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2002 Legislative Session: 3rd Session, 37th Parliament

FIRST READING

The following electronic version is for informational

purposes only.

The printed version remains the official version.

HONOURABLE GARY COLLINS

MINISTER OF FINANCE

BILL 47 – 2002

BUSINESS CORPORATIONS ACT

Contents

Section

Part 1 –

Interpretation and Application

Division 1 –

Interpretation

Definitions

Corporate relationships

When a company is recognized

Division 2 – Application

Special Act corporations

Dissolution

Division 3 – Distribution of Records

Mailing of records

Sending of records

Furnishing of records by registrar

Service of records in legal proceedings

Part 2 – Incorporation

Division 1 – Formation of Companies

Formation of company

Notice of articles

Articles

Incorporation

Withdrawal of application for incorporation

Obligations of completing party

Articles on incorporation

Effect of incorporation

Evidence of incorporation

Effect of notice of articles and articles

Pre-incorporation contracts

Division 2 – Corporate Names

Name of company

Reservation of name

Form of name of a company

Restrictions on use of name

Multilingual names

Assumed names

Name to be displayed

Registrar may order change of name

Other changes of name

Division 3 – Capacity and Powers

Capacity and powers of company

Joint tenancy in property

Extraterritorial capacity

Restricted businesses and powers

Division 4 – Company Offices

Registered and records offices

Change of registered or records office

Change of agent's office

Completion of change of address

Withdrawal of notice of change of address

Transfer of registered office by agent

Elimination of registered office

Transfer of records office by agent

Division 5 – Company Records

Records office records

Records may be kept at other locations

Maintenance of records

Missing records

Inspection of records

Inspection of central securities registers

Copies

List of shareholders

Remedies on denial of access or copies

Company to file annual report

Part 3 – Finance

Division 1 – Authorized Share Structure

Kinds, classes and series of shares

Description of authorized share structure

Change in authorized share structure

Alterations may be expressed in a single resolution

Division 2 – Share Attributes

Share is personal estate

Contents of share certificate

Special rights or restrictions

Classes of shares

Shares in series

No interference with class or series rights without consent

Division 3 – Allotment and Issue of Shares

Issue of shares

Issue price for shares

Payment of consideration for shares

Deemed receipt of payment

Restrictions on power of pre-existing company to allot and issue shares

Commissions and discounts

Validation of creation, allotment or issue of shares

Fractional shares

Dividends

Discharge for payment

Division 4 – Capital

Capital

Special rule

Reduction of capital

Exception to

section 74

Division 5 – Conversion, Exchange or Acquisition of Shares by Company

Conversion or exchange

Company may redeem or purchase

Purchase or acquisition prohibited when insolvent

Redemption prohibited when insolvent

Shares of pre-existing company to be purchased rateably

Shares of pre-existing company to be redeemed rateably

Cancellation and retention of shares

Elimination of fractional shares

Division 6 – Purchase of Shares by Subsidiary

Definitions

Subsidiary may purchase shares of parent

Purchase prohibited when insolvent

Division 7 – Liability of Shareholders

Liability of shareholders

Shareholder's liability for partly paid shares of a pre-existing company

Liability of former and present shareholders on bankruptcy or winding up

Division 8 – Trust Indentures

Definitions

Application

Eligibility of trustee

Persons holding debentures may request information from trustee

Information for trustee

Evidence of compliance with trust indenture

Contents of evidence of compliance

Additional evidence of compliance

Notice of default

Trustee's duty of care

Reliance on statements

Trustee not relieved from duties

Division 9 – Debentures

Validity of perpetual debenture

Enforcement of contract to take debentures

Issue of redeemed debenture

Division 10 – Receivers and Receiver Managers

Powers of directors and officers

Duties of receiver and receiver manager

Part 4 – Shares, Registers and Transfers

Right to share certificate

Shares jointly owned

Lost or destroyed certificate

Signature on share

Securities registers

Index of shareholders

Share transferable

Instrument of transfer

Powers of personal representative

Transfer by personal representative

Registration of transfer

Documents for transmission

Effect of documents provided

Part 5 – Management

Division 1 – Directors

Number of directors

First directors

Succeeding directors

Consent

Persons disqualified as directors

Share qualification

Register of directors

Companies to file notices as to directors

When directors cease to hold office

Application to remove self as director or officer

Memorandum or articles may apply to vacancies among directors

Vacancies among directors

Vacancies among class or series directors

End of term of replacement director

Loss of quorum

If no directors in office

Division 2 – Powers and Duties of Directors, Officers,

Attorneys, Representatives and Agents

Powers and functions of directors

Powers of directors may be restricted and transferred

Application of this Act to persons performing functions of a director

Revocation of resolutions

Proceedings of directors

Officers

Duties of directors and officers

Validity of acts of directors and officers

Corporations may grant power of attorney in writing

Corporate representatives

Persons may rely on authority of companies and their directors, officers and agents

Division 3 – Conflicts of Interest

Disclosable interests

Obligation to account for profits

Approval of contracts and transactions

Powers of court

Validity of contracts and transactions

Limitation of obligations of directors and senior officers

Disclosure of conflict of office or property

Division 4 – Liability of Directors

Directors' liability

Dissent procedure by companies

Legal proceedings on liability

Limitations on liability

Liability if company's name not displayed

Division 5 – Indemnification of Directors and Officers

and Payment of Expenses

Definitions

Indemnification and payment permitted

Mandatory payment of expenses

Authority to advance expenses

Indemnification prohibited

Court ordered indemnification

Insurance

Division 6 – Meetings of Shareholders

Location of general meetings

Requisitions for general meetings

No liability

Notice of general meetings

Waiver of notice

Setting record dates

Quorum for shareholders' meetings

Voting

Participation at meetings of shareholders

Pooling agreements

Date of resolution

Subsidiary not to vote

Election of chair

Minutes

Consent resolutions of shareholders

Rules applicable to general meetings apply to other shareholders' meetings

Annual general meetings

First annual reference date for pre-existing companies

Pre-existing reporting company meetings

Information for shareholders

Powers of court

Division 7 – Shareholders' Proposals

Definitions and application

Requirements for valid proposals

Rights and obligations arising from proposal

No liability

Refusal to process proposal

Division 8 – Insiders

Liability of insiders

Division 9 – General

Form and effect of contracts

Authentication or certification of records

Financial assistance

Part 6 – Financial Records

Division 1 – Accounting Records

Accounting records required

Division 2 – Financial Statements

Exemption

Financial statements

Approval for publication

Waiver of financial statements

Financial statements for qualifying debentureholders

Part 7 – Audits

Division 1 – Definition and Application

Definition

Application of this Part

Division 2 – Appointment and Removal of Auditors

Appointment of auditors

Persons authorized to act as auditors

Independence of auditors

Remuneration of auditors

Capacity to act as auditor

Removal of auditor during term

Change of auditor by public company

Replacement auditor must receive representations

Division 3 – Duties and Rights of Auditors

Auditor's duty to examine and report

Qualifications on auditor's opinion

Shareholders may require auditor's attendance at general meetings

Auditor's information to be presented at general meetings

Amendment of financial statements and auditor's report

Access to records

Information as to foreign subsidiaries

Right and obligation of auditors to attend meetings

Qualified privilege

Division 4 – Auditor Certification Board

Auditor Certification Board

Board function and liability

Division 5 – Audit Committee

Application

Appointment and procedures of audit committee

Duties of audit committee

Provision of financial statements to audit committee

Part 8 – Proceedings

Division 1 – Court Proceedings

Complaints by shareholder

Compliance or restraining orders

Remedying corporate mistakes

Applications to court to correct records

Enforcement of duty to file records

Derivative actions

Powers of court in relation to derivative actions

Relief in legal proceedings

Applications to court under this Act

Court may order security for costs

Division 2 – Dissent Proceedings

Definitions and application

Right to dissent

Waiver of right to dissent

Notice of resolution

Notice of court orders

Notice of dissent

Notice of intention to proceed

Completion of dissent

Payment for notice shares

Loss of right to dissent

Shareholders entitled to return of shares and rights

Division 3 – Investigations

Appointment of inspector by court

Conditions applicable to court appointed inspectors

Appointment of inspector by company

Powers of inspectors

Exemption from disclosure to inspectors

Reports of inspector

Inspectors' reports as evidence in legal proceedings

Immunities during investigations

Part 9 – Company Alterations

Division 1 – Memorandum, Notice of Articles and Articles

Memorandum and articles of pre-existing company not to be altered

Alteration to notice of articles

Withdrawal of notice of alteration

Alteration to articles

Shareholders may dissent

Alteration to Table 1 articles

Articles issued by company must reflect alterations

Change of company name

Exceptional resolutions and resolutions respecting unalterable provisions

Resolution must be passed by greatest majority

Division 2 – Conversion

Conversion of special Act corporations

Articles on conversion

Effect of conversion

Division 3 – Amalgamation

Amalgamation permitted

Amalgamation agreements

Shareholder adoption of amalgamation agreements

Shareholders may dissent

Vertical short form amalgamations

Horizontal short form amalgamations

Formalities to amalgamation

Amalgamations with court approval

Amalgamations without court approval

Notice to creditors in relation to an amalgamation without court approval

Amalgamation

Withdrawal of amalgamation application

Registrar's duties on amalgamation

Effect of amalgamation

Division 4 – Amalgamation into a Foreign Jurisdiction

Definitions

Amalgamations into foreign jurisdictions

When amalgamation under this Division prohibited

After amalgamation

Shareholders may dissent

Division 5 – Arrangements

Arrangement may be proposed

Adoption of arrangement

Information regarding arrangement

Role of court in arrangements

Effect of court orders

Effect of court order if memorandum or notice of articles altered

Effect of court order if articles altered

Effect of court order if amalgamation results

Application of Act to arrangements

Binding effect of arrangements

Withdrawing from arrangements

Withdrawal of arrangement filings

Division 6 – Compulsory Acquisitions

Acquisition procedures

Division 7 – Disposal of Undertaking

Power to dispose of undertaking

Division 8 – Transfer of Incorporation

Application for continuation into British Columbia

Continuation

Withdrawal of continuation application

Effect of continuation

Rights preserved

Articles for a continued company

Application for continuation out of British Columbia

Shareholders may dissent

When continuation out of British Columbia prohibited

After continuation

Part 10 – Liquidation, Dissolution and Restoration

Division 1 –

Definitions and Application

Definitions

Application of this Part

Division 2 – Voluntary Dissolution without Liquidation

Authorization for voluntary dissolution

Provision for unpaid debts and undelivered assets

Application for voluntary dissolution

Date of dissolution

Withdrawal of application for dissolution

Division 3 – Voluntary Liquidation

Authorization for liquidation

Limits on liquidator

Statement of intent to liquidate

Resignation and removal of liquidators in voluntary liquidations

Withdrawal of statement of intent to liquidate

Division 4 – Powers and Duties of the Court

Court may order company be liquidated and dissolved

Court orders respecting liquidations

Remuneration of liquidator appointed by court

Division 5 – Liquidators

Qualifications of liquidators

Validity of acts of liquidators

Filing of notices

Duties of liquidators

Notice to creditors

Limitations on claimants

Liquidation records office

Powers of liquidators

Recovery of property by liquidators

Right to distribution in money

Provision for unpaid debts and undelivered assets

Obligation to prepare accounts

Limitations on liability

Division 6 – Corporate Status before Dissolution

Capacity of companies in liquidation

Division 7 – Proceedings for Dissolution

Completion of liquidation

Court approval of dissolution in court ordered liquidations

Application for dissolution

Division 8 – Effect of Dissolution

Effect of dissolution

Certificates of dissolution

Dissolved companies deemed to continue for litigation purposes

Liabilities survive

Liability of shareholders of dissolved companies

Dissolved company's assets available to judgment creditors

Division 9 – Discharge of Liquidators of Dissolved Companies

Discharge of liquidator by court order

Division 10 – Records of Dissolved Companies

Custody of records

Entitlement to inspect records of dissolved companies

Remedies on denial of access to or copies of records of dissolved companies

Division 11 – Restoration

Definitions and

interpretation

Pre-requisites to application

Applications to the registrar for restoration

Contents of application to the registrar for restoration

Registrar must restore

Limited restoration by registrar

Applications to the court for restoration

Limited restoration by court

Filing of restoration application with the registrar

Restrictions on restoration

Effect of restoration of company

Effect of restoration of extraprovincial company

Name on restoration

Registrar's duties after restoration

Corporate assets to be returned to restored company

Division 12 – Post-restoration Transition for Pre-existing Companies

Definition

Transition – restored pre-existing companies

Post-restoration transition application

Alteration to articles of restored company

Timing and effect of post-restoration transition

Part 11 – Extraprovincial Companies

Division 1 – Registration

Definitions

Foreign entities required to be registered

Application for registration

Registration as an extraprovincial company

Effect of registration

Amalgamation of extraprovincial company

Extraprovincial companies to file annual report

Extraprovincial companies to notify registrar of changes

Change of name of extraprovincial companies

Cancellation or change of assumed name of extraprovincial company

Liability if name of extraprovincial company not displayed

Enforcement of duty to file records

Division 2 – Attorneys for Extraprovincial Companies

Attorneys to be appointed

First attorneys

Authorization of attorneys

Appointment of attorneys

Withdrawal of appointment

Change of address of attorneys

Withdrawal of notice of change of address

Revocation of appointments of attorneys

Withdrawal of revocation of appointment

Resignations of attorneys

Obligation to maintain head office or attorney

Division 3 – Cancellation of Registration of Extraprovincial Companies

Registrar may cancel registration of defunct extraprovincial companies

Lieutenant Governor in Council may cancel registration of extraprovincial companies

Registrar's duties on cancellation of registration

Part 12 – Administration

Division 1 – Office of Registrar

Appointment of registrar and staff

Seal of office

Registrar may suspend services and functions

Service of records on registrar

Examination of registrar

Immunities

Appeal to Appeals Commission

Division 2 – Records Filed with or Issued by the Registrar

Means of filing

Filing of records

Future dated filing of records

Limitation on future dated filings

Companies and extraprovincial companies in default of filing

Maintenance of records filed with the registrar

Deficient filings

Correction of corporate register

Validity of corporate register

Inspection and copies of records

Lost or destroyed records

Registrar may issue records

Effect of records issued by registrar

Correction of certificates and other certified records

No constructive notice

Division 3 – Powers of Dissolution and Cancellation

Dissolutions and cancellations of registration by registrar

Lieutenant Governor in Council may cancel incorporation of company

Publication of notice of dissolution

Division 4 – Offences and Penalties

Offence Act

Offences

Misleading statements an offence

Penalties

Remedies preserved

Limitation period

Division 5 – Fees and Regulations

Fees

Power to make regulations

Part 13 – Reporting Companies

Prescribed provisions

Obligations of pre-existing reporting companies

Lieutenant Governor in Council may make exclusions

Part 14 – Transitional, Repeals and Commencement

Division 1 – Charter Transition

Transition – pre-existing companies

Transition application

Alteration to articles

Timing and effect of transition

Division 2 – Company Transition

Registered and records office of pre-existing company

Prescribed address

Name of specially limited company

Division 3 – Extraprovincial Company Transition

Head office of pre-existing extraprovincial company

Attorney for pre-existing extraprovincial company

Division 4 – General

Repeals

Portions of this Part repealed

Commencement

Schedule

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