Amendments to the Canada Business Corporations Act (CBCA) that impose majority voting requirements, annual director terms, a prohibition on slate voting and a change to the period during which shareholders must deliver proposals to be included in an issuer's proxy circular take effect on August 31, 2022.
As we have previously discussed, for CBCA-incorporated issuers, effective August 31, 2022, long anticipated amendments to the CBCA will require that:
- Reporting issuers allow shareholders to vote "for" or "against" individual director nominees in uncontested elections rather than "for" or "withhold";
- A director of a reporting issuer be elected by a majority of votes cast at the meeting in respect of the director's election, unless otherwise required by the issuers' articles;
- Directors be elected for a term ending not later than the close of the issuer's next annual shareholder meeting;
- Directors be elected individually and not as part of a slate; and
- Shareholders seeking to have a proposal included in an issuer's proxy circular deliver such proposal to management during the 60-day period between 90 and 150 days before the anniversary date of the issuer's prior annual meeting.
CBCA-incorporated issuers that are listed on the TSX will generally be in compliance with the majority voting requirements of the TSX Company Manual if they are in compliance with the amended provisions of the CBCA. Compliance with the CBCA amendments need not be outlined in a majority voting policy of the issuer.
For further information, please see "Statutory Majority Voting Requirements to Come Into Force for CBCA Incorporated Reporting Issuers" (April 12, 2022).
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
