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May 20, 2020

COVID-19 Response and Reforms to Modernize Ontario Act Introduces Flexibility and Relief for Businesses in Ontario

By: Jonathan Zepp, Ismail Ibrahim, Charlie Kim and Nathan Holloway

On May 12, 2020, the Government of Ontario passed Bill 190, the COVID-19 Response and Reforms to Modernize Ontario Act, 2020 into law, which introduced the Alternative Filing Methods for Business Act, 2020 and amended various other statutes. The purpose of this new legislation and amendments is to provide flexibility and relief to corporations and businesses in Ontario during the COVID-19 pandemic. While some of these changes are temporary and will only remain in place during the emergency declared under the Emergency Management and Civil Protection Act (the "Declared Emergency"), others will be permanent.

The changes that have been introduced include the following:

  1. Electronic Filing and Signatures: effective May 12, 2020, individuals, corporations and other businesses may electronically sign documents and electronically file documents with the Ministry of Government and Consumer Services (the "MGCS"). Specifically, during the Declared Emergency, documents under the following legislation may be filed electronically with the MGCS: Business Corporations Act (OBCA), Business Names Act (BNA), Corporations Act (OCA), Co-operative Corporations Act (CCA), Corporations Information Act (CIA), Limited Partnerships Act (LPA), and the Extra-Provincial Corporations Act (EPCA) (collectively, the "Business Statutes").

    Accordingly, individuals, corporations and other businesses may now file:

    1. copies of articles, applications, declarations (in the case of limited partnerships) and other documents (and any supplementary documents) filed under the Business Statutes (“Business Documents”);

    2. Business Documents signed electronically; and

    3. Business Documents by an electronic method, including e-mail and fax, and any other method that may be specified at a later date by the Minister, Director, or Registrar under the applicable Business Statute.

    The Business Statutes have also been permanently amended to allow for changes set out in (a) and (b) above to continue after the Declared Emergency has been terminated. However, once the Declared Emergency is terminated, copies of articles, declarations, and applications will only be accepted in place of originals if permitted by the Director under the applicable Business Statute. Whether copies of these documents will be accepted will not be known until a later date.  In respect of the change set out in (c) above, the Government of Ontario has indicated that filing by the new electronic methods will only be permitted temporarily during the Declared Emergency. Such alternative methods will no longer be permitted once the Alternative Filing Methods for Business Act, 2020 is repealed, though the repeal date has not been set.

  2. Virtual shareholder and director meetings: retroactive to March 17, 2020, certain requirements placed on corporations governed by the OBCA, the CCA, the Condominium Act, 1998 and the OCA in respect of shareholder and director meetings are temporarily suspended or amended. As a result, these corporations may now hold shareholder and director meetings virtually (i.e. by videoconference and teleconference) despite any contrary provision in the corporation's by-laws or articles or in a unanimous shareholders' agreement. As well, temporary provisions have been introduced which amend: (a) the requirements in respect of materials to be provided to shareholders at meetings; (b) voting procedures; and (c) notice requirements. These provisions will remain in place during the temporary suspension period, being the period ending 120 days after the Declared Emergency ends.

  3. Deferred Annual Meetings: retroactive to March 17, 2020, the time period for corporations governed by the OBCA, the CCA, the Condominium Act, 1998, and the OCA to hold an annual meeting has been extended if the original deadline to hold the meeting falls within, or shortly after, the termination of the Declared Emergency. In those situations, the deadline is extended to: (a) no later than 90 days after the Declared Emergency is terminated, if the original deadline fell within the Declared Emergency; or (b) no later than 120 days after the Declared Emergency is terminated, if the original deadline falls within the 30 day period immediately following the day on which the Declared Emergency is terminated.

  4. Notaries Act and Commissioners for Taking Affidavits Act: effective May 12, 2020, both of these Acts are amended to permit remote or virtual commissioning and notarization, subject to certain conditions. The conditions under each Act will be established by regulation at a later date. The amendments also allow paralegals to be appointed as notaries in the same manner as lawyers. That is, paralegals can be appointed without fulfilling the examination requirement by virtue of being a licensee of the Law Society of Ontario. This will benefit many individuals and businesses as access to notary services will be expanded as a result.



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