Does a share purchase agreement have to be registered?

A share purchase agreement is a contract between the buyer and the sellers. The sources read for this page describe records a corporation keeps and notices it sends after a share sale, and none of them describes filing the agreement itself. So the practical question is which records change when the shares do. For the agreement itself, see what a share purchase agreement is and how it works.

The securities register

Under the Canada Business Corporations Act (CBCA), a corporation must maintain a securities register that records the securities it has issued in registered form. For each class or series, the register shows each person who is or has been a security holder, with their latest known address, the number of securities each holds, and the date and particulars of the issue and transfer of each security. The Act says that registering the issue or transfer of a security in the central or a branch securities register is complete and valid registration for all purposes. Ask your lawyer who will update the register at closing, and whether the articles or a shareholder agreement require approval of the transfer first.

The register of individuals with significant control

Corporations Canada says most corporations created under the CBCA must keep a register of individuals with significant control. The register records the day each individual became or ceased to be one. Under section 21.1 of the CBCA, the corporation must take reasonable steps to keep it accurate, complete and up to date at least once in each financial year, and must record newly learned information within 15 days of becoming aware of it. Corporations Canada also says these corporations must file that information with it. A share sale that changes who controls the company is a reason to ask whether the register needs updating.

Notices that follow a change of directors

If the sale changes the board, a CBCA corporation must, within fifteen days after a change is made among its directors, send the Director a notice setting out the change, in the form the Director fixes. The CRA adds that structure or owner changes for a corporation must be updated and validated with the federal or provincial incorporating authority before you contact the CRA. The steps after closing are laid out in updating corporate records after a share purchase.

If the company is not a federal corporation

This page covers corporations created under the CBCA, and the sources read for it say nothing about provincial corporations. Check which statute the company was formed under, and ask your lawyer or the issuing registry what applies if it is a provincial one. Also ask your lawyer whether anything beyond the corporation’s own records applies to your deal, such as a lender, a licence or a clause in the agreement that calls for a filing.