When is it necessary to amend the articles of association of a joint-stock company?

The articles of association contain certain fundamental characteristics of your company. They do not need to be amended every time a change occurs within the company.

An amendment to the articles of association is generally required when information or a provision contained therein needs to be changed, particularly to add any provision permitted by applicable law or to replace or delete any provision already included, and applicable law requires the filing of amendment articles. When the amendment is the responsibility of the shareholders, it generally requires approval by a special resolution of the shareholders, subject to any specific applicable rules.

The rules differ depending on whether your company is incorporated under the Quebec Business Corporations Act or the Canada Business Corporations Act .

Company incorporated in Quebec

For a company incorporated in Quebec, amendment articles of incorporation may be required, in particular, to:

• change the company name;
• create, modify or delete a category or series of actions or the rights attached to it;
• modify certain restrictions relating to the transfer of shares;
• modify certain provisions or restrictions contained in the statutes;
• make another amendment for which the Business Corporations Act requires amendment articles of incorporation.

Other changes concerning the company may instead require a statement of update to the Registrar of Companies or an amendment to corporate records and documents, without requiring articles of amendment.

Federally incorporated company

For a company incorporated under the Canada Business Corporations Act, articles of amendment may be required, in particular, to:

• change the company name;
• modify the province or territory where the headquarters is located;
• modify the fixed, minimum or maximum number of directors stipulated in the articles of association;
• create, modify or delete categories of shares or the rights attached to them;
• modify certain restrictions regarding the transfer of shares;
• amend other provisions contained in the statutes.

Again, many changes in the day-to-day operations of the company do not require amending the articles of association. They can instead be recorded in a resolution, entered in the corporate registers, or declared to the competent authority.

Therefore, it is necessary to verify the company's incorporation regime and the content of its articles of association before determining the required formality.

In summary , the circumstances requiring articles of amendment are not exactly the same for a Quebec corporation and a federal corporation. Before changing the structure or certain fundamental information of your corporation, you must determine whether articles of amendment are required or if another corporate formality will suffice.