Dissolving a corporation in Canada is necessary if the business was registered with Industry Canada. Corporations are required to report activities and other information, such as current addresses, to Industry Canada until the corporation is formally dissolved. What a corporation must do to dissolve depends on its businesses activities. A corporation that never issued stock and has no property or outstanding debt needs a director resolution, while a corporation with issued stock only needs approval from shareholders. Corporations that have debt or property and issued stock must get shareholder approval and give notice of the decision to dissolve. In all cases, the corporation must designate a person to keep its records for at least six years after dissolution is granted.
No Debts or Property
Prepare a resolution permitting dissolution if the corporation never issued shares. The resolution must include the corporation's name, the date, a statement indicating dissolution is authorized and all the director's signatures. Keep the resolution with the corporation's records.
Prepare a special resolution for shareholders if the corporation issued shares. You must have majority shareholder approval. The resolution should state it is for dissolution, identify the number of stockholders voting and the vote results. Put the document with the corporation's business records.
Go to the official website of Industry Canada to complete Articles of Dissolution to Corporations (Form 17) online. You need your corporation key, the corporation's name and the name and address of the corporation's records custodian. Complete all the questions and submit the dissolution online. You'll receive the dissolution certificate once the articles are approved.
Issued Shares, Has Debt or Property
Prepare a special resolution for shareholders. You need the majority of the shareholders to vote for liquidation and dissolution of the corporation. Include a statement indicating the document is for dissolution and liquidation. Identify stockholder participation and vote tallies. Place the resolution with the business records.
Go to Industry Canada's official website to fill out the Statement of Intent to Dissolve (Form 19) from the "Dissolve a Corporation" section. Answers the questions about the business and submit. You'll receive the certificate of intent when the statement is accepted.
Place a legal notice of the intent to dissolve in a newspaper with general circulation in each Canadian province the corporation did business in. The notice should include the corporation's name, the date of the resolution vote and its intent to dissolve. Run the notice in the legal classified section of the newspaper at least one time. Ask the newspaper for a proof of publication and keep the proof with the business records.
Send notice of the intent to dissolve to all of the corporation's creditors. You may use a copy of the intent to dissolve certificate. Use registered mail and keep proof of delivery.
Complete liquidation of the corporation. What you must do varies by situation, but commonly includes selling the corporation's property, paying all the business debts and giving the shareholders their portions. Visit the official website of Industry Canada and fill out and submit Articles of Dissolution to Corporations (Form 17) online to complete the dissolution.
Tips & Warnings
- Print the final copy of any form you submit online for the corporation's records.
- All classes of stockholders have the right to vote on dissolution and liquidation matters, even if the class didn't have the right to vote before.
- If the corporation is in bankruptcy or no longer has the money to pay its debts, you must contact the Office of the Superintendent of Bankruptcy Canada at 877-376-9902 for help with dissolution.
- The person who is keeping the corporations records is legally liable for the records during the required custodian holding period.
References & Resources
- Industry Canada: Dissolving a Corporation
- Department of Justice Canada: Canada Business Corporations Act
- Industry Canada: Articles of Dissolution and Statement Online
- Industry Canada: Find Corporation Key
- Industry Canada: Form 17
- Industry Canada: Form 19
- Industry Canada: Contact Us
- Office of the Superintendent of Bankruptcy Canada: Contact Us
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