Changes To The Canada Business Corporations Act

On June 21, 2019, Bill C-97, an act to implement certain provisions of the budget tabled in Parliament on March 19, 2019 and other measures (C-97), received Royal Assent and became law. The act includes several amendments to the Canada Business Corporations Act (the CBCA) that introduce important new obligations on CBCA companies. We will summarize some of the most important amendments below.

The Best Interests of the Corporation

The CBCA has long required the directors and officers of a corporation to act with a view to the best interests of that corporation. Historically, the best interests of a corporation were understood to mean the best interests of its shareholders. This changed in BCE Inc. v. 1976 Debentureholders (BCE) where the Supreme Court held that, in evaluating the best interests of a corporation, directors could look beyond the interests of shareholders and consider the interests of a broader array of stakeholders, including employees, creditors,