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)
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Assented to 2007-12-14
R.S., c. B-3; 1992, c. 27, s. 2BANKRUPTCY AND INSOLVENCY ACT
59. Section 275 of the Act, as enacted by section 122 of chapter 47 of the Statutes of Canada, 2005, is amended by adding the following after subsection (2):
Marginal note:Forms of cooperation
(3) For the purpose of this section, cooperation may be provided by any appropriate means, including
(a) the appointment of a person to act at the direction of the court;
(b) the communication of information by any means considered appropriate by the court;
(c) the coordination of the administration and supervision of the debtor’s assets and affairs;
(d) the approval or implementation by courts of agreements concerning the coordination of proceedings; and
(e) the coordination of concurrent proceedings regarding the same debtor.
60. Subsection 284(2) of the Act, as enacted by section 122 of chapter 47 of the Statutes of Canada, 2005, is replaced by the following:
Marginal note:Public policy exception
(2) Nothing in this Part prevents the court from refusing to do something that would be contrary to public policy.
R.S., c. C-36COMPANIES’ CREDITORS ARRANGEMENT ACT
61. (1) The definition “shareholder” in subsection 2(1) of the Companies’ Creditors Arrangement Act, as enacted by subsection 124(2) of chapter 47 of the Statutes of Canada, 2005, is replaced by the following:
“shareholder”
« actionnaire »
“shareholder” includes a member of a company — and, in the case of an income trust, a holder of a unit in an income trust — to which this Act applies;
(2) The definitions “director” and “income trust” in subsection 2(1) of the Act, as enacted by subsection 124(3) of chapter 47 of the Statutes of Canada, 2005, are replaced by the following:
“director”
« administrateur »
“director” means, in the case of a company other than an income trust, a person occupying the position of director by whatever name called and, in the case of an income trust, a person occupying the position of trustee by whatever named called;
“income trust”
« fiducie de revenu »
“income trust” means a trust that has assets in Canada if
(a) its units are listed on a prescribed stock exchange on the day on which proceedings commence under this Act, or
(b) the majority of its units are held by a trust whose units are listed on a prescribed stock exchange on the day on which proceedings commence under this Act;
(3) The definition agent négociateur in subsection 2(1) of the French version of the Act, as enacted by subsection 124(3) of chapter 47 of the Statutes of Canada, 2005, is replaced by the following:
« agent négociateur »
“bargaining agent”
agent négociateur Syndicat ayant conclu une convention collective pour le compte des employés d’une compagnie.
(4) Subsection 2(2) of the Act, as enacted by subsection 124(5) of chapter 47 of the Statutes of Canada, 2005, is replaced by the following:
Meaning of “related” and “dealing at arm’s length”
(2) For the purpose of this Act, section 4 of the Bankruptcy and Insolvency Act applies for the purpose of determining whether a person is related to or dealing at arm’s length with a debtor company.
62. Paragraph 11.02(3)(b) of the French version of the Act, as enacted by section 128 of chapter 47 of the Statutes of Canada, 2005, is replaced by the following:
b) dans le cas de l’ordonnance visée au paragraphe (2), le demandeur le convainc en outre qu’il a agi et continue d’agir de bonne foi et avec la diligence voulue.
63. (1) Subsection 11.05(1) of the Act, as enacted by section 128 of chapter 47 of the Statutes of Canada, 2005, is replaced by the following:
Marginal note:Eligible financial contracts
11.05 (1) No order may be made under this Act that has the effect of staying or restraining the exercise of a right to terminate or amend an eligible financial contract or claim an accelerated payment or a forfeiture of the term under it.
(2) The definition “eligible financial contract” in subsection 11.05(3) of the Act, as enacted by section 128 of chapter 47 of the Statutes of Canada, 2005, is replaced by the following:
“eligible financial contract”
« contrat financier admissible »
“eligible financial contract” means an agreement of a prescribed kind.
64. Section 11.06 of the Act, as enacted by section 128 of chapter 47 of the Statutes of Canada, 2005, is replaced by the following:
Marginal note:Member of the Canadian Payments Association
11.06 No order may be made under this Act that has the effect of preventing 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 or the by-laws or rules of that Association.
65. Sections 11.1 to 11.4 of the Act, as enacted by section 128 of chapter 47 of the Statutes of Canada, 2005, are replaced by the following:
Meaning of “regulatory body”
11.1 (1) In this section, “regulatory body” means a person or body that has powers, duties or functions relating to the enforcement or administration of an Act of Parliament or of the legislature of a province and includes a person or body that is prescribed to be a regulatory body for the purpose of this Act.
Marginal note:Regulatory bodies — order under section 11.02
(2) Subject to subsection (3), no order made under section 11.02 affects a regulatory body’s investigation in respect of the debtor company or an action, suit or proceeding that is taken in respect of the company by or before the regulatory body, other than the enforcement of a payment ordered by the regulatory body or the court.
Marginal note:Exception
(3) On application by the company and on notice to the regulatory body and to the persons who are likely to be affected by the order, the court may order that subsection (2) not apply in respect of one or more of the actions, suits or proceedings taken by or before the regulatory body if in the court’s opinion
(a) a viable compromise or arrangement could not be made in respect of the company if that subsection were to apply; and
(b) it is not contrary to the public interest that the regulatory body be affected by the order made under section 11.02.
Marginal note:Declaration — enforcement of a payment
(4) If there is a dispute as to whether a regulatory body is seeking to enforce its rights as a creditor, the court may, on application by the company and on notice to the regulatory body, make an order declaring both that the regulatory body is seeking to enforce its rights as a creditor and that the enforcement of those rights is stayed.
Marginal note:Interim financing
11.2 (1) On application by a debtor company and on notice to the secured creditors who are likely to be affected by the security or charge, a court may make an order declaring that all or part of the company’s property is subject to a security or charge — in an amount that the court considers appropriate — in favour of a person specified in the order who agrees to lend to the company an amount approved by the court as being required by the company, having regard to its cash-flow statement. The security or charge may not secure an obligation that exists before the order is made.
Marginal note:Priority — secured creditors
(2) The court may order that the security or charge rank in priority over the claim of any secured creditor of the company.
Marginal note:Priority — other orders
(3) The court may order that the security or charge rank in priority over any security or charge arising from a previous order made under subsection (1) only with the consent of the person in whose favour the previous order was made.
Marginal note:Factors to be considered
(4) In deciding whether to make an order, the court is to consider, among other things,
(a) the period during which the company is expected to be subject to proceedings under this Act;
(b) how the company’s business and financial affairs are to be managed during the proceedings;
(c) whether the company’s management has the confidence of its major creditors;
(d) whether the loan would enhance the prospects of a viable compromise or arrangement being made in respect of the company;
(e) the nature and value of the company’s property;
(f) whether any creditor would be materially prejudiced as a result of the security or charge; and
(g) the monitor’s report referred to in paragraph 23(1)(b), if any.
Marginal note:Assignment of agreements
11.3 (1) On application by a debtor company and on notice to every party to an agreement and the monitor, the court may make an order assigning the rights and obligations of the company under the agreement to any person who is specified by the court and agrees to the assignment.
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 within the meaning of subsection 11.05(3); or
(c) a collective agreement.
Marginal note:Factors to be considered
(3) In deciding whether to make the order, the court is to consider, among other things,
(a) whether the monitor approved the proposed assignment;
(b) whether the person to whom the rights and obligations are to be assigned would be able to perform the obligations; and
(c) whether it would be appropriate to assign the rights and obligations to that person.
Marginal note:Restriction
(4) 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 company’s insolvency, the commencement of proceedings under this Act or the company’s failure to perform a non-monetary obligation — will be remedied on or before the day fixed by the court.
Marginal note:Copy of order
(5) The applicant is to send a copy of the order to every party to the agreement.
Marginal note:Critical supplier
11.4 (1) On application by a debtor company and on notice to the secured creditors who are likely to be affected by the security or charge, the court may make an order declaring a person to be a critical supplier to the company if the court is satisfied that the person is a supplier of goods or services to the company and that the goods or services that are supplied are critical to the company’s continued operation.
Marginal note:Obligation to supply
(2) If the court declares a person to be a critical supplier, the court may make an order requiring the person to supply any goods or services specified by the court to the company on any terms and conditions that are consistent with the supply relationship or that the court considers appropriate.
Marginal note:Security or charge in favour of critical supplier
(3) If the court makes an order under subsection (2), the court shall, in the order, declare that all or part of the property of the company is subject to a security or charge in favour of the person declared to be a critical supplier, in an amount equal to the value of the goods or services supplied under the terms of the order.
Marginal note:Priority
(4) The court may order that the security or charge rank in priority over the claim of any secured creditor of the company.
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