BILL 18 – 2006
FINANCE STATUTES AMENDMENT ACT, 2006

HER MAJESTY, by and with the advice and consent of the Legislative Assembly of the Province of British Columbia, enacts as follows:

 
Business Corporations Act

1 Section 1 (1) of the Business Corporations Act, S.B.C. 2002, c. 57, is amended

(a) in the definition of "foreign corporation" by repealing paragraph (d) (iii) and substituting the following:

(iii) the result of an amalgamation under Division 4 of Part 9 or a similar process, or of an amalgamation or similar process in a jurisdiction other than British Columbia,

and includes an extraprovincial corporation within the meaning of the Financial Institutions Act; , and

(b) in the definition of "foreign entity" by striking out "or" at the end of paragraph (a), by adding ", or" at the end of paragraph (b) and by adding the following paragraph:

(c) an extraprovincial society, within the meaning of the Society Act, that,

(i) under section 191 of the Financial Institutions Act, is deemed to have a business authorization, or

(ii) under section 193 (2) of the Financial Institutions Act, is ordered by the Financial Institutions Commission to apply for a business authorization; .

2 Section 1 (1) is amended

(a) in the definition of "shareholder" by striking out "or" at the end of paragraph (a), by adding ", or" at the end of paragraph (b) and by adding the following paragraph:

(c) in the case of a company that has been recognized within the meaning of section 3 (1) (b) or (d), a person who, immediately before the corporation was recognized as a company, held one or more shares of the corporation; ,

(b) in the definition of "special rights or restrictions" by adding ", election" after "nomination", and

(c) by repealing paragraph (a) of the definition of "special separate resolution" and substituting the following:

(a) a resolution passed at a class meeting or series meeting under the following circumstances:

(i) notice of the meeting specifying the intention to propose the resolution as a special separate resolution is sent to all shareholders holding shares of that class or series of shares at least the prescribed number of days before the meeting;

(ii) when voting on the resolution, shareholders voting shares of that class or series of shares vote in favour of the resolution by at least the following majority:

(A) the majority specified by the memorandum or articles as being required to pass a special separate resolution of those shareholders, or, if no such majority is specified, to pass a separate resolution of those shareholders, if that majority is at least 2/3 and not more than 3/4 of the votes cast on the resolution;

(B) if clause (A) does not apply and the company is a pre-existing company that has not complied with section 370 (1) (a) or 436 (1) (a) or that has a notice of articles that reflects that the Pre-existing Company Provisions apply to the company, 3/4 of the votes cast on the resolution;

(C) if clauses (A) and (B) do not apply, 2/3 of the votes cast on the resolution, or .

3 Section 11 (h) is amended by striking out "after," in both places and substituting "on or after,".

4 Section 32 (a) is amended by striking out "British Columbia to the extent that the laws of that jurisdiction permit," and substituting "British Columbia,".

5 Section 42 (1) is amended

(a) by repealing paragraph (b), and

(b) in paragraph (d) (ii) by striking out "is kept;" and substituting "is available for inspection and copying in accordance with section 111 (4.1) or (4.2), as the case may be;".

6 Section 43 (2) is repealed and the following substituted:

(2) Despite section 42 but subject to section 111 (4) to (4.2), a company may keep all or any of the records referred to in section 42 (1) and (2) at a location other than the records office so long as those records are available for inspection and copying in accordance with sections 46 and 48 at the records office by means of a computer terminal or other electronic technology.

7 Section 47 is repealed.

8 Section 48 (1) is amended by striking out "or 47".

9 Section 49 (8) (b) is amended by striking out "is kept." and substituting "is available for inspection and copying in accordance with section 111 (4.1) or (4.2), as the case may be."

10 Section 50 (1) is amended by striking out "47,".

11 Section 60 (1) (b) is amended

(a) in subparagraph (i) by striking out "determination made under this subparagraph," and substituting "determination made, under this subparagraph or otherwise, in relation to a maximum number of those shares,",

(b) in subparagraph (ii) by striking out "under this subparagraph;" and substituting "for those shares;", and

(c) in subparagraph (iii) by striking out "such special rights or restrictions." and substituting "special rights or restrictions attached to those shares."

12 Section 68 (1) (a) (i) and (2) (a) (ii) is amended by striking out "this Act, a former Companies Act or any other Act" and substituting "this or any other Act, including a former Companies Act, or of any regulation".

13 Section 74 is amended

(a) by repealing subsection (1) (b) and substituting the following:

(b) subject to subsection (1.1), by a special resolution. , and

(b) by adding the following subsection:

(1.1) A company must not reduce its capital under subsection (1) (b) if there are reasonable grounds for believing that the realizable value of the company's assets would, after the reduction, be less than the aggregate of its liabilities.

14 Section 75 (a) is repealed and the following substituted:

(a) redeem, purchase or otherwise acquire shares under section 77 or 227 (3) (g), or under Division 2 of Part 8 or Division 5 of Part 9; .

15 Section 111 is amended

(a) in subsection (4) by striking out "in British Columbia" and substituting "inside or outside British Columbia" , and

(b) by adding the following subsections:

(4.1) If, under subsection (4), the directors designate a location outside British Columbia as the location at which the company maintains its central securities register, the central securities register must be available for inspection and copying in accordance with sections 46 and 48 at a location inside British Columbia by means of a computer terminal or other electronic technology.

(4.2) If, under subsection (4), the directors designate a location inside British Columbia as the location at which the company maintains its central securities register, the central securities register must be available for inspection and copying in accordance with sections 46 and 48 at

(a) that designated location, or

(b) another location inside British Columbia by means of a computer terminal or other electronic technology.

16 Section 117 is amended by striking out "register." and substituting "register or a branch securities register."

17 Section 140 (3) (a) is repealed and the following substituted:

(a) may be passed without a meeting in any of the following circumstances:

(i) in the case of a resolution to approve a contract or transaction in respect of which a director has disclosed that he or she has or may have a disclosable interest, within the meaning of Division 3, if each of the other directors who have not made such a disclosure in respect of the contract or transaction and who are entitled to vote on the resolution consents in writing to the resolution;

(ii) in the case of a resolution not referred to in subparagraph (i), if each of the directors entitled to vote on the resolution consents to it in writing;

(iii) in the case of either resolution, in any other manner permitted under this Act or under the memorandum or articles of the company, and .

18 Section 144 (1) is amended by striking out "behalf in any location inside or outside British Columbia." and substituting "behalf."

19 Section 157 (1) (d) is amended by striking out everything after "whether or not" and by adding the following subparagraphs:

(i) the record was forged, fraudulently made or inaccurate, or

(ii) the information or representation was fraudulently made or inaccurate.

20 Section 181 is amended

(a) by striking out "Act does not or" and substituting "Act or the regulations or", and

(b) by striking out "Act and of the memorandum and" and substituting "Act, the regulations, the memorandum and the".

21 Section 205 (c) is repealed and the following substituted:

(c) the company is a reporting issuer or a reporting issuer equivalent and the person is

(i) a person referred to in paragraph (a) or (b) of this section, or

(ii) authorized to make an auditor's report under the Securities Act, or, in the case of a reporting issuer equivalent, under the legislation that applies to the company and has provisions that are comparable in scope and intent to the auditor qualification provisions of the Securities Act and the regulations made under that Act.

22 Section 266 is amended by adding the following subsection:

(8) Without limiting section 111 (1), after a special Act corporation is converted into a company, the converted company must register in its central securities register the shares of the company that were held by shareholders of the corporation immediately before its conversion, and, with respect to those shares, must register

(a) the name and last known address of each of those shareholders,

(b) the class, and any series, of those shares, and

(c) the number of those shares held by each of those shareholders.

23 Section 271 (7) is amended by striking out "(6) (a)" and substituting "(6) (a) (ii)".

24 Section 272 is amended by striking out "271 (6)" and substituting "section 271 (6)".

25 Section 274 (1) and (2) is repealed and the following substituted:

(1) Two or more companies that are subsidiaries of the same holding corporation or two or more companies that are either wholly owned by the same individual or that are subsidiaries of one or more companies wholly owned by that individual may amalgamate and continue as one company without complying with sections 270 and 271 if

(a) all of the issued shares of each amalgamating company are held by,

(i) in the case of amalgamating companies that are subsidiaries of the same holding corporation, the holding corporation or another amalgamating company, or

(ii) in the case of amalgamating companies that are wholly owned by the same individual or by a subsidiary of a company wholly owned by that individual, that individual or another amalgamating company,

(b) the amalgamation is approved by each of the amalgamating companies by a special resolution of the amalgamating company or by a resolution of its directors,

(c) the resolutions require that

(i) subject to subsections (2) and (2.1) of this section, the shares of all but one of the amalgamating companies be cancelled on the amalgamation without any repayment of capital in respect of those shares, and

(ii) the amalgamated company have, as its notice of articles and articles, the notice of articles and articles of the amalgamating company the shares of which are not to be cancelled (which amalgamating company is, in this section, called the "primary company"), and

(d) the primary company, if a pre-existing company, has complied with section 370 (1) or 436 (1).

(2) If the amalgamation is one to which subsection (1) (a) (i) of this section applies, the primary company must be a company all of the issued shares of which are held by the holding corporation.

(2.1) If the amalgamation is one to which subsection (1) (a) (ii) applies, the primary company must be a company all of the issued shares of which are held by the individual.

26 Section 284 (5) is amended by striking out "(4) (a)" and substituting "(4) (a) (ii)".

27 Sections 285 and 310 are amended by adding ", in effect," after "provide".

28 Section 289 (2) is amended by striking out "(1) (a)" and substituting "(1) (a) (ii)".

29 Section 303 is amended by adding the following subsection:

(3) Without limiting section 111 (1), after a foreign corporation is continued into British Columbia as a company, the continued company must register in its central securities register the shares of the company that were held by shareholders of the corporation immediately before its continuation, and, with respect to those shares, must register

(a) the name and last known address of each of those shareholders,

(b) the class, and any series, of those shares, and

(c) the number of those shares held by each of those shareholders.

30 Section 339 (d) is repealed and the following substituted:

(d) any record, information or representation that the court considers provides reasonable grounds for the actions of the liquidator, whether or not

(i) the record was forged, fraudulently made or inaccurate, or

(ii) the information or representation was fraudulently made or in-accurate.

31 Sections 370 (3), 372 (2), 436 (3) and 438 (2) are amended by striking out "contain a condition" and substituting "state".

32 Sections 371 (1) (c) and 437 (1) (c) are amended by striking out "to (3)".

33 Section 411 is amended by adding the following subsections:

(1.1) The registrar may refuse to accept any record submitted to the registrar for filing by or on behalf of a company if

(a) the company has not made the filings, contemplated by section 127, that would confirm that it is in compliance with section 120, or

(b) the company

(i) tendered a cheque in payment of a fee required under section 431 and that cheque failed to clear the savings institution on which it was drawn, or

(ii) otherwise failed to pay a fee required under section 431.

(1.2) Despite subsection (1.1) (a) but without limiting subsections (1) and (1.1) (b), the registrar must not, in the circumstances referred to in subsection (1.1) (a), refuse to accept

(a) a filing contemplated by section 127, or

(b) a filing under section 316 or 343.

34 Section 422 (1) (e) is amended by striking out "drawn," and substituting "drawn, or otherwise fails to pay a fee required under section 431,".

35 Section 426 (1) is amended

(a) in paragraph (a) by adding "49 (3)," after "42,", and

(b) by repealing paragraph (c).

36 Section 428 is amended

(a) in subsection (1) by striking out "(c),", and

(b) in subsections (4) and (5) by striking out "that commits" and substituting "who commits".

37 Section 442.1 is amended by adding the following subsection:

(2.1) If a pre-existing company that has not removed the application of the Pre-existing Company Provisions under subsection (3) amalgamates with one or more corporations under section 273 or 274 and the amalgamated company has as its notice of articles the notice of articles of that pre-existing company, this section applies to the amalgamated company as if it were a pre-existing company.

 
Escheat Act

38 Section 4 (4) of the Escheat Act, R.S.B.C. 1996, c. 120, is amended by striking out "by order of a court, the order" and substituting ", the revival".

 
Financial Institutions Act

39 Section 1 (1) of the Financial Institutions Act, R.S.B.C. 1996, c. 141, is amended in the definition of "capital base" by striking out "section 289 (3) (f)" and substituting "section 289 (3) (e) or (f)".

40 Section 1 (4) is amended

(a) in paragraph (b) by striking out "subject to paragraph (c),",

(b) in paragraph (b) by striking out "financial institution or extraprovincial corporation," and substituting "financial institution,", and

(c) by adding ", and" at the end of paragraph (a), by striking out "and" at the end of paragraph (b) and by repealing paragraph (c).

41 Section 2 is amended by striking out "financial institution or an extraprovincial corporation." and substituting "financial institution."

42 Section 6 is repealed.

43 Section 9 (3) is repealed and the following substituted:

(3) A reference to "company" or "corporation" in the Company Act must be read as a reference to "financial institution" or to "credit union", "trust company" or "insurance company", as the context requires.

44 Section 10 is amended

(a) by repealing subsection (2),

(b) by repealing subsection (15.1) and substituting the following:

(15.1) The references to "the registrar" in section 262 (4) (a) (i) of the Company Act must be read as references to "the registrar and the commission". , and

(c) by repealing subsection (16).

45 The following section is added:

Specific rules respecting Business Corporations Act
application to extraprovincial corporations

10.1 (1) Sections 90 to 102 and 302 to 307 of the Business Corporations Act do not apply to extraprovincial corporations.

(2) Without limiting Division 11 of Part 10 of the Business Corporations Act, before submitting an application to the registrar under that Division or before making an application to the court under that Division, the applicant must, if the application relates to an extraprovincial corporation,

(a) first obtain the consent of the superintendent to a name and then reserve that name under the Business Corporations Act, and

(b) obtain the consent of the commission to the restoration, or conversion of a limited restoration, contemplated by the application.

(3) For the purposes of section 379 of the Business Corporations Act as it applies to extraprovincial corporations, the reference in section 379 (1) to "within 2 months" must be read as "immediately".

46 Section 67 is amended by adding the following subsection:

(2.1) Whether or not a credit union is otherwise complying with the regulations, if the amount of the capital base of a credit union does not comprise a prescribed percentage of the calculated value of the credit union's risk weighted assets, the credit union must obtain the commission's written consent before engaging in

(a) prescribed activities, or

(b) prescribed activities in prescribed circumstances or that have or may have prescribed consequences.

47 Section 127 (3) is amended by striking out "a report in in the form" and substituting "a report in the form".

48 Section 136 (3) (a) (iv) is amended by striking out "risk," and substituting "risk, and".

49 Section 158 is amended

(a) in subsection (1) by striking out "67 (1), 79," and substituting "67 (1) and (2.1), 79,", and

(b) in subsection (3) by striking out "67 (2), 112," and substituting "67 (2) and (2.1), 112,".

50 Section 161 is amended by striking out "prescribed words" as part of the name" and substituting "prescribed words as part of the name".

51 Section 202.1 is repealed and the following substituted:

Application of Administrative Tribunals Act

202.1 Sections 1 to 3, 5 to 8 and 10 of the Administrative Tribunals Act apply to the commission.

52 Section 230 is amended by striking out "sections 231 to 233 to the council" and substituting "sections 231 to 232.1 to the council, except if the reference is to rules made by the council,".

53 Section 235 is amended

(a) in subsection (1) (b) by striking out ", or," and substituting ", or",

(b) in subsection (2) by striking out "67 (3)," and substituting "67 (2.1) and (3),", and

(c) in subsection (5) (b) by striking out "71,".

54 Section 237 (2) is amended

(a) in paragraph (a) by striking out "233,", and

(b) in paragraph (b) by striking out "71 or".

55 Section 241 (5) is amended by striking out "section 233" and substituting "section 233 before its repeal or section 241.1 (1)".

56 Section 242 (1) is amended

(a) by adding "the superintendent," after "A person directly affected by any of the following decisions of",

(b) in paragraph (a) by striking out "67 (2), 93," and substituting "67 (2) and (2.1), 93,", and

(c) in paragraph (a) by adding "241.1," after "231 (1),".

57 Section 242.1 (7) is amended

(a) by adding "31," after "24,", and

(b) by striking out "48 to 57 and 59 to 61" and substituting "48 to 58, 60 and 61".

58 Section 242.2 (10) is amended

(a) by adding "and" at the end of paragraph (e.1), and

(b) by repealing paragraph (f).

59 Section 242.4 (1) (a) is amended

(a) by striking out "67 (2), 93," and substituting "67 (2) and (2.1), 93,", and

(b) by adding "241.1," after "231 (1),".

60 Section 243 (1) and (2) (b) is amended by striking out "248 (4)" and substituting "248 (2)".

61 Section 244 (2) is amended

(a) by striking out "opinion of the commissioner" and substituting "opinion of the commission",

(b) by adding the following paragraph:

(a.1) if the person is an extraprovincial corporation, does not comply with the Business Corporations Act, , and

(c) in paragraph (c) by striking out "this Act, the regulations or the Company Act as it applies for the purposes of this Act," and substituting "this Act or the regulations, with the Company Act as it applies for the purposes of this Act or, in the case of an extraprovincial corporation, with the Business Corporations Act,".

62 Section 245 (1) (j) (ii) is amended by striking out "Winding-up Act (Canada)." and substituting "Winding-up and Restructuring Act (Canada)."

63 Section 252 is amended

(a) in subsection (2) by striking out "or" at the end of paragraph (f), by adding ", or" at the end of paragraph (g) and by adding the following paragraph:

(h) is an extraprovincial corporation and contravenes the Business Corporations Act. , and

(b) by repealing subsection (6) and substituting the following:

(6) If a financial institution commits an offence under the Company Act as it applies for the purposes of this Act, or if an extraprovincial corporation commits an offence under subsection (2) (h), a director or officer of the financial institution or extraprovincial corporation who authorizes, permits or acquiesces in the offence commits the same offence whether or not the financial institution or extraprovincial corporation is convicted of the offence.

64 Section 253 (2) is amended by striking out "section 252 (2) (b), (d) or (g)" and substituting "section 252 (2) (b), (d), (g) or (h)".

65 Section 256 is repealed and the following substituted:

Court order to comply

256 If a person is convicted of an offence under

(a) this Act,

(b) the Company Act as it applies for the purposes of this Act, or

(c) the Business Corporations Act with respect to an extraprovincial corporation,

the court may, in addition to any punishment the court may impose, order the person to comply with the applicable enactment.

66 Section 289 (3) is amended by adding the following paragraph:

(f.1) for the purpose of section 67 (2.1),

(i) prescribing a percentage of the calculated value of a credit union's risk weighted assets,

(ii) prescribing activities, circumstances and consequences, and

(iii) establishing matters about which the commission must be satisfied before giving its consent, .

67 Section 289 (4) is amended by striking out "and" at the end of paragraph (o) and by adding the following paragraph:

(o.1) providing that a provision of the Business Corporations Act applicable to an extraprovincial corporation does not apply to or in respect of a person, entity, thing or transaction, and prescribing circumstances in which or conditions on which the provision is disapplied under this paragraph, and .

68 Section 290 (a) is amended by striking out "sections 231 to 233" and substituting "sections 231 to 232.1".

 
Mutual Fire Insurance Companies Act

69 Sections 26 and 27 of the Mutual Fire Insurance Companies Act, R.S.B.C. 1960, c. 262, are repealed.

70 Section 64 is amended by striking out "reserve or".

 
Pacific North Coast Native Cooperative Act

71 The Pacific North Coast Native Cooperative Act, R.S.B.C. 1996, c. 343, is repealed.

 
Public Sector Employers Act

72 Section 1 of the Public Sector Employers Act, R.S.B.C. 1996, c. 384, is amended in the definition of "public sector employer" by repealing paragraph (b) and substituting the following:

(b) unless exempted by the regulations,

(i) a corporation or an unincorporated board, commission, council, bureau, authority or similar body that has on its board of management or board of directors 50% or more members who are appointed by an Act, a minister or the Lieutenant Governor in Council, or

(ii) a subsidiary, as defined in section 1 (1) of the Business Corporations Act, of a corporation that is a public sector employer, .

73 Section 15 (2) (a) is amended by striking out "designating" and substituting "designating or exempting".

 
Real Estate Services Act

74 Section 1 of the Real Estate Services Act, S.B.C. 2004, c. 42, is amended by adding the following definition:

"strata corporation" means a strata corporation within the meaning of the Strata Property Act and includes a section within the meaning of that Act; .

75 Section 27 is amended

(a) by repealing subsection (2) (b) and substituting the following:

(b) all money held or received on account of remuneration for real estate services, including a share of remuneration received from another brokerage. , and

(b) by adding the following subsections:

(4.1) Despite subsection (2) (b), remuneration that has already been earned, as determined in accordance with the rules, by a brokerage may be paid into a commission trust account maintained by the brokerage.

(4.2) Subsections (2) (b) and (4.1) do not apply to remuneration that has already been earned, as determined in accordance with the rules, by a brokerage if the brokerage has no related licensees other than a managing broker.

76 Section 60 is amended in the definition of "compensable loss" by striking out "or" at the end of paragraph (c), by adding ", or" at the end of paragraph (d) and by adding the following paragraph:

(e) was caused by conduct of a licensee acting under an exemption provided by Part 9 of the rules; .

77 The following section is added:

Consolidation and revision of bylaws and rules

85.1 (1) Subject to the regulations, the real estate council may make bylaws giving effect to an editorial consolidation or revision of all or some of its bylaws and rules that does one or more of the following:

(a) consolidates provisions and omits spent provisions;

(b) alters the form, style, punctuation, numbering and arrangement of provisions;

(c) corrects typographical errors.

(2) The authority under subsection (1) does not include the authority to make substantive changes to the bylaws or rules.

78 Section 128 is amended

(a) in subsections (2) and (3) by striking out "no action or other legal proceedings for damages lies or may be brought" and substituting "no legal proceeding for damages lies or may be commenced or maintained",

(b) by adding the following subsection:

(2.1) Subject to subsection (4), no legal proceeding for damages lies or may be commenced or maintained against a protected individual, the real estate council, the compensation fund corporation or the government because of anything done or omitted

(a) in the performance or intended performance of any duty, or

(b) in the exercise or intended exercise of any power

under Part 5 [Payments from Special Compensation Fund]. , and

(c) by repealing subsection (4) and substituting the following:

(4) Subsections (2), (2.1) and (3) do not apply to a protected individual in relation to anything done or omitted in bad faith.

 
Society Act

79 Section 74 (1) of the Society Act, R.S.B.C. 1996, c. 433, is repealed and the following substituted:

(1) Subject to subsection (2), a society may, with the consent of the registrar and in accordance with the regulations, be converted to a company and, for that purpose, the following provisions of the Business Corporations Act apply to the society as if it were a special Act corporation within the meaning of that Act:

(a) section 266 except

(i) in subsection (1), the words "if it has the consent of the minister to do so, and", and

(ii) subsections (3) (b) and (6);

(b) sections 267 and 268.

Transitional -- Financial Institutions Act

80 If an extraprovincial corporation is authorized or required to file a record with the registrar under a provision of the Company Act referred to in section 6 of the Financial Institutions Act, the filing with the registrar of a record referred to in the Business Corporations Act that is of the same or similar effect to the authorized or required record, if filed in the manner and form authorized or required under the Business Corporations Act, constitutes full and complete filing of the authorized or required record.

Retroactive effect -- Miscellaneous Statutes Amendment Act, 1998

81 (1) Sections 12 and 13 of the Miscellaneous Statutes Amendment Act, 1998, S.B.C. 1998, c. 11, are deemed to have come into force on May 13, 1998.

(2) This section is retroactive to the extent necessary to give it full force and effect and must not be construed as lacking retroactive effect in relation to any matter because it makes no specific reference to that matter.

Commencement

82 The provisions of this Act referred to in column 1 of the following table come into force as set out in column 2 of the table: