The Business Corporations Act, the enabling legislation under which all profit corporations are set up, provides, in Section 19(1): "A corporation shall at all times have a registered office in Saskatchewan". The Act goes on to state, in Section 20, that not only must it have a registered office, but that certain corporate records of the corporation must be maintained at that registered office and are, in fact, accessible to shareholders and creditors of the corporation, their agents and representatives. Thankfully, most creditors do not realize that they have the right to examine the records of a corporation which is indebted to them!
In addition to acting as a registered office, the law firm attempts to ensure that the corporation acts in a manner consistent with the requirements of The Business Corporations Act.
The requirements of this Act include:
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The filing of a corporate Annual Return.
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The preparation and execution of Annual Minutes.
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Other requirements that do not occur annually but are occasionally required by statute. For example, in 1980 all corporations were required to register under the new Business Corporations Act, and numerous corporations were struck because the shareholders were unaware of this requirement. This necessitated a costly application for reinstatement.
The Annual Return is a document sent out on a yearly basis by the Corporations Branch. It must be completed and filed within the appropriate period of time, and the Province of Saskatchewan's annual fee paid. Failure to do so results in a corporation being struck off of the list of registered corporations in Saskatchewan. If a corporation ceases to be registered,
then it no longer has the authority to carry on business in Saskatchewan, or own land and other property in this province.
Without a registered office, in the course of day-to-day business, one can easily overlook the filing of the Annual Return. As a result, a corporation would be struck. The cost of reinstating a corporation is considerably more than the cost of filing the Annual Return.
The importance of Annual Minutes, and the way in which they may save the shareholders money, is often overlooked. The Annual Minutes are more than just a nuisance and the yearly recital of who the corporate officers, directors and shareholders are. Very importantly, the Annual Minutes are the way in which the corporation may save its shareholders money by, for instance, outlining the purchase or sale of assets out of the usual course of business, entering into or terminating large contracts, issuing of dividends and/or the taking or repayment of shareholders' loans. Particularly where dividends are concerned, there must be a record of the issuance of such dividends and it is in the Annual Minutes that this requirement is normally met. In the event a corporation is audited by The Canadian Customs & Revenue Agency, the record of issuance of dividends is extremely important. Shareholders of the corporation should attend at our office, on an annual basis, to execute the Annual Minutes so as to ensure that the corporate structure is up to date and subject to the scrutiny of the Canadian Customs & Revenue Agency.
