Crown Corporation General Regulations, 1995 (SOR/95-226)

Regulations are current to 2016-05-12

Crown Corporation General Regulations, 1995

SOR/95-226

FINANCIAL ADMINISTRATION ACT

Registration 1995-05-02

Regulations Respecting Restricted Transactions, Disposal of Property, Remuneration, By-Laws, Deemed Transactions to Borrow Money and Exemptions from a Provision of the Financial Administration Act in Respect of Borrowing Transactions for Crown Corporations

P.C. 1995-711  1995-05-02

His Excellency the Governor General in Council, on the recommendation of the Minister of Finance and the Treasury Board, pursuant to subsections 93(2), 99(4), 108(3), 114(4) and 127(4) of the Financial Administration Act, is pleased hereby to repeal the Crown Corporation Borrowing Regulations, made by Order in Council P.C. 1984-3093 of August 31, 1984Footnote *, and the Crown Corporation General Regulations, made by Order in Council P.C. 1984-3094 of August 31, 1984Footnote **, and to make the annexed Regulations respecting restricted transactions, disposal of property, remuneration, by-laws, deemed transactions to borrow money and exemptions from a provision of the Financial Administration Act in respect of borrowing transactions for Crown corporations, in substitution therefor.

Short Title

 These Regulations may be cited as the Crown Corporation General Regulations, 1995.

Interpretation

 In these Regulations,

Act

Act means the Financial Administration Act; (Loi)

working day

working day means a day that is not a Saturday or a holiday. (jour ouvrable)

Notification

 For the purposes of subsection 93(1) of the Act,

  • (a) the prescribed persons to be notified are the appropriate Minister for the parent Crown corporation and the President of the Treasury Board; and

  • (b) the prescribed manner in which those persons are to be notified is by the subsequent corporate plan or corporate plan amendment to be submitted by the parent Crown corporation.

Disposal of Property by Agent Corporations

 For the purposes of subsection 99(2) of the Act, an agent corporation that is a parent Crown corporation or that is a wholly-owned subsidiary of a parent Crown corporation may sell or otherwise dispose of personal property on the condition that the property is sold or otherwise disposed of at fair market value in the ordinary course of business in a transaction that is consistent with the most recently approved corporate plan or amended corporate plan of the parent Crown corporation.

 For the purposes of subsection 99(2) of the Act, an agent corporation that is a parent Crown corporation named in Schedule III to the Act or that is a wholly-owned subsidiary of such a parent Crown corporation may sell or otherwise dispose of

  • (a) real property that has a fair market value of $200,000 or less; and

  • (b) real property that has a fair market value of more than $200,000, on the condition that the property is sold or otherwise disposed of at not less than fair market value in the ordinary course of business in a transaction that is consistent with the most recently approved corporate plan or amended corporate plan of the parent Crown corporation.

  • SOR/99-103, s. 1.

 For the purposes of subsection 99(2) of the Act, an agent corporation that is a parent Crown corporation or that is a wholly-owned subsidiary of a parent Crown corporation may retain and use all or any part of the proceeds of any disposition of property in a manner that is consistent with the most recently approved corporate plan or amended corporate plan of the parent Crown corporation.

Remuneration

 For the purposes of section 108 of the Act, remuneration means a salary, a fee, an allowance or any other form of monetary compensation, except monetary compensation payable under the provisions of a registered pension plan as defined in the Income Tax Act, whether payable on or during the course of the appointment or on or by reason of termination of the appointment.

  • SOR/99-103, s. 2.
  •  (1) Subject to subsection (2), the aggregate value of any benefits fixed by a board of directors of a parent Crown Corporation in respect of a director, chairman or chief executive officer for services in respect of that office and, in the case of a chairman or chief executive officer, any other office of the corporation or an affiliate thereof, pursuant to subsection 108(2) of the Act shall not exceed the aggregate value of the standard benefits usually provided by other corporations in the public and private sectors

    • (a) that carry on businesses or activities similar to the businesses or activities of the parent Crown corporation; or

    • (b) where there are no corporations carrying on businesses or activities similar to those of the parent Crown corporation, that provide such benefits to persons having responsibilities similar to the responsibilities of the director, chairman or chief executive officer of the parent Crown corporation.

  • (2) No benefit that is a low interest loan or interest free loan shall be provided to a director, chairman or chief executive officer of a parent Crown corporation for services in respect of that office and, in the case of a chairman or chief executive officer, any other office of the corporation or an affiliate thereof, unless the loan is provided for purposes of aiding in meeting costs due to relocation.

  • (3) For the purposes of subsection (2),

    • (a) low interest loan means a loan or mortgage at a rate of interest below that commercially available for a loan or mortgage for similar purposes; and

    • (b) costs due to relocation means costs attributable to relocation where the relocation is solely for the purposes of the parent Crown corporation.

  • (4) Where a board of directors of a parent Crown corporation fixes any benefits or modifies them pursuant to subsection 108(2) of the Act, the board of directors shall report to the appropriate Minister and to the Clerk of the Privy Council

    • (a) by sending a copy of the resolution or other instrument so fixing or modifying the benefits, within 15 working days after fixing the benefits; and

    • (b) in the case of any appointment as chief executive officer, by sending a statement detailing the full benefits accorded to the chief executive officer, including the registered pension plan provisions, no later than six months after the effective date of the appointment.

  • (5) [Repealed, SOR/99-103, s. 3]

  • SOR/99-103, s. 3.

By-laws

 A copy of a by-law of a parent Crown Corporation is to be sent to the appropriate Minister and the President of the Treasury Board within 15 workings days after the adoption of the resolution by the board of directors of the parent Crown corporation approving the making, amending or repealing of the by-law.

  • SOR/99-103, s. 4.

Transactions to Borrow Money

 The following classes of transactions are deemed, for the purposes of Part X of the Act, to be transactions to borrow money:

  • (a) the issuance and sale of a term preferred share of a Crown corporation to a person, partnership or association;

  • (b) a capital lease, as defined in The Canadian Institute of Chartered Accountants Handbook, as amended from time to time, to a Crown corporation by a person, partnership or association, where the capital lease exceeds the lesser of 1 per cent of the total assets of the Crown corporation and $100,000;

  • (c) the entering into a supplier credit arrangement that matures after a period of more than 12 consecutive months by a Crown corporation with a person, partnership or association, where the person, partnership or association is extending credit to the Crown corporation and the supplier credit arrangement exceeds the lesser of 1 per cent of the total assets of the Crown corporation and $100,000; and

  • (d) a guarantee by a Crown corporation, other than the Canada Deposit Insurance Corporation, in respect of

    • (i) a note, bond or debenture,

    • (ii) term preferred shares,

    • (iii) a loan,

    • (iv) a banker’s acceptance,

    • (v) a capital lease, or

    • (vi) a supplier credit arrangement.

Borrowing Approvals

 An approval under subsection 127(3) of the Act shall be granted by an instrument in writing addressed to the Crown corporation proposing to enter into the transaction to borrow money.

Borrowing Exemptions

  •  (1) A parent Crown corporation is exempt from the application of subsection 127(3) of the Act in respect of the borrowing of money where the lender is a wholly-owned subsidiary of the parent Crown corporation.

  • (2) A wholly-owned subsidiary of a parent Crown corporation is exempt from the application of subsection 127(3) of the Act in respect of the borrowing of money where the lender is the parent Crown corporation or another wholly-owned subsidiary of the parent Crown corporation.

 The following Crown corporations are exempt from the application of subsection 127(3) of the Act in respect of any borrowing of money of the class set out in paragraph 10(d):

  • (a) the Canada Mortgage and Housing Corporation;

  • (b) Export Development Canada;

  • (c) Farm Credit Canada; and

  • (d) the Federal Business Development Bank.

  • 2001, c. 22, s. 22, c. 33, s. 30.
  •  (1) In this section, local port corporation means a corporation established pursuant to section 25 of the Canada Ports Corporation Act.

  • (2) The Canada Ports Corporation is exempt from the application of subsection 127(3) of the Act in respect of the borrowing of money from a local port corporation pursuant to subsection 57(2) of the Canada Ports Corporation Act.

  • (3) A local port corporation is exempt from the application of subsection 127(3) of the Act in respect of the borrowing of money from the Canada Ports Corporation pursuant to section 27 of Schedule I to the Canada Ports Corporation Act.

 
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