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Investment and business structuring law in Toronto covers how companies are formed, organized, and governed, as well as how assets and investments are held and transferred. It includes corporate formation, corporate governance, mergers and acquisitions, and the use of holding or special purpose vehicles (SPVs) to manage risk and tax planning. In Toronto, many transactions involve cross-border considerations, requiring coordination between provincial, federal, and securities regulations.
For residents and business owners, a clear understanding of jurisdictional differences helps determine whether a Ontario-based corporation, a federal CBCA entity, or a blended holding structure best suits growth, financing, and regulatory compliance. A Toronto-based lawyer can help decide between share and asset purchases, advise on shareholder agreements, and align structure with tax planning, regulatory reporting, and funding needs. This guide provides a practical overview tailored to Toronto’s market and regulatory environment.
Starting a tech startup and choosing an initial structure. If you plan to issue stock options, bring in angel investors, or scale quickly, you may need to decide between a federally incorporated CBC A structure (CBCA) or a provincial OBCA structure. A lawyer can draft articles of incorporation, shareholder agreements, and option plans that protect founders and align with fundraising needs.
Acquiring a Toronto business through an asset or share purchase. The choice affects tax consequences, litigation risk, and ongoing liabilities. A lawyer can conduct due diligence, negotiate reps and warranties, and prepare the purchase agreement and completion documents for a smooth closing.
Structuring foreign investment into Ontario operations. Cross-border investments require compliance with Investment Canada Act thresholds and regulatory review for certain acquisitions. A legal professional helps coordinate filings, due diligence, and post-close conditions to avoid delays or penalties.
Preparing for a merger or corporate reorganization in Ontario or nationwide. For a plan of arrangement or corporate consolidation, you need precise governance, filing timelines, and regulator notifications. A lawyer ensures the structure meets both OBCA or CBCA requirements and securities regime expectations.
Drafting restrictive or comprehensive shareholder and buy-sell agreements. These agreements determine how shares transfer on death, disability, or exit, and they help prevent disputes among family members or co-founders. A lawyer can tailor the agreement to Ontario law and the specific business context.
Toronto businesses operate under both federal and provincial frameworks, with securities and corporate governance primarily supervised by Ontario regulators and federal statute in cross-border cases. Below are 2-3 key laws, with notes on their scope and recent considerations.
The CBCA provides a federal framework for the incorporation, organization and governance of corporate entities in Canada. It governs federally incorporated corporations and their governance, share capital, and annual filings.
Canada Business Corporations Act provides a federal framework for the incorporation, organization and governance of corporate entities in Canada.
Source: Laws - CBCA (Justice Canada)
The OBCA regulates Ontario corporations, including incorporation, corporate governance, director duties, and share transfers for provincially incorporated entities. It is the provincial counterpart to the CBCA for companies operating primarily within Ontario.
Ontario Business Corporations Act outlines the governance and structure for Ontario corporations under provincial law.
Source: OBCA - Ontario Laws
The Ontario Securities Act regulates the trading of securities in Ontario and provides the framework for market participants, registrations, and exemptions. It is administered by the Ontario Securities Commission (OSC).
Ontario Securities Act regulates securities trading and market participants within Ontario; enforcement is overseen by the OSC.
Source: Ontario Securities Commission and Ontario Securities Act - Ontario Laws
The ICA governs foreign investments to protect Canadian national interests and may require review for significant acquisitions. It applies to investments by non-Canadians and certain strategic sectors, with thresholds and timelines set by the act and regulations.
Investment Canada Act governs foreign investments intended to protect Canada’s national interests.
Source: Investment Canada Act - Industry Canada
Recent regulatory emphasis in this space includes enhanced scrutiny of cross-border investment flows, compliance with anti-money laundering obligations, and ongoing reform of corporate governance requirements. For corporate structuring, professionals should monitor developments from OSC guidance, CBCA/OBCA amendments, and ICA reviews. See official sources linked above for the latest updates and procedural changes.
Regulatory updates across corporate governance and securities in Ontario emphasize enhanced disclosure, governance, and investor protections.
Sources: Ontario Securities Commission, CBCA on Justice Canada, Investment Canada Act
The CBCA applies to federally incorporated companies; OBCA applies to Ontario-based corporations. CBCA filings go through Corporations Canada, while OBCA filings are handled via ServiceOntario. Your choice can affect regulatory filing locations, director residency, and cross-border financing options.
In Ontario, you can file online or by paper with ServiceOntario. Typical online filing fees for OBCA are around a few hundred dollars, with additional costs for name searches and lawyer fees for documentation. A lawyer helps prepare articles, bylaws, and share structures to fit your plans.
A holding company can isolate liabilities and simplify financing. It is commonly used for real estate, IP, or intercompany royalty structures. A lawyer can design the multi-tier structure, ensure proper intercompany agreements, and manage tax implications.
Ontario corporations file annual returns with the Ontario Business Registry via ServiceOntario. Federally incorporated entities file annual returns with Corporations Canada. A lawyer can coordinate deadlines and document requirements to avoid penalties.
Shareholder agreements clarify ownership, voting rights, transfer restrictions, and buy-sell terms. They reduce disputes when funding rounds occur or a founder exits. A well drafted agreement aligns with both Ontario law and investor expectations.
Yes, Ontario allows Limited Partnerships for passive investment structures or real estate ventures. LPs can provide liability separation for silent partners and offer specific tax planning opportunities. A lawyer helps draft the partnership agreement and navigate regulatory requirements.
Yes. A lawyer coordinates asset sale agreements, title transfers, and tax considerations. They also ensure proper assignment of contracts, permits, and IP, while addressing potential post sale obligations.
Yes. Tax-efficient structures often involve intercompany loans, dividends, and careful consideration of personal versus corporate tax rates. A Toronto tax attorney or CPA-lawyer collaboration can optimize for cash flow and exit planning.
Often yes, because a corporation can facilitate succession planning and limit personal liability. However, family governance and buyout provisions require careful drafting to prevent disputes. A lawyer can tailor an ownership and transfer plan to your family’s needs.
Timeline depends on complexity, regulatory approvals, and consent from shareholders. A typical plan may take 6 to 16 weeks from due diligence to filing, with longer durations for cross-border matters or complicated tax structures.
Legal fees vary by project scope and firm. Expect hourly rates from about CAD 250 to 700, or a fixed fee for straightforward incorporations and standard agreements. A detailed engagement letter helps set expectations and budgets.
Private placements rely on exemptions under securities laws and OSC guidelines. A lawyer will prepare offering documents, verify eligibility for exemptions, and ensure proper regulatory filings and investor communications. Timing depends on investor readiness and regulatory review.
Clarify your business goals and preferred jurisdiction (Ontario vs federal) and identify the core assets and liabilities to be structured or protected.
Gather key documents including articles of incorporation or organization, corporate bylaws, share register, current contracts, IP filings, and tax records.
Consult a Toronto investment & business structuring lawyer for a tailored structure, governance framework, and regulatory plan. Request a written engagement letter with scope and fees.
Obtain a preliminary budget and timeline; plan for due diligence, financing agreements, and potential regulatory notifications (eg, securities or foreign investment reviews).
Proceed with drafting and negotiating corporate documents, including articles, shareholder or unitholder agreements, and intercompany arrangements.
Complete filings, registrations, and disclosures; set up ongoing compliance calendar for annual returns, board meetings, and regulatory reports.
Review the final structure with your lawyer and implement the plan, including post closing adjustments and tax optimization strategies.
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Disclaimer:
The information provided on this page is for general informational purposes only and does not constitute legal advice. While we strive to ensure the accuracy and relevance of the content, legal information may change over time, and interpretations of the law can vary. You should always consult with a qualified legal professional for advice specific to your situation.
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