You have incorporated your company. Now what?

It is not uncommon that an individual may incorporate their company, either provincially or federally, but fails to do anything else to comply with the legal requirements with respect to records required to be kept by corporations. However, both the Ontario Business Corporation Act (“OBCA”) and the Canada Business Corporation Act (“CBCA”) mandate corporations must keep certain information about the company at its registered office, in a binder, whether loose leaf or in electronic format.

For the purpose of this article, I will be focused on these record keeping requirements under the OBCA. That being said, there are similarities with federally incorporated companies under the CBCA.

Although the term “minute book” is not used in the OBCA or the CBCA, both Acts require that an incorporated company under either jurisdiction must maintain its key corporate records at its registered address to be reviewed, if and when required, not just by the shareholders of the company, but by any government entity under whose jurisdiction the company falls. One such entity could be the Canada Revenue Agency (“CRA”). The need to maintain a minute book is of even more importance since there are new requirements in place for a transparency and land register to be included in the corporation’s records.

When you have incorporated your company, you will receive the Articles of Incorporation, which creates the corporation. In addition to this, the OBCA requires the following to be kept in the company’s minute book:

1. Any amendments to the Articles and the by-laws;
2. Forms filed to complete the company’s annual return; 
3. A copy of the shareholders’ agreement (if applicable);
4. Minutes of the shareholders’ meetings and resolutions which includes the election of the directors of the company;
5. Minutes of the directors and resolutions of the directors including the resolution appointing the officers of the company together with approval of the issuance of the shares to the shareholders;
6. Subscription of the shares purchased by each shareholder including the cost of the shares purchased;
7. A shareholders’ register listing the name of each shareholder and the class of shares issued to the shareholder; and
8. A directors’ register listing all the directors and register of all the officers of the company.

In the last few years, the OBCA has been amended to require that the following disclosures be included in the minute book:

1. Ownership Interest in Land - This requires a list and detail of all real properties purchased and/ or sold by the company in Ontario, including the date the land was purchased or sold. The best practice is to include both legal and beneficial ownership interest in the real property in this register. Note, this is not a requirement under the CBCA, but that is not to say it may not be in the future.
2. Transparency Register - This came into effect as of January 1, 2023 and is in line with the CBCA. This requires a list of personal information (including, without limitation, name, birth date, address, etc.) of all the individuals with “significant ownership” in the company. Significant ownership is defined to include, but is not limited to, an individual or group of individuals with at least 25% voting control in the company or 25% or more of all the corporation’s outstanding shares measured by fair market value. Failure to provide the information required for an individual identified as having significant control in the company may result in the directors, officers, and/ or shareholders of the company being fined up to $200,000.00, being imprisoned for up to six months, or both. Although this register is required to be kept in the minute book of the company, it will not be available to the public. However, it must be made available, upon request, by a number of government officials such as law enforcement and the CRA. This is to support the overall purpose of the register – assisting the government in addressing corporate criminal activities such as money laundering. 

Given the above, it is very important that you keep your corporation’s minute book up to date by reviewing and updating it on an annual basis. Please speak with one of our lawyers in our Business Law group who would be happy to assist you with any concerns you may have regarding your corporate records and bringing them up to date.

The foregoing should not be considered to be legal advice and should not be relied upon as such. Please consult a lawyer to get advice and an opinion on your unique circumstances.