Continuance: move your corporation to another jurisdiction

What is a corporate continuance?

Every Canadian corporation is governed by the corporate statute of the jurisdiction where it was created: the Canada Business Corporations Act (CBCACBCAFederal statute governing corporations formed with Corporations Canada.See definition →) for a federal corporation, the Business Corporations Act (Ontario) for an Ontario corporation, the Business Corporations Act (Quebec) for a Quebec corporation, and so on. A continuance changes that governing statute. The corporation leaves one registry and joins another, but it does not end: it keeps its assets, its debts, its contracts, its shareholders and its history.

That is the main difference from the alternative many owners first consider: incorporating a new company in the target jurisdiction, moving the business over and dissolving the old one. A new company means new contracts, asset transfers and, often, tax questions on those transfers. A continuance keeps one legal person from start to finish.

• Same legal person: the corporation is not wound up and does not need to reassign its contracts or assets.
• New rulebook: after the continuance, the corporation follows the statute of its new jurisdiction for directors, shareholders, records and annual filings.
• New registry: annual returns, notices of change and amendments are filed with the importing registry from then on.
• New articles: the articles of continuance replace the old articles and must meet the importing statute's rules on name, share structure and directors.

Continuance in and continuance out

Each continuance has two sides, and each side has its own filing. Registries often call them import and export.

The two sides depend on each other. The importing registry wants to see that the move is authorized where the corporation comes from, and the exporting registry wants confirmation that the corporation now exists under another statute before it removes it from its records. The order of the filings and the documents vary from one jurisdiction to another; part of the work is lining them up so neither registry is left waiting.

Why corporations change jurisdictions

Owners look at a continuance for different reasons. The common ones are listed below; whether any of them applies to a given corporation is a question for its lawyer or accountant.

• Director residency rules. Federal rule: At least 25% of directors must be resident Canadians; at least 1 if fewer than 4 directorssource. Ontario: No residency requirement; s. 118(3) repealed effective 2021-07-05source. Quebec: None: any natural person may be a director, except persons disqualified under the Civil Code or declared incapable by a foreign courtsource. A corporation whose board changes may look for a statute that fits its new board.
• Name protection across Canada. A federal corporation has its name reviewed at the national level, which some businesses expanding outside their home province look for.
• The business has moved. The founders, the head office and the customers are now in another province, and keeping two registries (home and extra-provincial) no longer makes sense.
• A merger or reorganization. Two corporations governed by different statutes generally need to be under the same statute before they can amalgamate.
• Investors or lenders who ask for a particular governing statute in their financing documents.

Authorization from the exporting jurisdiction

No registry lets a corporation leave without checking first. Corporate statutes generally require three things before a continuance out: the shareholders approve it, the exporting registry authorizes it, and the importing statute is one that the exporting jurisdiction recognizes.

1. 1Shareholder approvalThe shareholders adopt a special ResolutionResolutionFormal decision of directors or shareholders, recorded in the minute book.See definition → authorizing the corporation to apply for continuance in the target jurisdiction. Depending on the statute and the share structure, some classes of shares may vote separately, and dissenting shareholders may have rights.
2. 2Filings up to dateThe exporting registry generally checks that the corporation is in good standing: annual returns filed, no outstanding notices, sometimes no tax filings in default. A corporation with overdue returns usually has to catch up first.
3. 3Application to the exporting registryThe corporation applies for authorization, often called a letter of consent, a letter of satisfaction or an authorization to continue. Its form and name depend on the jurisdiction.
4. 4Proof of importOnce the importing registry has issued the certificate of continuance, a copy goes back to the exporting registry, which records that the corporation has left.

Some jurisdictions add their own checks, such as a confirmation that creditors are not prejudiced or that the importing statute gives shareholders comparable rights. We confirm the list of documents for your pair of jurisdictions before anything is filed.

Government fees for a continuance (sourced)

The fees below are the government fees charged by the importing jurisdiction for articles of continuance. Each one links to its source and verification date. Name searches, the exporting jurisdiction's own fees and any extra-provincial registration are charged separately.

For Saskatchewan, Manitoba, New Brunswick, Nova Scotia, Prince Edward Island, Newfoundland and Labrador, Yukon, the Northwest Territories and Nunavut, the continuance fee is being verified against the government source and is not displayed here yet. The exact amount for your file appears in your quote, separate from our service fee, before you pay.

Other government costs often come with a continuance: a name search or name approval in the importing jurisdiction, the filing of the new registered office and directors, and, if the corporation keeps operating in its former province, an extra-provincial registration there. For a federal corporation, the significant control filing also follows the continuance: Annually with the annual return; within 15 days of a change; on incorporation (30 days after amalgamation/continuance)source.

How we file your continuance for you

A continuance is a file with two registries, two sets of rules and several documents that have to match. Incorpo handles the preparation and the filings; the decision to continue, and any advice on its legal or tax effects, stays with you and your advisers.

1. 1Review of the current fileYou tell us where the corporation is governed today and where it is going. We review its current articles, directors, registered office and filing status in the exporting registry.
2. 2Name and articles of continuanceWe check the name against the importing jurisdiction's rules and prepare the articles of continuance, adapting the share structure and director provisions to the new statute where needed. You review everything before filing.
3. 3Resolutions and authorizationWe prepare the shareholder resolution approving the continuance and the application to the exporting registry, for signature online.
4. 4Filing in the importing jurisdictionOnce the authorization is in hand, we file the articles of continuance and pay the government fee for you.
5. 5Closing the loopWe send proof of the continuance to the exporting registry, update your digital minute bookminute bookOfficial record holding a corporation’s articles, by-laws, resolutions and registers.See definition → and registers, and list the follow-up filings: new initial return, CRA records, extra-provincial registrations and bank.

The continuance does not change the corporation's business number with the Canada Revenue Agency, but the CRA and the provincial tax authorities need to know about the new governing statute and any new address. If the corporation also moves its activities, provincial tax accounts, payroll and workers' compensation registrations may change. Your accountant can map these out for your situation.

What to have ready before a continuance

• The corporation number and the current certificate and articles of incorporation, including any amendments.
• The minute book, with the securities register and the list of current directors and officers.
• The address of the new registered office in the importing jurisdiction.
• The proposed directors, checked against the importing statute's residency rule.
• Confirmation that annual returns are up to date in the exporting registry.
• For a corporation operating in Quebec, a French form of the name if it does not already have one: A business name must be in French; a French name is required to obtain legal personalitysource.

Continuances involving a jurisdiction outside Canada, a corporation that is not in good standing, or a corporation with outstanding litigation or secured lenders are usually more involved. Our partner law firm can review those files.