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

Act current to 2022-11-16 and last amended on 2022-06-23. Previous Versions

PART VICorporate Governance (continued)

DIVISION IIIFundamental Changes (continued)

Amendments — By-laws (continued)

Marginal note:Participating policyholder vote

  •  (1) Participating policyholders are entitled to vote separately on a proposal to amend the by-laws to add to, change or remove the rights of policyholders, other than participating policyholders, to vote at meetings of shareholders or policyholders.

  • Marginal note:Policyholder vote

    (2) Policyholders who are entitled to vote, other than participating policyholders, are entitled to vote separately on a proposal to amend the by-laws to add to, change or remove the rights of policyholders, other than participating policyholders, to vote at meetings of shareholders or policyholders.

  • Marginal note:Right limited

    (3) The holders of a class of non-participating policies who are entitled to vote are entitled to vote separately as a class if the right to vote attached to policies of that class is added to, changed or removed by an addition or amendment to the by-laws in a manner different from the right to vote attached to other non-participating policies.

Marginal note:Separate resolutions

  •  (1) A proposed addition or amendment to the by-laws referred to in subsection 239(1) is adopted when the holders of the shares of each class or series entitled to vote separately thereon as a class or series and the policyholders have approved the addition or amendment by a special resolution.

  • Marginal note:Idem

    (2) A proposed addition or amendment to the by-laws referred to in section 240 is adopted when the participating policyholders, the non-participating policyholders who are entitled to vote and the holders of each class of non-participating policies entitled to vote separately thereon as a class and the shareholders have approved the addition or amendment by a special resolution.

Marginal note:Revoking resolution

 Where a special resolution referred to in subsection 238(2) so states, the directors may, without further approval of the shareholders or policyholders, revoke the special resolution.

Marginal note:Proposal to amend

  •  (1) Subject to subsection (2), a director or a shareholder or policyholder who is entitled to vote at an annual meeting of shareholders and policyholders of a company may, in accordance with sections 147 and 148, make a proposal to make an application referred to in section 224 or to make, amend or repeal the by-laws referred to in subsection 238(1) of the company.

  • Marginal note:Notice of amendment

    (2) Notice of a meeting of shareholders or policyholders at which a proposal to amend the incorporating instrument or to make, amend or repeal the by-laws of a company to effect any of the changes referred to in subsection 238(1) is to be considered must set out the proposal.

  • 1991, c. 47, s. 243
  • 2001, c. 9, s. 389

Marginal note:Rights preserved

 No amendment to the incorporating instrument or by-laws of a company affects an existing cause of action or claim or liability to prosecution in favour of or against the company or its directors or officers, or any civil, criminal or administrative action or proceeding to which the company or any of its directors or officers are a party.

Amalgamation

Marginal note:Application to amalgamate

  •  (1) On the joint application of two or more bodies corporate, incorporated by or under an Act of Parliament, including companies and insurance holding companies but not including federal credit unions, the Minister may issue letters patent amalgamating and continuing the applicants as one mutual company.

  • Marginal note:Application to amalgamate

    (2) On the joint application of two or more bodies corporate incorporated by or under an Act of Parliament, including companies — other than mutual companies — and insurance holding companies but not including federal credit unions, the Minister may issue letters patent amalgamating and continuing the applicants as one company.

  • Marginal note:Application to amalgamate societies

    (3) On the joint application of two or more societies, the Minister may issue letters patent amalgamating and continuing the applicants as one society.

  • 1991, c. 47, s. 245
  • 1997, c. 15, s. 218
  • 2001, c. 9, s. 390
  • 2010, c. 12, s. 2119

Marginal note:Amalgamation agreement

  •  (1) Each applicant proposing to amalgamate shall enter into an amalgamation agreement.

  • Marginal note:Contents of agreement — company

    (2) Every amalgamation agreement for an amalgamation to which subsection 245(1) or (2) applies shall set out the terms and means of effecting the amalgamation and, in particular,

    • (a) the name of the amalgamated company and the province in which its head office is to be situated;

    • (b) whether the amalgamated company is to be a mutual company or a company with common shares;

    • (c) the name and place of ordinary residence of each proposed director of the amalgamated company;

    • (d) the manner in which any shares of each applicant are to be converted into shares or other securities of the amalgamated company;

    • (e) if any shares of an applicant are not to be converted into shares or other securities of the amalgamated company, the amount of money or securities that the holders of those shares are to receive in addition to or in lieu of shares or other securities of the amalgamated company;

    • (f) the manner of payment of money in lieu of the issue of fractional shares of the amalgamated company or of any other body corporate that are to be issued in the amalgamation;

    • (g) the proposed by-laws of the amalgamated company;

    • (h) details of any other matter necessary to perfect the amalgamation and to provide for the subsequent management and operation of the amalgamated company; and

    • (i) the proposed effective date of the amalgamation.

  • Marginal note:Contents of agreement — society

    (2.1) Every amalgamation agreement for an amalgamation to which subsection 245(3) applies shall set out the terms and means of effecting the amalgamation and, in particular,

    • (a) the name of the amalgamated society and the province in which its head office is to be situated;

    • (b) the name and place of ordinary residence of each proposed director of the amalgamated society;

    • (c) the proposed by-laws of the amalgamated society;

    • (d) details of any other matter necessary to perfect the amalgamation and to provide for the subsequent management and operation of the amalgamated society; and

    • (e) the proposed effective date of the amalgamation.

  • Marginal note:Cross ownership of shares

    (3) If shares of one of the applicants are held by or on behalf of another of the applicants, other than shares held in the capacity of a personal representative or by way of security, the amalgamation agreement must provide for the cancellation of those shares when the amalgamation becomes effective without any repayment of capital in respect thereof, and no provision shall be made in the agreement for the conversion of those shares into shares of the amalgamated company.

  • 1991, c. 47, s. 246
  • 1997, c. 15, s. 219
  • 2005, c. 54, s. 261

Marginal note:Approval of agreement by Superintendent

  •  (1) An amalgamation agreement must be submitted to the Superintendent for approval and any approval of the agreement under subsection 248(5) by the shareholders, policyholders or members of an applicant is invalid unless, before the date of the approval, the Superintendent has approved the agreement in writing.

  • Marginal note:Report of independent actuary

    (2) An amalgamation agreement submitted to the Superintendent for approval must be accompanied by the report of an independent actuary on the agreement.

  • 1991, c. 47, s. 247
  • 1997, c. 15, s. 220(E)
  • 2007, c. 6, s. 205

Marginal note:Approval by shareholders, policyholders and members

  •  (1) The directors of each applicant shall submit an amalgamation agreement for approval

    • (a) to a meeting of the shareholders and policyholders entitled to vote of the applicant company of which they are directors and to the holders of each class or series of shares;

    • (b) to a meeting of the shareholders of the body corporate of which they are directors and to the holders of each class or series of shares; or

    • (c) to a meeting of the members of the applicant society of which they are directors.

  • Marginal note:Right to vote

    (2) Each share of an applicant carries the right to vote in respect of an amalgamation agreement whether or not it otherwise carries the right to vote.

  • Marginal note:Separate vote for class or series

    (3) The holders of shares of a class or series of shares of each applicant are entitled to vote separately as a class or series in respect of an amalgamation agreement if the agreement contains a provision that, if it were contained in a proposed amendment to the by-laws or incorporating instrument of the applicant, would entitle those holders to vote separately as a class or series.

  • Marginal note:Policyholder vote

    (4) Policyholders who are entitled to vote are entitled to vote separately from shareholders in respect of an amalgamation agreement.

  • Marginal note:Special resolution

    (5) Subject to subsections (3) and (4), an amalgamation agreement is approved when it has been approved by special resolution by

    • (a) the shareholders and the policyholders who are entitled to vote of each applicant company;

    • (b) the shareholders of each applicant body corporate; and

    • (c) the members of each applicant society.

  • Marginal note:Termination

    (6) An amalgamation agreement may provide that, at any time before the issue of letters patent of amalgamation, the agreement may be terminated by the directors of an applicant even though the agreement has been approved by the shareholders, policyholders or members of all or any of the applicant companies, bodies corporate or societies.

  • 1991, c. 47, s. 248
  • 1997, c. 15, s. 221
  • 2005, c. 54, s. 262

Marginal note:Vertical short-form amalgamation

  •  (1) A company that does not have any participating policyholders may, without complying with sections 246 to 248, amalgamate with one or more bodies corporate that

    • (a) are incorporated by or under an Act of Parliament,

    • (b) are wholly-owned subsidiaries of the company, and

    • (c) do not have any participating policyholders

    if

    • (d) the amalgamation is approved by a resolution of the directors of the company and of each amalgamating subsidiary, and

    • (e) the resolutions provide that

      • (i) the shares of each amalgamating subsidiary will be cancelled without any repayment of capital in respect thereof,

      • (ii) the letters patent of amalgamation and the by-laws of the amalgamated company will be the same as the incorporating instrument and the by-laws of the amalgamating company that is the holding body corporate, and

      • (iii) no securities will be issued by the amalgamated company in connection with the amalgamation.

  • Marginal note:Horizontal short-form amalgamation

    (2) Two or more bodies corporate that

    • (a) are incorporated by or under an Act of Parliament,

    • (b) are wholly-owned subsidiaries of the same holding body corporate, and

    • (c) do not have any participating policyholders

    may amalgamate and continue as one company without complying with sections 246 to 248 if

    • (d) at least one of the applicants is a company,

    • (e) the amalgamation is approved by a resolution of the directors of each of the applicants, and

    • (f) the resolutions provide that

      • (i) the shares of all applicants, except those of one of the applicants that is a company, will be cancelled without any repayment of capital in respect thereof,

      • (ii) the letters patent of amalgamation and the by-laws of the amalgamated company will be the same as the incorporating instrument and the by-laws of the amalgamating company whose shares are not cancelled, and

      • (iii) the stated capital of the amalgamating companies and bodies corporate whose shares are cancelled will be added to the stated capital of the amalgamating company whose shares are not cancelled.

  • 1991, c. 47, s. 249
  • 2005, c. 54, s. 263

Marginal note:Joint application to Minister

  •  (1) Subject to subsection (2), unless an amalgamation agreement is terminated in accordance with subsection 248(6), the applicants shall, within three months after the approval of the agreement in accordance with subsection 248(5) or the approval of the directors in accordance with subsection 249(1) or (2), jointly apply to the Minister for letters patent of amalgamation continuing the applicants as one company or society.

  • Marginal note:Conditions precedent to application

    (2) No application for the issue of letters patent under subsection (1) may be made unless

    • (a) notice of intention to make such an application has been published at least once a week for a period of four consecutive weeks in the Canada Gazette and in a newspaper in general circulation at or near the place where the head office of each applicant is situated; and

    • (b) the application is supported by satisfactory evidence that the applicants have complied with the requirements of this Part relating to amalgamations.

  • Marginal note:Application of sections 23 to 26

    (3) If two or more bodies corporate, none of which is a company or society, apply for letters patent under subsection (1), sections 23 to 26 apply in respect of the application with any modifications that the circumstances require.

  • Marginal note:Matters for consideration

    (4) Before issuing letters patent of amalgamation continuing the applicants as one company or society, the Minister shall take into account all matters that the Minister considers relevant to the application, including

    • (a) the sources of continuing financial support for the amalgamated company or society;

    • (b) the soundness and feasibility of the plans of the applicants for the future conduct and development of the business of the amalgamated company or society;

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

    • (d) the reputation of the applicants for being operated in a manner that is consistent with the standards of good character and integrity;

    • (e) whether the amalgamated company or society 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 operations and businesses of the applicants on the conduct of those operations and businesses;

    • (g) if one of the applicants is a converted company in respect of which the Minister has issued an order under subsection 407(8) or a converted company in respect of which subsection 407(11) applied at any time, or a body corporate that controls, within the meaning of paragraph 3(1)(d), such a company, the opinion of the Superintendent regarding the extent to which the proposed corporate structure of the amalgamated company and its affiliates may affect the supervision and regulation of the amalgamated company, having regard to

      • (i) the nature and extent of the proposed financial services activities to be carried out by the amalgamated company and its affiliates, and

      • (ii) the nature and degree of supervision and regulation applying to the proposed financial services activities to be carried out by the affiliates of the amalgamated company; and

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

  • Marginal note:Restriction

    (5) The Minister may not, before January 1, 2002, issue letters patent under section 251 amalgamating a converted company in respect of which subsection 407(4) or (11) applies, a company to which subsection 407(5) or (12) applies or an insurance holding company to which subsection 407(6) or (13) applies with any other body corporate.

  • Marginal note:Restriction

    (6) If one of the applicants for letters patent of amalgamation is a converted company in respect of which subsection 407(4) applies, or a company to which subsection 407(5) applies or an insurance holding company to which subsection 407(6) applies, the Minister may not issue the letters patent of amalgamation unless the amalgamated company is

    • (a) widely held; or

    • (b) controlled, within the meaning of paragraph 3(1)(d), by a company to which subsection 407(5) applies, or by an insurance holding company to which subsection 407(6) applies, that controlled one of the applicants at the time the application was made.

  • Marginal note:Deeming

    (7) If one of the applicants for letters patent of amalgamation is a converted company in respect of which subsection 407(4) applies, a company to which subsection 407(5) applies or an insurance holding company to which subsection 407(6) applies and the letters patent of amalgamation are issued, the amalgamated company is deemed to be a converted company in respect of which subsection 407(4) applies or a company to which subsection 407(5) applies, as the case may be.

  • 1991, c. 47, s. 250
  • 1997, c. 15, s. 222
  • 2001, c. 9, s. 391
 
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