Doing Business in Canada - Legal Aspects Łódź,

About Me Saad Syed B.Comm. (Hons.), J.D. (Juris Doctor) Member of the Law Society of Upper Canada Canadian Bar Association

The Canadian Legal System  Common law Applied in 9 provinces and 3 territories Federally  Civil Code Québec

Division of Powers  Provincial laws govern “property and civil rights” (contract law, labour relations, consumer protection, regulation of professionals, etc.)  Federal law particular kinds of business (banks and most other financial institutions, airlines, railways, broadcasters, and telecom companies)

Corporate Ownership Restrictions  Financial institutions  Broadcasting  Telecom  Air transportation

Forms of Business Organizations  Sole proprietorship;  Partnership;  Joint ventures;  Corporations;  Co-operatives;  Associations; and  Non-profit corporations.

Sole Proprietorships  An individual carries on business as the sole owner without incorporating  All benefits accrue to the owner  No distinction between the proprietorship and the owner  Maybe personally liable for debts

Partnerships  Ordinary  Limited  Limited Liability

Ordinary Partnerships  2 or more individuals or entities carry on business together with a view to making profit without incorporating  Not a separate legal entity  The liabilities of the partnership = the personal liabilities of the partners  Not taxed at the partnership level; taxed at the individual partner level.

Limited partnerships  A legal hybrid: provides some of the benefits of a limited liability company along with many of the tax benefits of a partnership.  One or more general partners who are liable for all the partnership’s debts.  Limited partners whose liability is limited to the amount they agree to contribute.

Joint Ventures  Common business undertaking between two or more entities  Usually limited to one project  Usually formed to carry out a project too onerous for a single party or small group

Corporation  Separate legal entity  Shareholders not responsible for the debts, liabilities or obligations of the corporation  Enjoys perpetual succession  Private vs. public corporation

Franchising/Licensing  If run from outside Canada, no need for a separate Canadian business structure.  If a Canadian entity is set up through which Canadian licences or franchises are granted: notification required under the ICA.  Protect your intellectual property rights.

Federal vs Provincial incorporation Pro: federal incorporation allows company to operate/use name across Canada Con: for most federally incorporated corporations, 25% of directors must be resident Canadians

Taxation  Canada-Poland tax treaty  Federal  Provincial

For additional information Saad Syed B.Comm. (Hons.), J.D. (Juris Doctor) ul. Marszałkowska 20/22 lok Warszawa tel: