Regulatory relief requires reform

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In a nutshell

The CBA’s Business Law and Insolvency Law Sections make recommendations for the government’s review of Canada’s federal business law frameworks. The amendments are practical and overdue. Reducing unnecessary administrative burden, modernizing outdated statutory requirements, and enabling digital governance practices are needed for a federal legal framework that is efficient, accessible, and internationally competitive. However, the CBA has concerns about some proposed amendments for the Companies’ Creditors Arrangement Act.

Key considerations

The Business Law Section addresses proposed amendments to the Canada Business Corporations Act (CBCA), and the Insolvency Law Section addresses proposed amendments to the Bankruptcy and Insolvency Act (BIA) and the Companies’ Creditors Arrangement Act (CCAA):

• Canada Business Corporations Act: The CBCA should remain technology-neutral and accessible to closely held corporations, SMEs, venture-backed companies, and distributing corporations, and should be harmonized, where appropriate, with securities law and modern provincial corporate statutes. Below are a few amendments that the CBA recommends the government prioritize as part of a broader CBCA modernization package:
• Adopt a broader digital-by-default framework for meetings, director and shareholder approvals, etc.
• For non-distributing corporations, permit ordinary written shareholder resolutions to be passed by the voting threshold that would apply at a meeting, with prompt notice to non-signing shareholders.
• Review or repeal the general 25% resident Canadian director requirement for ordinary CBCA corporations, while preserving sector-specific Canadian ownership or control requirements where separately justified.
• Add a modern curative regime for defective corporate acts, share issuances, by-law approvals, director appointments, amalgamation steps, and filings, with court validation where needed.
• Bankruptcy and Insolvency Act and Companies’ Creditors Arrangement Act: The CBA supports the majority of the proposed amendments, but has substantive concerns about the following amendments:
• CCAA Superintendent Directive-Making Power: The CBA does not support this amendment (B2.2) in its current form. The consultation paper does not identify the specific administrative matters on which the Superintendent would be authorized to issue directives, making it impossible to assess the scope or impact of the proposed power. The government should not proceed with this amendment without first publishing the specific matters on which the Superintendent would be authorized to issue directives, and consulting with insolvency practitioners and other affected stakeholders.
• CCAA Initial Stay Period: The CBA recommends amending section 11.02(1) of the CCAA to extend the maximum initial stay from 10 days to 20 days. This would reduce scheduling pressure on courts and counsel and give stakeholders adequate time to engage meaningfully at the outset of a restructuring.

Why this matters

These proposed amendments to the CBCA, BIA, and CCAA are practical, proportionate reforms grounded in the day-to-day experience of practitioners who work with these statutes on behalf of corporations, creditors, debtors, and insolvency professionals. The additional recommendations in this submission identify targeted amendments that would materially strengthen the proposed package.

Read the full submission.