Evidence of meeting #13 for Industry, Science and Technology in the 40th Parliament, 2nd Session. (The original version is on Parliament’s site, as are the minutes.) The winning word was provincial.
A recording is available from Parliament.
4:35 p.m.
Conservative
The Chair Conservative Michael Chong
Thank you, Mr. Lennon.
Mr. Wallace had something to say on this.
4:35 p.m.
Conservative
Mike Wallace Conservative Burlington, ON
I think the staff have been clear on why this should be here. It's not something that's to be used that often. From the government's perspective, or from the perspective of all governments, I think we're better off....
I know the act is big. It was big before and it still stays big. But I think we're better off with the protections this provides than without having it there and causing issues for those one or two or three or four—whatever happens every year—who have to engage in legal process to resolve the issues that we have here incorporated in the act. I'm encouraging other members to keep parts 6 and 7 intact.
Thank you very much.
4:35 p.m.
Conservative
Mike Lake Conservative Edmonton—Mill Woods—Beaumont, AB
I'd reiterate what Mr. Wallace is saying. The point Mr. Lennon makes is that they are self-contained. There's nothing complex for anybody for whom these two parts don't apply anyway; those smaller organizations can simply skip those two parts, and I don't really believe they make the situation more complex for individuals. I'm certainly not comfortable wiping out as many...we're talking about almost 100 clauses of our bill here. There is a reason why they're in it.
One question I have is whether these two parts have been in previous incarnations of this bill.
4:35 p.m.
Senior Project Leader, Corporate and Insolvency Law Policy and Internal Trade Directorate, Department of Industry
Yes.
4:35 p.m.
Manager, Policy Section, Corporations Canada, Department of Industry
They are not new. In fact, I don't think they have changed since the original Bill C-21.
4:35 p.m.
Conservative
4:35 p.m.
Manager, Policy Section, Corporations Canada, Department of Industry
November 2004 is when it was introduced.
4:35 p.m.
Conservative
Mike Lake Conservative Edmonton—Mill Woods—Beaumont, AB
Okay, and at that time there was no move to pull those out.
I'm curious what members of the other two parties at the table would have to say about this. Is there an indication as to which direction you're leaning?
4:35 p.m.
Conservative
The Chair Conservative Michael Chong
Thank you, Mr. Lake.
Are there any further comments?
Mr. Thibeault.
April 21st, 2009 / 4:35 p.m.
NDP
Glenn Thibeault NDP Sudbury, ON
I do have some comments. I have some trepidation, looking right off the bat at parts 6 and 7, at unilaterally removing them without having the opportunity to know what is actually in them.
I completely understand my peers down the table wanting to make it easier for not-for-profits, but I would really need some clarification of the impacts removing these parts would have. I'm hoping staff can restate this, once again.
4:40 p.m.
Senior Project Leader, Corporate and Insolvency Law Policy and Internal Trade Directorate, Department of Industry
The parts are intended to assist and provide guidance, procedures, and rules for the small number of corporations who may issue debt obligations to get financing. A number of the corporations under this act are quite large. They undertake capital projects. They can go out into the public marketplace to get capital funds. These procedures allow them to do that.
4:40 p.m.
Manager, Policy Section, Corporations Canada, Department of Industry
To specify what is in part 6, it spells out what a debt obligation is, what sort of certificate is required to create one, what kind of record-keeping the corporation is required to do, how you transfer debt obligations from one person to another—because some of these are traded on the stock exchange.
These are fairly common. If they are transferred and there is some difficulty with the transfer concerning whether it is valid or not; or if the person who signed it is somebody who has since resigned or been fired from the company, is the certificate still good, although the signature has changed? They are very detailed, technical issues, but the general concept behind them is to allow a regime for these things to be traded and transferred.
4:40 p.m.
Senior Director, Corporate and Insolvency Law Policy and Internal Trade Directorate, Department of Industry
I would add that one other thing we try to do is create uniformity at the national level for all these corporations, because right now there isn't uniformity at the provincial level either. You are setting rules that apply across the country for these corporations. For those companies that will be in those situations, this will be simpler. Removing it raises a number of issues, not only in terms of other parts of the bill that make reference to some of the terms but also of the legal regime that applies then and the differences that currently still remain within provincial jurisdiction. The intent in federal corporate statutes is to create uniformity.
4:40 p.m.
NDP
Glenn Thibeault NDP Sudbury, ON
Could I just follow up?
To clarify the points you brought forward, if we were to remove this information from this act, would they have opportunity to find it elsewhere, or does this, for lack of a better term, make for one-stop shopping whereby they're able to find everything in one location?
4:40 p.m.
Manager, Policy Section, Corporations Canada, Department of Industry
At the moment, the current Uniform Securities Transfer Act project plans that eventually every province and territory will have the same set of rules. At the moment, the rules are consistent in eight of the provinces. Nova Scotia, we know, is drafting a law, but as of the last time I checked, had not yet tabled it. The Yukon has currently tabled one. The two territories and Prince Edward Island haven't yet, as far as we know, even started work on this.
We know this is where they are going, which is why federally we are already looking at the fact that all the financial institutions, the Canada Business Corporations Act, and the Canada Cooperatives Act, which all have these provisions, are at some point going to have to be dealt with. What we are doing is adding one more act, so that the federal regime is consistent. If you are a federal corporation or cooperative, you know what regime applies to you.
At some point, the government is going to have to deal with the fact that we will end up with one regime federally and a different regime in every province and territory. If we remove these now, there could be questions in the provinces and territories that don't yet have a securities transfer act about what rules apply in those provinces, although for the provinces that have put in a securities transfer act, we know what the rules would be and they would be consistent.
It's just the problem of having 13 jurisdictions and the time it takes to get consistency throughout them.
4:40 p.m.
Liberal
Siobhan Coady Liberal St. John's South—Mount Pearl, NL
Thank you for the robust discussion concerning this. The concerns we raised were mostly because very few corporations or not-for-profits will be using these sections. It was an effort to streamline. But based on the concerns that were raised today, there's no objection here to continuing with them within the act.
4:40 p.m.
Conservative
4:40 p.m.
Conservative
The Chair Conservative Michael Chong
Thank you, Madam Coady, for your help on that.
Clause 146 is under consideration.
(On clause 146—Directors' liability)
4:45 p.m.
Conservative
4:45 p.m.
Conservative
The Chair Conservative Michael Chong
Mr. Wallace will move the government amendments. Would Mr. Wallace care to comment on the government amendments?
4:45 p.m.
Conservative
Mike Wallace Conservative Burlington, ON
Thank you. I'm going to ask the officials to comment on clause 146 and the amendments that are being proposed on pages 61 and 62.