courts for that purpose, and
    • has sufficient funds to pay dissenting shareholders and that arrangements have been made to ensure that those funds will be available to satisfy that claim
  • a signed legal opinion by counsel qualified to practice in the jurisdiction responsible for the importing legislation. The opinion must state that the importing legislation
    • allows the continuance of a CBCA corporation and
    • provides for the rights listed in subsection 188(10) of the CBCA
  • the filing fee (see Services, fees and turnaround times - CBCA).

Caution

It is important that you provide the full name of the jurisdiction responsible for the importing legislation as well as the proper title of the importing legislation since they will both appear on the Letter of Satisfaction.  If the name and title provided are not accurate or complete, you may have to apply for another Letter of Satisfaction and pay the filing fees.

Step 3 – Send the Letter of Satisfaction to the organization that administers the importing legislation

The corporation must send the Letter of Satisfaction to the organization (for example, a provincial registrar) that administers the importing legislation.

If the organization approves the application for continuance, it will issue a document (for example, a Certificate of Continuance) stating that the corporation is duly continued under the importing legislation as if it had been incorporated under it.

Step 4 – Send the document issued by the organization that administers the importing legislation to Corporations Canada

Once a document is issued by the organization that administers the importing legislation, the corporation must send by mail, or email (in PDF format), the document issued (for example, a Certificate of Continuance) to Corporations Canada.

Upon receipt of the document:

  • Corporations Canada will issue a Certificate of Discontinuance. The date indicated on the certificate will be the same as the date on the document issued by the organization that administers the importing legislation. The corporation will then be no longer governed by the CBCA, and
  • a notice of issuance of a Certificate of Discontinuance will be published in Monthly Transactions.

Caution

The corporation must obtain a Certificate of Discontinuance to complete the continuance. Until Corporations Canada issues the Certificate of Discontinuance, the corporation will continue to be governed by the CBCA, even though it is also governed by the importing legislation.

Continuing (export) a corporation into another federal legislation

To continue (export) your business corporation under the Canada Not-for-profit Corporations Act or the Canada Cooperatives Act see Continuance of a business corporation under the Canada Not-for-profit Corporations Act or the Canada Cooperatives Act.

To continue (export) your corporation under the Bank Act, the Insurance Companies Act, the Trust and Loan Companies Act or the Cooperative Credit Associations Act, see Continuance (export) of a business corporation under the Bank Act, the Insurance Companies Act, the Trust and Loan Companies Act or the Cooperative Credit Associations Act.

Complaints and appeals - Export transactions

Anyone wishing to register a complaint with Corporations Canada asking for intervention in an export transaction, see Complaints and appeals - Export transactions.

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