BILL 86 – 2003
BUSINESS CORPORATIONS AMENDMENT ACT (No. 2), 2003

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

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

(a) in the definition of "corporate register" by striking out "information filed with the registrar under this Act or filed with or recorded by the registrar under a former" and substituting "information filed with or recorded by the registrar under this Act or a former",

(b) by adding the following definition:

"Pre-existing Company Provisions" means the provisions prescribed by the Lieutenant Governor in Council under section 442.1 (1); ,

(c) in paragraph (b) of the definition of "special majority" by striking out "pre-existing company," and substituting "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,",

(d) in paragraph (a) (iii) (A) and (B) of the definition of "special separate resolution" by adding "memorandum or" before "articles",

(e) in paragraph (a) (iii) (B) of the definition of "special separate resolution" by striking out "pre-existing company," and substituting "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,", and

(f) in the definition of "statutory business hours" by striking out "afternoon," and substituting "afternoon, local time,".

2 Section 11 is amended by striking out "and" at the end of paragraph (h), by adding "and" at the end of paragraph (g) and by repealing paragraph (i).

3 Section 19 (2) is repealed and the following substituted:

(2) A pre-existing company and its shareholders are bound, in the manner contemplated by subsection (3),

(a) by the company's notice of articles, if any,

(b) by the company's articles, and

(c) subject to section 373 (3) or 439 (3), as the case may be, by the company's memorandum.

4 Section 26 (1) is amended by striking out "company with that name," and substituting "company,".

5 Section 42 is amended

(a) in subsection (2) by adding the following paragraph:

(f) if the company is an amalgamated company, copies of the records described in the following paragraphs of this subsection for each amalgamating company:

(i) paragraphs (a) and (b);

(ii) paragraph (c);

(iii) paragraph (d);

(iv) paragraph (e) (i);

(v) paragraph (e) (ii);

(vi) paragraph (e) (iii). , and

(b) in subsection (3) by adding "or (f) (v)" after "subsection (2) (e) (ii)".

6 Section 43 (1) is amended by striking out "or (2) (c), (d) or (e) (ii) or (iii)" and substituting "or (2) (c), (d), (e) (ii) or (iii) or (f) (ii), (iii), (v) or (vi)".

7 Section 46 (6) is repealed and the following substituted:

(6) Despite subsections (1) to (5) of this section but without limiting any obligation to pay the fee required under this section, a person may inspect a record kept by a company under section 42 (2) (c), (d), (e) (ii) or (iii) or (f) (ii), (iii), (v) or (vi) only if and to the extent that,

(a) in the case of a record kept under section 42 (2) (c) or (f) (ii), the person was entitled to do so under the corporate legislation of the jurisdiction that, before the continuation, was the foreign corporation's jurisdiction,

(b) in the case of a record kept in the records office of an amalgamated company under section 42 (2) (d) or (f) (iii) in relation to an amalgamating foreign corporation, the person was entitled to do so under the corporate legislation of the jurisdiction that, before the amalgamation, was the foreign corporation's jurisdiction, or

(c) in the case of a record kept under section 42 (2) (e) (ii) or (iii) or (f) (v) or (vi), the person was entitled to do so under the Company Act, 1996.

8 Section 57 (1) (a) is amended by striking out 'the words "A British Columbia Company Act company",' and substituting "words indicating that it is a British Columbia company,".

9 Section 62 is amended by striking out "sections 64 and 66 and to the memorandum or notice of articles, as the case may be, and" and substituting "section 64, to the Pre-existing Company Provisions, if applicable, to the memorandum or notice of articles, as the case may be, and to".

10 Section 63 (1) (b) (i) is amended by striking out "pre-existing company," and substituting "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,".

11 Sections 66, 80 and 81 are repealed.

12 Section 72 is repealed and the following substituted:

Capital

72 (1) When a company issues shares without par value, there is added to the capital of the company for that class or series of shares,

(a) if the shares are issued for property within the meaning of section 64 (1), an amount not greater than the issue price for those shares,

(b) if the shares are issued by way of dividend, the declared amount, if any, of the dividend, and

(c) in any other case, the issue price for those shares.

(2) In addition to any additions to capital effected under subsection (1), a company may add to its capital in respect of a class or series of shares without par value an amount specified by a directors' resolution or an ordinary resolution.

(3) When a company issues shares with par value, there is added to the capital of the company, for that class or series of shares, an amount equal to the aggregate of the par values of those shares.

13 Section 77 is amended by striking out "sections 78 to 81," and substituting "sections 78 and 79 and the Pre-existing Company Provisions, if applicable,".

14 Section 114 is repealed and the following substituted:

Instrument of transfer

114 Despite the memorandum and articles of a company, a company must not register a transfer of shares unless a proper instrument of transfer has been provided to the company but

(a) an instrument of transfer is not required for the company to register a transmission of shares under section 119, and

(b) nothing in this section requires that an instrument of transfer be provided in relation to

(i) an involuntary transfer including, without limitation, in relation to a transfer effected under section 244 (3) or 300 (7), or

(ii) a redemption.

15 Section 118 is amended by striking out "If a person applies to a company or its transfer agent to effect a transmission of shares or other securities, the person must provide to the company" and substituting "A person applying to a company or its transfer agent to effect a transmission of shares or other securities must provide".

16 Section 137 is amended

(a) in subsection (1) by striking out "Despite" and substituting "Subject to subsection (1.1) but despite",

(b) in subsection (1) by striking out "may restrict in whole or in part" and substituting "may transfer, in whole or in part," and by striking out "and may transfer those restricted powers",

(c) by adding the following subsection:

(1.1) A provision of the articles transferring powers of the directors to manage or supervise the management of the business and affairs of the company is effective

(a) if the provision is included in the articles at the time of the company's recognition or if the company resolved, by special resolution, to add that provision to the articles, and

(b) if the provision clearly indicates, by express reference to this section or otherwise, the intention that the powers be transferred to the proposed transferee. ,

(d) in subsection (3) by adding "in relation to that right, power, duty or liability" after "regulations to a director or directors", and

(e) by adding the following subsection:

(4) A company may resolve to alter its articles, by special resolution, to alter a provision referred to in subsection (1.1).

17 Section 147 (2) (a) is repealed and the following substituted:

(a) the situation that would otherwise constitute a disclosable interest under subsection (1) arose before the coming into force of this Act or, if the company was recognized under this Act, before that recognition, and was disclosed and approved under, or was not required to be disclosed under, the legislation that

(i) applied to the corporation on or after the date on which the situation arose, and

(ii) is comparable in scope and intent to the provisions of this Division, .

18 Section 148 (2) (a) is amended by striking out everything after "coming into force of this Act" and substituting "under the former Companies Act that was in force at the time of the disclosure, and, after that disclosure, the contract or transaction is approved in accordance with section 149 of this Act, other than section 149 (3);".

19 Section 157 (1) (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 director, whether or not that record was forged, fraudulently made or inaccurate.

20 Section 259 is amended by adding the following subsection:

(8) Nothing in subsection (5) or (6) prevents an alteration to the articles made by a court order from taking effect in accordance with that order.

21 Section 263 is amended

(a) in subsection (2) by adding "or change" after "articles to adopt",

(b) in subsection (4) by striking out "at the date" and substituting "when", and

(c) in subsection (4) (a) by striking out "on the date" and substituting "when".

22 Sections 273 and 274 are repealed and the following substituted:

Vertical short form amalgamations

273 (1) A holding corporation that is a company and one or more of its subsidiary corporations may amalgamate and continue as one company without complying with sections 270 and 271 if

(a) the holding corporation, if a pre-existing company, has complied with section 370 (1) or 436 (1),

(b) all of the issued shares of each amalgamating subsidiary corporation are held by one or more of the other amalgamating corporations,

(c) the amalgamation is approved by a special resolution of the holding corporation or by a resolution of its directors, and

(d) the resolution requires that

(i) the shares of each amalgamating subsidiary corporation be cancelled on the amalgamation without any repayment of capital in respect of those shares,

(ii) the amalgamated company have, as its notice of articles and articles, the notice of articles and articles of the holding corporation, and

(iii) the amalgamated company refrain from issuing any securities in connection with the amalgamation.

(2) On an amalgamation under this section, the capital of the amalgamated company is the same as the capital of the amalgamating holding corporation.

Horizontal short form amalgamations

274 (1) Two or more companies that are subsidiaries of the same holding corporation 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 the holding corporation 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 subsection (2), 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 whose shares are not to be cancelled, and

(d) the amalgamating company the shares of which are not to be cancelled under paragraph (c) (i) of this subsection, if a pre-existing company, has complied with section 370 (1) or 436 (1).

(2) The amalgamating company, the shares of which are not to be cancelled under subsection (1) (c) (i) of this section (the "primary company") must be a company the shares of which are held by the holding corporation.

(3) On an amalgamation under this section, the capital of the primary company consists of

(a) the capital that was the capital of the primary company immediately before the amalgamation, and

(b) the capital that was the capital of the other amalgamating companies other than the portion of that capital that is attributable to the shares of any amalgamating company that were held by the primary company or any other amalgamating company.

23 Section 275 (2) (a) (i) is amended by striking out ", as the case may be,".

24 Section 289 is amended

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

(a) in respect of an arrangement proposed with the shareholders of the company,

(i) the shareholders approve the arrangement by a special resolution, or

(ii) if any of the shares held by the shareholders who under subsection (2) are entitled to vote on the resolution to approve the arrangement do not otherwise carry the right to vote, the shareholders approve the arrangement by a resolution passed at a meeting by at least a special majority of the votes cast by the shareholders, if at least the prescribed number of days' notice of the meeting and of the intention to propose the resolution has been sent to all of the shareholders, , and

(b) by repealing subsections (2), (3) and (4) and substituting the following:

(2) Each share of a company carries the right to vote in respect of a resolution referred to in subsection (1) (a) whether or not that share otherwise carries the right to vote.

(3) If the court orders, under section 291, that a meeting be held to adopt an arrangement in addition to or in substitution for a meeting contemplated by subsection (1) of this section, the arrangement must not be submitted to the court for approval until after

(a) it has been adopted at that court ordered meeting, or

(b) it has been consented to under subsection (1) (f) by the persons who were entitled to vote at that meeting.

(4) If an arrangement is consented to under subsection (1) (f),

(a) the meeting that would otherwise have been necessary under subsection (1) or (3) need not be held, and

(b) the consent is as valid and effective as if it had been expressed in a vote passed at that meeting.

(5) Section 61 does not apply to an arrangement under this Division.

25 Section 302 is amended by adding the following subsection:

(3) A foreign corporation seeking to be continued into British Columbia as a company may, by one or both of the articles referred to in subsection (1) (c) of this section and the notice of articles referred to in subsection (2) (c), effect any amendment to its charter if the amendment is an amendment that a company may make to its charter under this Act.

26 Section 305 (1) is amended by adding the following paragraph:

(a.1) the continued company has, as its notice of articles, the notice of articles contained in the continuation application, .

27 Section 344 is amended

(a) in subsection (2) by striking out "on the date on which" and substituting "when", and

(b) in subsection (2) (a) by striking out "on the date of dissolution," and substituting "on dissolution,".

28 Section 345 (b) (ii) is repealed and the following substituted:

(ii) the person who submitted the application for dissolution on behalf of the company, and .

29 Section 354 (2) is amended

(a) in paragraph (a) by striking out "or" at the end of subparagraph (i) and by adding the following subparagraph:

(iii) in the case of an application under section 360 (2) (a) or 361 (2) (a), the person is a person referred to in subparagraph (i) or (ii), as the case may be, or is ordered by the court to be an appropriate person to make the application, or, and

(b) in paragraph (b) by striking out "or" at the end of subparagraph (i), by adding ", or" at the end of subparagraph (ii) and by adding the following subparagraph:

(iii) in the case of an application under section 360 (2) (a) or 361 (2) (a), the person is a person referred to in subparagraph (i) or (ii), as the case may be, or is ordered by the court to be an appropriate person to make the application.

30 Section 364 is amended by adding the following subsection:

(3.1) Despite any other provision of this Division, section 442.1 applies to a restored company if the company was, immediately before its dissolution, a pre-existing company that had not, before its dissolution, complied with section 370 (1) (a) and (b) or 436 (1) (a) and (b).

31 Section 366 (1) is amended by striking out "on the date of its restoration," and substituting "on its restoration,".

32 Section 369 (c) is amended by striking out "section 370 or 436." and substituting "section 370 (1) (a) or 436 (1) (a)."

33 Section 370 (1) (c) is amended

(a) in subparagraph (i) by striking out "on the date of its restoration," and substituting "on its restoration,", and

(b) in subparagraph (ii) (A), (C), (D) and (E) by striking out "those periods," and substituting "that period,".

34 Section 371 (2) (b) is amended

(a) in subparagraph (iii) by striking out "and (i)",

(b) by striking out "and" at the end of subparagraph (iv), and

(c) by repealing subparagraph (v) and substituting the following:

(v) indicates that the Pre-existing Company Provisions apply to the company, and

(vi) does not contain any other information.

35 Section 372 (3) (b) is amended by adding ", other than prescribed provisions," after "each provision".

36 Section 377 (2) (c) is repealed and the following substituted:

(c) furnish a copy of the registration statement to each attorney referred to in the registration statement who has not been furnished with a copy of that record under paragraph (b), and .

37 Section 379 is repealed and the following substituted:

Amalgamation of extraprovincial company

379 (1) If a foreign entity that is registered as an extraprovincial company is a party to an amalgamation or similar process other than one that results in a company, there must be provided to the registrar the records and information the registrar may require, and there must be filed with the registrar, within 2 months after the effective date of the amalgamation or similar process,

(a) a notice of amalgamation of extraprovincial company that complies with subsection (2), and

(b) any other records the registrar may require.

(2) A notice of amalgamation of extraprovincial company must be in the form established by the registrar and must set out

(a) the name of the amalgamated extraprovincial company if the amalgamated extra provincial company

(i) has adopted as its name the name of one of the amalgamating extraprovincial companies, or

(ii) is a federal corporation,

(b) if paragraph (a) does not apply, the name reserved for the amalgamated extraprovincial company under section 22 and the reservation number given for it, or

(c) if paragraphs (a) and (b) of this subsection do not apply but section 26 applies, the name of the foreign entity, the assumed name reserved for it under section 26 and the reservation number given for that assumed name.

(3) After the notice of amalgamation of extraprovincial company is filed with the registrar, the registrar must

(a) issue a certificate of registration showing

(i) the name and any assumed name for the amalgamated extraprovincial company,

(ii) its registration number and the date and time of its registration, and

(iii) the date, and the time, if any, shown for the amalgamation or similar process on the notice of amalgamation of extraprovincial company,

(b) furnish to the amalgamated extraprovincial company the certificate referred to in paragraph (a) and a copy of the notice of amalgamation of extraprovincial company,

(c) furnish a copy of the notice of amalgamation of extraprovincial company to each attorney of the amalgamated extraprovincial company who has not been furnished with a copy of that record under paragraph (b), and

(d) publish in the prescribed manner a notice of the amalgamation or similar process.

(4) From the time of the amalgamation or similar process, the amalgamated extraprovincial company is seized of and holds and possesses all land of the amalgamating entities that is located in British Columbia.

(5) At any time, before or after a certificate of registration is issued under subsection (3), the registrar may order the amalgamated foreign entity to provide to the registrar, within the time required by the registrar, proof satisfactory to the registrar of the foreign entity's status in the foreign entity's jurisdiction.

38 Section 432 (2) is amended by adding the following paragraph:

(cc.1) prescribing a set of provisions, and designating those provisions as the "Pre-existing Company Provisions"; .

39 Section 437 (2) (b) is amended

(a) in subparagraph (v) by striking out "and (i)",

(b) by striking out "and" at the end of subparagraph (vi), and

(c) by repealing subparagraph (vii) and substituting the following:

(vii) indicates that the Pre-existing Company Provisions apply to the company, and

(viii) does not contain any other information.

40 Section 438 (3) (b) is amended by adding ", other than prescribed provisions," after "each provision".

41 The following section is added to Division 2:

Pre-existing Company Provisions

442.1 (1) The Lieutenant Governor in Council may, by regulation, prescribe a set of provisions, and designate those provisions as the "Pre-existing Company Provisions".

(2) The Pre-existing Company Provisions apply to each pre-existing company until

(a) the pre-existing company complies with section 370 (1) (a) or 436 (1) (a), and

(b) the pre-existing company's notice of articles is altered to remove the application of the Pre-existing Company Provisions.

(3) A pre-existing company may alter its notice of articles to remove the application of the Pre-existing Company Provisions if it is authorized to do so by a special resolution.

(4) Except insofar as it is necessary to do so to comply with section 372 (3) (b) or 438 (3) (b), a pre-existing company must not alter its articles in relation to any matter included in the Pre-existing Company Provisions until the pre-existing company has removed the application of the Pre-existing Company Provisions in accordance with subsection (3) of this section.

(5) Nothing in this section precludes a pre-existing company that has removed the application of the Pre-existing Company Provisions in accordance with subsection (3) from adding to its articles any or all of the Pre-existing Company Provisions.

42 The Schedule is amended

(a) in item 4 by striking out "$35*" and substituting "$43.39*", and

(b) by adding the following item:

 
Consequential Amendments

Advanced Education Statutes Amendment Act, 2003

43 Section 9 of the Advanced Education Statutes Amendment Act, 2003, S.B.C. 2003, c. 48, is repealed and the following substituted:

9 Section 51 is repealed and the following substituted:

Application of the Business Corporations Act

51 The Business Corporations Act does not apply to an institution, but on the recommendation of the minister, the Minister of Finance, by regulation, may declare that all or part of that Act applies to the institution.

44 Section 26 is repealed and the following substituted:

26 Section 3 (5) of the Royal Roads University Act, R.S.B.C. 1996, c. 409, is repealed and the following substituted:

(5) The Business Corporations Act does not apply to the university, but on the recommendation of the minister, the Minister of Finance, by regulation, may declare that all or part of that Act applies to the university.

45 Section 30 is repealed and the following substituted:

30 Section 3 (4) and (5) is repealed and the following substituted:

(4) The Business Corporations Act does not apply to a university, but on the recommendation of the minister, the Minister of Finance, by regulation, may declare that all or part of that Act applies to a university.

 
Coastal Ferry Act

46 Section 1 of the Coastal Ferry Act, S.B.C. 2003, c. 14, is amended in the definition of "company" by striking out "the Company Act;" and substituting "the Business Corporations Act;".

47 Section 9 is repealed and the following substituted:

Application of the Business Corporations Act

9 (1) Sections 124 (1) and (2), 126, 136, 140, 142 and 143 of the Business Corporations Act apply to the Authority and to its directors.

(2) A director who ceases to be qualified to act as a director of the Authority under section 124 (2) of the Business Corporations Act as it applies for the purposes of this section must promptly resign and may be removed by the other directors.

(3) For the purposes of subsection (1), a reference in sections 136, 140 and 142 of the Business Corporations Act, as they apply for the purposes of this section, to "articles" is deemed to be a reference to the bylaws of the Authority.

48 Section 19 (2) is amended by striking out "Despite the Company Act, if" and substituting "After".

49 Section 68 (4) is amended by striking out "sections 164 (5) and 165 of the Company Act apply." and substituting "sections 46 (7) and (8) and 48 (1) of the Business Corporations Act apply."

 
Emergency Communications Corporations Act

50 Section 5 (1) of the Emergency Communications Corporations Act, S.B.C. 1997, c. 47, is amended by striking out "Sections 41, 45 and 237 of the Company Act" and substituting "Section 154 (2) of the Business Corporations Act".

 
Industry Training Authority Act

51 Section 12 (2) (f) of the Industry Training Authority Act, S.B.C. 2003, c. 34, is amended by striking out "the Company Act" and substituting "the Business Corporations Act".

52 Section 14 is repealed and the following substituted:

Application of Business Corporations Act to authority

14 The Business Corporations Act does not apply to the authority except to the extent provided in the regulations.

 
Liquor Distribution Act

53 Section 10.1 (2) of the Liquor Distribution Act, R.S.B.C. 1996, c. 268, is amended by striking out "the Company Act." and substituting "the Business Corporations Act."

 
Museum Act

54 Section 17 of the Museum Act, S.B.C. 2003, c. 12, is amended

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

(c) a proposed contract or transaction relates to an indemnity of the type described in Division 5 of Part 5 of the Business Corporations Act, or to insurance of the type described in section 165 of that Act; , and

(b) in subsection (5) by striking out "the Company Act applies and section 1 (2) to (7) of that Act applies." and substituting "the Business Corporations Act applies and section 2 of that Act applies."

55 Section 21 is amended

(a) in subsection (1) by striking out "the Company Act and the Company Clauses Act do" and substituting "the Business Corporations Act does", and

(b) in subsection (2) by striking out "the Company Act" and substituting "the Business Corporations Act".

 
Private Career Training Institutions Act

56 Section 5 (3) of the Private Career Training Institutions Act, S.B.C. 2003, is repealed and the following substituted:

(3) Within 90 days after the end of the fiscal year of the agency, the board must submit to the minister, in a form approved by the minister, a financial report on the operation of the fund as of the end of the preceding fiscal year prepared by a person authorized to be an auditor of a company under section 205 of the Business Corporations Act.

 
Railway Act

57 Section 8 of the Railway Act, R.S.B.C. 1996, c. 395, is amended

(a) in subsection (1) by striking out "deposited and registered" and substituting "filed",

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

(2) There must be paid to the registrar, for the incorporation of a company under this Act, the fee set out for the incorporation of a company under the Business Corporations Act and payment of the applicable fee is a condition precedent to the Registrar of Companies filing the memorandum of association. , and

(c) in subsection (3) by striking out "the Company Act" and substituting "the Business Corporations Act".

58 Section 11 is repealed and the following substituted:

Alteration of authorized share structure

11 The company may alter its authorized share structure, as that term is defined in the Business Corporations Act, in the manner, and subject to the rights and obligations, provided for in that Act.

 
School Act

59 Section 95.7 (1) (a) of the School Act, R.S.B.C. 1996, c. 412, is repealed and the following substituted:

(a) adopts, in substitution for the memorandum and articles, or for the notice of articles and articles, as the case may be, of the company,

(i) a notice of articles that reflects the information that will apply to the company on its conversion, and

(ii) articles that comply with the Business Corporations Act, .

 
Small Business Venture Capital Act

60 Section 24 (2) of the Small Business Venture Capital Act, R.S.B.C. 1996, c. 429, is amended by striking out "the Company Act." and substituting "the Business Corporations Act."

 
Transmission Corporation Act

61 Section 1 of the Transmission Corporation Act, S.B.C. 2003, c. 44, is amended by repealing the definition of "transmission corporation" and substituting the following:

"transmission corporation" means British Columbia Transmission Corporation; .

62 Section 2 (3) (a) is amended by striking out "the Company Act;" and substituting "the Business Corporations Act;".

Commencement

63 This Act comes into force by regulation of the Lieutenant Governor in Council.