The extension of the deadline for federal businesses, not-for-profits and cooperatives to call annual general meetings (“AGM”) and to present financial statements, as issued by the Minister of Innovation, Science and Industry in March, 2020, has ended. The pre-pandemic rules surrounding meetings and financial statements have been reinstated. Such businesses and organizations must hold an AGM of their shareholders or members yearly, within 15 months of the previous annual general meeting and no more than 6 months after the organization’s last financial year-end, in order to make governance decisions based on current information and to ensure confidence in continuing to support the business.
To comply with public health advice surrounding physical distancing and self-isolation during the pandemic while remaining compliant under the Canada Business Corporations Act, the Canada Not-for-profit Corporations Act and the Canada Cooperatives Act, federal corporations and organizations may consider the following alternative options to in-person meetings, where applicable:
Hold an entirely virtual meeting or a partially virtual meeting
- No matter the medium, all participants must be able to communicate adequately with one another during the meeting.
- To hold an entirely virtual meeting, the corporation’s by-laws must specifically permit virtual meetings. If the corporation’s by-laws prohibit virtual meetings or are silent on the topic, the board of directors may change the by-laws, effective until the next meeting of shareholders or members when the change is confirmed or rejected.
- If the by-laws do not permit virtual meetings, consider holding a partially virtual meeting for which some participants may attend in person and other participants attend through digital means.
- Participants in both types of meetings may also vote digitally, if not prohibited by the corporation’s by-laws, and if votes are gathered in a way that allows them to be verified, tallied and presented while maintaining vote anonymity.
Pass a written resolution in lieu of an annual general meeting
- An alternative to an AGM, which might be appropriate for corporations, not-for-profits and cooperatives made up of a small number of shareholders or members, would be to approve of such matters normally approved at an AGM (such as electing directors, considering financial statements and appointing or waiving the appointment of an auditor or accountant) by way of resolution. All shareholders or members entitled to vote at an AGM must sign the written resolution.
Delay calling an annual general meeting
- Not-for-profits may apply to Corporations Canada to delay an AGM (at least 30 business days before the notice calling the AGM is to be sent to its members) where it would be detrimental to call the meeting within the normal timeframe. Visit this link to apply or apply by email to [email protected].
- Federal corporations and cooperatives may delay an AGM with court approval.
In addition, every federal corporation, not-for-profit and cooperative must file an annual return with Corporations Canada yearly, within 60 days following the corporation/organization’s anniversary date. In your annual return, you must include, among other information, the date of your last AGM or signed written resolution. If your corporation fails to either hold an AGM or sign a written resolution in lieu of an AGM, you may not be able to file an annual return on time. If the status of your corporation’s annual filings with Corporation’s Canada changes to “overdue”, your corporation will not be able to obtain a certificate of compliance, when needed. If you fail to file an annual return at all, Corporations Canada may take steps to dissolve your company. For assistance with compliance and understanding your legal obligations, preparing annual resolutions and/or filing annual returns, please contact us.
This blog post was written by Jade Renaud, a member of the Business Law team. Jade can be reached at 613-369-0373 or at [email protected].
