Legal information

  • The three "basic" rights attached to a company's shares are the right to receive any dividends declared, the right to vote at any shareholders' meeting, and the right to share in the remaining property in the event of dissolution or liquidation. The Canada Business Corporations Act (CBCA) and the Quebec Business Corporations Act (QBCA) regulate the existence of these three basic rights differently.
  • Determining ultimate beneficiaries for the purposes of the Legal Publicity Act ("LPLE") can be complex when one of the shareholders is a discretionary family trust, heavily used for tax planning purposes. While many grey areas remain on how to apply these new rules (in effect since March 2023), here are a few (non-exhaustive) elements to consider in determining ultimate beneficiaries when a shareholder is a trust
  • The election of a company's directors is an important component of corporate governance. Here are a few practical considerations. Number ofdirectors When the company is incorporated, the articles of incorporation must specify either a fixed number ofdirectors or a minimum and maximum number ofdirectors. When the number is fixed, the shareholders must elect or attempt to elect this fixed number ofdirectors. In practice, the number
  • When a company is incorporated, so-called "control" shares are often included in the share capital structure. These shares enable the holder to have greater control over the company's affairs than other shareholders. Here's a summary of how this type of share works. Characteristics Control shares generally carry no dividend rights. In most cases, the only rights conferred on holders of
  • Since 2018, federally incorporated corporations have been required to maintain a register of individuals with significant control ("IBO"). The purpose of the register is to be able to determine which individuals control a given corporation, even if shares are held through another corporation, or by a nominee. On March 31, 2023, Quebec legislators followed suit with the concept of "beneficiary" disclosure.
  • As of March 31, 2023, it will be required to declare the ultimate beneficiaries of companies in the enterprise register. The notion of ultimate beneficiary is defined in the Legal Publicity of Enterprises Act as amended by the Act to improve the transparency of enterprises. An ultimate beneficiary is in all cases a natural person, thus excluding legal persons or any other grouping. We offer you an overview of the circumstances in
  • The Quebec Business Corporations Act, unlike the federal incorporation regime and the regimes of most other Canadian provinces, permits the issuance of shares that are not "fully paid" at the time of issue. This means that the Board of Directors authorizes the issue of shares regardless of the amount received from the share subscriber. These shares will be subject to an instalment call and ultimate forfeiture, as we will see later.
  • On June 8, 2021, Bill 78 (An Act primarily to improve the transparency of enterprises) was assented to by the Quebec National Assembly. The effective date of these amendments is March 31, 2023. This Act amends the Act respecting the legal publicity of enterprises (the "LPLE") and will have a significant impact on the obligations of Quebec enterprises.
  • The formation of a federal not-for-profit organization is in many ways similar to the incorporation process of a corporation. Articles of incorporation are filed electronically with Corporations Canada, indicating the name of the organization, the number ofdirector (fixed or variable) and a list of the first directors who will form the board of directors. Following incorporation and receipt of the Certificate of Incorporation, the Board of Directors holds an organizational meeting (or


The information contained in the articles on the website does not constitute legal opinions, and is only general information intended to popularise certain legal concepts relating to company law or SME taxation. The information contained in the articles may not be applicable to certain specific cases. Pronto Corporate Services Inc. and the author of the texts are not responsible for any error, inaccuracy or out-of-date information that may be contained in the articles.

May 15, 2019

Practical advice for choosing a company name

It is not always easy to find a business name, especially since the choice of name is restricted by various laws in Quebec. First, the
July 22, 2019

Incorporate under Quebec or Canadian law?

When the time comes to incorporate a business, it is necessary to decide under which law the company will be incorporated: the Quebec law (Business Corporations Act),
August 11, 2020

Canadian incorporation: make sure you pay for your shares

One of the major differences between the Canada Business Corporations Act (CBCA) and the Business Corporations Act (Quebec) (QBCA) is that the CBCA
September 12, 2020

Transfer of shares and arm's length relationship

Transfers of shares, by sale, gift or otherwise, often occur between people with family ties, especially within family businesses.
October 12, 2020

Responsibility of directors

The position ofdirector in a corporation implies a lot of responsibility. Indeed, both the corporate laws and the
October 20, 2020

Transfer of shares and formalism

When it comes to transferring shares, whether by sale, donation or otherwise, it is important to respect the rules laid down by the law
October 25, 2020

Can an LLC be formed in Canada?

The LLC (Limited Liability Company) is a specific legal vehicle in the United States. The first US state to enact legislation allowing the creation of an LLC was the
October 28, 2020

Common shares vs. preferred shares

The authorised share capital of a corporation may provide for several classes of shares. In this case, the company's articles of association will
March 1, 2021

How to issue shares

There are legal formalities that must be complied with when issuing shares, whether it is for an initial issue following the incorporation of the
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