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Bank Act (S.C. 1991, c. 46)

Full Document:  

Act current to 2024-05-28 and last amended on 2024-03-30. Previous Versions

PART VICorporate Governance (continued)

Corporate Records (continued)

Members Register

Marginal note:Members register

  •  (1) A federal credit union must maintain a members register in which it must record

    • (a) the names, alphabetically arranged, and latest known addresses of the members and former members of the federal credit union;

    • (b) the number of membership shares held by each member; and

    • (c) the date and particulars of the issue and transfer of each membership share.

  • Marginal note:Similar registers

    (2) For the purposes of subsection (1), “members register” includes similar registers required by law to be maintained by a body corporate that was continued, or amalgamated and continued, as a federal credit union before the continuance or amalgamation and continuance.

  • Marginal note:Access to members register

    (3) Members, shareholders and creditors of a federal credit union, and their personal representatives, may examine the members register during the usual business hours of the federal credit union and may take extracts from it free of charge or have copies of it made on payment of a reasonable fee. If the federal credit union is a distributing bank, any other person may, on payment of a reasonable fee, examine the members register during the usual business hours of the bank and take extracts from it or have copies of it made.

  • Marginal note:Electronic access

    (4) The federal credit union may make the information contained in the members register available by any mechanical or electronic data processing system or other information storage device that is capable of reproducing it in intelligible written form within a reasonable time.

  • Marginal note:Affidavit and undertaking

    (5) A person who wishes to examine the members register, take extracts from it or have copies of it made must provide the federal credit union with an affidavit containing their name and address — or, if they are an entity, the name and address for service of the entity — and an undertaking that the information contained in the register will not be used except in the same way as a list of shareholders or members may be used under section 242. In the case of an entity, the affidavit is to be sworn by a director or officer of the entity or a person acting in a similar capacity.

  • Marginal note:Supplementary information

    (6) A person who wishes to examine a members register, take extracts from it or have copies of it made may, on payment of a reasonable fee, if they state in the accompanying affidavit that supplementary information is required, request the federal credit union or its agent to provide supplementary information setting out any changes made to the register.

  • Marginal note:When supplementary information to be provided

    (7) A federal credit union or its agent must provide the supplementary information within

    • (a) 10 days after the day on which the members register is examined if the changes take place before that day; and

    • (b) 10 days after the day to which the supplementary information relates if the changes take place on or after the day on which the members register is examined.

  • 2010, c. 12, s. 2015

Marginal note:Branch members registers

 A federal credit union may establish as many branch members registers as it considers necessary.

  • 2010, c. 12, s. 2015

Marginal note:Agents

 A federal credit union may appoint an agent to maintain its members register and each of its branch members registers.

  • 2010, c. 12, s. 2015

Marginal note:Location of members register

  •  (1) The members register of a federal credit union is to be maintained by the federal credit union at its head office or at any other place in Canada designated by the federal credit union’s directors.

  • Marginal note:Location of branch members register

    (2) A branch members register of a federal credit union may be kept at any place in or outside Canada designated by the directors of the federal credit union.

  • 2010, c. 12, s. 2015

Marginal note:Particulars in branch members register

  •  (1) A branch members register must contain only particulars of the membership shares issued or transferred at the branch for which that register is established.

  • Marginal note:Particulars in members register

    (2) Particulars of each issue or transfer of a membership share registered in a branch members register of a federal credit union must also be kept in the members register of the federal credit union.

  • 2010, c. 12, s. 2015

Marginal note:Cancelled membership share certificates

 A federal credit union, its agent or a trustee within the meaning of section 294 is not required to produce a cancelled membership share certificate in registered form after six years from the day on which it is cancelled.

  • 2010, c. 12, s. 2015

Corporate Name and Seal

Marginal note:Publication of name

 A bank shall set out its name in legible characters in all contracts, invoices, negotiable instruments and other documents evidencing rights or obligations with respect to other parties that are issued or made by or on behalf of the bank.

Marginal note:Corporate seal

  •  (1) A bank may adopt a corporate seal and change one that it adopted.

  • Marginal note:Validity of unsealed documents

    (2) A document executed on behalf of a bank is not invalid merely because a corporate seal is not affixed to it.

  • 1991, c. 46, s. 256
  • 2005, c. 54, s. 54

 [Repealed, 1997, c. 15, s. 30]

Insiders

Marginal note:Definitions

  •  (1) In this section and sections 266 to 272,

    affiliate

    affiliate means a body corporate that is affiliated with another body corporate within the meaning of subsection 6(2); (groupe)

    business combination

    business combination means an acquisition of all or substantially all of the assets of one body corporate by another, an amalgamation of two or more bodies corporate or any similar reorganization between two or more bodies corporate; (regroupement d’entreprises)

    call

    call means an option, transferable by delivery, to demand delivery of a specified number or amount of shares at a fixed price within a specified time but does not include an option or right to acquire shares of the body corporate that granted the option or right to acquire; (option d’achat)

    distributing bank

    distributing bank[Repealed, 2005, c. 54, s. 55]

    insider

    insider[Repealed, 2005, c. 54, s. 55]

    officer

    officer, in relation to a bank, means

    • (a) an officer as defined in paragraph (a) of the definition officer in section 2, or

    • (b) any natural person who performs functions for the bank similar to those performed by a person referred to in paragraph (a) of the definition officer in section 2; (dirigeant d’une banque)

    put

    put means an option, transferable by delivery, to deliver a specified number or amount of shares at a fixed price within a specified time; (option de vente)

    share

    share means a voting share and includes

    • (a) a security currently convertible into a voting share,

    • (b) a currently exercisable option or a right to acquire a voting share or a security referred to in paragraph (a), and

    • (c) a membership share. (action)

  • Marginal note:Control

    (2) For the purposes of this section and sections 266 to 272, a person controls a body corporate when the person controls the body corporate within the meaning of section 3, determined without regard to paragraph 3(1)(d).

  • (3) and (4) [Repealed, 2005, c. 54, s. 55]

  • 1991, c. 46, s. 265
  • 2005, c. 54, s. 55
  • 2010, c. 12, s. 2016

Insider Reporting

Marginal note:Insider report

 An insider shall submit an insider report in accordance with the regulations.

  • 1991, c. 46, s. 266
  • 1997, c. 15, s. 31
  • 2005, c. 54, s. 56

Marginal note:Exemption by Superintendent

 On application by an insider, the Superintendent may in writing and on any terms that the Superintendent thinks fit exempt the insider from any of the requirements of section 266. The exemption may be given retroactive effect and the Superintendent shall publish the partic­ulars of the exemption and the reasons for it in a periodical available to the public.

  • 1991, c. 46, s. 267
  • 2005, c. 54, s. 56

 [Repealed, 2005, c. 54, s. 56]

Marginal note:Regulations

 The Governor in Council may make regulations for carrying out the purposes of sections 266 and 267, including

  • (a) defining insider for the purposes of sections 266 and 267;

  • (b) respecting the form and content of an insider report; and

  • (c) respecting the submission or publication of an insider report.

  • 1991, c. 46, s. 268
  • 2005, c. 54, s. 56

 [Repealed, 2005, c. 54, s. 56]

Insider Trading

Meaning of insider

  •  (1) In this section, insider means with respect to a distributing bank

    • (a) a director or officer of the bank;

    • (b) a director or officer of a subsidiary of the bank;

    • (c) a director or officer of a body corporate that enters into a business combination with the bank; or

    • (d) a person employed or retained by the bank.

  • Marginal note:Prohibition — short sale

    (2) No insider may knowingly sell, directly or indirectly, a security of a distributing bank or of any of the distributing bank’s affiliates if the insider does not own or has not fully paid for the security.

  • Marginal note:Exception

    (3) Despite subsection (2), an insider may sell a security that they do not own if they own another security that is convertible into the security that was sold or they own an option or right to acquire the security that was sold, and if within 10 days after the sale they

    • (a) exercise the conversion privilege, option or right and deliver the security so acquired to the purchaser; or

    • (b) transfer the convertible security, option or right to the purchaser.

  • Marginal note:Prohibition — calls and puts

    (4) No insider may knowingly, directly or indirectly, buy or sell a call or put in respect of a security of a bank or of any of the bank’s affiliates.

  • 1991, c. 46, s. 270
  • 2005, c. 54, s. 57

Civil remedies

Extended meaning of insider

  •  (1) In this section and sections 271.1 and 272, insider with respect to a bank means

    • (a) the bank;

    • (b) an affiliate of the bank;

    • (c) a director or officer of the bank or of any person described in paragraph (b), (d) or (f);

    • (d) a person who beneficially owns directly or indirectly, or who exercises control or direction over or has a combination of ownership, control and direction in respect of, shares of the bank carrying more than the prescribed percentage of the voting rights attached to all of the bank’s outstanding shares not including shares held by the person as underwriter while those shares are in the course of a distribution to the public;

    • (e) a person, other than a person described in paragraph (f), who is employed or retained by the bank or by a person described in paragraph (f);

    • (f) a person who engages in or proposes to engage in any business or professional activity with or on behalf of the bank;

    • (g) a person who received material confidential information concerning the bank while they were a person described in any of paragraphs (a) to (f);

    • (h) a person who receives material confidential information from a person who is and who they know or ought reasonably to have known is a person described in this subsection, including in this paragraph, or subsection (3) or (4); or

    • (i) a prescribed person.

  • Extended meaning of insider — federal credit union

    (1.1) In addition to subsection (1), in this section and sections 271.1 and 272, insider with respect to a bank that is a federal credit union means a member of the federal credit union who holds more than the prescribed percentage of the membership shares of the federal credit union.

  • Extended meaning of security

    (2) For the purposes of this section, each of the following is deemed to be a security of a bank:

    • (a) a membership share of the bank, if the bank is a federal credit union;

    • (a.1) a put, call, option or other right or obligation to purchase or sell a security of the bank; and

    • (b) a security of another entity, the market price of which varies materially with the market price of the securities of the bank.

  • Marginal note:Deemed insider — take-over bid or business combination

    (3) For the purposes of this section and subsection 271.1(1), a person who proposes to make a take-over bid as defined in the regulations for securities of a bank or to enter into a business combination with a bank is an insider of the bank with respect to material confidential information obtained from the bank.

  • Marginal note:Deemed insider — affiliate or associate

    (4) An insider of a person referred to in subsection (3), or the person’s affiliate or associate, is an insider of the bank referred to in that subsection. Paragraphs (1)(b) to (i) apply in making this determination except that references to “bank” are to be read as references to “person described in subsection (3)”.

  • Meaning of associate

    (5) In subsection (4), associate means with respect to a person

    • (a) a body corporate that the person directly or indirectly controls, determined without regard to paragraph 3(1)(d), or of which they beneficially own shares or securities currently convertible into shares carrying more than 10% of the voting rights under all circumstances or by reason of the occurrence of an event that has occurred and is continuing or a currently exercisable option or right to purchase the shares or convertible securities;

    • (b) a partner of the person acting on behalf of the partnership of which they are partners;

    • (c) a trust or estate in which the person has a substantial beneficial interest or in respect of which they serve as a trustee or a liquidator of the succession or in a similar capacity;

    • (d) a spouse or common-law partner of the person;

    • (e) a child of the person or of their spouse or common-law partner; or

    • (f) if that relative has the same residence as the person, a relative of the person or of their spouse or common-law partner.

  • Marginal note:Insider trading — compensation to sellers and purchasers

    (6) An insider of a bank who purchases or sells a security of the bank with knowledge of confidential information that if it were generally known might reasonably be expected to materially affect the value of any of the securities of the bank is liable to compensate the seller or purchaser of the security, as the case may be, for any loss suffered by them as a result of the purchase or sale unless the insider establishes that

    • (a) the insider reasonably believed that the information had been generally disclosed;

    • (b) the information was known or ought reasonably to have been known by the seller or purchaser; or

    • (c) the purchase or sale of the security took place in the prescribed circumstances.

  • Marginal note:Insider trading — compensation to bank

    (7) The insider is accountable to the bank for any benefit or advantage received or receivable by the insider as a result of a purchase or sale described in subsection (6) unless they establish the circumstances described in paragraph (6)(a).

  • 1991, c. 46, s. 271
  • 2005, c. 54, s. 57
  • 2010, c. 12, s. 2017
 

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