On May 1, 2015, a significant number of changes to the Yukon’s Business Corporations Act and Business Corporations Regulation were proclaimed in force. This was the culmination of an almost seven-year process undertaken to modernize the Yukon’s corporations and securities legislation.
While many of these changes simply bring the Yukon’s corporations and securities legislation in line with that of other Canadian jurisdictions, there are a number of amendments that are unique to the Yukon.
Amendments of note include:
- “Safe harbour” provisions which allow directors, with the approval the majority of directors or shareholders, to pursue a “business opportunity” which might otherwise be considered in conflict with the interest of the corporation
- If unable to attend themselves, directors are permitted to appoint another director to act as their proxy at meetings
- If provided for by a unanimous shareholders agreement, a corporation is not required to have directors at all
- Flexibility regarding the location of corporate records offices, including the ability to maintain a records office outside of the Yukon so long as it is accessible by electronic means
As explained when An Act to Amend the Business Corporations Act was introduced, these changes are designed to “contribute to the creation of a more inviting economic climate for new business registrations in the Yukon”. This has long been a goal of the Yukon, which, in an effort to attract foreign corporations, was one of the first jurisdictions to eliminate residency requirements for corporate directors.
One reporter has pointed out that these amendments alone are not likely to result in the Yukon becoming the jurisdiction where the majority of corporations in Canada are registered or, as he put it, the Yukon is not exactly poised to become “Delaware North”.
However, these changes, in addition to the lack of director residency requirements, may well make the Yukon a more attractive place for foreign and domestic companies to incorporate or continue their businesses. Certainly, when determining where to incorporate in Canada, companies should be aware of these amendments and consider how the Yukon Business Corporations Act compares to the corporate legislation of other Canadian jurisdictions.