How to buy a trucking company in Quebec: licences, ownership rules and what transfers

A buyer of a trucking company in Quebec deals with one regulator above all: the Commission des transports du Québec. Under Quebec’s Act respecting owners, operators and drivers of heavy vehicles, the Commission keeps a register of heavy-vehicle owners and operators and assigns each registrant a safety grade. A sale puts that record in play. When a registered owner or operator acquires an enterprise, the Commission may require information about the past road-safety conduct of the people who ran or controlled it. A buyer that is not registered needs to be before it puts the business’s Quebec-registered heavy vehicles on the road, unless a regulation exempts it. This page follows the Quebec statutes and their regulation.

Who regulates a trucking company in Quebec

The Commission des transports du Québec is the body named in the Act. It keeps the register of heavy-vehicle owners and operators, which the Act says is public. When the Commission is informed that a registrant does not meet one of the conditions the Act sets, it indicates in the register that the registrant’s right to put a heavy vehicle into circulation or operate one is suspended. For national context, read buying a trucking business in Canada, then treat the Quebec Act as the controlling text for a business whose vehicles are registered in Quebec.

Who must be registered, and as what

Under the Act, only owners of heavy vehicles entered on the Commission’s register may put a heavy vehicle registered in Quebec into circulation on a public road. Likewise, only operators entered on the register may operate such a vehicle. For a heavy vehicle registered outside Quebec, the same section requires the operator to hold a safety fitness certificate issued by another authority under the federal Motor Vehicle Transport Act, or a similar document that Act recognizes, although a registered operator may operate a vehicle registered outside Canada. The Act lets the government exempt groups or classes of persons from registration by regulation. When it registers, one person may declare itself both owner and operator. Ask your lawyer which entity will own the trucks and which will operate them, and check that each is on the register in the right capacity.

Conditions of registration

The Act lists conditions a registrant must meet before it may put a heavy vehicle into circulation or operate one. They include giving the Commission the name and address of each of its directors, keeping its registration up to date and paying the prescribed fees, paying any fines imposed under the Act, the Transport Act or the Highway Safety Code that are not under appeal, five years having passed since any unpardoned conviction for an indictable offence related to the use of a heavy vehicle, and, where the law requires it, holding a fuel tax permit, being registered under section 290 of the Act respecting industrial accidents and occupational diseases and being registered under Quebec’s Act respecting the legal publicity of enterprises. That last Act provides for registering individuals and trusts who carry on an enterprise, partnerships, legal persons and groups of persons. Ask about unpaid fines or a lapsed update, because when the Commission is informed of either, the register shows the registrant’s right as suspended. The Act also provides that the Commission assigns an unsatisfactory grade if, considering its information about the registrant, its directors, partners, officers or employees, or an enterprise involved in a merger, change of control or acquisition, it judges the registrant unable to properly put a heavy vehicle into circulation or operate one, so the people behind the business matter to the record, not only the corporation.

The safety grade and what a sale can trigger

The Commission assigns each registrant one of three safety grades: satisfactory, conditional or unsatisfactory. A conditional grade means the right to put a vehicle into circulation or operate it carries particular conditions. An unsatisfactory grade prohibits the registrant from doing so. The Act also says that a registrant with a conditional or unsatisfactory grade cannot transfer or otherwise dispose of the heavy vehicles registered in its name without the Commission’s consent, and the Commission must refuse consent if it considers the transfer is meant to defeat the administrative measure imposed. The same rule applies to an owner or operator under Commission investigation for trying to evade the Act, and to one whose file is before the Commission for an administrative measure. The regulation provides for a “not audited” notation beside a satisfactory grade, so ask whether the seller’s grade carries it. In a merger, a change of control or the acquisition of an enterprise by a registered owner or operator, the Commission may require any information it considers necessary about the past road-safety conduct of the people who operated or controlled that enterprise.

Bulk trucking and other registers

Quebec’s Transport Act separately has the Commission keep a bulk trucking register, listing heavy-vehicle operators covered in a public market by a stipulation-for-another clause for the benefit of small bulk trucking businesses. If the target hauls bulk materials, ask whether it is entered there and what that entry depends on. The Transport Act says that, subject to striking off, an entry under section 47.10, which covers operators that on 31 December 1999 were authorized to carry the bulk materials that section names, is transferable by the Commission on the application of the transferor and the transferee, while an entry under section 47.11 for an operator whose principal establishment is outside Quebec is not transferable.

What to ask the seller for

Ask for records showing the register as it stands, and have a Quebec lawyer read them with the Act and its regulation. Useful requests include:

• The seller’s current register entry as owner, operator or both, showing the safety grade, any conditions attached to a conditional grade and any suspension.
• Proof that the directors’ names and addresses, the registration update and the prescribed fees are current with the Commission.
• Records of fines under the Act, the Transport Act and the Highway Safety Code, with evidence that those not under appeal are paid.
• The seller’s registration under the Act respecting the legal publicity of enterprises, if the law requires it for this business.
• Any Commission correspondence about conditions, audits or information requests concerning the people who ran or controlled the business.

Browse trucking companies for sale to see how sellers describe these businesses, then check each claim against the register.