A challenge for many foreign businesses operating in Canada has been our history of requiring the boards of directors of Canadian business corporations to include a minimum number of resident Canadians. While several provinces have already moved away from this policy, Ontario (and the federal government) have been notable holdouts. For many private companies, the task of finding Canadians willing to sit on their boards of directors has been a difficult and sometimes impossible task. The minimum resident Canadian director requirement has been an obvious impediment to foreign investment in Ontario.
Commencing July 5th, 2021, with the coming into force of Bill 213: Better for People, Smarter for Business Act, 2020 (“Bill 213”), this will no longer be the case for Ontario incorporated businesses. Effective as of this date, section 118(3) of the Business Corporations Act (Ontario), the section that required that resident Canadians make up at least 25% of the directors of Ontario incorporated business corporations, is being repealed.
This change will apply automatically to all Ontario business corporations, regardless of when they were incorporated.
If you would like more information about the changes being implemented by Bill 213 and how they will impact your business, you can reach one of our business lawyers through our Team page or email us [email protected].
At Ross Rumbell Business Law, we are here to solve your legal issues and protect your business through every stage of growth and legal challenge. Our client-centric firm is tech-savvy, results-driven and truly focused on you, the business owner. Whether you are a start-up, a growing firm or an established company seeking expert and responsive legal advice, we are here to help.