Certificate of Incorporation in Canada: Procedure & Benefits
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The process of starting a business in Canada can be complex and overwhelming. A crucial step in this procedure involves acquiring a Certificate of Incorporation. This legal document is issued by the government and confirms that a business has been legally registered as a corporation. In this article, we will explore what a Certificate of Incorporation is, how to obtain an incorporation certificate in Canada, the documents required, and the legal requirements that must be met.
What is a Certificate of Incorporation in Canada?
The formation of a corporation in Canada is officially recognized through the issuance of an incorporation certificate, which serves as a legally binding document. It is issued by the relevant provincial or territorial government agency responsible for business registration. This record proves that the company has fulfilled the criteria to function as a corporation. It bestows upon the corporation a unique legal entity, independent from its shareholders, and confers upon it specific rights and obligations.
Establishing a business as a corporation offers numerous benefits, including protection against personal liability, opportunities to raise capital from financial markets, and the capacity to distribute shares. By obtaining a Certificate of Incorporation, businesses can enhance their credibility and establish a strong foundation for growth and success.
How to Obtain an Incorporation Certificate in Canada
To obtain an Incorporation Certificate in Canada, several steps must be followed. The steps involved may differ slightly depending on the province or territory in which the business is being incorporated. Here is a basic outline of the process:
- Choose a Business Name: Selecting an exclusive and remarkable corporation name is the initial stage. This name should comply with the naming guidelines set by the government agency responsible for business registration. Search to ensure that your desired name is not already in use.
- Prepare Articles of Incorporation: The subsequent stage involves the preparation of the Articles of Incorporation, which delineate the essential particulars of the corporation, including its name, purpose, share structure, and registered office address. These articles must comply with the requirements set by the government agency.
- Submit the Application: Once the Articles of Incorporation are prepared, they need to be submitted to the relevant government agency along with the necessary fees. The application submission can be done online or in person, depending on the jurisdiction.
- Wait for Approval: Once you have submitted your application, it will be necessary to wait for the government agency to assess and handle it. This may take several weeks, depending on the workload of the agency. It is important to be patient during this period.
- Receive the Certificate: Once the application is approved, you will receive the Certificate of Incorporation. This document is proof that your corporation has been legally registered and can commence its operations.
Documents Required to Obtain Certificate of Incorporation in Canada
When applying for a Certificate of Incorporation in Canada, certain documents and information will be required. These may vary depending on the jurisdiction, but here are some common requirements:
- Articles of Incorporation: This document provides an overview of the essential information regarding the corporation, encompassing its name, objective, share distribution, and registered office location.
- NUANS Name Search Report: A NUANS (Newly Upgraded Automated Name Search) report is required to ensure that the chosen business name is unique and not already in use. This report can be obtained from a registered NUANS service provider.
- Consent to Act as a Director: Each director of the corporation must sign a consent form, indicating their willingness to act as a director and their agreement to comply with the legal obligations.
- Registered Office Address: The registered office address must be provided by the corporation, and it will be utilized for official correspondence from the government.
- Director and Shareholder Information: The names, addresses, and contact details of the directors and shareholders of the corporation will need to be provided.
Legal Requirements to Obtain Certificate of Incorporation in Canada
To obtain a Certificate of Incorporation in Canada, certain legal requirements must be met. These requirements ensure that the corporation is established in compliance with the law and can operate effectively. Some of the key legal requirements include:
- Name Restrictions: The corporation’s selected name must adhere to the naming regulations established by the government agency. It should not be misleading, infringe on trademarks, or be similar to existing business names.
- Minimum Number of Directors: Each province and territory in Canada has specific requirements regarding the minimum number of directors that a corporation must have. Generally, at least one director is required, and they must be at least 18 years old.
- Share Structure: The establishment is required to establish its share configuration, encompassing the count of authorized shares and the various categories or series of shares. This data should be incorporated within the Articles of Incorporation.
- Registered Office: The corporation must have a registered office address in the province or territory where it is incorporated. This address will be used for official correspondence from the government.
- Annual Filings: Once the corporation is incorporated, it must comply with ongoing reporting and filing requirements. This includes filing annual returns, maintaining proper corporate records, and updating any changes to the corporation’s information.
Obtaining a Certificate of Incorporation in Canada is an essential milestone in the establishment of a corporation. It grants legal recognition and lays a solid groundwork for the business. By following the necessary steps, providing the required documents, and meeting the legal requirements, entrepreneurs can successfully obtain a Certificate of Incorporation and embark on their journey to business success.
The duration for acquiring a Certificate of Incorporation may vary depending on the jurisdiction and workload. Typically, it takes a few weeks, but in certain instances, it may take longer.
Certainly, it is possible to make modifications to your Certificate of Incorporation. These modifications may include altering the name of your corporation or adjusting the number of authorised shares. However, it is important to note that you will be required to submit an amendment to the government and pay any relevant fees associated with the process.
It is not mandatory to hire a lawyer to incorporate your business. Nevertheless, it is advisable if you lack familiarity with the process or if your business structure is intricate. Or you can consult with OnDemand International’s experts.