Incorporating a company

incorporating a company

By Dawn Wattie, Surrey Business Lawyer

Incorporation is deceptively easy and only the first step to properly establishing a company.

With the advent of online corporate registration systems such as BC Online, the responsibility for properly completing incorporation of a new company falls to the completing party as the BC Corporate Registry no longer provides a substantive review of incorporation documents. As a result, an online incorporation application can be completed and an incorporation certificate issued whether or not the legal requirements of incorporation are met.

The online BC Corporate Registration process makes it clear, with notice, that an Incorporation Agreement and Articles have to be signed prior to completing the online incorporation application otherwise the application would be invalid. However it is left to the completing party to do so. Also, there is no information on the following:

  • How to determine share structure for the company
  • Who should be the incorporator(s) and what does that mean
  • How many shares should be taken on incorporation
  • The difference between par value and without par value
  • What are special rights and restrictions
  • What is a registered records office
  • The necessity of directors consenting to act as directors prior to their appointment.

So, even without this important information, the applicant is completing this information as part of the incorporation application.

As a result, it is a good idea to seek assistance or completing a review of the incorporation requirements of the Business Corporations Act so you can:

  1. Attain some of the benefits of incorporation such as proper share structure required to optimize tax planning.
  2. Avoid having to file changes with the corporate structure due to deficiencies.
  3. Avoid having your incorporation application deemed invalid.

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