Source: https://www.leg.bc.ca/content/data%20-%20ldp/Pages/41st4th/1st_read/gov24-1.htm
Timestamp: 2019-09-20 22:16:32
Document Index: 54191646

Matched Legal Cases: ['art 2', 'art 4', 'art 2', 'art 4', 'art 4', 'art 4', 'art 4', 'art 4']

Bill 24 – 2019: Business Corporations Amendment Act, 2019
BILL 24 – 2019
SECTION 1:	[Business Corporations Act, section 1] adds a definition of "transparency register".
1	Section 1 (1) of the Business Corporations Act, S.B.C. 2002, c. 57, is amended by adding the following definition:
"transparency register" means a transparency register referred to in section 119.2; .
SECTION 2:	[Business Corporations Act, section 41.1] establishes that Division 5 [Company Records] of Part 2 does not apply to a transparency register except as specified in Part 4.1.
2	The following section is added to Division 5 of Part 2:
41.1 This Division does not apply to a transparency register except as specified in Part 4.1.
SECTION 3:	[Business Corporations Act, section 58.1] provides for the replacement of bearer share certificates.
58.1 (1)	In this section, "bearer share certificate" means a share certificate that states that the bearer of the certificate is entitled to the shares described in the certificate.
(a)	a bearer share certificate issued by a company before October 1, 1973, and
(b)	a bearer share certificate issued by a company on or after October 1, 1973 in non-compliance with the legislative requirement to issue the certificate in the name of the person to whom it is issued.
(3)	A company must, on the request of a bearer of a bearer share certificate issued by the company, replace the bearer share certificate with a share certificate that complies with the requirements of section 57.
(4)	If a person who is the bearer of a bearer share certificate for shares to which special rights are attached applies to the company that issued the certificate to give effect to one or more of those rights, the company must not give effect to any of those rights unless the bearer share certificate is replaced with a share certificate that complies with the requirements of section 57.
SECTION 4:	[Business Corporations Act, section 70] requires companies to issue warrants in a person's name, which precludes warrants being issued in bearer form.
4	Section 70 is amended by adding the following subsection:
(1.1)	A company must set out, on the face of each warrant issued by the company after the coming into force of this subsection, the name of the person to whom it is issued.
SECTION 5:	[Business Corporations Act, Part 4.1] adds a new Part that
requires every private company to maintain a transparency register that identifies significant individuals in respect of the company, and
authorizes directors of a private company and certain inspecting officials to inspect the transparency register of the company.
Part 4.1 – Transparency Register
119.1 In this Part:
"inspecting official" means an individual who is authorized to conduct an inspection of the transparency register under section 119.7, 119.71 or 119.8;
"person who maintains the records office" in respect of a private company includes a private company that maintains its own records office;
(b)	a reporting issuer equivalent,
(c)	listed on a designated stock exchange within the meaning of section 248 (1) of the Income Tax Act (Canada), or
(d)	within a prescribed class of companies;
(b)	a prescribed law of British Columbia or Canada that is related to a law referred to in paragraph (a).
119.11 (1)	In this section, "significant number of shares", in respect of a private company, means either of the following:
(a)	25% or more of the issued shares of the company;
(b)	issued shares of the company that carry 25% or more of the rights to vote at general meetings.
(2)	Subject to any prescribed class of exclusions, an individual is a significant individual in respect of a private company if any of the following apply:
(a)	the individual has any of the following interests or rights, or any combination of them, in a significant number of shares of the private company:
(i)	an interest as a registered owner of one or more of the company's shares;
(ii)	an interest as a beneficial owner of one or more of the company's shares, other than an interest that is contingent on the death of another individual;
(iii)	indirect control, within the meaning of the regulations, of one or more of the company's shares;
(b)	the individual has any of the following rights or abilities, or any combination of them, that, if exercised, would result in the election, appointment or removal of the majority of the directors of the private company:
(i)	the right to elect, appoint or remove one or more of the company's directors;
(ii)	indirect control, within the meaning of the regulations, of the right to elect, appoint or remove one or more of the company's directors;
(c)	the individual has a prescribed interest, right or ability in relation to the private company, or a prescribed criterion or circumstance applies to the individual in relation to the private company.
(3)	If an interest or right referred to in subsection (2) in respect of a private company is held jointly by 2 or more individuals, each individual is a significant individual in respect of the company.
(4)	When 2 or more individuals have interests, rights or abilities that, when combined, meet a criterion described in subsection (2) (a), (b) or (c) in respect of a private company, each individual is a significant individual in respect of the company if
(b)	each individual is an associate, within the meaning of paragraph (c) or (d) of the definition of "associate" in section 192 (1), of the other individuals.
119.2 (1)	A private company must take reasonable steps to maintain a transparency register that contains the information and material referred to in subsections (2) to (5).
(2)	The transparency register must contain the following information for each significant individual in respect of the private company:
(a)	the individual's full name, date of birth and last known address;
(d)	whether or not the individual is resident in Canada for the purposes of the Income Tax Act (Canada);
(e)	the date on which the individual became or ceased to be a significant individual in respect of the company;
(f)	a description of how the individual is a significant individual;
(g)	prescribed information, if any.
(3)	If a private company determines that there are no individuals who are significant individuals in respect of the company, the transparency register must contain a statement setting this out.
(4)	If a private company is unable to obtain or confirm some or all of the information referred to in subsection (2) in respect of a significant individual, the transparency register must contain the following:
(a)	the information referred to in subsection (2) that the company was able to obtain or confirm in respect of the individual;
(b)	for information referred to in subsection (2) that the company was not able to obtain or confirm, a summary of the steps taken to obtain or confirm the information;
(5)	If, by operation of section 119.6, an order is made under section 45 (1) in respect of the private company's transparency register, the transparency register must contain a copy of the order.
Shareholder's duty to send information
119.21 (1)	A private company may at any time send to a shareholder of the company a request to provide the company with information for the purposes of maintaining its transparency register.
(2)	A shareholder, after receiving a request under subsection (1), must, after taking reasonable steps to compile the requested information, promptly send to the private company the information that the shareholder was able to compile.
Annual review to confirm information
119.3 A private company must annually, within the period starting on the anniversary of the date on which the company was recognized and ending 2 months after that date, take reasonable steps to confirm that the information required under section 119.2 to be contained in its transparency register is accurate, complete and up to date.
119.31 (1)	If a private company becomes aware of any new or different information referred to in section 119.2 (2) or (3) as a result of steps taken in accordance with section 119.3 or through any other means, the company must record that information in its transparency register within 30 days after becoming aware of the information.
(2)	If a private company is unable to obtain or confirm some or all of the information referred to in section 119.2 (2) after taking steps in accordance with section 119.3 as part of the company's annual review, the company must record in the transparency register the information specified in section 119.2 (4) within the 2-month period referred to in section 119.3 in respect of that annual review.
Duties after individual ceases to be a significant individual
119.4 Within one year after the sixth anniversary of the date on which an entry is made in a private company's transparency register indicating that an individual has ceased to be a significant individual in respect of the company, the company must
(a)	delete from its transparency register all information relating to the individual, and
(b)	destroy any record that the company created or received in respect of the individual for the purposes of maintaining the transparency register.
Duty to notify individuals
119.41 A private company must, within 10 days after indicating in its transparency register that an individual is a significant individual in respect of the company or that an individual has ceased to be a significant individual in respect of the company, send a notice to the individual that sets out this fact and the prescribed information, if any.
Location of transparency register
119.5 (1)	Subject to subsection (2), a private company must keep its transparency register at its records office.
(2)	A private company may keep its transparency register at a location other than its records office so long as the register is available for inspection and copying, in accordance with sections 119.7 to 119.91, at its records office by means of a computer terminal or other electronic technology.
Requirements relating to transparency register
119.51 (1)	A person who maintains the records office for a private company must take reasonable steps to
(a)	keep the company's transparency register in a complete state,
(b)	avoid loss, mutilation or destruction of the transparency register, except as required under section 119.4,
(c)	avoid falsification of entries in the transparency register, and
(d)	provide inspecting officials and the company's directors with simple, reliable and prompt access to the transparency register.
(2)	A person who maintains the records office for a private company must ensure that the company's transparency register is maintained
(a)	in an electronic form,
(b)	on microfilm,
(c)	in a bound or looseleaf form, or
(d)	in another prescribed form.
119.6 Section 45 (1) [missing records] applies in respect of a private company's transparency register.
Inspection of transparency register
119.61 (1)	A person who maintains the records office for a private company must allow an inspecting official or a director of the company who complies with the requirements and restrictions under section 119.81 (1) or 119.9, as the case may be, to inspect the company's transparency register.
(2)	A person who maintains the records office for a private company must not allow anyone to inspect the company's transparency register except
(a)	an inspecting official, or
(b)	a director of the company.
Inspection for tax purposes
119.7 An official or employee of a taxing authority may inspect a private company's transparency register for the following purposes:
(b)	providing information contained in the transparency register to another jurisdiction in or outside Canada to assist the jurisdiction in the administration or enforcement of a law of that jurisdiction that provides for the imposition or collection of a tax, royalty or duty if this assistance is authorized under an arrangement, written agreement, treaty or law of British Columbia or Canada.
Inspection for law enforcement purposes
119.71 An officer within the meaning of the Police Act or a member of the Royal Canadian Mounted Police may inspect a private company's transparency register for the following purposes:
(b)	policing and criminal intelligence operations in Canada;
(d)	providing information contained in the transparency register to a law enforcement agency in a jurisdiction outside Canada to assist the agency in a law enforcement proceeding if this assistance is authorized under an arrangement, written agreement, treaty or law of British Columbia or Canada.
Inspection for regulatory purposes
119.8 An official or employee of a regulator may inspect a private company's transparency register for the following purposes:
(b)	assisting another agency in Canada in the administration or enforcement of a law that is similar to a law for which the regulator is responsible;
(c)	providing information contained in the transparency register to an agency outside Canada to assist the agency in the administration or enforcement of a law that is similar to a law for which the regulator is responsible if this assistance is authorized under an arrangement, written agreement, treaty or law of British Columbia or Canada.
Inspecting official – requirements and restrictions
119.81 (1)	An inspecting official who inspects a transparency register is subject to the following requirements and restrictions:
(a)	subject to paragraph (b), the inspection must occur during statutory business hours;
(b)	if a private company has passed an ordinary resolution in accordance with subsection (2) that reduces the hours during which the transparency register may be inspected, the inspection of the company's transparency register must occur during those hours;
(c)	the inspecting official must present identification on the request of the person who provides access to the transparency register;
(d)	prescribed requirements or restrictions, if any.
(2)	A private company may, by an ordinary resolution, reduce the hours during which an inspecting official may inspect its transparency register, but the resolution must provide that the transparency register may be inspected for a period of at least 2 consecutive hours per day within statutory business hours.
Hours when director can inspect
119.9 A director of a private company is restricted to inspecting the company's transparency register during statutory business hours.
Copies of transparency register
119.91 (1)	If an inspecting official or director requests a copy of a private company's transparency register and pays, to the person who maintains the records office for the company, the copying fee, if any, set by that person, the person must provide, in accordance with subsection (3), the copy to the inspecting official or director promptly after receipt of the payment.
(2)	The copying fee referred to in subsection (1) must not exceed the prescribed maximum copying fee.
(3)	A copy of the transparency register referred to in subsection (1) must be provided
(a)	in a manner agreed on by the individual seeking to obtain the copy and the person who maintains the records office, or
(b)	in the absence of agreement, in a prescribed manner or by registered mail as selected by the individual seeking to obtain the copy.
SECTION 6:	[Business Corporations Act, section 230] adds the transparency register to the records that can be corrected by court order.
6	Section 230 (1) is amended by striking out "and" at the end of paragraph (e), by adding ", and" at the end of paragraph (f) and by adding the following paragraph:
(g)	if the company is a private company within the meaning of section 119.1, the company's transparency register.
SECTION 7:	[Business Corporations Act, section 330] adds the transparency register to the records that must be maintained by a liquidator of a private company.
7	Section 330 is amended
(c.01)	if the company is a private company within the meaning of section 119.1, ensure that the company's transparency register is maintained and made available in accordance with Part 4.1, , and
(b)	in paragraph (c.1) by adding "or (c.01)" after "without limiting paragraph (c)".
SECTION 8:	[Business Corporations Act, section 351] adds the transparency register to the definition of a dissolved company's records.
8	Section 351 (1) is amended
(a)	in paragraph (a) by striking out "and" at the end of subparagraph (i) and by adding the following subparagraph:
(i.1)	if the company was a private company within the meaning of section 119.1, the company's transparency register, and , and
(b)	in any other case, the records that the company was, immediately before its dissolution, required to keep under section 42 and, if the company was a private company within the meaning of section 119.1, the company's transparency register.
SECTION 9:	[Business Corporations Act, section 352] requires a person who is required to retain the transparency register of a dissolved private company to allow inspection of, and to provide copies of, the register in specified circumstances.
9	Section 352 is amended
(1.1)	Subject to subsection (4), in the case of a private company within the meaning of section 119.1 that is dissolved under this Act, the person who, under section 351, is required to retain and produce the company's transparency register must, if and to the extent requested to do so by a person who was, before the dissolution, entitled to inspect the transparency register,
(a)	allow the requesting person to inspect the transparency register during statutory business hours, and
(b)	promptly provide to the requesting person, in accordance with subsection (3) of this section, a copy of the transparency register on payment of the copying fee, if any, set by the person who is required to retain and produce the transparency register, which fee must not exceed the prescribed fee. ,
(b)	in subsection (3) by striking out "subsection (1) (b)" and substituting "subsection (1) (b), (1.1) (b)", and
(c)	in subsection (4) by striking out "subsection (1)" and substituting "subsection (1), (1.1)".
SECTIONS 10 AND 11:	[Business Corporations Act, section 426] make it an offence to contravene specified provisions added to the Act by this Bill.
10	Section 426 (1) (a) is amended by adding "58.1 (3) or (4)," after "51.96 (3),".
11	Section 426 is amended
(4.1)	A person who contravenes section 119.2 (1), 119.21 (2), 119.3, 119.31, 119.4, 119.41 or 119.61 commits an offence. , and
(b)	in subsection (5) (b) by adding "or 119.91 (3)" after "section 48 (3)".
SECTION 12:	[Business Corporations Act, section 427] makes a technical change to ensure consistency with section 427.1 as added to the Act by this Bill.
12	Section 427 (2) is amended by adding ", subject to subsection (3)," before "authorizes, permits".
SECTION 13:	[Business Corporations Act, section 427.1] makes it an offence for a private company to make false entries in its transparency register and for shareholders of a private company to provide false information to the company for the purposes of the company's transparency register.
427.1 (1)	In this section:
"private company" has the same meaning as in section 119.1;
"significant individual" means a significant individual under section 119.11.
(2)	Subject to subsection (4), a private company commits an offence if its transparency register
(a)	identifies an individual as a significant individual who is not a significant individual in respect of the company,
(b)	excludes an individual who is a significant individual in respect of the company,
(c)	contains information about a significant individual that is false or misleading in respect of any material fact, or
(d)	omits information about a significant individual, the omission of which makes the information false or misleading.
(3)	If a private company commits an offence under subsection (2), any director or officer of the company who, subject to subsection (4), authorizes, permits or acquiesces in the commission of the offence also commits an offence, whether or not the company is prosecuted or convicted.
(4)	No person is guilty of an offence under subsection (2) or (3) if the person
(a)	did not know that the identification or exclusion of the individual was incorrect or that the information about a significant individual was false or misleading, and
(b)	with the exercise of reasonable diligence, could not have known that the identification or exclusion of the individual was incorrect or that the information was false or misleading.
(5)	Subject to subsection (6), a shareholder of a private company who sends information to the company for the purposes of the company's transparency register commits an offence if the information
(a)	is false or misleading in respect of any material fact, or
(b)	omits any material fact, the omission of which makes the information false or misleading.
(6)	No person is guilty of an offence under subsection (5) if the person
(a)	did not know that the information was false or misleading, and
(b)	with the exercise of reasonable diligence, could not have known that the information was false or misleading.
SECTION 14:	[Business Corporations Act, section 428] establishes the penalties for offences related to the transparency register.
14	Section 428 is amended by adding the following subsection:
(2.1)	A person who commits an offence under section 426 (4.1) or 427.1 (2), (3) or (5) is liable
(a)	in the case of a person other than an individual, to a fine of not more than $100 000, and
(b)	in the case of an individual, to a fine of not more than $50 000.
SECTION 15:	[Business Corporations Act, section 432]
allows for regulations that establish time periods for keeping records to be different for different records;
adds a new regulation-making power with respect to the transparency register.
15	Section 432 is amended
(a)	in subsection (2) (g) by striking out "different manners and forms" and substituting "different manners, forms and periods", and
(9.2)	Without limiting any other subsection of this section, the Lieutenant Governor in Council may make regulations respecting a matter for which regulations are contemplated in Part 4.1, and those regulations may
(a)	be different for different matters or things or for different classes of matters or things in respect of which the regulations are made, including, without limitation, differences based on types of inspecting officials or circumstances,
(b)	in excluding a class of companies from the definition of "private company" in section 119.1 or excluding a class of individuals from being a significant individual for the purposes of section 119.11, provide limits or conditions on the exclusion and circumstances in which the exclusion applies, and
(c)	in setting out the meaning of indirect control for the purposes of section 119.11 (2) (a) (iii) or (b) (ii), include criteria or circumstances that are based on the ownership of shares even though the ownership of the shares does not result in control.
3 Sections 5 to 9 By regulation of the Lieutenant Governor in Council
4 Sections 11 to 15 By regulation of the Lieutenant Governor in Council