A look at how Ontario may soon update its business laws
Ontario is likely to see some significant changes to its business laws following the establishment of the province’s new Business Law Advisory Council, according to a news release from the Government of Ontario. The new council, made up mainly of members practicing in the area of corporate and commercial law, has been tasked with advising the government on how to keep Ontario’s business laws up to date and to ensure the province remains an attractive place to conduct business in. While the council has yet to propose any specific changes, it has indicated there are some issues, such as shareholder rights and laws affecting limited partnerships, that it intends to deal with soon.
Modernizing Ontario’s business laws
The council was created after a 2015 report recommended the creation of such a council to set priorities for corporate and commercial law reforms in the province. The 12-member council is composed primarily of business lawyers who look at how Ontario’s business laws could potentially be updated to ensure the province remains an attractive place for businesses to set up and operate in.
As the Globe and Mail reports, one of the council’s priorities is likely to be a look at reforming the province’s laws affecting limited partnerships. Complaints have been raised that Ontario’s current limited partnership law is unclear about how exposed limited partners are to liability. As a result, many companies have chosen to create limited partnerships in other jurisdictions – notably Manitoba – where the laws are much clearer.
The council has also indicated that it will look at ways of significantly revamping laws affecting shareholders in the province. One proposal that the council will consider, for example, is giving “beneficial” shareholders and registered shareholders the same rights as one another. The 2015 report also recommended giving shareholders the right to vote “no” on the appointment of corporate directors. Currently, shareholders can either support a corporate director or withhold their vote. Relatedly, the council will also consider doing away with a current rule that requires a quarter of a company’s board of directors consist of Canadians.
Corporate and commercial law
As big changes seem to be on the way for Ontario’s business laws, it is important for businesses themselves to be prepared. An experienced commercial and corporate lawyer can offer businesses the legal representation they need both in and out of the courtroom. By having courteous and professional counsel at hand, businesses will benefit from the peace of mind they need to focus less of legal worries and more on running a successful enterprise.