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Business Law

In Force Date Postponed (until at least March 2023) for Quebec's Corporate Beneficial Ownership Transparency Register

Mar 30th, 2022

By Daniel Frajman

Quebec has just announced that its corporate beneficial ownership transparency register, to be publicly available on-line and accessible free of charge, is now scheduled to be in force in March 2023 (the previous projected in force date was October 2022).

This legislation obliges registrants (mostly corporations and partnerships formed anywhere in the world that have activity in Quebec) to post on the online public register the individuals who are their ultimate beneficiaries, generally being the individuals with a stake of 25% or more in votes or value after all holding companies and trusts are looked through, and after potential de facto control is assessed, regardless as to whether any interests are held by nominees.  Some additional details on the legislation are at my previous blog article, here.

Some observers are calling this Quebec register Canada's de facto public corporate beneficial ownership register, as no other Canadian jurisdiction, provincial or federal, is currently enacting a public register on this matter.

Also just announced by Quebec is that an ability to search the on-line register by names of individuals (who are, for the most part, ultimate beneficiaries of corporations or partnerships, or top voting shareholders, certain top partnership stakeholders, corporate directors and main corporate officers) will be postponed one further year, until March 2024 as currently foreseen.   This just mentioned postponement is meant to provide concerned individuals with the time, once the register is in force, to file with the register a business address to replace their home address which would otherwise appear on the register.

In addition to the usual stated reasons for the reporting of beneficial ownership (combatting tax evasion, undue tax avoidance,  money laundering, terrorist financing and corruption), Quebec's reason for wanting to institute a public register is that it will in essence level the economic paying field between counterparties, due to them having a better idea as to who they are ultimately dealing with when dealing with a corporation (or partnership).  Furthermore, Quebec is stating that a public register adds to accuracy, as users will be able to report perceived errors.

Do not hesitate to be in touch with me should you have any question on this or other matters.