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Corporate law

Business Corporate law Legal Practice Management White-collar crimes

U.S. authorities target individuals for corporation wrongdoings

Internal investigations are likely going to be more costly and more difficult to conduct for Canadian companies with operations in the United States following a change of policy by the U.S. Department of Justice that will now prioritize the prosecution of individual employees for civil and criminal corporate wrongdoing, according to anti-corruption and white collar criminal defence lawyers.

The new policy is widely expected to compel companies being investigated by the DOJ for civil and criminal transgressions to undertake more timely, independent, thorough and well-documented internal investigations that will almost certainly drive a wedge between the organization and its senior executives and employees whose interests may be at odds with one another, added the legal experts.…

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Business Canada Corporate law

New investor state dispute settlement mechanism following Canada – European Union trade agreement

A new proposed permanent investment court-like system under the free trade agreement between Canada and the European Union that will replace the controversial ad hoc investor-state dispute settlement arbitration system has drawn mixed reaction from international trade and investment lawyers.

The new approach, negotiated during the legal scrubbing or revision of the CETA deal, represents a clear break from the traditional ad hoc ISDS system where three arbitrators sat on the tribunal, one of whom was appointed by investors, another by the defending government, and a third usually by agreement of the two disputing parties.…

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Accounting Business Corporate law Tax

OECD hopes reforms will end era of tax avoidance

An unprecedented international collaboration on tax reform that recently unveiled sweeping plans to crack down on aggressive tax planning by multinational companies has the potential of becoming the biggest shake-up in international tax rules in nearly a century, according to tax professionals.

Endorsed by G20 finance ministers and leaders, the ambitious proposals by the Paris-based Organisation for Economic Co-operation and Development (OECD) aims to close loopholes, increase transparency to assist tax authorities in risk assessments, and restrict the use of tax havens to curb many international tax planning strategies.

The plan, known as the Base Erosion and Profit Shifting (BEPS) project, lists 15 specific actions intended to establish coherent rules for corporate income taxation, prevent tax treaty abuse, tackle the tax challenged posed by the digital economy, and amend the world’s 3,000 bilateral tax treaties through a multilateral instrument.…

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Business Class actions Corporate law Financial services Quebec Quebec Court of Appeal Rulings

OSFI exchanges with insurers and financial institutions not confidential

The Quebec Court of Appeal upheld a lower court ruling that could have a chilling effect on the flow and quality of confidential information financial institutions disclose to regulatory authorities, and even potentially undermine the “safety and soundness” of Canada’s financial system, according to business lawyers.

In a majority decision in line with two Ontario Superior Court decisions, the Quebec Court of Appeal held that documents and exchanges between federally regulated firms such as banks and insurance companies with the Office of the Superintendent of Financial Institutions (OSFI) are protected by statutory confidentiality provisions imposed by Regulations under the Insurance Companies Act, with some exceptions. While the regulations were enacted to limit the communication of supervisory information, the appeal court found that sections 2 and 3 of the Regulations did not create an absolute prohibition on disclosure and could be subject to production in civil proceedings.…

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Business Corporate law Quebec Quebec Superior Court Rulings

Court orders franchisor to pay $16.4 million to franchisees

In a “sad saga” of a once successful franchise operation that fell precipitously from grace in less than a decade, a nine-year legal battle came to a bittersweet end after Quebec Superior Court condemned Dunkin’ Brands Canada Ltd. to pay 21 Quebec franchisees $16.4 million for failing to protect its brand in the Quebec market.

In a 43-page ruling, Justice Daniel Tingley castigated the franchisor, formerly Allied Domecq Retailing International (Canada) Ltd. (ADRIC), for trying to pin the blame of its “stunning fall from grace” to the “Tim Hortons’ phenomenon” and underperforming, even poor, franchisees.

“ADRIC had assigned to itself the principal obligation of protecting and enhancing its brand,” wrote Justice Tingley. “It failed to do so, thereby breaching the most important obligation it had assumed in its contracts.…

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Business Corporate law Quebec

Quebec Business Corporations Act in force today

Quebec’s legislative framework for companies incorporated in the province, for years practically shunned by the business and legal community, has been revamped, modernized and simplified, drawing praise alike from corporate and commercial lawyers and shareholder activists.

Replacing both Part I and Part IA of the outdated and much-maligned Companies Act (Act), which was last updated nearly three decades ago, the Quebec Business Corporations Act (BCA) has the ambitious aim of making Quebec a national leader in the business legal landscape thanks to the introduction of measures that clarifies directors’ duties, simplifies the process of incorporating in the province, and grants new rights to minority shareholders.

“It brings Quebec into the 21st century,” remarked Benjamin Silver, counsel to McCarthy Tétrault LLP’s business law group in Montreal. …

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Business Corporate law Legal Practice Management

Dodd-Frank Act – Americans mean business

When General Electric Company agreed last August to pay US$23.4 million to settle charges laid by the United States Securities and Exchange Commission (SEC) for its involvement in a US$3.6 million kickback scheme with Iraqi government agencies to win contracts to supply medical and water purification equipment, it was the latest of an impressive long list of multinationals that paid the price of Washington’s newfound resolve to crack down on corporate bribery.

The Americans now mean business. Largely dormant since becoming law in 1977, the U.S. Department of Justice (DOJ) and the SEC have over the past two years vigorously enforced the Foreign Corrupt Practices Act (FCPA), going so far as to launch sting operations while levying penalties unimaginable a couple of years ago.

The Dodd-Frank Act provides the SEC with more enforcement tools and wider jurisdiction and most notably introduces an eye-catching whistleblower bounty -- all of which should cause concern for Canadian companies even though the full impact of the new law has yet to be determined.…

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Business Canada Corporate law

Legal community craved guidance in real estate dispute

When the Commissioner of Competition recently settled a long-standing abuse of dominance case against the Canadian Real Estate Association, it likely paved the way for a dramatic overhaul in the way that residential property is bought and sold, allowing Canadians to choose services à la carte from real estate agents.

But the settlement, approved by 97 per cent of nearly 100 real estate boards across Canada representing approximately 96,000 real estate agents and brokers, has somewhat disappointed some in the legal community who are craving for more guidance in abuse of dominance cases, particularly since significant amendments were introduced to the Competition Act in 2009.…

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Accounting Business Corporate law Quebec Superior Court Rulings

Quebec inches its way towards doctrine of rectification

ookie maker par excellence, Monsieur Félix & Mr. Norton, heaved a sigh of relief when Quebec Superior Court annulled a resolution adopted nearly three years ago by the its Board of Directors to dole out dividends totaling $950,000 in a ruling that inches Quebec civil law towards the acceptance of the doctrine of rectification...…

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