An Act to amend the Canada Business Corporations Act and the Canada Cooperatives Act and to amend other Acts in consequence (S.C. 2001, c. 14)
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Assented to 2001-06-14
1998, c. 1CANADA COOPERATIVES ACT
164. Subsection 98(1) of the Act is replaced by the following:
Marginal note:Participation
98. (1) Subject to the by-laws, a director may, in accordance with the regulations, if any, participate in a meeting of directors or of a committee of directors by means of a telephonic, electronic or other communication facility that permits all participants to communicate adequately with each other during the meeting.
165. Subsection 100(3) of the Act is replaced by the following:
Marginal note:Evidence
(3) Unless a ballot is demanded, an entry in the minutes of a meeting to the effect that the chairperson of the meeting declared a resolution to be carried or defeated is, in the absence of evidence to the contrary, proof of the fact without proof of the number or proportion of the votes recorded in favour of or against the resolution.
166. Paragraph 101(3)(d) of the Act is repealed.
167. (1) Subsection 102(2) of the Act is repealed.
(2) Subsection 102(7) of the French version of the Act is replaced by the following:
Marginal note:Subrogation
(7) L’administrateur qui acquitte les dettes visées au présent article, dont l’existence est établie au cours d’une procédure soit de liquidation et de dissolution, soit de faillitte, a droit à toute priorité qu’aurait pu faire valoir l’employé et, le cas échéant, est subrogé aux droits constatés dans le jugement.
168. Subsection 103(7) of the Act is repealed.
169. Subsection 104(1) of the Act is replaced by the following:
Marginal note:Voting
104. (1) A director who is interested in a contract or transaction referred to in subsection 103(1) may not vote on any resolution to approve the contract or transaction.
170. Sections 106 and 107 of the Act are replaced by the following:
Marginal note:Effect of disclosure
106. A contract or transaction for which disclosure is required under section 103 is not invalid, and the director or officer is not accountable to the cooperative, its members or its shareholders for any profit realized from the contract or transaction, because of the director’s or officer’s interest in the contract or transaction or because the director was present or was counted to determine whether a quorum existed at the meeting of directors or committee of directors that considered the contract or transaction, if
(a) disclosure of the interest was made in accordance with sections 103 to 105;
(b) the directors approved the contract or transaction; and
(c) the contract or transaction was reasonable and fair to the cooperative when it was approved.
Marginal note:Confirmation
106.1 Even if the conditions of section 106 are not met, a director or officer, acting honestly and in good faith, is not accountable to the cooperative, its members or its shareholders for any profit realized from a contract or transaction for which disclosure is required under section 103 and the contract or transaction is not invalid by reason only of the interest of the director or officer in the contract or transaction if
(a) the contract or transaction is approved or confirmed by special resolution at a meeting of the members;
(b) disclosure of the interest was made to the members in a manner sufficient to indicate its nature before the contract or transaction was approved or confirmed; and
(c) the contract or transaction was reasonable and fair to the cooperative when it was approved or confirmed.
Marginal note:Court order
107. If a director or officer of a cooperative fails to disclose an interest in a material contract or transaction in accordance with section 103, or otherwise fails to comply with sections 103 to 106.1, a court may, on the application of the cooperative or a member or shareholder, set aside the contract or transaction on any terms that it thinks fit or order that the director or officer account to the cooperative, its members or its shareholders for any profit realized from the contract or transaction.
171. (1) Paragraph 109(3)(g) of the Act is replaced by the following:
(g) pay a commission referred to in section 128, except as authorized by the directors;
(2) Subsection 109(3) of the Act is amended by striking out the word “or” at the end of paragraph (h), by adding the word “or” at the end of paragraph (i) and by adding the following after paragraph (i):
(j) issue investment shares of a series under section 126 except as authorized by the directors.
172. Section 111 of the Act is replaced by the following:
Marginal note:Due diligence
111. A director is not liable under this Part if the director exercised the care, diligence and skill that a reasonably prudent person would have exercised in comparable circumstances, including reliance in good faith on
(a) financial statements of the cooperative represented to the director by an officer of the cooperative or in a written report of the auditor of the cooperative fairly to reflect the financial condition of the cooperative; or
(b) a report of a person whose profession lends credibility to a statement made by the professional person.
173. (1) Subsection 113(2) of the Act is replaced by the following:
Marginal note:Advance of costs
(2) A cooperative may advance moneys to a director, officer or other individual for the costs, charges and expenses of a proceeding referred to in subsection (1). The individual must repay the moneys if the individual did not fulfil the conditions of subsection (3), unless the members and shareholders decide, by separate resolutions, that the individual need not repay the moneys.
(2) Paragraph 113(5)(a) of the Act is replaced by the following:
(a) was not judged by the court or other competent authority to have committed any fault or omitted to do anything that the individual ought to have done; and
174. (1) Subsection 115(1) of the Act is replaced by the following:
Marginal note:Restricting powers of directors
115. (1) A provision in the articles of the cooperative or in a unanimous agreement that restricts, in whole or in part, the powers of the directors to manage, or supervise the management of, the business and affairs of the cooperative or vests, in whole or in part, but only in members and subject to subsection 76(1), those powers, is valid.
(2) Subsections 115(3) to (8) of the Act are replaced by the following:
Marginal note:Investment shareholders
(3) A purchaser or transferee of an investment share that is subject to a unanimous agreement is deemed to be party to the unanimous agreement.
Marginal note:When no notice given
(4) If notice is not given to the purchaser or transferee of the existence of a unanimous agreement, in the manner referred to in subsection 183(2) or otherwise, the purchaser or transferee may, no later than thirty days after they become aware of its existence, rescind the transaction by which they acquired the investment shares.
Marginal note:Rights of members
(5) To the extent that a provision in the articles of the cooperative, or in a unanimous agreement, restricts the powers of the directors to manage, or supervise the management of, the business and affairs of the cooperative, members who are given that power to manage or supervise the management of the business and affairs of the cooperative have all the rights, powers, duties and liabilities of directors, whether they arise under this Act or otherwise, including any defences available to the directors, and the directors are relieved of their rights, powers, duties and liabilities, including their liabilities under section 102, to the same extent.
Marginal note:Discretion of shareholders
(6) Nothing in this section prevents members from fettering their discretion when exercising the powers of directors under a unanimous agreement.
175. Subsection 123(1) of the Act is replaced by the following:
Marginal note:Charge on membership shares for amounts
123. (1) A cooperative has a charge on a membership share or any amount standing to the credit of a member or the personal representative of a member for a debt of that member to the cooperative.
176. The portion of subsection 126(1) of the Act before paragraph (a) is replaced by the following:
Marginal note:Shares in series
126. (1) The articles may authorize, subject to any limitations set out in them and subject to subsection (2), the issue of any class of investment shares in one or more series and may do either or both of the following:
177. Subsection 129(1) of the Act is replaced by the following:
Marginal note:Charge on investment shares
129. (1) Subject to subsection 183(2), the articles may provide that the cooperative has a charge on an investment share registered in the name of a shareholder or the personal representative of a shareholder for a debt of the shareholder to the cooperative, including an amount unpaid as of the date a body corporate was continued under this Act, in respect of an investment share issued by it.
178. (1) The portion of subsection 130(1) of the Act before paragraph (a) is replaced by the following:
Marginal note:Constraints on shares
130. (1) Subject to subsection 290(3), a distributing cooperative that has issued investment shares that remain outstanding and are held by more than one person may, by special resolution of the members and by a separate special resolution of the shareholders of each class, amend its articles to constrain
(2) Paragraph 130(1)(d) of the Act is replaced by the following:
(d) the issue, transfer or ownership of any investment share to assist the cooperative to comply with any prescribed law; or
179. (1) Paragraph 131(1)(b) of the Act is replaced by the following:
(b) complying with any prescribed law.
(2) Subsection 131(2) of the French version of the Act is replaced by the following:
Marginal note:Choix des parts
(2) Les administrateurs doivent choisir les parts de placement à vendre en vertu du paragraphe (1) de bonne foi et de manière à ne pas se montrer injuste à l’égard des autres détenteurs de parts de placement de la catégorie soit en leur portant préjudice soit en ne tenant pas compte de leurs intérêts.
180. (1) The portion of section 137 of the Act before paragraph (a) is replaced by the following:
Marginal note:Borrowing
137. Unless the articles, the by-laws or a unanimous agreement provide otherwise, the directors may, subject to subsection 126(2), without the authorization of the members or shareholders,
(2) Paragraph 137(c) of the Act is replaced by the following:
(c) give guarantees;
181. (1) Subparagraphs 138(3)(a)(i) and (ii) of the French version of the Act are replaced by the following:
(i) de biens d’une personne avec laquelle elle avait, au moment de l’échange, un lien de dépendance au sens de la Loi de l’impôt sur le revenu,
(ii) d’actions ou de parts de placement d’une entité ou de droits ou d’intérêts dans celle-ci, lorsque la coopérative avait avec celle-ci, soit au moment de l’échange, soit en raison de celui-ci, un tel lien;
(2) Paragraph 138(3)(a) of the Act is amended by striking out the word “or” at the end of subparagraph (i) and by adding the following after subparagraph (ii):
(iii) property of a person who, immediately before the exchange, dealt with the cooperative at arm’s length within the meaning of that expression in the Income Tax Act, if the person, the cooperative and all the holders of shares in the class or series of shares so issued consent to the exchange; or
(3) Subsection 138(6) of the Act is replaced by the following:
Marginal note:Membership share inclusion
(6) For greater certainty, if a cooperative issues membership shares with a par value, the cooperative is deemed, for the purposes of subsection 147(2), sections 151 and 154 and paragraph 299(2)(d), to have a stated capital account for its membership shares that includes each amount that has been received by the cooperative for the membership shares.
182. Subsection 139(4) of the Act is replaced by the following:
Marginal note:Continued cooperative
(4) For the purposes of subsection 147(2), sections 151 and 154 and paragraph 299(2)(d), when a cooperative is continued under this Act, its stated capital account is deemed to include the amount that would have been included if the cooperative had been incorporated under this Act.
183. The portion of subsection 147(2) of the French version of the Act before paragraph (a) is replaced by the following:
Marginal note:Exception
(2) La coopérative ne peut faire aucun paiement en vue d’acquérir des parts de placement s’il existe des motifs raisonnables de croire que :
184. Section 160 of the Act and the heading before it are repealed.
185. The definitions “intermediary” and “solicit” or “solicitation” ” in subsection 163(1) of the Act are replaced by the following:
“intermediary”
« intermédiaire »
“intermediary” means a person who holds a security on behalf of another person who is not the registered holder of the security, and includes
(a) a securities broker or dealer required to be registered to trade or deal in securities under the laws of any jurisdiction;
(b) a securities depositary;
(c) a financial institution;
(d) in respect of a clearing agency, a securities dealer, trust company, bank or other person, including another clearing agency, on whose behalf the clearing agency or its nominees hold securities of an issuer;
(e) a trustee or administrator of a self-administered retirement savings plan, retirement income fund, education savings plan or other similar self-administered savings or investment plan registered under the Income Tax Act;
(f) a nominee of a person referred to in any of paragraphs (a) to (e); and
(g) a person who carries out functions similar to those carried out by individuals or entities referred to in any of paragraphs (a) to (e) and that holds a security registered in its name, or in the name of its nominee, on behalf of another person who is not the registered holder of the security.
“solicit” or “solicitation”
« sollicitation »
“solicit” or “solicitation”
(a) includes
(i) a request for a proxy whether or not accompanied by or included in a form of proxy,
(ii) a request to execute or not to execute a form of proxy or to revoke a proxy,
(iii) the sending of a form of proxy or other communication to a shareholder under circumstances reasonably calculated to result in the procurement, withholding or revocation of a proxy, and
(iv) the sending of a form of proxy to a shareholder under section 165; but
(b) does not include
(i) the sending of a form of proxy in response to an unsolicited request made by or on behalf of a shareholder,
(ii) the performance of administrative acts or professional services on behalf of a person soliciting a proxy,
(iii) the sending by an intermediary of the documents referred to in section 169,
(iv) a solicitation by a person in respect of investment shares of which they are the beneficial owner,
(v) a public announcement, as prescribed, by a shareholder of how the shareholder intends to vote and the reasons for that decision,
(vi) a communication for the purposes of obtaining the number of investment shares required for a proposal under subsection 58(2.1), or
(vii) a communication, other than a solicitation by or on behalf of the management of the cooperative, that is made to shareholders, in any circumstances that may be prescribed.
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