Corporate Restructuring Under The BIA And CCAA – Key Differences

Two major pieces of legislation govern insolvency and bankruptcy in Canada – the Bankruptcy and Insolvency Act (BIA) and the Companies' Creditors Arrangement Act (CCAA). Both allow insolvent corporations to file proposals in an effort to make alternate arrangements for settling outstanding debts. The two statues have many similarities but also a number of differences that can make either one more advantageous than the other in a corporate restructuring.

Flexibility in interpretation

One of the most significant advantages of proceedings under the CCAA is its greater interpretative latitude. Unlike the more rigid BIA, the CCAA has fewer rules. As such, a court would have greater discretion in applying its provisions – flexibility that can be useful for corporations with more complex debt profiles.