An Act to amend the Canada Business Corporations Act and to make consequential and related amendments to other Acts

This bill is from the 44th Parliament, 1st session, which ended in January 2025.

Sponsor

Status

This bill has received Royal Assent and is now law.

Summary

This is from the published bill. The Library of Parliament has also written a full legislative summary of the bill.

This enactment amends the Canada Business Corporations Act to, among other things,
(a) require the Director appointed under that Act to make available to the public certain information on individuals with significant control over a corporation;
(b) protect the information and identity of certain individuals;
(c) add, or broaden the application of, offences and provide the Director with additional enforcement and compliance powers; and
(d) add regulatory authority to prescribe further requirements in certain provisions.
It also makes consequential and related amendments to other Acts.

Elsewhere

All sorts of information on this bill is available at LEGISinfo, an excellent resource from Parliament. You can also read the full text of the bill.

Bill numbers are reused for different bills each new session. Perhaps you were looking for one of these other C-42s:

C-42 (2017) Veterans Well-being Act
C-42 (2014) Law Common Sense Firearms Licensing Act
C-42 (2012) Law Enhancing Royal Canadian Mounted Police Accountability Act
C-42 (2010) Law Strengthening Aviation Security Act

Votes

June 22, 2023 Passed 3rd reading and adoption of Bill C-42, An Act to amend the Canada Business Corporations Act and to make consequential and related amendments to other Acts
June 20, 2023 Passed Concurrence at report stage of Bill C-42, An Act to amend the Canada Business Corporations Act and to make consequential and related amendments to other Acts
June 20, 2023 Failed Bill C-42, An Act to amend the Canada Business Corporations Act and to make consequential and related amendments to other Acts (report stage amendment)
June 19, 2023 Passed Time allocation for Bill C-42, An Act to amend the Canada Business Corporations Act and to make consequential and related amendments to other Acts
June 1, 2023 Passed 2nd reading of Bill C-42, An Act to amend the Canada Business Corporations Act and to make consequential and related amendments to other Acts

Debate Summary

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This is a computer-generated summary of the speeches below. Usually it’s accurate, but every now and then it’ll contain inaccuracies or total fabrications.

Bill C-42 aims to combat money laundering, terrorist financing, and tax evasion by amending the Canada Business Corporations Act to create a publicly accessible registry of beneficial owners of federally regulated corporations. The registry will require corporations to disclose information about individuals with significant control, including residential addresses and citizenship, while implementing an exemption regime for at-risk individuals and protections for whistle-blowers. The bill also proposes consequential amendments to other acts to facilitate information sharing and data validation, with the goal of improving corporate accountability and public trust.

Liberal

  • Supports beneficial ownership registry: The Liberal Party supports Bill C-42, which would implement a public and searchable beneficial ownership registry of corporations governed under the Canada Business Corporations Act. The registry would increase the transparency of beneficial owners of federally regulated Canadian corporations, which would increase corporate accountability and improve public trust in corporate institutions.
  • Combat financial crimes: The Liberals argue that the bill would strengthen Canada's efforts to prevent and combat financial crimes, facilitate tax administration, and improve corporate accountability. It is intended to help protect the public, improve trust in business institutions, and ensure a well-functioning marketplace.
  • Minimize administrative burden: The Liberal speakers argue that the bill minimizes the administrative burden on businesses by leveraging existing intake and reporting mechanisms that federal corporations are already familiar with, such as annual updates.
  • Collaboration with provinces: The Liberals are working to ensure that the federal registry is scalable and provides access to the beneficial ownership data held by provinces and territories that agree to participate. They cite collaboration with Quebec as an example.

Conservative

  • Supports registry concept: The Conservatives support the concept of a national public registry of beneficial owners of companies as an important tool in the fight against money laundering and terrorist financing. The Cullen commission in British Columbia called for the creation of such a registry.
  • Bill has shortcomings: The Conservatives believe that much can be done to improve this bill and guarantee that it is effective. They feel that in order to reach the objectives of this registry, the bill must be amended.
  • Need pan-Canadian registry: The corporate registry will be only as strong as the provinces and territories that opt into it, and without all of them on board, criminals will just take their dirty money to the jurisdiction with the least strongest regulations. Amendments should be adopted to ensure the federal government is required to pursue agreements with the provinces and territories on information sharing to ensure the registry is truly pan-Canadian and interoperable.
  • Penalties must be stronger: Parliament needs to consider the registry in the context of the ability of law enforcement to combat the use of illegal funds, and strengthen some of the penalties. The government should consider strengthening the penalties and making some offences indictable, and ensure that corporations that do not comply with these regulations are held just as accountable as the individuals involved.
  • Lower the threshold: The CBCA currently defines significant control as an individual who owns or controls 25% or more, which is quite a high threshold. The House should consider aligning these regulations with those currently imposed on publicly traded companies by amending this bill to change the threshold to 10%.
  • Registry functionality unclear: The bill is concerningly quiet when it comes to how this registry will work and what information will be made available to the public. What exactly does it mean by “prescribed information”?, as the information made publicly available must keep in mind privacy interests.

NDP

  • Supports beneficial ownership registry: The NDP supports a public beneficial ownership registry, arguing it will help identify individuals with controlling stakes in the economy. This will address issues like unjustified price hikes and opaque land-use decisions.
  • Combating money laundering: The NDP believes the registry is crucial for combating money laundering, as Canada has a reputation as a destination for illicit funds. Identifying beneficiaries of corporate holdings is essential for effective action.
  • Enforcing sanctions on Russia: The registry is seen as a vital tool for enforcing sanctions against Russia by identifying the individuals behind corporate entities. This would enable Canada to take more meaningful action against those supporting the war in Ukraine.
  • Addressing wealth inequality: The NDP argues the registry will help track the wealth of the top 1%, enabling the implementation of wealth taxes. This is seen as a solution to the structural deficits causing problems for most Canadians, in contrast to Conservative proposals like cutting the carbon tax.

Bloc

  • Supports greater transparency: The Bloc supports the bill's aim to increase transparency by requiring federally incorporated businesses to report their real owners to Corporations Canada, creating a public registry.
  • Importance of provincial jurisdiction: The Bloc emphasizes the importance of respecting provincial jurisdiction over business ownership and property rights, particularly Quebec's Civil Code and Autorité des marchés financiers, to avoid centralization and ensure continued harmonization of laws.
  • Identifying beneficial owners: The Bloc questions whether the bill effectively identifies the true owners of companies with complex structures, especially those involving entities in tax havens or countries with limited information sharing, and emphasizes the need for well-equipped monitoring teams and international cooperation.
  • Mirrors Quebec's Efforts: The Bloc highlights that Quebec has already passed similar legislation (Bill 78) to create a registry of beneficial owners, emphasizing the importance of coordinating efforts between the federal and provincial governments.
Was this summary helpful and accurate?

Canada Business Corporations ActGovernment Orders

May 31st, 2023 / 5:10 p.m.

Winnipeg North Manitoba

Liberal

Kevin Lamoureux LiberalParliamentary Secretary to the Leader of the Government in the House of Commons

Mr. Speaker, the member, in his concluding remarks, talked about unintended consequences, and at the beginning of his speech, he said it has taken a number of years to get the bill to this stage. One of the reasons it has taken the time it has is so we could do the proper consultation necessary. We need to allow civil servants to do what they do best in terms of ensuring that we have something of substance, in good form, so it can go to a standing committee to see if there are ways we can improve upon it there. Issues such as individual privacy are of great concern; there is no doubt about that.

My question, as I posed to his colleague, is this: Does the member, having looked at the legislation, have any specifics about where he, personally, would like to see some changes?

Canada Business Corporations ActGovernment Orders

May 31st, 2023 / 5:15 p.m.

Conservative

Mel Arnold Conservative North Okanagan—Shuswap, BC

Mr. Speaker, as this bill works its way through the process, we may see amendments at committee stage. I look forward to possibly being able to participate.

The issue I raised is that it has taken over four years, and the government is eight years into its mandate. The issues I raised within the fisheries sector have been very clear, but there was little to no action until stakeholders really started pressing the government. We are finally starting to see some very slow, initial steps being taken, steps that should have been taken years ago.

Canada Business Corporations ActGovernment Orders

May 31st, 2023 / 5:15 p.m.

Bloc

Caroline Desbiens Bloc Beauport—Côte-de-Beaupré—Île d’Orléans—Charlevoix, QC

Mr. Speaker, I commend my Conservative colleague. We sit on the Standing Committee on Fisheries and Oceans together. We work very well together. It is a pleasure to work with him. He is thorough, skilled and always diligent. I want to take this opportunity to thank him for his work.

Time is money. Everyone knows that. My colleague mentioned the time it takes to get a reaction from the government. We are studying foreign investments in fisheries, and we hear that there are even people who are asking to testify in camera, which is very troubling.

I would like my colleague to talk about how effectively and quickly we need to act if we do not want to essentially lose ownership of our fishery resources.

Canada Business Corporations ActGovernment Orders

May 31st, 2023 / 5:15 p.m.

Conservative

Mel Arnold Conservative North Okanagan—Shuswap, BC

Mr. Speaker, I thank the member for the kind mention of my work at FOPO. We have heard from witnesses. Some have asked to appear in camera, with their names not divulged, because they were afraid of repercussions. We have heard of other harvesters who are concerned, but, out of fear of repercussions, simply will not testify. It is very concerning to us as members, and to me as a parliamentarian, to hear that there are those kinds of threats and concerns being brought. Sometimes, the only way people and their families feel safe is through back doors. I think it is a bigger issue that we as parliamentarians owe a duty to Canadians to fully investigate, to fully make sure we retain beneficial ownership of Canada's resources for Canadians.

Canada Business Corporations ActGovernment Orders

May 31st, 2023 / 5:15 p.m.

Conservative

Marty Morantz Conservative Charleswood—St. James—Assiniboia—Headingley, MB

Mr. Speaker, there is one thing I want to ask my colleague about. The bill would put the threshold for significant control at 25% or more of the company shares. For it to be truly effective, I think, and a lot of my Conservative colleagues would agree with me, the threshold would need to be lower, like, for example, what is used by the Ontario Securities Commission, which is 10%.

I wonder if the member could comment on that.

Canada Business Corporations ActGovernment Orders

May 31st, 2023 / 5:15 p.m.

Conservative

Mel Arnold Conservative North Okanagan—Shuswap, BC

Mr. Speaker, certainly, the threshold of 25% seems to be quite high, especially when tracking of that foreign ownership may not be all that clear in other countries. That 25% threshold, I believe, should be lowered, and we may see that amendment at the committee stage.

Canada Business Corporations ActGovernment Orders

May 31st, 2023 / 5:20 p.m.

Conservative

Ed Fast Conservative Abbotsford, BC

Mr. Speaker, I am thankful for the opportunity to engage in this debate.

The reason I find this so important is that I am from the beautiful province of British Columbia and from the city of Abbotsford, which is nestled between majestic Mount Baker, at 10,500 feet high, and, on the other side, the mighty Fraser River. We live in a wonderful community in a wonderful region of the country. However, one of the challenges we have had over the years is that Canada, and more specifically British Columbia, has become the locus, the very heart, of money laundering in our country.

Just so Canadians understand what money laundering is, I will note that it is not benign activity engaged in by Canadians who want to avoid taxes or something like that. Money laundering is about taking the proceeds of crime, channelling them into what appears to be a legitimate business or a legitimate asset and trying to make those proceeds seem legitimate. It is a great way for criminals to hide the proceeds of crime. The last thing I believe Canadians want to do is aid and abet criminals to commit their crimes in our country, yet that is what has been happening for many years.

This legislation is not the be-all and end-all. Bill C-42 is simply a part of the solution. What it would do is establish a beneficial registry, an ownership registry, that would allow Canadians to see who actually owns the companies into which money might be directed from the proceeds of crime. This is not going to solve the whole problem of money laundering. Our police have their hands full in trying to track these criminals down, trying to identify the proceeds of crime and trying to get convictions.

Here is another problem. Money laundering has contributed significantly to the inflationary impacts on prices of land, real estate and homes that Canadians want to buy. These criminals know that if they can get money channelled into a house, it will be less likely for the police to identify that asset as being a proceed of crime. They also channel these proceeds of crime into legitimate businesses, like small and medium-sized enterprises. They channel this money into hard assets. They may be boats or expensive cars. At the end of the day, this costs Canadians big time.

There is another reason this is important to British Columbians. It was in British Columbia that the Cullen commission was established to investigate this very challenging problem to our criminal justice laws and to the broader issue of how much money laundering costs the average Canadian.

The Cullen commission made a long list of recommendations, most of which implicated the provincial government. It called upon the provincial government to act. However, there was one recommendation that stood out, which was that the federal government establish a pan-Canadian beneficial ownership registry for corporations. I believe Justice Cullen really intended for this to cover all companies in Canada. The problem is that the criminal justice law is federal law, so we as a Parliament have jurisdiction over it. Here is the problem: The large majority of Canadian companies are incorporated not at the federal level but at the provincial level, implicating every one of our 10 provinces and our territories.

How do we cobble together a pan-Canadian foreign ownership registry program with all of these different players at the table? The bill would, at least in the immediate term, establish a corporate beneficial ownership registry for federally incorporated companies, which is a good start. However, I believe the Cullen commission's intent was for the Liberal government to engage the provinces and territories to expand this to include the provincial regimes in federal legislation so that we can go after the money launderers in every corner of our country.

There is a reason this has come to our attention as lawmakers. Back in 2016, the Panama papers exposed how vulnerable Canada was to money laundering. Those papers made it clear that Canada was a laggard on the international stage when it came to addressing money laundering and interdicting the criminals who were taking proceeds of crime, filtering that money through legitimate enterprises and assets and then getting away with their crimes.

In 2017, it was the Liberal government's finance minister, Bill Morneau, who said we needed a beneficial registry to help combat money laundering in our market to determine the true source of funds and ownership in the acquisition of firms. He was right at that time, and that was 2017.

What happened in the intervening years? Nothing. From 2016 to 2023, we had eight years of inaction on the part of the Liberal government. This is pretty shocking, since the government, through its finance minister, at the very least had become aware that this was a very important issue for Canadians and nothing was done.

I will say that I am pleased that at least this has now come before us as Bill C-42, and it looks like we will see a beneficial ownership registry passed and implemented in our country. However, as the bill goes through committee review and comes back to the House, we are going to be asking a lot of questions. For example, how will this registry protect Canadians' privacy rights? We want to interdict criminals as they try to undertake their criminal enterprises, but we also want to make sure that the privacy of Canadians is protected.

I do not have great confidence that the government will actually protect our privacy, and here is why. We recently debated Bill C-27 in the House, which is all about privacy rights. We have been asking the government to actually include privacy as a fundamental right in Canada that Canadians can depend on. Sadly, Bill C-27 did not include that, so we have a right to be concerned.

We also want to ask who will have access to the information in the beneficial registry. Is it the police? Is it the ordinary citizen? It is business people? None of that is clarified in this legislation. We need to know that. Will the bill give law enforcement the necessary tools to combat money laundering and terrorist financing?

To conclude, I believe there is all-party agreement, so I am asking for unanimous consent to request a recorded vote on Bill C-42.

Canada Business Corporations ActGovernment Orders

May 31st, 2023 / 5:25 p.m.

The Assistant Deputy Speaker Carol Hughes

Does the hon. member have unanimous consent?

Canada Business Corporations ActGovernment Orders

May 31st, 2023 / 5:25 p.m.

Some hon. members

Agreed.

Canada Business Corporations ActGovernment Orders

May 31st, 2023 / 5:25 p.m.

The Assistant Deputy Speaker Carol Hughes

Pursuant to order made on Thursday, June 23, 2022, the division stands deferred until Thursday, June 1, at the expiry of the time provided for Oral Questions.

The House resumed from May 31 consideration of the motion that Bill C-42, An Act to amend the Canada Business Corporations Act and to make consequential and related amendments to other Acts, be read the second time and referred to a committee.

Canada Business Corporations ActGovernment Orders

June 1st, 2023 / 3:10 p.m.

The Speaker Anthony Rota

It being 3:13 p.m., pursuant to order made on Thursday, June 23, 2022, the House will now proceed to the taking of the deferred recorded division on the motion at second reading of Bill C-42.

Call in the members.

(The House divided on the motion, which was agreed to on the following division:)

Vote #343

Canada Business Corporations ActGovernment Orders

June 1st, 2023 / 3:25 p.m.

The Speaker Anthony Rota

I declare the motion carried. Accordingly, the bill stands referred to the Standing Committee on Industry and Technology.

(Bill read the second time and referred to a committee)

Canada Business Corporations ActGovernment Orders

June 1st, 2023 / 3:25 p.m.

The Speaker Anthony Rota

I wish to inform the House that, because of the deferred recorded division, Government Orders will be extended by 12 minutes.