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Insurance Companies Act (S.C. 1991, c. 47)

Act current to 2024-04-01 and last amended on 2024-01-01. Previous Versions

PART XVIIInsurance Holding Companies (continued)

Purpose (continued)

 [Repealed, 2001, c. 9, s. 465]

DIVISION 1Interpretation

Marginal note:Definitions

  •  (1) The following definitions apply in this Part.

    affairs

    affairs, with respect to an insurance holding company, means the relationships among the insurance holding company and its affiliates and the shareholders, directors and officers of the insurance holding company and its affiliates, but does not include the business of the insurance holding company or any of its affiliates. (affaires internes)

    complainant

    complainant, in relation to an insurance holding company or any matter concerning an insurance holding company, means

    • (a) a registered holder or beneficial owner, and a former registered holder or beneficial owner, of a security of the insurance holding company or any of its affiliates;

    • (b) a director or an officer, or a former director or officer, of the insurance holding company or any of its affiliates; or

    • (c) any other person who, in the discretion of a court, is a proper person to make an application under section 912, 916 or 1031. (plaignant)

    subordinated indebtedness

    subordinated indebtedness means an instrument evidencing an indebtedness of an insurance holding company that by its terms provides that the indebtedness will, in the event of the insolvency or winding-up of the insurance holding company, be subordinate in right of payment to all liabilities of the insurance holding company except those liabilities that, by their terms, rank equally with or are subordinate to such indebtedness. (titre secondaire)

  • Marginal note:Provisions in other Parts

    (2) A reference in a provision in this Part to a provision in any other Part is deemed to be a reference to that provision as it has been made applicable by this Part in respect of insurance holding companies.

  • Marginal note:References in other Parts

    (3) A reference in a provision of another Part to a provision that has been made applicable in respect of insurance holding companies by this Part is to be read as including a reference to that provision as it has been made applicable in respect of insurance holding companies.

  • 1991, c. 47, s. 700
  • 2001, c. 9, s. 465

DIVISION 2Status and Powers

Marginal note:Corporate powers

  •  (1) An insurance holding company has the capacity of a natural person and, subject to this Act, the rights, powers and privileges of a natural person.

  • Marginal note:Powers restricted

    (2) An insurance holding company shall not carry on any business or exercise any power that it is restricted by this Act from carrying on or exercising, or exercise any of its powers in a manner contrary to this Act.

  • Marginal note:Business in Canada

    (3) An insurance holding company may carry on business throughout Canada.

  • Marginal note:Powers outside Canada

    (4) Subject to this Act, an insurance holding company has the capacity to carry on its business, conduct its affairs and exercise its powers in any jurisdiction outside Canada to the extent and in the manner that the laws of that jurisdiction permit.

  • 1991, c. 47, s. 701
  • 2001, c. 9, s. 465

Marginal note:Policies and procedures — integrity or security

 An insurance holding company shall establish and adhere to policies and procedures to protect itself against threats to its integrity or security, including foreign interference.

Marginal note:No invalidity

 No act of an insurance holding company, including any transfer of property to or by an insurance holding company, is invalid by reason only that the act or transfer is contrary to the insurance holding company’s incorporating instrument or this Act.

  • 1991, c. 47, s. 702
  • 1996, c. 6, s. 102
  • 2001, c. 9, s. 465

Marginal note:By-law not necessary

 It is not necessary for an insurance holding company to pass a by-law in order to confer any particular power on the insurance holding company or its directors.

  • 1991, c. 47, s. 703
  • 1996, c. 6, s. 103
  • 1997, c. 15, s. 330
  • 1999, c. 31, s. 145(F)
  • 2001, c. 9, s. 465

Marginal note:No personal liability

 The shareholders of an insurance holding company are not, as shareholders, liable for any liability, act or default of the insurance holding company except as otherwise provided by this Act.

  • 1991, c. 47, s. 704
  • 2001, c. 9, s. 465

Marginal note:No constructive notice

 No person is affected by or is deemed to have notice or knowledge of the contents of a document concerning an insurance holding company by reason only that the document has been filed with the Superintendent or the Minister or is available for inspection at an office of the insurance holding company.

  • 1991, c. 47, s. 705
  • 2001, c. 9, s. 465

Marginal note:Authority of directors, officers and representatives

  •  (1) No insurance holding company and no guarantor of an obligation of an insurance holding company may assert against a person dealing with the insurance holding company or against a person who has acquired rights from the insurance holding company that

    • (a) the insurance holding company’s incorporating instrument or any by-laws of the insurance holding company have not been complied with;

    • (b) the persons named as directors of the insurance holding company in the most recent return sent to the Superintendent under section 994 are not the directors of the insurance holding company;

    • (c) the place named in the incorporating instrument or by-laws of the insurance holding company is not the place where the head office of the insurance holding company is situated;

    • (d) a person held out by the insurance holding company as a director, officer or representative of the insurance holding company has not been duly appointed or has no authority to exercise the powers and perform the duties that are customary in the business of the insurance holding company or usual for a director, officer or representative; or

    • (e) a document issued by any director, officer or representative of the insurance holding company with actual or usual authority to issue the document is not valid or not genuine.

  • Marginal note:Exception — knowledge

    (2) Subsection (1) does not apply in respect of a person who has or ought to have knowledge of a situation described in that subsection by virtue of their relationship to the insurance holding company.

  • 1991, c. 47, s. 706
  • 1997, c. 15, s. 331
  • 2000, c. 12, s. 157
  • 2001, c. 9, s. 465
  • 2005, c. 54, s. 304

Marginal note:Sunset provision

  •  (1) Subject to subsections (2) and (4), insurance holding companies shall not carry on business after June 30, 2025.

  • Marginal note:Extension

    (2) The Governor in Council may, by order, extend by up to six months the time during which insurance holding companies may continue to carry on business. No more than one order may be made under this subsection.

  • Marginal note:Order not a regulation

    (3) The order is not a regulation for the purposes of the Statutory Instruments Act. However, it shall be published in Part II of the Canada Gazette.

  • Marginal note:Exception — dissolution

    (4) If Parliament dissolves on the day set out in subsection (1) or on any day within the six-month period before that day or on any day within an extension ordered under subsection (2), insurance holding companies may continue to carry on business until the end of the 180th day after the first day of the first session of the next Parliament.

  • 1991, c. 47, s. 707
  • 1997, c. 15, s. 332
  • 2001, c. 9, s. 465
  • 2006, c. 4, s. 201.1
  • 2007, c. 6, s. 310
  • 2012, c. 5, s. 154
  • 2016, c. 7, s. 121
  • 2018, c. 12, s. 358
  • 2021, c. 23, s. 157

DIVISION 3Incorporation, Continuance and Discontinuance

Formalities of Incorporation

Marginal note:Incorporation of insurance holding company

 On the application of one or more persons made in accordance with this Part, the Minister may, subject to this Division, issue letters patent incorporating an insurance holding company.

  • 1991, c. 47, s. 708
  • 2001, c. 9, s. 465

Marginal note:Restrictions on incorporation

 Letters patent incorporating an insurance holding company may not be issued if the application therefor is made by or on behalf of

  • (a) Her Majesty in right of Canada or in right of a province, an agency of Her Majesty in either of those rights, or an entity controlled by Her Majesty in either of those rights;

  • (b) the government of a foreign country or any political subdivision thereof;

  • (c) an agency of the government of a foreign country or any political subdivision thereof; or

  • (d) an entity, other than a foreign institution or any subsidiary of a foreign institution, that is controlled by the government of a foreign country or any political subdivision thereof.

  • 1991, c. 47, s. 709
  • 2001, c. 9, s. 465

Marginal note:National treatment

  •  (1) If a proposed insurance holding company would be a subsidiary of a foreign institution that is engaged in the insurance business, letters patent to incorporate the insurance holding company may not be issued unless the Minister is satisfied that, if the application is made by a non-WTO Member foreign institution, treatment as favourable for insurance holding companies to which this Act applies exists or will be provided in the jurisdiction in which the foreign institution principally carries on business, either directly or through a subsidiary.

  • Marginal note:Part XII of the Bank Act

    (2) Nothing in subsection (1) affects the operation of Part XII of the Bank Act.

  • 1991, c. 47, s. 710
  • 2001, c. 9, s. 465

Marginal note:Application for incorporation

 An application for letters patent to incorporate an insurance holding company setting out the names of the first directors of the insurance holding company shall be filed with the Superintendent, together with such other information, material and evidence as the Superintendent may require.

  • 1991, c. 47, s. 711
  • 2001, c. 9, s. 465

Marginal note:Matters for consideration

 Before issuing letters patent to incorporate an insurance holding company, the Minister shall take into account all matters that the Minister considers relevant to the application, including

  • (a) the nature and sufficiency of the financial resources of the applicant or applicants as a source of continuing financial support for the company that is proposed to be its subsidiary;

  • (b) the soundness and feasibility of the plans of the applicant or applicants for the future conduct and development of the business of the company that is proposed to be its subsidiary;

  • (c) the business record and experience of the applicant or applicants;

  • (d) the character and integrity of the applicant or applicants or, if the applicant or any of the applicants is a body corporate, its reputation for being operated in a manner that is consistent with the standards of good character and integrity;

  • (e) whether the insurance holding company will be operated responsibly by persons with the competence and experience suitable for involvement in the operation of a financial institution;

  • (f) the impact of any integration of the businesses and operations of the applicant or applicants with those of the insurance holding company and its affiliates on the conduct of those businesses and operations; and

  • (g) the best interests of the financial system in Canada.

  • 1991, c. 47, s. 712
  • 2001, c. 9, s. 465

Marginal note:Contents of letters patent

  •  (1) There shall be set out in the letters patent incorporating an insurance holding company

    • (a) the name of the insurance holding company;

    • (b) the province in which the head office of the insurance holding company is to be situated; and

    • (c) the date that the insurance holding company came, or is to come, into existence.

  • Marginal note:Provisions in letters patent

    (2) The Minister may set out in the letters patent incorporating an insurance holding company any provision not contrary to this Act that the Minister considers advisable in order to take into account the particular circumstances of the proposed insurance holding company.

  • Marginal note:Terms and conditions

    (3) The Minister may impose such terms and conditions in respect of the issuance of letters patent incorporating an insurance holding company as the Minister considers necessary or appropriate.

  • 1991, c. 47, s. 713
  • 2001, c. 9, s. 465
  • 2005, c. 54, s. 305

Marginal note:Letters patent of incorporation on application of life company

  •  (1) If the Minister, under section 708, issues letters patent incorporating an insurance holding company on the application of a life company, including a converted company, there may, on the request of the company, and with the approval of the Minister, be included in the letters patent of incorporation of the insurance holding company a provision deeming shares of the insurance holding company to be issued, on a share for share basis, to all shareholders of the company in exchange for all the issued and outstanding shares of the company.

  • Marginal note:Effect of provision

    (2) Shares of an insurance holding company deemed to be issued under subsection (1) are subject to the same designation, rights, privileges and restrictions or conditions and, subject to any agreement to the contrary, to the same charges, encumbrances and other restrictions as the shares of the company for which they are exchanged and the shares of the company, on the issuance of the letters patent, become the property of the insurance holding company free and clear of any charge, encumbrance or other restriction.

  • Marginal note:Effect of provision

    (3) An exchange of shares of a company referred to in subsection (1) under a provision included in the letters patent incorporating an insurance holding company does not deprive a person who was a holder of shares of the company immediately before the exchange of any right or privilege with respect to the shares or relieve the person of any liability in respect of the shares, but that right or privilege must be exercised in accordance with this Act.

  • Marginal note:Transfer and voting of company shares

    (4) Despite subsection (3), no share of an insurance holding company that is deemed to be issued under a provision included in the letters patent incorporating an insurance holding company may subsequently be transferred or voted contrary to this Act.

  • Marginal note:Shareholder and policyholder approval

    (5) No provision described in subsection (1) may be included in letters patent issued under section 708 unless the application for the letters patent is accompanied by evidence that the request for the provision was approved by a special resolution of the shareholders and the policyholders of the company who are entitled to vote at a meeting of shareholders and policyholders called to consider the application.

  • Marginal note:Exchange of share certificates

    (6) If, under a provision included in the letters patent incorporating an insurance holding company, a share exchange is deemed to have taken place, the insurance holding company shall, within ninety days after the issuance of the letters patent, make provision for the issue of share certificates representing shares of the insurance holding company and for the exchange of those certificates for share certificates representing the shares of the company that were outstanding on the effective date of the letters patent.

  • 1991, c. 47, s. 714
  • 2001, c. 9, s. 465
 

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