Ontario Emergency Order Extends Deadline for Shareholder Meetings under the OBCA

March 31, 2020

Pursuant to an order under the Emergency Management and Civil Protection Act (Ontario), the Government of Ontario has temporarily suspended and replaced provisions of the Business Corporations Act (Ontario) extending the deadline for shareholder meetings and allowing issuers to hold virtual-only board and shareholder meetings, regardless of their articles and bylaws.

Shareholder Meetings

The Business Corporations Act (Ontario) (OBCA) requires the directors of a corporation incorporated under the OBCA to call an annual meeting of shareholders not later that 18 months after incorporation and subsequently not later than 15 months after the corporation’s last annual meeting. In light of the state of emergency declared in Ontario, the deadline to hold an annual meeting of shareholders has temporarily been extended for OBCA incorporated corporations as follows:

  • If the last day on which the annual meeting is required to be held falls during the time that the current declaration of emergency applies, the corporation may hold the meeting any time before the 90th day after the day the declaration of emergency is terminated.
  • If the last day on which the annual meeting is required to be held falls within the 30-day period that begins on the day after the day the current declaration of emergency is terminated, the corporation may hold the meeting any time before the 120th day after the declaration of emergency is terminated.

As previously discussed, annual meeting deadlines were also extended by each of the TSX and the TSX-V for issuers listed on those exchanges. The Canadian Securities Administrators have expressed support for the use of virtual meetings in the 2020 proxy season and the CBCA Director has provided guidance on virtual meetings as well.

Virtual Meetings

The Government of Ontario has also temporarily amended the provisions of the OBCA in respect of shareholders’ and directors’ meetings that provides additional flexibility for corporations looking to hold virtual meetings. While the OBCA permits OBCA incorporated corporations to hold meetings of shareholders by telephonic or electronic means, this ability is subject to the corporation’s articles and by-laws. The temporary amendment permits shareholder meetings to be held by telephonic or electronic means, regardless of any provision in the corporation’s articles or bylaws. A similar amendment is provided for meetings of directors or committees of directors.

General

The temporary amendments to the OBCA can be found in Order Under Subsection 7.1(2) of the Act – Meetings for Corporations, Ontario Regulation 107/20 made under the Emergency Management and Civil Protection Act, published on March 30, 2020. The order provides for similar temporary amendments to the Corporations Act (Ontario).

For further information about virtual shareholder meetings, please see our prior posts:

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