Company Registration in New Brunswick (Canada) - Business Starting & Setup

The legal system of Canada is English common law for all matters within federal jurisdiction and in all provinces and territories except Quebec, which is based on the civil law, based on the Custom of Paris in pre-revolutionary France as set out in the Civil Code of Quebec.

In Ontario, the legal system is based on English common law.

The principal forms of business organization in Ontario are:

• Sole Proprietorship;
• General Partnership;
• Limited Partnership;
• Corporation;
• Not-for-profit Corporation;
• Extraprovincial Corporation;
• Branch Office.

The most common structure in New Brunswick is the corporation.

Corporation is a limited liability company with transferable ownership, continuous existence and separate legal entity. It can be formed in one of two ways: provincially and federally. This means that choosing to register your business in Canada as a corporation creates a separate legal entity under the laws of the federal government or one of the provinces or territories. Each jurisdiction has its own laws, but many corporations that operate in more than one province are incorporated federally.

Federal incorporation lets you do business under the same name in all provinces and territories, but it's more expensive and a little more work to setup and maintain.

Provincial incorporation is likely sufficient for most ecommerce business owners operating out of Canada.

If you register a company in New Brunswick, according to the Business Corporations Act for the Province of New Brunswick, there is no requirement for corporations to appoint local Canadian directors. As such, non-Canadian residents can incorporate Canadian corporations in this province.

Every corporation in Canada must have a name; it may be a corporate name or a numbered name.

Company name must be distinct from the names of all other corporations in New Brunswick.

A corporate name should contain three elements:

• a distinctive element (such as a surname or other unique term);
• a descriptive element (e.g., Manufacturing, Consulting, Trading); and
• a mandatory legal element: Limited, Limitée, Incorporated, Incorporée or Corporation or the corresponding abbreviations, Ltd., Ltée, Inc. or Corp.

A company name should not contain any prohibited words or phrases, such as “co-operative”, “credit union” или “municipal”, “Engineering”, “Nursing Home”, “bank”, “trust”, “insurance”, “stock exchange”, as well as words suggesting connection with government.

Company name should not be obscene or too general.

The Province of New Brunswick has Legislative and Regulatory provisions that prohibit the incorporation/registration of names that are identical or similar to deceptively similar to Nova Scotia corporations.

Numerals may be used in company names as the distinctive element. The incorporation number may be used as the name of a British Columbia company. The accepted format is “123456 N.B. Ltd.”.

A company may have an English or a French name or an English and French name. If a company has both an English and French name it may use either one at any time, or it may use both versions. It should be noted that there is no requirement that the French or English version of a company name be an exact translation, but they must have the same general meaning.

N.B. or (N.B.) may be used at the end of a corporate name, however, if there is a parent company, consent is required. If you want to use “New Brunswick” or “N.B.” as the first words in the name, you should get a special permission.

In order to have the exclusive use of a corporate name in Canada, you must provide two things to Corporations Canada:

• A NUANS Name Search Report – a document that includes a list of business names and trademarks that sound similar to the name an incorporator is proposing. The list is drawn from NUANS, the national data bank of existing and reserved business names as well as trademarks registered and applied for in Canada. Note that a NUANS Name Search Report is valid for 90 days from the date of the report. If you do not apply to incorporate within this period, you will have to obtain a new report. You can order a NUANS Name Search Report online and pay the fees of approximately CAD 20 by credit card, or you can ask for a report from a search house, an independent, private-sector business that charges a fee for advice on the availability of your corporate name choice.
• Information about the name: The approval of the name may be facilitated if you provide information about your reasons for choosing the name.

An approved federal corporate name offers an extra degree of protection of your rights to that name. Specifically, federal incorporation allows your business to operate using its corporate name right across Canada, which is important if you decide to expand your business to other provinces or territories.

Every incorporating jurisdiction in Canada screens proposed corporate names. However, if you incorporate under the legislation of one province or territory and later want to expand your business to another province or territory, you could find that another corporation is already using a name similar to yours in that other location.

Please note that the Province of Quebec does not currently provide corporate name data to NUANS. It is your responsibility to verify with the Registraire des entreprises, Quebec that the chosen corporate name is not used in Quebec by another business.

Instead of asking Corporations Canada to approve a name for your corporation, you can also choose to have a number name assigned (e.g., 1234567 Canada Ltd.). In such cases, Corporations Canada simply assigns the next available number when processing the articles. You must ask for a number name when you apply for your Articles of Incorporation. A NUANS Name Search Report is not needed.

Many companies choose this option when a corporate name is not important to their business. This ensures faster processing and saves the expense of a NUANS Name Search Report.

Another option is to apply for a number name and ask for a name change later. To replace a number name by a corporate name, you must amend your Articles of Incorporation by filing Articles of Amendment and paying the CAD 200 fee. In this case, a NUANS Name Search Report is required.

Some incorporators choose this option when they want to incorporate a business but do not have enough time to obtain approval for a corporate name.

To incorporate a company in New Brunswick, the following steps are required:

1. Select a proposed name and obtain a NUANS name search report.

The name search report must be a current report, i.e. one done within 90 days of receipt by the Registry. The Corporate Registry will review the NUANS report to determine whether the proposed name is suitable for incorporation/registration.

2. Prepare Articles of Incorporation and other required documents.

In order to apply for corporation registration in Corporate Registry, it is required to complete the following forms:

• Form 1 Articles of Incorporation,
• Form 2 Notice of Registered Office and
• Form 4 Notice of Directors.

3. File an Incorporation Application with the Corporate Registry.

The Incorporation Application must be submitted electronically over the Internet by visiting Corporate Online. When the filing is completed, the company is incorporated and you will be assigned an incorporation number at that time.

After you have filed the Incorporation Application electronically and the company is incorporated, the Corporate Registry will send you the original Certificate of Incorporation.

The fee to incorporate a company by filing an Incorporation Application using Corporate Online is CAD 262.00.

It take one to two business days to incorporate a company. Certificate of Incorporation is available from the New Brunswick Corporate Registry in 3 to 5 business days.

A corporation shall at all times have a registered office within New Brunswick.

A corporation shall prepare and maintain, at its registered office or at any other place in New Brunswick designated by the directors, records containing:

• copies of the articles and the by-laws, and all amendments thereto, and a copy of any unanimous shareholder agreement;
• minutes of all meetings and resolutions of shareholders;
• copies of all notices;
• a share register;
• the names and addresses of all persons who are or have been directors of the corporation with the several dates at which each became or ceased to be a director;
• adequate accounting records and records containing minutes of meetings and resolutions of the directors and any committees thereof.

The records described in subsection shall be kept at the registered office of the corporation or at such other place as the directors think fit and shall at all reasonable

times be open to inspection by the directors.

A Canadian corporation is not required to have a seal. If you want to have a corporate seal for your corporation, you may purchase one from a legal stationery store or commercial supplier.

The redomiciliation of companies to or from New Brunswick is permitted.

To apply for continuance into New Brunswick, a company should:

• File Form 7 (Articles of Continuance), Form 2 (Notice of Registered Office or Notice of Change of Registered Office) and Form 4 (Notice of Directors or Notice of Change of Directors), in duplicate with the Corporate Registry.
• Pay fee of CAD 362.
• Do a proper NUANS name search (except where the corporation is registered as an extra-provincial corporation under the Act).
• File an approval in writing from Director/Registrar of the jurisdiction. This will be a letter of satisfaction, certificate of discontinuance or other document issued by the proper officer of the incorporating jurisdiction that indicates that the body corporate is authorized under the laws of the jurisdiction in which it was incorporated or continued to apply for articles of continuance. The mailing address and fax of the Director/Registrar should be provided where such approval is from a non-Canadian jurisdiction.

If continuing in from outside Canada, additional requirements are as follows:

1. Directors and shareholder resolutions authorizing the continuance, and approving any amendments to charter.
2. Directors resolution no changes to the charter will be done until application for continuance is proceeded with.
3. Legal opinion to Director (Business Corporations Act) from outside counsel that corporation may continue out of the jurisdiction to New Brunswick (enclosed copy of relevant legislation/section of).
4. Certified copies of charter documents.
5. Certificate of good standing.
6. Authentication procedure for documents signed by the proper official in the exporting jurisdiction. Signature should be authenticated through External Affairs Canada or embassy official in Canada of that exporting jurisdiction.

To continue in another jurisdiction, the requirements are as follows:

• Indicate name of corporation, corporation No.
• The laws of the jurisdiction to which the corporation will apply for an instrument of continuance provide in effect that 1) The property of the corporation continues to be the property of the body corporate; 2) The body corporate continues to be liable for the obligations of the corporation; 3) An existing cause of action, claim or liability to prosecution is unaffected; 4) A civil, criminal, or administrative action or proceeding pending by or against the corporation may be continued to be prosecuted by or against the body corporate; and 5) A conviction against the corporation may be enforced against the body corporate or a ruling, order or judgment in favor of or against corporation may be enforced by or against the body corporate.
• The corporation believes the proposed continuance will not adversely affect creditors or shareholders of the corporation.
• The application should be authorized by the shareholders of the corporation.
• The corporation undertakes to ensure the Director will receive a notice of continuance of the corporation forthwith so that a certificate of discontinuance may be issued.

The Fee for continuance in another jurisdiction is CAD 362.

A company in New Brunswick should at least have <b>one director</b>, as well as a Canadian federal company. A director must be:

• at least 19 years old;
• of sound mind (i.e., not a person a court has determined to be of unsound mind);
• an individual (a corporation cannot be a director); and
• not in bankrupt status.

While at least 25 percent of the directors of a federal corporation must be resident Canadians, or if a corporation has fewer than four directors, then at least one of them must be a resident Canadian, resident Canadian directors are not required in accordance with the British Columbia Business Corporations Act.

Directors’ details are searchable only if corporate name is known.

Most boards of directors meet on a regular basis to oversee the business operations of the corporation. Such meetings may be held monthly, quarterly or annually, depending on the needs of the corporation. Directors may also need to meet occasionally to conduct special business.

Meetings of the board can be held whenever and wherever the board wishes, unless the corporation’s by-laws or Articles say otherwise. In all cases, however, a quorum of directors must be present.

Directors may conduct business through signed resolutions instead of meetings. Note, however, that in such situations the signatures of all directors are required. These signed resolutions have the same value as they would have if they were adopted at a meeting of the board of directors. This way of conducting the business of the corporation can be very useful for small companies with only one or a few directors.

Note that it is also possible for one or more directors to participate in a meeting by telephone or electronically, as long as the corporation’s by-laws permit it and as long as all participants in the meeting can communicate fully.

Corporate Secretary is not required. An individual may hold more than one of the positions in a corporation. For example, the same individual may be a shareholder, a director and a secretary, or even the sole shareholder, sole director and sole secretary.

In New Brunswick, one or more individuals 19 years of age or older who are of sound mind and not in a state of bankruptcy may form a corporation. Similarly, one or more corporations or bodies corporate may incorporate a business.

A person becomes a shareholder by buying shares, either from the corporation or from an existing shareholder. A person ceases to be a shareholder once his or her shares are sold either to a third party or back to the corporation (in accordance with the terms of the Articles of Incorporation) or when the corporation is dissolved.

After paying for their shares, shareholders have the right to:

• vote at the shareholders’ meeting (according to the class of shares);
• share in the profits (dividends) of the corporation (according to the class of shares);
• share in the property of the corporation upon dissolution;
• be called to and participate in shareholders’ meetings;
• elect and dismiss directors;
• approve by-laws and by-law changes;
• appoint the auditor of the corporation (or waive the requirement for an auditor);
• examine and copy corporate records, financial statements and directors’ reports;
• receive the corporation’s financial statements at least 21 days before each annual meeting; and
• approve major or fundamental changes (such as those affecting a corporation’s structure or business activities).

The shareholders’ liability in a corporation is limited to the amount they paid for their shares; shareholders are usually not liable for the corporation’s debts. At the same time, shareholders usually do not actively run the corporation.

Shareholders who are entitled to vote can attend an annual shareholders’ meeting. A notice of this meeting is sent not more than 60 days and not less than 21 days before the meeting date. For example, if the meeting is to take place on May 20, the notice should be sent no sooner than March 22 and no later than April 30.

The directors of a corporation must call the first shareholders’ meeting within 18 months of the corporation’s date of incorporation. This meeting is usually held after the first organizational meeting of the directors.

A corporation must hold a shareholders’ meeting on a date that is no later than 15 months after holding the last preceding annual meeting, but no later than six months after the end of its preceding financial year.

In a small business where one or two people act as directors, officers and shareholders, meetings are not necessary. Shareholders in these corporations often prefer to act through written resolutions. If every shareholder signs a written record that sets out the terms of the necessary resolutions, then a shareholders’ meeting is not needed.

The annual meeting must be held in New Brunswick. An annual meeting may be held outside New Brunswick only in cases where the corporation’s articles permit it or if all voting shareholders agree.

Also, where the corporation’s by-laws permit it, the directors of a corporation may decide that a meeting of shareholders will be held entirely by means of a telephonic, electronic or other communication means that will permit all participants to communicate adequately with each other during the meeting. In such cases, it is the responsibility of the corporation to make these facilities available.

Since 2019, Canadian companies are required to maintain a register of "persons with significant control" containing the following information: name, date of birth and address; jurisdiction of residence for tax purposes; date when the person became or ceased to be a person with “significant control”, etc.

The register is not public, however, upon request, Canadian companies must disclose the register to a department of the federal government.

There is no minimum share capital in New Brunswick. Capital can be denominated in any currency. The standard currency is Canadian dollar.

One of a corporation’s first activities following incorporation is to issue shares.

The corporation cannot issue a share until it actually receives full consideration (payment) for that share. This consideration is generally in the form of money, although it can also be in the form of services or property given to the corporation. A person’s payment for the share(s), in a form agreed upon by the directors, represents that person’s investment in the corporation.

Once a share has been issued, the shareholder is entitled to a share certificate. This certificate must state:

• the corporation’s name, as set out in the Articles of Incorporation;
• the name of the shareholder; and
• the number and class of shares it represents.

Shares of a corporation may be with nominal or par value or without nominal or par value or of both kinds.

A corporation that has not issued any shares may be dissolved at any time by resolution of all the directors. A corporation that has no property and no liabilities may be dissolved by special resolution of the shareholders or, where it has issued more than one class of shares, by special resolutions of the holders of each class whether or not they are otherwise entitled to vote.

A corporation that has property or liabilities or both may be dissolved by special resolution of the shareholders or, where it has issued more than one class of shares, by special resolutions of the holders of each class whether or not they are otherwise entitled to vote.

Articles of dissolution in prescribed form shall be sent to the Director. Upon receipt of articles of dissolution, the Director shall issue a certificate of dissolution. The corporation ceases to exist on the date shown in the certificate of dissolution.

The directors may propose the voluntary liquidation and dissolution of a corporation. A corporation may be liquidated and dissolved by special resolution of the shareholders ratifying a proposal by the directors, and, where the corporation has issued more than one class of shares, special resolutions of the holders of each class, whether or not they are otherwise entitled to vote, shall be required ratifying such directors' proposal.

A statement of intent to dissolve in prescribed form shall be sent to the Director. Upon receipt of a statement of intent to dissolve, the Director shall issue a certificate of intent to dissolve. Upon issue of a certificate of intent to dissolve, the corporation shall cease to carry on business except to the extent necessary for the liquidation, but its corporate existence continues until the Director issues a certificate of dissolution. After issue of a certificate of intent to dissolve, the corporation shall

• immediately cause notice thereof to be sent or delivered to each known creditor of the corporation;
• forthwith publish notice thereof once a week for four consecutive weeks in a newspaper published or distributed in the place where the corporation has its registered office and take reasonable steps to give notice thereof in each province in Canada where the corporation was carrying on business at the time it sent the statement of intent to dissolve to the Director;
• proceed to collect its property, to dispose of properties that are not to be distributed in kind to its shareholders, to discharge all its obligations and to do all other acts required to liquidate its business; and
• after giving the notice required under paragraphs (a) and (b) and adequately providing for the payment or discharge of all its obligations, distribute its remaining property, either in money or in kind, among its shareholders according to their respective rights.

Articles of dissolution in prescribed form shall be sent to the Director. Upon receipt of articles of dissolution, the Director shall issue a certificate of dissolution. The corporation ceases to exist on the date shown in the certificate of dissolution.