OTTAWA – The Ontario government is bringing into force the most significant reforms to corporate and commercial laws in 50 years to ensure Ontario companies can continue to compete in the global economy, said Government Services Minister Gerry Phillips in a speech at the Ottawa Rotary Club today.
“Business, investor and shareholder groups told us that Ontario needed to update its business laws to compete with other jurisdictions in the global economy,” said Phillips. “We listened to their concerns and are delivering strong, clear laws to ensure Ontario remains attractive to investors and businesses, and provides better protection for shareholders’ investments.”
Bill 152, the Consumer Protection and Service Modernization Act, updated Ontario’s business laws and harmonized them with federal law by making changes to the Ontario Business Corporations Act, Personal Property Security Act, Partnerships Act, Corporations Act and the Repair and Storage Liens Act. Once in force, these changes will:
- Improve the legal protections available to shareholders who take on the duties of a director
- Reduce unnecessary costs for businesses, including measures that allow more flexibility to communicate electronically with shareholders
- Help protect shareholders’ investments by improving the ongoing requirements for directors to notify a company of changes in their conflict of interest
- Make businesses more competitive in the global economy by providing more avenues to obtain financing and making boards more attractive to top talent
- Create efficiencies by making Ontario and federal business laws more consistent.
Bill 152 will come into force on August 1, 2007, to give businesses time to adjust to the new rules.
“These new changes will enhance our ability to compete internationally, attract more investment and jobs to Ontario and create a more efficient and ethical marketplace where business leaders want to do business,” said Phillips.
Bill 152 is the second of three phases of business law reforms the government committed to in the 2005 Budget. Phase one, the Securities Transfer Act (STA) was brought into force in January 2007, to make the process of transferring securities in Ontario more certain, predictable and efficient, and to harmonize its laws with the U.S. The STA helps make Ontario a more attractive place to invest and more competitive in the world economy.
The ministry is now preparing for the third phase of business law reform. It will soon be consulting with stakeholders about modernizing Ontario’s laws that govern the not-for-profit sector to better reflect the unique characteristics and complexity of those organizations.