Category Archives: Businesses

Canada Considering Creating a Database of Beneficial Owners of its Corporations

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CBC is reporting that the Canadian government is mulling over the possibility of emulating jurisdictions trying to curb the problems of the individuals who can (still a little too easily) hide behind corporations, by creating a public register of  beneficial owners. The Federal government may thus amend the statute that governs corporations created under the federal regime (as opposed to this incorporated under provincial statutes), so as to force them to disclose who the real owners are.

To be clear, yes the federal statute at issue already says corporations created under the CBCA must create and maintain a register stating who the real owners are, and logging a modicum of info as to each, including date of birth, etc. However, until now, this info can remain secret (even IF the register is actually created and maintained), locked in a minute-book that no one ever sees, so to speak. The change that the government is now contemplating would make such information part of a PUBLIC register, thereby taking this info from entirely private to public -of course subject to hiding really private info.

As to this, I’d say that with everything I have seen over the years, with individuals declaring false names and addresses (e.g., PO boxes, etc.), holding shares for somebody else (under scrutiny or investigation), declaring an other lawyer’s office at the domicile of a shareholder, etc., it’s not a moment too soon! I think we could definitely do with a little more transparency as to Canadian corporations. The current regime is simply too naïve to lead to a system that one can rely on to know who’d really behind any private corporation. Want an example? Check out this story in this morning’s paper (in French), about a security company that the Federal government apparently regularly hires. Blink, blink… yes, I know.

Mind you, rules are fine, but having rules that are serious enough (with strong enforcement behind them) is something else. Not sure the current set of rules is quite adequate to convince overly creative (read scumbag) businessmen, fraudsters and mafiosi to play by them whenever they use corporate vehicles to do their dirty work.

Meanwhile, Québec is doubling down on its own efforts to curb this kind of problem. Starting next month, corporations registered in the province will have to provide more info on their owners, provide IDs of directors, etc. Québec is also starting to require corporations to determine who the real owners are, and to collate that info, internally at least. Apparently, starting next year, the REQ register will also include info on beneficial owners behind the ones listed as shareholders, and even start allowing searches of the REQ database to identify what entities any given individual is involved in. Not a moment too soon!

It’s February: Time to Implement a Security Freeze on Your Credit?

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The province of Québec adopted the Credit Assessment Agents Act a while back, so as to better protect consumers against the practices of credit agencies such a Equifax. When that particular law came into effect, however, the legislator opted to wait before implementing one particular section dealing with what is generally referred to as a “security freeze”.

Good news on that front: since February 1st 2023, Section 8 of the act is now in force, thereby providing Quebecers who wish to do so with the possibility of effecting a credit freeze. As described in the act, a  security freeze prohibits any credit agency (you know, those which hold your credit report and give you a credit score) from communicating your personal information and your credit report when the information was requested by a business claiming that it needs it to provide you with credit.

When such a freeze is in place, for example, a bank will simply be told by the credit bureau it can’t disclose your credit report as you have previously elected to implement a security freeze. In the normal course of things, the bank will then have to have a talk with you or whoever is impersonating you) about this, thereby stopping the attempt to open credit facilities in your name.

Of course, if you’re shopping around of a new credit card, this may prove an inconvenience for you but if you’re not in the process of hoping to secure more credit in the foreseeable future, this is definitely something you may want to think about doing.

Contrary to some subscription services offered by credit agencies, a security freeze must be available to Quebecers FREE OF CHARGE. Though I’m sure implementing one requires jumping through hoops, it may be worthwhile to avoid the eventual headache of having to deal with identity theft! By the way, so far, the act at issue applies to Equifax and Trans-Union, so you will have to contact both these entities to see about implementing a freeze for yourself.

CIPO Proposes a 25% Increase of Governmental Fees for 2024

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The Canadian Intellectual Property Office (CIPO) is proposing to deal with its chronic financial problems by increasing governmental fees in matters of I.P. come next year. The Canadian government is thus proposing to amend the regulations relating to the costs of I.P. matters in Canada. This substantial increase, if indeed adopted, would raise the fees relating to matters such as registration of patents, trademarks, copyrights, industrial designs and trademarks.

As explained in the summary prepared by the government:

CIPO is proposing to adjust most fees by 25% over the 2024 fees to address its current structural deficit situation and return the organization to a position of financial stability. CIPO is also proposing to expand the definition of small entity while maintaining the current patent fees for small entities.

As a result, to give you an idea, the proposed increase would raison the costs associated with trademark application from $330.00 to $458.00 for the first class, and from $100.00 to $139.00 for additional classes. The costs associated with recording assignments would increase from $100.00 to $125.00, etc.

Even though this is only a proposal, it is generally agreed this is likely to sail through and indeed materialize. Come 2024, it seems probable this increase will be adopted and applied.

This is one more good reason not to wait to protect your I.P. rights if you haven’t done so already.