An Act to amend the Bankruptcy and Insolvency Act, the Companies’ Creditors Arrangement Act, the Wage Earner Protection Program Act and chapter 47 of the Statutes of Canada, 2005 (S.C. 2007, c. 36)
Full Document:
- HTMLFull Document: An Act to amend the Bankruptcy and Insolvency Act, the Companies’ Creditors Arrangement Act, the Wage Earner Protection Program Act and chapter 47 of the Statutes of Canada, 2005 (Accessibility Buttons available) |
- PDFFull Document: An Act to amend the Bankruptcy and Insolvency Act, the Companies’ Creditors Arrangement Act, the Wage Earner Protection Program Act and chapter 47 of the Statutes of Canada, 2005 [495 KB]
Assented to 2007-12-14
2005, c. 47CHAPTER 47 OF THE STATUTES OF CANADA, 2005
107. Sections 132 to 134 of the Act are replaced by the following:
Marginal note:Wage Earner Protection Program Act
132. The Wage Earner Protection Program Act, as enacted by section 1 of this Act, applies in respect of wages owing by an employer only if
(a) the employer becomes bankrupt on or after the day on which that section comes into force; or
(b) all or part of the employer’s property comes into the possession or under the control of a receiver on or after the day on which that section comes into force.
Marginal note:Bankruptcy and Insolvency Act
133. (1) An amendment to the Bankruptcy and Insolvency Act that is enacted by any of sections 2 to 5 and 7 to 106, subsection 107(1) and sections 108 to 123 of this Act applies only to a person who, on or after the day on which the amendment comes into force, is described in one of the following paragraphs:
(a) the person becomes bankrupt;
(b) the person files a notice of intention;
(c) the person files a proposal without having filed a notice of intention;
(d) a proposal is made in respect of the person without the person having filed a notice of intention;
(e) an interim receiver is appointed in respect of the person’s property and all or part of the person’s property comes into the possession or under the control of the interim receiver; or
(f) all or part of the person’s property comes into the possession or under the control of a receiver.
Marginal note:Subsection 107(2)
(2) The amendment to the Bankruptcy and Insolvency Act that is enacted by subsection 107(2) of this Act applies only to a person who is an undischarged bankrupt on the day on which it comes into force or who becomes bankrupt on or after the day on which it comes into force.
Marginal note:Companies’ Creditors Arrangement Act
134. An amendment to the Companies’ Creditors Arrangement Act that is enacted by any of sections 124 to 131 of this Act applies only to a debtor company in respect of whom proceedings commence under that Act on or after the day on which the amendment comes into force.
108. Sections 137 to 139 of the Act are replaced by the following:
137. Paragraph 23(2)(b) of the Canada Pension Plan is replaced by the following:
(b) subsection 224(1.2) of the Income Tax Act shall apply to employer’s contributions, employee’s contributions, and related interest, penalties or other amounts, subject to subsections 69(1) and 69.1(1) of the Bankruptcy and Insolvency Act and section 11.09 of the Companies’ Creditors Arrangement Act.
Employment Insurance Act
138. Paragraph 99(b) of the Employment Insurance Act is replaced by the following:
(b) subsection 224(1.2) of the Income Tax Act shall apply to employer’s premiums, employee’s premiums, and related interest, penalties or other amounts, subject to subsections 69(1) and 69.1(1) of the Bankruptcy and Insolvency Act and section 11.09 of the Companies’ Creditors Arrangement Act.
Income Tax Act
139. The portion of subsection 224(1.2) of the Income Tax Act before paragraph (a) is replaced by the following:
Marginal note:Garnishment
(1.2) Notwithstanding any other provision of this Act, the Bankruptcy and Insolvency Act, any other enactment of Canada, any enactment of a province or any law, but subject to subsections 69(1) and 69.1(1) of the Bankruptcy and Insolvency Act and section 11.09 of the Companies’ Creditors Arrangement Act, if the Minister has knowledge or suspects that a particular person is, or will become within one year, liable to make a payment
109. Section 141 of the Act is replaced by the following:
Marginal note:Order in council
141. Sections 1 to 131 and 136 to 139 come into force on a day or days to be fixed by order of the Governor in Council.
TRANSITIONAL PROVISIONS
Marginal note:Bankruptcy and Insolvency Act
110. An amendment to the Bankruptcy and Insolvency Act that is enacted by any of subsections 1(1) and (5) to (7), sections 3 and 6, subsection 9(3), sections 12 and 13, subsections 14(2) and (3), 15(2) and (3), 16(2) and (3) and 17(2), sections 19 to 22, 25, 31, 34, 35, 37, 42, 44, 46 to 48 and 50, subsection 51(1), sections 55 to 57 and subsection 58(2) of this Act applies only to a person who, on or after the day on which the amendment comes into force, is described in one of the following paragraphs:
(a) the person becomes bankrupt;
(b) the person files a notice of intention;
(c) the person files a proposal without having filed a notice of intention;
(d) a proposal is made in respect of the person without the person having filed a notice of intention;
(e) an interim receiver is appointed in respect of the person’s property and all or part of the person’s property comes into the possession or under the control of the interim receiver; or
(f) all or part of the person’s property comes into the possession or under the control of a receiver.
Marginal note:Companies’ Creditors Arrangement Act
111. The amendment to the Companies’ Creditors Arrangement Act that is enacted by section 67 of this Act applies only to a debtor company in respect of whom proceedings commence under that Act on or after the day on which the amendment comes into force.
COORDINATING AMENDMENTS
Marginal note:Bill C-52
112. (1) Subsections (2) to (25) apply if Bill C-52, introduced in the 1st session of the 39th Parliament and entitled the Budget Implementation Act, 2007 (the “other Act”), receives royal assent.
(2) If subsection 94(1) of the other Act comes into force before section 25 of this Act, then section 25 of this Act is repealed.
(3) If subsection 94(1) of the other Act comes into force on the same day as section 25 of this Act, then section 25 of this Act is deemed to have come into force before subsection 94(1) of the other Act.
(4) On the later of the day on which subsection 94(1) of the other Act comes into force and the day on which section 26 of this Act comes into force — or, if those days are the same day, then on that day — paragraph 65.11(10)(a) of the Bankruptcy and Insolvency Act, as enacted by section 44 of chapter 47 of the Statutes of Canada, 2005, as that section 44 is amended by that section 26, is replaced by the following:
(a) an eligible financial contract;
(5) If section 26 of this Act comes into force before section 95 of the other Act, then section 95 of the other Act is deemed never to have had its effects and is repealed.
(6) If section 95 of the other Act comes into force on the same day as section 26 of this Act, then section 95 of the other Act is deemed to have come into force before section 26 of this Act.
(7) If section 96 of the other Act comes into force before section 31 of this Act, then section 31 of this Act is repealed.
(8) If section 31 of this Act comes into force before section 96 of the other Act, then
(a) section 96 of the other Act is deemed never to have had its effects and is repealed; and
(b) subsections 66.34(8) and (9) of the Bankruptcy and Insolvency Act are replaced by the following:
Marginal note:Permitted actions
(8) Despite section 69.2, the following actions are permitted in respect of an eligible financial contract that is entered into before the filing of a consumer proposal and is terminated on or after that filing, but only in accordance with the provisions of that contract:
(a) the netting or setting off or compensation of obligations between the consumer debtor and the other parties to the eligible financial contract; and
(b) any dealing with financial collateral including
(i) the sale or foreclosure or, in the Province of Quebec, the surrender of financial collateral, and
(ii) the setting off or compensation of financial collateral or the application of the proceeds or value of financial collateral.
Marginal note:Net termination values
(9) If net termination values determined in accordance with an eligible financial contract referred to in subsection (8) are owed by the consumer debtor to another party to the eligible financial contract, that other party is deemed, for the purposes of subsection 69.2(1), to be a creditor of the consumer debtor with a claim provable in bankruptcy in respect of those net termination values.
(9) If section 96 of the other Act and section 31 of this Act come into force on the same day, then section 31 of this Act is deemed to have come into force before section 96 of the other Act and subsection (8) applies.
(10) If section 100 of the other Act comes into force before section 40 of this Act, then
(a) section 40 of this Act is deemed never to have had its effects and is repealed; and
(b) sections 84.1 and 84.2 of the Bankruptcy and Insolvency Act, as enacted by section 68 of chapter 47 of the Statutes of Canada, 2005, as that section 68 is amended by that section 100, are replaced by the following:
Marginal note:Assignment of agreements
84.1 (1) On application by a trustee and on notice to every party to an agreement, a court may make an order assigning the rights and obligations of a bankrupt under the agreement to any person who is specified by the court and agrees to the assignment.
Marginal note:Individuals
(2) In the case of an individual,
(a) they may not make an application under subsection (1) unless they are carrying on a business; and
(b) only rights and obligations in relation to the business may be assigned.
Marginal note:Exceptions
(3) Subsection (1) does not apply in respect of rights and obligations that are not assignable by reason of their nature or that arise under
(a) an agreement entered into on or after the date of the bankruptcy;
(b) an eligible financial contract; or
(c) a collective agreement.
Marginal note:Factors to be considered
(4) In deciding whether to make the order, the court is to consider, among other things,
(a) whether the person to whom the rights and obligations are to be assigned is able to perform the obligations; and
(b) whether it is appropriate to assign the rights and obligations to that person.
Marginal note:Restriction
(5) The court may not make the order unless it is satisfied that all monetary defaults in relation to the agreement — other than those arising by reason only of the person’s bankruptcy, insolvency or failure to perform a non-monetary obligation — will be remedied on or before the day fixed by the court.
Marginal note:Copy of order
(6) The applicant is to send a copy of the order to every party to the agreement.
Marginal note:Certain rights limited
84.2 (1) No person may terminate or amend — or claim an accelerated payment or forfeiture of the term under — any agreement, including a security agreement, with a bankrupt individual by reason only of the individual’s bankruptcy or insolvency.
Marginal note:Lease
(2) If the agreement referred to in subsection (1) is a lease, the lessor may not terminate or amend, or claim an accelerated payment or forfeiture of the term under, the lease by reason only of the bankruptcy or insolvency or of the fact that the bankrupt has not paid rent in respect of any period before the time of the bankruptcy.
Marginal note:Public utilities
(3) No public utility may discontinue service to a bankrupt individual by reason only of the individual’s bankruptcy or insolvency or of the fact that the bankrupt individual has not paid for services rendered or material provided before the time of the bankruptcy.
Marginal note:Certain acts not prevented
(4) Nothing in this section is to be construed as
(a) prohibiting a person from requiring payments to be made in cash for goods, services, use of leased property or other valuable consideration provided after the time of the bankruptcy; or
(b) requiring the further advance of money or credit.
Marginal note:Provisions of section override agreement
(5) Any provision in an agreement that has the effect of providing for, or permitting, anything that, in substance, is contrary to this section is of no force or effect.
Marginal note:Powers of court
(6) On application by a party to an agreement or by a public utility, the court may declare that this section does not apply — or applies only to the extent declared by the court — if the applicant satisfies the court that the operation of this section would likely cause the applicant significant financial hardship.
Marginal note:Eligible financial contracts
(7) Subsection (1) does not apply
(a) in respect of an eligible financial contract; or
(b) to prevent a member of the Canadian Payments Association from ceasing to act as a clearing agent or group clearer for an insolvent person in accordance with the Canadian Payments Act and the by-laws and rules of that Association.
Marginal note:Permitted actions
(8) Despite section 69.3, the following actions are permitted in respect of an eligible financial contract that is entered into before the time of the bankruptcy, and is terminated on or after that time, but only in accordance with the provisions of that contract:
(a) the netting or setting off or compensation of obligations between the individual bankrupt and the other parties to the eligible financial contract; and
(b) any dealing with financial collateral including
(i) the sale or foreclosure or, in the Province of Quebec, the surrender of financial collateral, and
(ii) the setting off or compensation of financial collateral or the application of the proceeds or value of financial collateral.
Marginal note:Net termination values
(9) If net termination values determined in accordance with an eligible financial contract referred to in subsection (8) are owed by the individual bankrupt to another party to the eligible financial contract, that other party is deemed, for the purposes of paragraphs 69(1)(a) and 69.1(1)(a), to be a creditor of the individual bankrupt with a claim provable in bankruptcy in respect of those net termination values.
(11) If section 40 of this Act comes into force before section 100 of the other Act, then
(a) section 100 of the other Act is deemed never to have had its effects and is repealed;
(b) subsection 84.1(3) of the Bankruptcy and Insolvency Act, as enacted by section 68 of chapter 47 of the Statutes of Canada, 2005, as that section 68 is amended by that section 40, is replaced by the following:
Marginal note:Exceptions
(3) Subsection (1) does not apply in respect of rights and obligations that are not assignable by reason of their nature or that arise under
(a) an agreement entered into on or after the date of the bankruptcy;
(b) an eligible financial contract; or
(c) a collective agreement.
(c) subsection 84.2(7) of the Bankruptcy and Insolvency Act, as enacted by section 68 of chapter 47 of the Statutes of Canada, 2005, as that section 68 is amended by that section 40, is replaced by the following:
Marginal note:Eligible financial contracts
(7) Subsection (1) does not apply
(a) in respect of an eligible financial contract; or
(b) to prevent a member of the Canadian Payments Association from ceasing to act as a clearing agent or group clearer for an insolvent person in accordance with the Canadian Payments Act and the by-laws and rules of that Association.
Marginal note:Permitted actions
(8) Despite section 69.3, the following actions are permitted in respect of an eligible financial contract that is entered into before the time of the bankruptcy, and is terminated on or after that time, but only in accordance with the provisions of that contract:
(a) the netting or setting off or compensation of obligations between the individual bankrupt and the other parties to the eligible financial contract; and
(b) any dealing with financial collateral including
(i) the sale or foreclosure or, in the Province of Quebec, the surrender of financial collateral, and
(ii) the setting off or compensation of financial collateral or the application of the proceeds or value of financial collateral.
Marginal note:Net termination values
(9) If net termination values determined in accordance with an eligible financial contract referred to in subsection (8) are owed by the individual bankrupt to another party to the eligible financial contract, that other party is deemed, for the purposes of paragraphs 69(1)(a) and 69.1(1)(a), to be a creditor of the individual bankrupt with a claim provable in bankruptcy in respect of those net termination values.
(12) If section 100 of the other Act and section 40 of this Act come into force on the same day, then section 100 of the other Act is deemed to have come into force before section 40 of this Act and subsection (10) applies.
(13) If subsection (10) or (11) applies, then section 99 of the other Act is deemed never to have had its effects and is repealed.
(14) On the later of the day on which section 102 of the other Act comes into force and the day on which section 42 of this Act comes into force — or, if those days are the same day, then on that day — subsection 95(2.1) of the Bankruptcy and Insolvency Act is replaced by the following:
Marginal note:Exception
(2.1) Subsection (2) does not apply, and the parties are deemed to be dealing with each other at arm’s length, in respect of the following:
(a) a margin deposit made by a clearing member with a clearing house; or
(b) a transfer, charge or payment made in connection with financial collateral and in accordance with the provisions of an eligible financial contract.
(15) If section 107 of the other Act comes into force before section 63 of this Act, then section 63 of this Act is deemed never to have had its effects and is repealed.
(16) If section 107 of the other Act and section 63 of this Act come into force on the same day, then section 63 of this Act is deemed to have come into force before section 107 of the other Act.
(17) If section 109 of the other Act comes into force before section 65 of this Act, then subsection 11.3(2) of the Companies’ Creditors Arrangement Act, as enacted by section 128 of chapter 47 of the Statutes of Canada, 2005, as that section 128 is amended by that section 65, is replaced by the following:
Marginal note:Exceptions
(2) Subsection (1) does not apply in respect of rights and obligations that are not assignable by reason of their nature or that arise under
(a) an agreement entered into on or after the day on which proceedings commence under this Act;
(b) an eligible financial contract; or
(c) a collective agreement.
(18) If section 65 of this Act comes into force before section 109 of the other Act, then
(a) section 109 of the other Act is deemed never to have had its effects and is repealed; and
(b) subsection 11.3(2) of the Companies’ Creditors Arrangement Act, as enacted by section 128 of chapter 47 of the Statutes of Canada, 2005, as that section 128 is amended by that section 65, is replaced by the following:
Marginal note:Exceptions
(2) Subsection (1) does not apply in respect of rights and obligations that are not assignable by reason of their nature or that arise under
(a) an agreement entered into on or after the day on which proceedings commence under this Act;
(b) an eligible financial contract; or
(c) a collective agreement.
(19) If section 109 of the other Act and section 65 of this Act come into force on the same day, then section 109 of the other Act is deemed to have come into force before section 65 of this Act and subsection (17) applies.
(20) If section 110 of the other Act comes into force before section 76 of this Act, then paragraph 32(9)(a) of the Companies’ Creditors Arrangement Act, as enacted by section 131 of chapter 47 of the Statutes of Canada, 2005, as that section 131 is amended by that section 76, is replaced by the following:
(a) an eligible financial contract;
(21) If section 76 of this Act comes into force before section 110 of the other Act, then
(a) section 110 of the other Act is deemed never to have had its effects and is repealed; and
(b) paragraph 32(9)(a) of the Companies’ Creditors Arrangement Act, as enacted by section 131 of chapter 47 of the Statutes of Canada, 2005, as that section 131 is amended by that section 76, is replaced by the following:
(a) an eligible financial contract;
(22) If section 110 of the other Act and section 76 of this Act come into force on the same day, then section 110 of the other Act is deemed to have come into force before section 76 of this Act and subsection (20) applies.
(23) If section 111 of the other Act comes into force before section 77 of this Act, then subsection 34(7) of the Companies’ Creditors Arrangement Act, as enacted by section 131 of chapter 47 of the Statutes of Canada, 2005, as that section 131 is amended by that section 77, is replaced by the following:
Marginal note:Eligible financial contracts
(7) Subsection (1) does not apply
(a) in respect of an eligible financial contract; or
(b) to prevent a member of the Canadian Payments Association from ceasing to act as a clearing agent or group clearer for a company in accordance with the Canadian Payments Act and the by-laws and rules of that Association.
Marginal note:Permitted actions
(8) The following actions are permitted in respect of an eligible financial contract that is entered into before proceedings under this Act are commenced in respect of the company and is terminated on or after that day, but only in accordance with the provisions of that contract:
(a) the netting or setting off or compensation of obligations between the company and the other parties to the eligible financial contract; and
(b) any dealing with financial collateral including
(i) the sale or foreclosure or, in the Province of Quebec, the surrender of financial collateral, and
(ii) the setting off or compensation of financial collateral or the application of the proceeds or value of financial collateral.
Marginal note:Restriction
(9) No order may be made under this Act if the order would have the effect of staying or restraining the actions permitted under subsection (8).
Marginal note:Net termination values
(10) If net termination values determined in accordance with an eligible financial contract referred to in subsection (8) are owed by the company to another party to the eligible financial contract, that other party is deemed to be a creditor of the company with a claim against the company in respect of those net termination values.
Marginal note:Priority
(11) No order may be made under this Act if the order would have the effect of subordinating financial collateral.
(24) If section 77 of this Act comes into force before section 111 of the other Act, then
(a) section 111 of the other Act is deemed never to have had its effects and is repealed; and
(b) subsection 34(7) of the Companies’ Creditors Arrangement Act, as enacted by section 131 of chapter 47 of the Statutes of Canada, 2005, as that section 131 is amended by that section 77, is replaced by the following:
Marginal note:Eligible financial contracts
(7) Subsection (1) does not apply
(a) in respect of an eligible financial contract; or
(b) to prevent a member of the Canadian Payments Association from ceasing to act as a clearing agent or group clearer for a company in accordance with the Canadian Payments Act and the by-laws and rules of that Association.
Marginal note:Permitted actions
(8) The following actions are permitted in respect of an eligible financial contract that is entered into before proceedings under this Act are commenced in respect of the company and is terminated on or after that day, but only in accordance with the provisions of that contract:
(a) the netting or setting off or compensation of obligations between the company and the other parties to the eligible financial contract; and
(b) any dealing with financial collateral including
(i) the sale or foreclosure or, in the Province of Quebec, the surrender of financial collateral, and
(ii) the setting off or compensation of financial collateral or the application of the proceeds or value of financial collateral.
Marginal note:Restriction
(9) No order may be made under this Act if the order would have the effect of staying or restraining the actions permitted under subsection (8).
Marginal note:Net termination values
(10) If net termination values determined in accordance with an eligible financial contract referred to in subsection (8) are owed by the company to another party to the eligible financial contract, that other party is deemed to be a creditor of the company with a claim against the company in respect of those net termination values.
Marginal note:Priority
(11) No order may be made under this Act if the order would have the effect of subordinating financial collateral.
(25) If section 111 of the other Act and section 77 of this Act come into force on the same day, then section 111 of the other Act is deemed to have come into force before section 77 of this Act and subsection (23) applies.
- Date modified: