An Act to amend the Canada Business Corporations Act and the Canada Cooperatives Act and to amend other Acts in consequence (S.C. 2001, c. 14)

• 171. (1) Paragraph 109(3)(g) of the Act is replaced by the following:

  • (g) pay a commission referred to in section 128, except as authorized by the directors;

• (2) Subsection 109(3) of the Act is amended by striking out the word “or” at the end of paragraph (h), by adding the word “or” at the end of paragraph (i) and by adding the following after paragraph (i):

  • (j) issue investment shares of a series under section 126 except as authorized by the directors.

172. Section 111 of the Act is replaced by the following:

• 173. (1) Subsection 113(2) of the Act is replaced by the following:

  • Marginal note:Advance of costs

    (2) A cooperative may advance moneys to a director, officer or other individual for the costs, charges and expenses of a proceeding referred to in subsection (1). The individual must repay the moneys if the individual did not fulfil the conditions of subsection (3), unless the members and shareholders decide, by separate resolutions, that the individual need not repay the moneys.

• (2) Paragraph 113(5)(a) of the Act is replaced by the following:

  • (a) was not judged by the court or other competent authority to have committed any fault or omitted to do anything that the individual ought to have done; and

• 174. (1) Subsection 115(1) of the Act is replaced by the following:

  Marginal note:Restricting powers of directors

  • 115. (1) A provision in the articles of the cooperative or in a unanimous agreement that restricts, in whole or in part, the powers of the directors to manage, or supervise the management of, the business and affairs of the cooperative or vests, in whole or in part, but only in members and subject to subsection 76(1), those powers, is valid.

• (2) Subsections 115(3) to (8) of the Act are replaced by the following:

  • Marginal note:Investment shareholders

    (3) A purchaser or transferee of an investment share that is subject to a unanimous agreement is deemed to be party to the unanimous agreement.

  • Marginal note:When no notice given

    (4) If notice is not given to the purchaser or transferee of the existence of a unanimous agreement, in the manner referred to in subsection 183(2) or otherwise, the purchaser or transferee may, no later than thirty days after they become aware of its existence, rescind the transaction by which they acquired the investment shares.

  • Marginal note:Rights of members

    (5) To the extent that a provision in the articles of the cooperative, or in a unanimous agreement, restricts the powers of the directors to manage, or supervise the management of, the business and affairs of the cooperative, members who are given that power to manage or supervise the management of the business and affairs of the cooperative have all the rights, powers, duties and liabilities of directors, whether they arise under this Act or otherwise, including any defences available to the directors, and the directors are relieved of their rights, powers, duties and liabilities, including their liabilities under section 102, to the same extent.

  • Marginal note:Discretion of shareholders

    (6) Nothing in this section prevents members from fettering their discretion when exercising the powers of directors under a unanimous agreement.

175. Subsection 123(1) of the Act is replaced by the following:

176. The portion of subsection 126(1) of the Act before paragraph (a) is replaced by the following:

177. Subsection 129(1) of the Act is replaced by the following:

• 178. (1) The portion of subsection 130(1) of the Act before paragraph (a) is replaced by the following:

  Marginal note:Constraints on shares

  • 130. (1) Subject to subsection 290(3), a distributing cooperative that has issued investment shares that remain outstanding and are held by more than one person may, by special resolution of the members and by a separate special resolution of the shareholders of each class, amend its articles to constrain

• (2) Paragraph 130(1)(d) of the Act is replaced by the following:

  • (d) the issue, transfer or ownership of any investment share to assist the cooperative to comply with any prescribed law; or

• 179. (1) Paragraph 131(1)(b) of the Act is replaced by the following:

  • (b) complying with any prescribed law.

• (2) Subsection 131(2) of the French version of the Act is replaced by the following:

  • Marginal note:Choix des parts

    (2) Les administrateurs doivent choisir les parts de placement à vendre en vertu du paragraphe (1) de bonne foi et de manière à ne pas se montrer injuste à l’égard des autres détenteurs de parts de placement de la catégorie soit en leur portant préjudice soit en ne tenant pas compte de leurs intérêts.

• 180. (1) The portion of section 137 of the Act before paragraph (a) is replaced by the following:

  Marginal note:Borrowing

  137. Unless the articles, the by-laws or a unanimous agreement provide otherwise, the directors may, subject to subsection 126(2), without the authorization of the members or shareholders,

• (2) Paragraph 137(c) of the Act is replaced by the following:

  • (c) give guarantees;

• 181. (1) Subparagraphs 138(3)(a)(i) and (ii) of the French version of the Act are replaced by the following:

  • (i) de biens d’une personne avec laquelle elle avait, au moment de l’échange, un lien de dépendance au sens de la Loi de l’impôt sur le revenu,

  • (ii) d’actions ou de parts de placement d’une entité ou de droits ou d’intérêts dans celle-ci, lorsque la coopérative avait avec celle-ci, soit au moment de l’échange, soit en raison de celui-ci, un tel lien;

• (2) Paragraph 138(3)(a) of the Act is amended by striking out the word “or” at the end of subparagraph (i) and by adding the following after subparagraph (ii):

  • (iii) property of a person who, immediately before the exchange, dealt with the cooperative at arm’s length within the meaning of that expression in the Income Tax Act, if the person, the cooperative and all the holders of shares in the class or series of shares so issued consent to the exchange; or

• (3) Subsection 138(6) of the Act is replaced by the following:

  • Marginal note:Membership share inclusion

    (6) For greater certainty, if a cooperative issues membership shares with a par value, the cooperative is deemed, for the purposes of subsection 147(2), sections 151 and 154 and paragraph 299(2)(d), to have a stated capital account for its membership shares that includes each amount that has been received by the cooperative for the membership shares.

182. Subsection 139(4) of the Act is replaced by the following:

183. The portion of subsection 147(2) of the French version of the Act before paragraph (a) is replaced by the following:

184. Section 160 of the Act and the heading before it are repealed.