Alberta's Bill 84, Business Corporations Amendment Act ("Bill 84"), which received Royal assent on December 2, 2021 and is expected to come into force in early 2022, amends the Business Corporations Act ("ABCA") to provide greater flexibility in the management of corporations and reduce certain administrative burdens.
The amendments in Bill 84 aim to increase administrative efficiency, provide greater flexibility for shareholder meetings, revival of corporations, shareholder approval thresholds, and by removing inapplicable or antiquated provisions. We have summarized what we believe are the most substantial changes.
Shareholder Meetings. The minimum notice for shareholder meetings of private companies will be reduced from 21 to 7 days. This increases flexibility and permits shareholders to address time-sensitive issues as they arise.
Revival of Corporations. Corporations may be struck or dissolved for various reasons, intentionally or otherwise. Some may wish to revive a corporation to sue it, access insurance, or simply to recommence business. Prior to the amendments, the ABCA permitted a corporation's revival within five years of its dissolution. Now the period is increased to ten years, allowing more flexibility for interested parties to deal with dissolved corporations.
Notably, Bill 84 also amends the Companies Act and Societies Act to completely remove the five year revival period for non-profit corporations and societies. Consequently, non-profit corporations and societies can be revived at any time.
Written Shareholder Resolutions. Currently, a written resolution of a corporation's shareholders requires unanimity. The same is true for a resolution to dispense with auditor requirements. A lower threshold is available, but only if the resolution is decided at a shareholder meeting. Bill 84 changes this, and written resolutions now require only a two-thirds majority instead of 100%.
Further, the amendments allow corporations to dispense with auditor requirements by way of two-thirds voting shareholder approval, where previously 100% approval of all voting and non-voting shareholders was required. These changes reduce the burden in managing the corporation's affairs.
Other. Lastly, the amendments eliminate various impractical or outdated provisions. For example, the requirement to publish shareholder meeting information or dividend payments in a national newspaper has now been removed.
Over the past few years, the Government of Alberta has amended or enacted various pieces of legislation as part of their efforts to reduce administrative burdens on businesses, increase efficiencies and attract and increase business opportunities in Alberta. As a whole, Bill 84's amendments increase director's protections, expand corporate opportunities by permitting corporate opportunity waivers, add greater flexibility for plans of arrangement, and reduce administrative burdens. These amendments are optimistic additions to the corporate legislative landscape in Alberta and are intended to make Alberta a more competitive jurisdiction to do business.
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