The Business Corporations Act of Alberta (ABCA) has been amended to facilitate virtual AGMs and remove the director residency requirement.
Virtual shareholder meetings
Amendments have been made to the ABCA as well as to the Alberta Companies Act, Condominium Property Act, Cooperatives Act and Societies Act to facilitate the holding of virtual board, shareholder and member meetings. Essentially, the amendments allow Alberta organizations to hold meetings by “electronic means” unless the organization’s bylaws expressly provide otherwise. This effectively flips the legislative regime on its head, since previously meetings could only be held by electronic means if the bylaws so permitted.
Note that the new definition of “electronic means” requires that all persons attending the meeting be able to hear and communicate with each other instantaneously.
The amendments came into force with retroactive effect back to August 15, 2020, being the date that the ministerial order granting exemptive relief as a result of COVID-19 expired.
Amendments to the ABCA related to director residency requirements that were passed in July 2020 have now come into force. Previously, at least one-quarter of directors of ABCA corporations had to be resident Canadians. Alberta has now joined BC, Quebec, the maritime provinces (other than Newfoundland) and the territories in no longer having any residency requirement for directors. These amendments also impact quorum requirements for board meetings and the composition of board committees. Corporations that have residency requirements in their bylaws may wish to amend those bylaws to take advantage of the new flexibility in the ABCA.
The federal and Ontario business corporations statutes still have a residency requirement. Note that amendments to the Ontario Business Corporations Act were passed in December to remove the requirements, but have not yet come into force.
Importantly, given that an ABCA corporation might have no directors located in Canada, all ABCA corporations are now required to appoint an agent for service who is a resident Albertan and to give notice of that appointment to the Registrar. Existing ABCA corporations have one year to make the filing. Otherwise, the corporation will not be able to file any further updates (such as a name change, amalgamation, etc.) and Alberta Corporate Registries will begin the process to strike the corporation.
Note that the bill to remove the director residency requirements (Bill 22) also contained amendments to the Partnership Act to greatly reduce the information required in a certificate of limited partnership. Those amendments have not yet come into force.