Can I sell my business if my BC company was dissolved?

This covers British Columbia only. Under the Business Corporations Act, a dissolved company ceases to exist for any purpose, subject to sections 346 and 347. Restoration is the Act’s route back, in more than one form. See whether it matters that the seller’s corporation is not in good standing.

How the registrar can dissolve a BC company

Under section 422, the registrar may dissolve a company that, among other grounds, fails, in each of 2 consecutive years, to file an annual report. The registrar may first send a letter and publish a notice, after which the company has one month, or longer if it files an extension application, to show cause, satisfy the registrar or file a court order to the contrary.

What happens to the company’s property

Under section 344(2), an undistributed asset vests in the government on dissolution, with two exceptions: an asset held as a joint tenant vests in the other joint tenant, and land in British Columbia is, subject to that rule, deemed to escheat to the government under section 4 of the Escheat Act. On restoration, section 368 vests unsold assets back in the company and requires the government to return assets in its custody and pay what it realized from the rest and any money it received, subject to exceptions and once the government has been reimbursed for its costs. Restoration does not affect title to escheated land, except as section 4 of the Escheat Act provides (section 368(5)). BC Registries’ packages say land has its own Escheat Act rules.

Full or limited restoration

Under section 355, an unlimited liability company applies to the court; any other applies to the registrar or the court. Under sections 356 and 360, a related person may apply for a full restoration, and any person for a limited one. Under section 354 a person is related if, at dissolution, they were a director, officer or shareholder, or are the heir or personal or other legal representative of a shareholder; for a court application, a person the court orders to be appropriate also counts. Before applying, the applicant must, among other steps, publish notice in the Gazette and mail notice. A restored company is deemed to have continued as if never dissolved (section 364). A limited restoration lasts for a stated period, after which the company is dissolved again. Within that period, the court, or the registrar for a restoration it granted, may extend it, on any person’s application, or convert it to a full restoration, on a related person’s. BC Registries’ package says limited restorations are usually done to undertake or finalize a particular legal transaction with the company.

Before you list

• Confirm the company’s current status with BC Registries.
• Ask your lawyer which route fits a sale, and who is able to apply.
• Ask what the company owned when it was dissolved.