Electrical contractor licence (ESA)

A buyer of an electrical contracting firm in Ontario is buying a business whose right to trade depends on a licence that cannot be transferred to the buyer. Two things matter together: the contractor licence itself and the master electrician it depends on.

What the regulation says

Section 3 of O. Reg. 570/05 says no person shall operate an electrical contracting business without an electrical contractor licence, subject to the types of electrical work section 2 says the regulation does not apply to. Section 13(4) says a licence is not transferable. Section 14 requires the holder to stop operating immediately if a licence requirement, restriction, limitation or condition ceases to be met, with a specific exception, on notice to the Director, for losing the last designated master electrician. The Electrical Safety Authority says a contractor must be a master electrician or have at least one working for it at all times.

Other provinces

Ontario’s licence is an Ontario rule. Technical Safety BC, for instance, runs electrical operating permits in British Columbia; check the system in any other province where the business works.

What to ask

• Who the designated master electrician is, and whether that person is staying.
• Whether the buying entity can hold its own licence by closing.
• Whether the seller’s name appears on the licence, vehicles or marketing.

See whether trade licences transfer when you sell and compulsory trade licensing.