Transitioning to the New Societies Act


Further to last week’s post, the following sets out the immediate impact of the Societies Act (the “Act”) on existing BC societies and what is require to transition to the Act.

The Act, with a few noted exceptions therein, will apply to all BC societies on the day it comes into force, being November 28, 2016, and each society will be required to immediately comply and govern itself in accordance with the Act. Further, any provisions in a society’s bylaws that are inconsistent with the Act will no longer have any effect as of November 28, 2016. This will be true regardless of whether a society has transitioned to the Act or not. All BC societies however, will need to transition to the Act within two years of the Act coming into force. Continue reading

BC Societies – The New Act


New legislation will come into force the end of this November to govern societies formed or operating in BC. The new Societies Act (the “Act”) replaces the outdated Society Act with a more comprehensive framework that includes modern governance provisions that provides societies more flexibility in how they are created and operated.   Similar to what was done when the federal legislation governing non-profits was replaced, the Act borrows various provisions and concepts from the Business Corporations Act to allow societies to function and be run more like companies.

The following are some of the more significant features of the Act. Continue reading

Changes to Federal Privacy Laws and the Impact on Business Transactions

On a recent transaction where a client was purchasing an Ontario company we encountered some issues in conducting our due diligence.  On this deal, the vendor refused to disclose any personal information of any contractors, employees, customers or other relevant individuals related to their business to us or our client due to confidentiality concerns.  A timely amendment to the Personal Information Protection and Electronic Act (“PIPEDA”), however, enabled us to get past that hurdle.

What’s the issue? 

In BC, we rely on the Personal Information Protection Act (British Columbia) to disclose and receive personal information during the due diligence stage of a business transaction.  This act permits the disclosure of personal information to potential purchasers evaluating a company without obtaining consent.  Various other provinces however, including Ontario, do not have similar legislation (other than legislation directed at health information) and are instead subject to PIPEDA.  Prior to the aforementioned amendment, there were no exemptions similar to that in the BC Act and PIPEDA required a vendor to obtain an individual’s consent prior to disclosing their personal information to a potential purchaser.

What’s changed? 

In June of this year various amendments to PIPEDA came into force, including an exemption for obtaining consent to disclose personal information in the context of a business transaction.  In particular, if parties are involved in a prospective purchase and sale of an organization or its assets, merger or amalgamation of two or more organizations, financing to an organization, or charging, leasing or licensing an organization’s assets (each defined as a “Business Transaction”), such parties can use and disclose personal information without obtaining any individual’s consent if certain conditions are met.  One exception to this exception is where the primary purpose of the Business Transaction is the acquisition or disposition of the personal information itself.

How does it work?

In order to avail oneself of the exception to obtaining consent to use and disclose personal information under PIPEDA the following conditions must be met:

  1. the party disclosing, and the party receiving the personal information must enter into an agreement that requires the receiving party to only use the personal information for purposes related to the proposed Business Transaction, keep such personal information confidential and if the proposed Business Transaction does not proceed, to return or destroy such disclosed personal information;
  2. the personal information disclosed must be necessary both to determine whether to proceed with proposed Business Transaction and, if proceeding, to complete it; and
  3. with respect to the use and disclosure of personal information after the proposed Business Transaction completes:
    • both parties to such Business Transaction must enter into an agreement that requires both of them to only use and disclose personal information for the purposes for which it was collected or permitted to be used prior to the completion of the such Business Transaction, keep such personal information confidential and give effect to any withdraw of consent from an individual done in accordance with PIPEDA;
    • the personal information must be necessary to carry on the business that was the object of the proposed Business Transaction; and
    • one of the parties must notify each individual whose personal information was disclosed that the proposed Business Transaction completed and that their personal information was disclosed.

What does this mean?

For those of you familiar with the due diligence process with respect to the disclosure of personal information in BC, such process is now similar across the country.  For anyone involved in the acquisition, sale, lease or financing of a business, it is now easier to obtain, use and disclose personal information to evaluate and complete such transaction.

Digital Signatures & Electronic Execution


With services such as DocuSign becoming more prevalent by the day and the obvious attraction to the convenience that such solutions offer, executing documents by using electronic or digital signature technology is coming up in transactions and other routine matters with increasing frequency. The question is whether documents and agreements signed by applying an electronic or digital signature are valid, and what, if any, requirements there are with respect to such electronic signatures.

Continue reading