In February 2015, the Ministry of Government and Consumer Services commissioned a panel of 13 industry experts (Panel) to review Ontario’s corporate and commercial statutes as a step in developing a reform agenda to modernize and update Ontario’s business legislation. In June 2015, the Panel released the Business Law Agenda: Priority Findings & Recommendations Report with its recommendations. The report contains five key proposals:
1. Implementing a system to regularly update corporate and commercial law
The Panel noted that a comprehensive review of Ontario’s corporate and commercial legislation had not recently been completed. It suggested establishing a formal process that would provide for the regular review of Ontario’s business legislation in order to keep up with legislative and case law developments and to regularly solicit advice, comments and/or concerns from industry experts.
2. Encouraging businesses to choose Ontario as their jurisdiction of incorporation
The Panel suggested several legislative changes to attract businesses to Ontario including:
- Reviewing the Business Corporations Act (Ontario) to: better facilitate electronic meetings and communications; provide greater clarity on the standards to which directors and officers are held and the defences and protections available to them; and increase the rights and remedies available to beneficial shareholders;
- Evaluating Ontario’s Limited Partnership Act (which has not been substantively reviewed since the 1980s) to consider the potential liabilities of limited partners and whether the scope of such liabilities should be reduced; and
- Examining whether to broaden the types of businesses that may use limited liability partnerships.
3. Increasing market certainty and confidence in market transactions
In order to increase certainty in the assessment of potential fraudulent conveyances and fraudulent preferences, the Panel recommended the repeal of the Assignments and Preferences Act and the Fraudulent Conveyances Act and the adoption of the Uniform Law Conference of Canada’s Reviewable Transactions Act. The Panel also recommended the repeal of the Bulk Sales Act, as Ontario is the only jurisdiction which has not yet repealed it.
4. Modernizing laws relating to secured lending and other commercial activity
The Panel recommended reviewing the Personal Property Security Act in order to harmonize it with legislation in other provinces and to update it to incorporate legislative and case law developments.
5. Facilitating market activity and promoting small business growth
Among other suggestions for increasing certainty to business legislation that impact small businesses, the Panel recommended a review of business information and registration legislation in order to decrease the burden and cost on small businesses.
The Ministry of Government and Consumer Services is seeking public feedback and comments on the report by October 16, 2015. Comments may be submitted via e-mail email@example.com (with “Business Law Agenda Report” in the subject line) or by mail to Business Law Policy, Consumer and Business Policy Unit, Ministry of Government and Consumer Services, 5th Floor, 777 Bay Street, Toronto, Ontario M7A 2J3.