Today, the Government of Yukon introduced Bill No. 43, the Act to Amend the Business Corporations Act (2024), in the Yukon Legislative Assembly. These amendments are part of the Government of Yukon's efforts to participate in national and international efforts to safeguard against money laundering, tax evasion and other illegal activities.
Bill 43 meets the Government of Yukon goal of improving transparency, enhancing corporate governance, protecting market integrity and supporting sustainable economic growth.
The amendments would ensure Yukon corporations maintain a record of individuals with significant control over the corporation, commonly called "beneficial owners". These are people who own, control or direct 25 per cent or more of the total shares or voting rights, either individually or jointly with others, or who have control of the corporation.
Corporations would be compelled to make this information available on request by law enforcement, tax or regulatory authorities. Directors and shareholders would have access on request for corporate matters only, as would the Registrar of corporations to promote compliance with the Act.
In addition, the changes would strengthen a requirement for share certificates to state who the registered owner is. Any certificates in bearer form for shares or share purchase options would need to be replaced with certificates in registered form, so they specify the registered owner’s name.
These amendments arise from a 2017 agreement among Canadian finance Ministers to pursue amendments to territorial, provincial and federal corporate statutes to adopt beneficial ownership transparency and to harmonize rules across jurisdictions. The amendments in Bill 43 are similar to provisions now in effect in most provincial statutes and the first phase of amendments to the federal statute. They also align with equivalent rules in many countries and with international standards.
- The 2016 Panama Papers and other leaks highlighted how criminals were hiding behind opaque corporate structures to launder money, evade taxes and facilitate other crimes. International standards were updated, and many countries enacted equivalent rules.
- The amendments in Bill 43 are very similar to provisions in most provincial statutes and the first phase of federal amendments. They also align with standards set by the Financial Action Task Force, a body that leads global efforts against money laundering.
- The criteria for significant control are also coordinated with “know-your-client” rules in regulations under the federal Proceeds of Crime (Money Laundering) and Terrorist Financing Act. Under those rules, banks and other entities must verify the identity of corporate customers by obtaining the names of directors and the names and addresses of all those who own or control, directly or indirectly, 25 per cent or more of the shares.
- A share certificate in bearer form is owned by any person who possesses it. They are incompatible with ownership transparency since a corporation may be unaware who owns the shares until a person holding the certificate presents it to exercise a right.
- Three jurisdictions (federal, British Columbia and Quebec) enacted a second phase of changes for corporations to file their transparency records centrally with some information made publicly available. Officials in other jurisdictions, including the Yukon, participate with an intergovernmental working group to monitor those changes.
Jordan Owens
Cabinet Communications
867-332-0615
jordan.owens@yukon.ca
Bonnie Venton Ross
Communications, Community Services
867-332-5513
bonnie.ventonross@yukon.ca