7 August 2020
Extension of Periods and Time Limits for Federal Corporations under the Canada Business Corporations Act (CBCA)
In relation to the COVID-19 pandemic, an order has recently been issued by the Ministry of Innovation, Science and Industry of Canada regarding the extension of certain periods and time limits applying to corporations incorporated under the CBCA.
This order (a) extends the deadlines to call an annual meeting of shareholders, and (b) amends the period required to be covered by financial statements presented at a corporation’s annual shareholders meeting. This order applies retroactively as of March 13th, 2020 and shall cease to have effect on December 31st, 2020.
The CBCA provides that a corporation is required to call an annual shareholders’ meeting within 18 months of its incorporation, and subsequently no later than 15 months after holding its previous annual meeting, and within 6 months of its financial year end.
Pursuant to this order, the deadlines for the calling of an annual shareholders’ meeting have been extended, for a 6 month period, to the earlier of:
- (a) 24 months after incorporation, and (b) December 31st, 2020, for a first annual shareholders’ meeting ( g. a corporation incorporated under the CBCA on December 1st, 2018 has until December 1st, 2020 to hold its first annual shareholders’ meeting instead of June 1st, 2020); and
- (a) no later than 21 months after the corporation’s previous annual shareholders’ meeting and within 12 months of the corporation’s financial year end; and (b) December 31st, 2020, for any subsequent annual shareholders’ meeting ( g. a corporation having held an annual shareholders’ meeting on February 1st, 2019 and having a December 31st financial year end has until November 1st, 2020 to hold its annual shareholders’ meeting instead of May 1st, 2020).
Furthermore, under the CBCA, the directors of a corporation need to present the corporation’s financial statements to the shareholders at every annual meeting which relate to the period ending not more than 6 months prior to said meeting. Pursuant to this order, for any annual shareholders’ meeting held until December 31st, 2020, the financial statements presented to the shareholders can cover the period ending not more than 12 months prior to said meeting.
This order also extends certain deadlines and time limits for entities created under the Canada Cooperatives Act and the Canada Not-for-profit Corporations Act.
KRB Lawyers are experienced with all matters related to the CBCA and other corporate matters. Do not hesitate to reach out to a member of our corporate team for more information or assistance.