As we discussed in a previous blog, in August of this year, the Ontario government introduced two significant changes to the province’s business laws. It announced the coming into force of the Not-for-Profit Corporations Act, 2010, with substantial effects on the not-for-profit sector. These changes also heralded the creation of the online Ontario Business Registry (“OBR”), which aims to modernize the business filing system in Ontario by moving several essential corporate services online.
It has been a month since the Ontario Ministry of Government and Consumer Services opened the OBR. The government has reported that in the first 30 days, 120,000 transactions were processed using the new online system. This blog reviews the features of the new OBR, as well as reports of delays and costs caused by glitches in the new process.
Features of the Ontario Business Registry
Online Filing System
The Ontario Business Registry streamlines access for all organizations that are registered, incorporated, or licenced to carry on business in Ontario. Unlike the previous paper system, the OBR is accessible 24 hours a day, 365 days and facilitates more than 90 types of transactions, including the incorporation, amalgamation, and dissolution of existing businesses. Business registrations or filings that were previously submitted by mail or fax and took four to six weeks to process can now be completed online.
All corporations filing under the Business Corporations Act, the Business Names Act, the Corporations Act, the Not-For-Profit Corporations Act, the Corporations Information Act, the Extra-Provincial Corporations Act, the Partnerships Act, and the Limited Partnerships Act will be able to file under the OBR. Corporations already registered or incorporated in Ontario were automatically given a profile on the OBR when it launched.
As part of the new Ontario Business Registry system, the Ontario Corporations Information Act has been amended: annual return forms are no longer available for download from the Canada Revenue Agency (the “CRA”) website and, as of May 15, 2021, annual returns can also no longer be filed with the CRA. Corporations must now file their annual returns electronically using the OBR. A corporation that wants to file its annual return directly must register with the OBR by providing an official email address and receive a corporate access key. A registered intermediary, such as a law firm, can complete these and other required corporate findings on behalf of a corporation. By filing annual returns online, corporations can now keep all their filings in one place.
Company Keys and Business Numbers
Individuals who incorporate or register a new business directly with the Ontario Business Registry will be assigned a “company key.” The company key is a confidential passcode that may be shared with authorized representatives, such as legal counsel, to allow them to make profile changes and complete filings. Existing corporations can request a company key using the Request Form.
A company key is not be required if a corporation completes filings through a registered service provider since the registered service provider will have the authority to complete filings for the corporation.
In addition to the company key, a corporation may also be issued an Ontario Business Identification Number (“BIN”), a 9-digit number assigned by the Central Production and Verification Services Branch, Ontario Business Information System. The Ontario BIN is different from the federal business number issued by Canada Revenue Agency and can be found on a corporation’s Master Business License.
Integrating the OBR with the CRA is meant to enable the identification of a business or not-for-profit corporation by a single business number, allowing for a streamlined administrative process.
Law Firms Report “Significant Disruption,” “Significant Costs” Caused by Ontario Business Registry Glitches
While the Ontario Business Registry is just over a month old, users are already reporting problems using the system. The CBC and Toronto Star recently reported that users have said the OBR is negatively affecting business and is “having a chilling effect on doing business in Ontario in general.” In a letter to the Minister signed by sixteen law firms who represent hundreds of thousands of entities trying to carry on business in Ontario, the lawyers stated:
“The system shutdowns, technical glitches and substantive problems associated with the new [OBR] are causing significant disruption, delaying transactions and adding significant costs for businesses.
Given our collective OBR experiences to date, we have no confidence or assurances that year-end filings — the busiest time of the year for our law firms — can be completed without putting entire transactions at risk.”
The 16 law firms who signed the letter have said that they “are now recommending to their lawyers and clients that the creation or use of Ontario entities in corporate transactions be avoided if possible.” They said they were recommending registration with “federal entities or other provincial jurisdictions … in order to not jeopardize the successful completion of many year-end transactions.”
Contact Baker & Company in Toronto for Advice in Business Law Matters
At Baker & Company, we are passionate about business. Our corporate and commercial lawyers are here to assist with a wide range of corporate issues and provide tailored consultancy services to meet the unique needs of your business. Our skilled team of corporate lawyers is here to help your organization navigate the Ontario Business Registry and ensure your filings, including annual returns, are handled efficiently and effectively. To speak with a lawyer, contact us online or by phone at 416-777-0100.
