1. Register of individuals with significant control
CORPORATIONS CANADA
Register of individuals with significant control

2. AGENDA Objectives and corporations affected
Defining ISC and ISC Register
Access to the ISC Register and penalties
Regulations and guidance materials
Feedback
Note: Any information provided by Corporations Canada is not intended to be a substitute for legal advice.

3. OBJECTIVES
CBCA corporations are required to create and maintain a Register of individuals with significant control (ISC Register)
Knowing who controls a corporation
Increases transparency of who owns or controls corporations
Assists investigative bodies in exposing activities, like money laundering and tax evasion
Helps Canada meet its international obligations

4. CORPORATIONS AFFECTED
Budget Implementation Act, 2018, No. 2 (Bill C-86) made amendments to the CBCA obligations that apply to all CBCA corporations, except
reporting issuers
corporations listed under a designated stock exchange as defined by the Income Tax Act
Amendments in force on June 13, 2019

5. DEFINING ISC AND ISC REGISTER

6. W HAT IS AN ISC
An individual who directly or indirectly owns at least 25% of voting shares
Holds shares on behalf of
beneficial owner D
Registered shareholders A B C
Shareholdings
25%
20%
45%
A, C and D are ISCs
Corporation
One class of voting shares

7. W HAT IS AN ISC (cont’d)
An individual who directly or indirectly owns at least 25% of all shares measured by fair market value
Where there are more than one class of shares
An individual who has direct or indirect control or direction of at least 25% of voting shares or of all shares measured by fair market value
An individual who has any direct or indirect influence that would result in control in fact of the corporation

8. One class of voting shares
W HAT IS AN ISC (cont’d)
Two or more individuals who jointly hold an interest described in 1 to 4 or have an agreement to exercise those rights jointly
Agree to act jointly
Registered shareholders A B C D E
D and E are ISCs
Shareholdings
20%
20%
20%
20%
20%
Corporation
One class of voting shares

9. ISC REGISTER
Document that contains the required information about individuals who have significant control over the corporation
Name, date of birth and last known address
Jurisdiction for tax purposes
Date on which the individual became and ceased to be an ISC
Description of how the individual meets the definition of significant control
Register is to be kept with the other corporate records
Model template is available

10. STEPS TO CREATE AN ISC REGISTER
Corporation contacts its registered shareholders and asks for information so that it can determine who is an ISC
Corporation determines who else it may need to contact for information
After determining who is an ISC, the corporation records their information in the Register

11. REASONABLE STEPS TO MAINTAIN
Corporations must take reasonable steps once a year to update the information in the ISC Register
 Contact ISCs and ask if their information has changed
 Contact registered shareholders who are not ISCs and ask for information so that it can determine who is an ISC
 After determining if there are any new ISCs or if there is a change in the information in the Register, the corporation records that information

12. ACCESS TO THE ISC REGISTER AND PENALTIES

13. ACCESS TO THE ISC REGISTER
Corporations must provide any information requested by Corporations Canada
Shareholders and creditors can access the information with an affidavit and restrictions on the use of the information
The public does not have access to the information

14. ACCESS TO THE ISC REGISTER – INVESTIGATIVE BODIES (PROPOSED)
Budget Implementation Act 2019 No. 1 (Bill C-97) was tabled April 8, 2019 – not yet approved by Parliament
Provides investigative bodies* with warrantless access to the ISC Register when information is needed for investigative purposes related to offences in the Schedule to the CBCA
Corporations receiving a request must respond as soon as feasible
* Investigative bodies are defined to be any police force, or CRA and its provincial equivalents

15. DIRECTORS AND OFFICERS
PENALTIES
CORPORATION
DIRECTORS AND OFFICERS
SHAREHOLDERS
Offence
Fails to meet the ISC Register requirements without reasonable cause
Fails to meet request from investigative body
Knowingly:
Fail to prepare and maintain the ISC Register or meet request from investigative body
Allow false or misleading information to be recorded in the ISC Register
Allow false or misleading information to be provided to any person or entity
Knowingly fail to meet their obligations regarding the ISC Register
Fines
Up to $5,000
Up to $200,000
Imprisonment
N/A
Up to 6 months

16. REGULATIONS AND GUIDANCE MATERIAL

17. REGULATIONS No regulations will be in place for June 13, 2019
There is regulatory authority that allows us to:
Identify a class of corporations that would be exempt from having to create and maintain an ISC Register
Set out steps to take if a corporation is not able to identify any ISCs
Prescribe the form of the Register
Set out steps for updating ISC Register

18. GUIDANCE MATERIAL
Guidance material primarily targets small private corporations trying to meet their obligations without professional help
70%
of corporations fall under
this category
Initial information is available on the website
Information will be added and modified as project progresses, and based on feedback

19. FEEDBACK We would welcome feedback and suggestions on
guidance already released
additional material that could assist your client corporations in meeting their obligations
what regulations could help.
To reach us: