How to buy a funeral home in Quebec: licences, ownership rules and what transfers

Buying a funeral home in Quebec is governed by the Funeral Operations Act and its regulation, and the licensing body is Santé Québec. The Act says no one may offer or purport to offer funeral services unless they hold a funeral services business licence, and that the licence may not be transferred without written authorization from Santé Québec. That gives a Quebec buyer a route to ask for. This guide, written from the Act and the regulation in English, covers what the licence authorizes, what moves and what does not on a sale, the funeral services director, the ownership test, and what to request from the seller. It covers Quebec law only.

What the licence covers

Under Quebec’s Funeral Operations Act, a funeral services business licence specifies the funeral services the licensee is authorized to provide and the funeral facilities it is authorized to operate. Santé Québec issues an extract of the licence for each funeral facility where services may be provided. The Act says the licence is issued or renewed for a three-year term, and that any condition, restriction or prohibition set by Santé Québec must be written into the licence. Read the licence and each extract before anything else: they show what you would actually be buying the right to do.

Moving the licence on a sale

The transfer rule is in the Act itself: a funeral services business licence may not be transferred without written authorization from Santé Québec. The Act does not turn that into an automatic right. Ask Santé Québec early what it needs from the buyer and how long it takes. BDC describes closing conditions as undertakings the vendor agrees to complete in the period before closing; ask your lawyer whether the authorization belongs among them. The wider process is in how to buy a business in Canada.

The funeral services director

A licensee must appoint a funeral services director unless the licensee is a natural person who occupies that position, and in both cases Santé Québec must be informed. The Act says the director is responsible for the administration and operation of the business, sees to day-to-day management and represents the licensee in dealings with Santé Québec. The licensee is accountable for the director’s decisions in all matters the Act governs. The regulation sets the qualifications, and an application by a legal person includes a board resolution designating the director. If the seller’s director is leaving at closing, ask who the replacement will be and whether that person meets the regulation.

Who is looked at: directors, officers and shareholders

Under section 23, Santé Québec may suspend, revoke or refuse to renew a licence if the licensee has been found guilty, in any place, of an indictable or other offence relating to the licensed operations, unless a pardon has been obtained. For a legal person or partnership, the Act extends that test to a director or officer, or a partner or shareholder having a major interest in the business, and section 23 defines major interest by a share of voting rights or partnership interest. So ask who the shareholders would be after closing. Santé Québec may also act if a funeral services business licensee is insolvent, or if it considers that public health or safety is endangered by the licensee’s operations.

Changes and notices after closing

The Act requires licensees to inform Santé Québec without delay of any change that may affect the validity of their licence. A licensee who intends to cease operations must ensure a professional transition of the human ashes and prearranged funeral services under its responsibility and inform Santé Québec in writing, and Santé Québec revokes the licence on the date specified in the notice of cessation. Before suspending, revoking or refusing to issue or renew a licence, Santé Québec must notify the licensee in writing and give at least 10 days to submit observations, unless urgent action is required or to prevent irreparable injury. Ask the seller for any notices, orders or decisions of this kind on file.

Conditions for a new licence under the regulation

The regulation says a funeral services business licence may only be issued to a person who meets the conditions it sets out. Where the applicant is a natural person, the regulation sets a minimum age. It also lists what an application includes, such as the name, sex and date of birth of the person who will act as funeral services director and, for a legal person, a board resolution designating that director. If you buy through a new company, ask Santé Québec whether that company must file its own application. Ask your lawyer whether to apply in parallel with asking for authorization.

What to ask the seller for

• The funeral services business licence and every facility extract, with any conditions, restrictions or prohibitions written on them.
• The name and qualifications of the funeral services director, and the board resolution that designated that person.
• A list of the directors, officers and shareholders, to check against the offence and major-interest test.
• Any order, notice or decision from Santé Québec, including corrective measures ordered.
• The records the licensee must preserve and provide to Santé Québec on request, as the regulation specifies.