Table of Contents
Local, Economic and Cultural Aspects 1
Profile 1
Government and Political System 1
Legal System 2
Current Economic Aspects 4
Main Industries 4
Cultural Aspects 6
The Regulatory Framework 7
Business Vehicles 7
Corporate Form 7
Ongoing Securities Law Requirements for Public Companies 10
Branch Operations 15
Management Structure 15
Size of the Board 16
Partnerships 17
Joint Ventures 19
Cross-Border Income Trusts 20
Laws Affecting M&A 20
Plan of Arrangement Transactions 21
Amalgamations 29
Relevant Regulatory Authorities 29
Competition Bureau 29
Securities Regulators 30
Stock Exchanges 31
Tipping and Insider Trading 36
Controls/Restrictions on Foreign Investment 38
Notification 38
Restricted Sectors 41
Foreign Extraterritorial Measures Act 42
Incentives for Foreign Investment 43
Free Trade Agreements and Bilateral Investment Treaties 43
Expropriation 45
Financing 45
Specific Issues of Company Law 46
Incorporators 46
Corporate Name 46
Constating Documents 47
Shares 48
Share Certificates 49
Warrants and Options 49
Debt Financing 49
Liabilities of Directors and Officers 52
Indemnification and Insurance 55
Role of Shareholders in the Corporation 56
Limited Liability 56
Unlimited Liability 56
Shareholder Meetings 57
Voting Agreements 58
Fundamental Changes 58
Derivative Actions and the Oppression Remedy 60
Choice of Law and Forum Selection 61
Insolvency 62
Specific Rules on Public Takeovers 64
Takeover Bid Defined 64
Early Warning 65
Launching the Takeover Bid 66
Consideration for the Takeover Bid 66
Pre-bid Integration 66
Equal Treatment 67
Collateral Benefits Prohibited 67
Period of the Bid 68
Conditions to the Bid 69
Disclosure by the Offeror 70
Directors' Circular 71
Obtaining the Balance of the Shares 72
Other Relevant Laws and Due Diligence Issues 73
Anti-corruption 73
Corruption of Foreign Public Officials Act 75
Anti-Money Laundering 75
Environmental Regulations 77
Aboriginal Law and the Duty to Consult 78
Privacy Regulation & Government Information 78
Anti-spam and Privacy 82
The Due Diligence and Key Terms 85
Confidentiality Agreement 85
Letter of Intent 86
Purchase Price: Financing and Payment 86
Representations and Warranties 87
Pre-closing Covenants 89
Ontario Bulk Sales Act 89
Closing Conditions 90
Post-closing Covenants 91
Shareholder Approvals 91
Role of the Courts 92
Organization 92
Jurisdiction over Foreign Persons 93
Conduct of Litigation 93
Arbitration 94
Merger Controls: Anti-trust/Competition Issues 94
Relevant Legislation and Competent Authorities 94
Competition Bureau 94
Scope of the Controls 94
Process/Mechanics 96
Anti-competitive Restraints 97
Taxation Aspects 98
Nature of the Tax Regime 98
Liability to Tax 99
Canadian Branch Operations 99
Canadian Subsidiary Corporations 100
Taxation of Dividends 100
Tax Considerations Arising on M&A Transactions 100
Asset Purchase 100
Share Purchase 101
Tax-Deferred Transfers and Tax-Deferred Amalgamations 102
Withholding Taxes 104
Thin Capitalization 104
Transfer Pricing 104
Employment Considerations 105
Minimum Standards 105
Labour Relations/Trade Union Legislation 106
Pension and Benefits Plans 106
Retention or Key Personnel 107
Termination of Employment 108
Occupational Health and Safely 109
Workers' Compensation 109
Human Rights Legislation 110
Immigration Laws Relating to Employment 110
Accounting Treatment 111
Future Developments 113
Canada-EU Free Trade Agreement 113
Greenhouse Gas Emissions Legislation 114
Tax Measures 114