Minute book requirements for a federal Canadian (CBCA) corporation

What CBCA s. 20 requires

Section 20 of the Canada Business Corporations Act prescribes the records that every federal corporation must maintain. The minute book is the practical bundle that holds them.

• Articles and bylaws, including all amendments and any unanimous shareholder agreement
• Minutes of meetings and resolutions of shareholders and directors
• Register of directors and officers, with names, addresses, occupations, and the dates each individual became and ceased to be a director or officer
• Securities register under s. 50, recording the issued shares, the holders, the certificate numbers, and the dates of issuance and transfer
• ISC register under s. 21.1, identifying individuals with significant control (a 2019 addition to the CBCA, now required of every federal corporation)
• Accounting records, in sufficient detail to disclose the corporation's financial position

Where the records must be kept

The records must be kept at the corporation's registered office or another place in Canada that the directors designate by resolution. Records may be kept in electronic form, provided they can be reproduced on demand. Where records are kept outside the registered office, the corporation must be able to produce them at the registered office within a reasonable time after a request.

The accounting records may be kept outside Canada in some circumstances, but the corporate records under s. 20 must remain accessible from a Canadian location.

Inspection rights under s. 21

Shareholders and creditors of a CBCA corporation, and their personal representatives, are entitled to examine the records under s. 20 free of charge during the usual business hours of the corporation. They may take extracts or, on payment of a reasonable fee, obtain copies.

The right of access is broad. It does not require proof of a 'proper purpose' (as US Delaware corporations require under DGCL § 220); the status of shareholder or creditor is sufficient. Corporations Canada itself has the right to require production of the records for compliance review.

Penalty for non-compliance

Failure to keep the records required by s. 20 is an offence under s. 250. The maximum fine is $5,000 for an individual director, officer, or person responsible, and $200,000 for the corporation. Where the failure is intentional, directors and officers may also be liable. More importantly in practice, a corporation that cannot produce its records during a financing or diligence may simply fail to close, counsel will not certify a transaction the underlying records cannot support.