How do I buy a physiotherapy clinic in Ontario?

Buying a physiotherapy clinic in Ontario starts with a question about the buyer rather than the clinic: are you a physiotherapist registered with the College of Physiotherapists of Ontario? The answer shapes what you can buy. A clinic can be more than one legal entity, and Ontario law restricts who may own the part that carries on the practice. This guide covers those Ontario rules in the order a buyer meets them. It is not a guide to pricing a clinic or to buying one anywhere in Canada, which our wider guide on buying a physiotherapy clinic covers.

What the Act defines and protects

Ontario’s Physiotherapy Act, 1991 defines the practice of physiotherapy as the assessment of neuromuscular, musculoskeletal and cardio respiratory systems, the diagnosis of diseases or disorders associated with physical dysfunction, injury or pain, and the treatment, rehabilitation and prevention or relief of physical dysfunction, injury or pain to develop, maintain, rehabilitate or augment function and promote mobility. The Act also restricts a title: section 8 says no person other than a member shall use the title “physiotherapist” or “physical therapist”, a variation or abbreviation, or an equivalent in another language. A buyer who is not a member cannot present themselves that way.

Who may own a physiotherapy professional corporation

The College says only members of the same profession can be shareholders, officers or directors of a professional corporation, so every shareholder, officer and director of a physiotherapy professional corporation must be a physiotherapist. It also notes that the restricted ownership structure may negate some of the benefits of incorporating, which is a reason for a buyer to ask how the seller’s corporation is set up. The Ontario Business Corporations Act says the same about shares: all issued and outstanding shares must be legally and beneficially owned, directly or indirectly, by one or more members of the same profession, subject to its subsection 3.2(6), which lets regulations exempt classes of health profession corporations. On the College’s statement, if the clinic’s practice sits in such a corporation, a share purchase is open only to a physiotherapist; ask a health lawyer whether any exemption applies. Our answer on what an Ontario physiotherapy practice must do to operate through a health profession corporation covers the setup.

The certificate of authorization

The College says all professional corporations are legally required to have a certificate of authorization issued by the College in order to practise, and that the certificate must be renewed annually. The Regulated Health Professions Act, 1991 adds that no corporation shall hold itself out as a health profession corporation unless it holds a valid certificate of authorization. The Act also says no person shall hold himself or herself out as a shareholder, officer, director, agent or employee of a health profession corporation unless it holds a valid certificate, and it makes a contravention of either rule, by a corporation or an individual, an offence. A buyer should therefore not start acting as an owner before the certificate position is clear. Ask the seller for the current certificate and its renewal record, and ask the College what a change in shareholders requires before closing.

Practice management corporations

The College explains that some physiotherapists create a practice management corporation to lease space for a clinic, buy equipment or pay administrative employees. Such a corporation is not permitted to practise any regulated health profession, including physiotherapy. The College adds that, in contrast to professional corporations, the ownership rules for practice management corporations are more relaxed. For a buyer, the practical step is to ask the seller which corporation holds the lease, the equipment and the staff, and which holds the practice itself, because that split shows what each type of buyer can acquire.

Questions to settle before you make an offer

Because the rules turn on structure, settle the structure early. A non-physiotherapist buyer should ask the College and a health lawyer what role the College’s rules allow, rather than assume the relaxed rules for practice management corporations reach the practice itself. A physiotherapist buyer should confirm their own registration is in good standing and think through which entity will hold the new shares. Ask any lender how it treats this structure; our guide on financing a physiotherapy clinic acquisition covers lenders.

• Confirm your own College registration, or decide with a lawyer what role you can lawfully hold.
• List every entity in the clinic and what each one owns, leases or employs.
• Obtain the professional corporation’s certificate of authorization and its renewal history.
• Ask the College what a change of shareholders requires before closing.
• Have a health lawyer review the purchase structure before signing.