Legal information

The corporation (inc.) and the general partnership (s.e.n.c.) both allow a business to be operated by several people, as shareholders or partners. There are several differences between these two types of business operations, both legally and fiscally. We offer you an overview of 3 major differences. Legal personality and liability of the members corporation is a "legal person", with a legal personality

An amalgamation is the joining of several corporations into one, and requires articles of amalgamation to do so. In order to amalgamate two or more corporations, it is imperative that the amalgamating corporations be governed by the same law; for example, it is not possible to amalgamate a provincial corporation with a federal corporation. In this case, one of the corporations must be continued in the other

The Quebec regime for business corporations, as well as other provincial regimes (including Ontario and British Columbia), expressly allows for the issuance of uncertificated shares in its Act. This is also the case for almost all of the incorporation regimes of the various American states. Although relatively little used by private companies in Quebec, uncertificated shares are gaining in popularity. We offer an overview of the various advantages of choosing to issue uncertificated shares

It is possible at any time to add one or more shareholders to an existing company. The following is an overview of some practical considerations when adding a shareholder to your corporate structure. Sale or issue of shares? There are generally two ways to add a shareholder: the sale of existing shares, or the issuance of new shares. When proceeding by sale, a shareholder disposes of part of his shares, in exchange for

The unanimous shareholder agreement allows shareholders, under corporate law, to restrict or withdraw, in whole or in part, the decision-making powers of directors. Unlike "regular" shareholder agreements, unanimous agreements automatically apply to any new shareholder of the corporation. This restriction on the powers of the board of directors can be translated in several ways, of which we offer an overview. 1. Shareholder approval By unanimous agreement, the shareholders can make

The right to a dividend is one of the three fundamental rights of shares provided for in corporate legislation, in addition to the right to vote and the right to the residue in the event of dissolution or liquidation. Under both the Quebec and federal systems, the right to receive "any declared dividend" must be included in at least one of the classes of shares authorized in the articles of the corporation. In addition, one of the

When considering an incorporation mandate, it is important to do some due diligence with the prospective service provider. Dozens of online incorporation services exist, sometimes at very low prices. One might wonder why one should deal with a lawyer or notary when there are companies offering to do it for a fraction of the price. Reserved act It is important to know that doing

A class of shares that is often found in corporate capital structures and often included in the articles of incorporation is the rollover (or freeze) share class. Rollover shares are used primarily for tax planning purposes and therefore have special characteristics. Rollover of property to a company and estate freezes are the most common planning purposes when using this type of shares. 1.

Paid-up capital is a fundamental concept in the Canadian tax system. It is the "tax" equivalent of legal capital, i.e., issued and paid-up share capital (federally declared capital), which represents the consideration received by the corporation for the shares issued. We provide a basic overview of the concept of paid-up capital. Tax-free withdrawal The general principle is that a shareholder is entitled to withdraw the paid-up capital of his shares