Definitions and interpretation

1   (1) In this Act:

"articles" has the same meaning as in the Business Corporations Act;

"auditor" includes a partnership of auditors and an additional auditor appointed under section 125;

"Authority" means the BC Financial Services Authority established under section 2 of the Financial Services Authority Act;

"business authorization" means an authorization to carry on

(a) trust business,

(b) deposit business,

(c) insurance business, or

(d) both trust business and deposit business,

issued under Division 1 of Part 3 to a financial institution, under Division 1 of Part 6 to an extraprovincial corporation or under Division 5 of Part 6 to a society described in section 191;

"capital base" of a financial institution or extraprovincial corporation means the capital base determined in accordance with the regulations under section 289 (3) (e) or (f) and the rules made by the Authority under section 201.1 (1) (a) or (b);

"central credit union" means a credit union in which membership is restricted to credit unions, other corporations, public bodies and the Crown in right of Canada or British Columbia or in any other right;

"charter" includes

(a) an Act, statute, ordinance, letters patent, certificate, declaration,

(b) other instrument or provision of law by or under which a corporation is incorporated, amalgamated or continued,

(c) the memorandum, articles or bylaws by whatever name called of a corporation, and

(d) the constitution and rules of a credit union;

"common trust fund" means a fund in which moneys of different estates and trusts are co-mingled for the purpose of facilitating investment;

"conduct review committee", in relation to a financial institution, means the conduct review committee elected by the directors as required under section 112;

"constitution" means the document described in section 6 (2) of the Credit Union Incorporation Act and includes the constitution of a credit union incorporated under the Credit Union Act, R.S.B.C. 1979, c. 79, or incorporated under a former Credit Unions Act;

"contract of insurance" has the same meaning as "contract" in the Insurance Act;

"council" means the Insurance Council of British Columbia continued under section 220;

"credit union" means a corporation incorporated as a credit union under the Credit Union Incorporation Act, the Credit Union Act, R.S.B.C. 1979, c. 79, or a former Credit Unions Act, and includes a central credit union and a credit union continued into British Columbia under section 15.1 of the Credit Union Incorporation Act, but does not include a credit union continued under the laws of another jurisdiction under section 15.2 of the Credit Union Incorporation Act;

"debenture" includes an instrument, secured or unsecured, issued by a financial institution which instrument is

(a) in bearer or registered form,

(b) of a kind commonly dealt in on securities exchanges or markets, or commonly recognized in any area in which it is issued or dealt in as a medium for investment, and

(c) evidence of an obligation or indebtedness of the financial institution,

but does not include

(d) a negotiable unsecured promissory note maturing not more than one year after the date of issue,

(e) a receipt or another type of instrument issued by a financial institution evidencing

(i) a deposit, or

(ii) an annuity payment, or

(f) an investment contract or mutual fund certificate;

"deposit business" means the business of receiving on deposit or soliciting for deposit money that is repayable

(a) on demand,

(b) after notice,

(c) on the expiry of a specified term, or

(d) at specified intervals for a specified term,

whether or not the person undertaking an activity or activities set out in paragraphs (a) to (d) can or does distribute any gain, profit or dividend, or otherwise disposes of the person's assets, to a member or shareholder of the person other than during winding up or on dissolution;

"deposit insurance corporation" means the Credit Union Deposit Insurance Corporation of British Columbia continued under section 261;

"depositor" means an individual or entity

(a) that has money on deposit with a credit union, extraprovincial credit union or extraprovincial trust corporation, or

(b) that holds non-equity shares in a credit union issued before January 1, 2020;

"electronic meeting" means a fully electronic meeting or a partially electronic meeting;

"entity" includes a corporation, trust, partnership, fund or other unincorporated association or organization, the Crown in right of Canada or of a province, a Crown agency, a foreign government and an agency of a foreign government, but does not include an individual;

"equity share" means a share in a credit union that represents an equity interest in a credit union;

"extraprovincial corporation" means an extraprovincial credit union, extraprovincial insurance corporation or extraprovincial trust corporation;

"extraprovincial credit union" means a credit union that is incorporated by or under the laws of a jurisdiction other than British Columbia and that is, under those laws, licensed, registered or in any way authorized to carry on activities that are substantially the same as trust business or deposit business or both, but does not include a federal credit union within the meaning of the Bank Act (Canada);

"extraprovincial insurance corporation" means

(a) a corporation that is an insurer and is incorporated by or under the laws of a jurisdiction other than British Columbia and is, under those laws, licensed, registered or in any way authorized to carry on activities that are substantially the same as insurance business, or

(b) an insurance association,

and includes a society that is named in an order of the superintendent made under section 193 (2) to which society section 159 applies because of section 193 (3), but does not include

(c) a corporation that

(i) is licensed under Division 2 of Part 6 as an insurance agent or insurance adjuster, and

(ii) carries on insurance business only in its capacity as an insurance agent or insurance adjuster;

"extraprovincial trust corporation" means a corporation incorporated by or under the laws of a jurisdiction other than British Columbia and is, under those laws, licensed, registered or in any way authorized to carry on activities that are substantially the same as trust business or deposit business or both, but does not include a credit union, a bank or a corporation that is a subsidiary of a bank and is a loan company to which the Trust and Loan Companies Act (Canada) applies;

"fair market value" means the amount, price, consideration or rent that would be obtained in an arm's length transaction in the open market between willing parties acting in good faith;

"financial institution" means a credit union, trust company or insurance company;

"financial services" includes deposit business, insurance business, trust business, trading in securities, mortgage brokerage and real estate services;

"fully electronic meeting" means a meeting in which persons are entitled to participate solely by telephone or other communications medium, as set out in the notice for the meeting, if all persons attending the meeting are able to participate in it, whether by telephone or other communications medium;

"fund", except in the definition of "entity", means the fund continued under section 267;

"general insurance" means insurance that is not life insurance;

"general insurance business" means insurance business in respect of general insurance only;

"insolvent" includes the inability of a corporation to pay its debts as they become due in the usual course of the corporation's business;

"insurance association" means an association of persons formed on the plan known as Lloyd's or on another prescribed plan by which each associate underwriter is liable for a stated, limited or proportionate part of the whole amount insured by a contract of insurance;

"insurance business" means

(a) undertaking or offering to undertake to indemnify another person against loss or liability for loss in respect of a certain risk or peril to which the object of the insurance may be exposed,

(b) soliciting or accepting any risk,

(c) soliciting an application for a contract of insurance,

(d) issuing or delivering a

(i) receipt for any contract of insurance, or

(ii) contract of insurance,

(e) in consideration of any premium or payment, granting an annuity on a life or lives,

(f) collecting or receiving any premium for a contract of insurance,

(g) adjusting any loss covered by a contract of insurance, or

(h) advertising for any business described in paragraphs (a) to (g),

whether or not the person undertaking an activity or activities set out in paragraphs (a) to (h) can or does distribute any gain, profit or dividend, or otherwise disposes of the person's assets, to a member or shareholder of the person other than during winding up or on dissolution;

"insurance company" means

(a) a company incorporated under the Business Corporations Act for the purpose of carrying on insurance business,

(b) an insurer incorporated by or under another Act, or

(c) a pre-existing insurance company,

and includes

(d) a special Act insurance company that has been converted into a company under section 266 of the Business Corporations Act for the purpose of carrying on insurance business,

(e) an extraprovincial insurance corporation that has been continued into British Columbia as a company under section 303 of the Business Corporations Act,

(f) a company that results from an amalgamation referred to in section 20 (2), and

(g) a society that is named in an order of the superintendent made under section 193 (2) of this Act to which society section 59 applies because of section 193 (3),

but does not include

(h) a corporation continued under the laws of another jurisdiction,

(i) a society deemed under section 191 to have a business authorization issued under Division 5 of Part 6,

(j) a mutual fire insurance company as defined in section 188 or a grandparented insurance society as defined in section 200,

(k) a corporation that

(i) is licensed under Division 2 of Part 6 as an insurance agent or insurance adjuster, and

(ii) carries on insurance business only in the corporation's capacity as an insurance agent or insurance adjuster, or

(l) a corporation that is registered as a captive insurance company under the Insurance (Captive Company) Act; 

"insurer" means an individual, corporation or other entity carrying on insurance business;

"life insurance business" means insurance business in respect of life insurance;

"member",

(a) in relation to a trust company or an insurance company, has the same meaning as "shareholder" in the Business Corporations Act, and

(b) in relation to a credit union, means a person who has been admitted to membership or junior membership in the credit union and whose name is entered in its register of members, but does not include a person who is an auxiliary member as defined in section 1 of the Credit Union Incorporation Act;

"memorandum" means, in relation to a pre-existing trust company or pre-existing insurance company, the record that constituted the company's memorandum under section 12 of this Act as that section read before the coming into force of section 67 of the Finance Statutes Amendment Act, 2011;

"non-equity share" means a share in a credit union that

(a) evidences indebtedness of the credit union to the holder of the share, and

(b) does not represent an equity interest in the credit union;

"partially electronic meeting" means a meeting in which persons are entitled to participate in person or by telephone or other communications medium, as set out in the notice for the meeting, if all persons attending the meeting are able to participate in it, whether by telephone, by other communications medium or in person;

"pre-existing insurance company" means a corporation that was, before the coming into force of section 64 of the Finance Statutes Amendment Act, 2011, incorporated under this Act for the purpose of carrying on insurance business, and includes

(a) a special Act insurance company that was, before the coming into force of section 64 of the Finance Statutes Amendment Act, 2011, converted into an insurance company under section 21 of this Act as that section read before the coming into force of section 67 of the Finance Statutes Amendment Act, 2011, and

(b) an extraprovincial insurance corporation that was, before the coming into force of section 64 of the Finance Statutes Amendment Act, 2011, continued into British Columbia as a company under section 23 of this Act as that section read before the coming into force of section 67 of the Finance Statutes Amendment Act, 2011,

but does not include any corporation referred to in paragraph (h), (i), (j), (k) or (l) of the definition of "insurance company";

"pre-existing trust company" means

(a) a corporation that was, before the coming into force of section 64 of the Finance Statutes Amendment Act, 2011, incorporated under this Act for the purpose of carrying on trust business,

(b) an extraprovincial trust company that was, before the coming into force of section 64 of the Finance Statutes Amendment Act, 2011, continued into British Columbia under section 23 of this Act as that section read before the coming into force of section 67 of the Finance Statutes Amendment Act, 2011, or

(c) a corporation that was, before the coming into force of section 64 of the Finance Statutes Amendment Act, 2011, incorporated as a trust company under the Trust Company Act, R.S.B.C. 1979, c. 412, or was incorporated as a trust company under another Act,

but does not include a corporation continued under the laws of another jurisdiction;

"prescribed" means prescribed by regulation of the Lieutenant Governor in Council;

"public body", in relation to a credit union, means

(a) a municipality or regional district,

(b) [Repealed 2003-52-64.]

(c) the Municipal Finance Authority of British Columbia under the Municipal Finance Authority Act,

(d) a government body under the Financial Administration Act, or

(e) a board, commission, authority or similar body established or authorized under an Act to administer, regulate, manage or undertake the operation of schools, libraries, hospitals, health facilities, irrigation systems, drainage systems, water supply systems, local improvements or public utilities, or to regulate or facilitate the regulation of agricultural and other natural products marketing or to levy or raise taxes under the authority of an Act;

"security instrument" means security as defined in section 1 of the Securities Act;

"senior officer" means each of the 5 highest paid officers of a corporation and includes an individual who, whether or not among those 5 highest paid officers,

(a) is the chair or a vice chair of the board of directors or the president, a vice president, the secretary, the treasurer or the general manager of the corporation, or

(b) performs functions of the corporation similar to those normally performed by an individual occupying any of the offices described in paragraph (a);

"significant borrower", in relation to a trust company or insurance company, means

(a) an entity that has outstanding indebtedness for money borrowed from the company, or from the company and one or more of its affiliates, or from one or more affiliates of the company, if the aggregate principal amount of the outstanding indebtedness exceeds the greater of

(i) $1 million, or

(ii) 1/3 of the sum of

(A) the total indebtedness then outstanding for borrowed money of the entity, and

(B) the amount by which the assets of the entity exceed its liabilities, as shown on the balance sheet of the entity at the end of its most recently completed financial year, or

(b) an individual who has outstanding indebtedness for money borrowed from the company, or from the company and one or more of its affiliates, or from one or more affiliates of the company, if the aggregate principal amount of the outstanding indebtedness, excluding indebtedness secured by a mortgage of the individual's principal residence, exceeds $100 000;

"special Act insurance company" means an insurance company incorporated by another Act;

"special resolution",

(a) in relation to a trust company or insurance company, means a resolution

(i) passed by a majority of not less than 3/4 of the votes cast by those members of the company who, being entitled to do so, vote personally or by proxy at a general meeting of the company

(A) of which notice as the articles provide and being not less than 21 days' notice specifying the intention to propose the resolution as a special resolution has been given, or

(B) if every member entitled to attend and vote at the meeting agrees, at a meeting of which less than 21 days' notice has been given, or

(ii) consented to in writing by every member of the company who would have been entitled to vote personally or by proxy at a general meeting of the company, and a resolution so consented to is deemed to be a special resolution passed at a general meeting of the company, and

(b) in relation to a credit union, means a special resolution as defined in section 1 of the Credit Union Incorporation Act;

"spouse" means a person who

(a) is married to another person, or

(b) is living with another person in a marriage-like relationship;

"superintendent" means the Superintendent of Financial Institutions appointed under section 207;

"tribunal" means the Financial Services Tribunal continued under section 242.1;

"trust business" means the business of providing or offering to provide services to the public as

(a) trustee, executor or administrator,

(b) guardian of a minor's estate,

(c) committee, under the Patients Property Act, of the estate of a person with a mental disorder,

(d) attorney under Part 2 of the Power of Attorney Act, or

(e) representative granted power over an adult's financial affairs under section 7 (1) (b) of the Representation Agreement Act,

whether or not the person undertaking an activity or activities set out in paragraphs (a) to (e) can or does distribute any gain, profit or dividend, or otherwise disposes of the person's assets, to a member or shareholder of the person other than during winding up or on dissolution;

"trust company" means

(a) a company incorporated under the Business Corporations Act for the purpose of carrying on trust business and includes

(i) an extraprovincial trust company that has been continued into British Columbia as a company under section 303 of the Business Corporations Act, and

(ii) a company that results from an amalgamation referred to in section 20 (1),

(b) a corporation incorporated as a trust company under another Act, or

(c) a pre-existing trust company,

but does not include a corporation continued under the laws of another jurisdiction;

"unaffiliated director", in relation to a trust company or insurance company, means a director who is not also

(a) an officer or employee of the company or of an affiliate of it,

(b) the owner of 5% or more of the voting shares of the company or of an affiliate of it,

(c) a significant borrower from the company, or a director or senior officer of a significant borrower from the company or the owner of 10% or more of the voting shares of a significant borrower from the company,

(d) a borrower from the company under a loan that is not in good standing, or a director, officer or employee of, or the owner of 10% or more of the voting shares of an entity that is a borrower from the company under a loan that is not in good standing,

(e) the spouse of an individual described in any of paragraphs (a) to (d),

(f) a relative of an individual described in paragraph (a) or (b) who occupies the same home as that individual,

(g) an individual who, within the 2 years before becoming a director, has been an officer or employee of the company or of an affiliate of it, or

(h) unless determined to be an unaffiliated director by the superintendent under section 97 (2),

(i) an individual,

(ii) a partner in or an employee of a partnership,

(iii) an officer or employee of a corporation, or

(iv) an owner of 10% or more of the voting shares of a corporation

that provides goods or services to the company, if the total annual billing to the company in respect of the goods or services exceeds 10% of the total annual billings of the individual, partnership or corporation, as the case may be;

"voting share" means a share of a class of shares of a corporation that carries the right to vote under all circumstances on a resolution electing directors, and includes a share of a class of shares of a corporation that carries the right to vote on such a resolution because of the occurrence of a contingency that has occurred and is continuing.

(2) For the purposes of this Act, an affiliate of a corporation is deemed to be affiliated with all other corporations with which the corporation is affiliated.

(3) and (4) [Repealed 2011-29-64.]

(5) An activity referred to in paragraph (a) of the definition of "insurance business" in subsection (1), whether or not the activity is conducted in British Columbia, is conclusively deemed for the purposes of this Act to constitute the carrying on of insurance business in British Columbia if the risk or peril is located in British Columbia.

(6) A reference to "subsidiary" in this Act as it applies to credit unions,

(a) except in sections 120 and 128, has the same meaning as in the Credit Union Incorporation Act, and

(b) in sections 120 and 128, has the same meaning as in the Business Corporations Act,

and "holding company" has the corresponding meaning.

Application of Business Corporations Act

2   (1) The following provisions of the Business Corporations Act do not apply to trust companies or insurance companies:

(a) Part 2.1;

(b) Division 4 of Part 9;

(c) sections 16, 20, 84 to 86, 137, 154 (1) (e), 159 to 165, 183, 195, 197, 200, 203 and 229.

(2) Except as expressly provided in this Act or the Credit Union Incorporation Act and except insofar as sections 31, 144, 145 and 236 and Part 12 of the Business Corporations Act apply to credit unions by virtue of their application to corporations generally, the Business Corporations Act does not apply to credit unions.

(3) A special Act insurance company is subject to the following in addition to the provisions to which it is subject under section 4 of the Business Corporations Act:

(a) sections 269 to 300 and 302 to 311 of the Business Corporations Act;

(b) regulations made under sections 269 to 300 and 302 to 311 of the Business Corporations Act;

(c) subject to subsection (4) of this section, the Pre-existing Company Provisions prescribed under section 442.1 of the Business Corporations Act.

(4) The Lieutenant Governor in Council may prescribe provisions of the Pre-existing Company Provisions that do not apply to a special Act insurance company or a class of special Act insurance companies.

Repealed

3-5   [Repealed 2011-29-65.]

Repealed

6   [Repealed 2006-12-42.]

Repealed

7   [Repealed 2011-29-65.]

Pre-existing trust company

8   (1) The memorandum of a trust company existing at September 15, 1990 is deemed to have been amended on that date by striking out the objects clause contained in it and substituting the following:

"The businesses that the company is permitted to carry on are restricted to those that were set out in Schedules A and B to the Trust Company Act, R.S.B.C. 1979, c. 412, immediately before the repeal of that Act by the Financial Institutions Act."

(2) Every copy of a memorandum that has been deemed to be altered by subsection (1) that is issued on or after September 15, 1990 must be in accordance with the alterations.

Repealed

9-10   [Repealed 2011-29-65.]

Specific rules respecting Business Corporations Act application to extraprovincial corporations

10.1   (1) Sections 90 to 102 and 302 to 307 of the Business Corporations Act do not apply to extraprovincial corporations.

(2) Without limiting Division 11 of Part 10 of the Business Corporations Act, before submitting an application to the registrar under that Division, the applicant must, if the application relates to an extraprovincial corporation,

(a) first obtain the consent of the superintendent to a name and then reserve that name under the Business Corporations Act, and

(b) obtain the consent of the superintendent to the reinstatement, limited reinstatement or extension of a limited reinstatement contemplated by the application.

(3) For the purposes of section 379 of the Business Corporations Act as it applies to extraprovincial corporations, the reference in section 379 (1) to "within 2 months" must be read as "immediately".

This Act paramount

11   If a provision of this Act is inconsistent or in conflict with a provision of the Act by or under which a financial institution is incorporated, the provision of this Act prevails.