Bill C-15

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Royal Assent

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1991, c. 47	INSURANCE COMPANIES ACT
	*66. (1) The definitions ``provincial company'' and ``regulatory capital'' in subsection 2(1) of the Insurance Companies Act* are replaced by the following:**
``provincial company'' « société provinciale »	``provincial company'' means, subject to subsection (1.1),
	(a) The Maritime Life Assurance Company,
	(b) Antigonish Farmers' Mutual Fire Insurance Company,
	(c) Clare Mutual Insurance Company,
	(d) The Halifax Insurance Company, or
	(e) Pictou County Farmers' Mutual Fire Insurance Company,
	or, if the name of such company is changed, includes the successor company by its new name;
``regulatory capital'' « capital réglementai- re »	``regulatory capital'', in respect of a company, society or provincial company, has the meaning given that expression by the regulations;
	(2) Section 2 of the Act is amended by adding the following after subsection (1):
Provincial company status	(1.1) A company referred to in the definition ``provincial company'' in subsection (1) ceases to be a provincial company for the purposes of this Act if the order made by the Superintendent under subsection 657(1) approving the commencement and carrying on of business by the company is revoked.
	67. Subsection 42(1) of the Act is replaced by the following:
Prohibited names	42. (1) A company or society may not be incorporated under this Act with a name
	(a) that is prohibited by an Act of Parliament;
	(b) that is, in the opinion of the Superintendent, deceptively misdescriptive;
	(c) that is the same as or, in the opinion of the Superintendent, confusingly similar to any existing
	(i) trade-mark or trade name, or
	(ii) corporate name of a body corporate,
	except where the trade-mark or trade name is being changed or the body corporate is being dissolved or is changing its corporate name and consent to the use of the trade-mark, trade name or corporate name is signified to the Superintendent in such manner as the Superintendent may require;
	(d) that is the same as or, in the opinion of the Superintendent, confusingly similar to the known name under or by which any entity carries on business or is identified; or
	(e) that is reserved under section 45 for another company or society or a proposed company or society.
	68. Section 43 of the Act is replaced by the following:
Affiliated company or society	43. Notwithstanding section 42, a company or society that is affiliated, within the meaning of subsection 6(2), with another entity may, with the consent of that entity and the approval in writing of the Superintendent, be incorporated with, or change its name to, substantially the same name as that of the affiliated entity.
	69. Subsection 44(4) of the Act is replaced by the following:
Directions	(4) Where a company or society is carrying on business under or identifying itself by a name other than its corporate name, the Superintendent may, by order, direct the company or society not to use that other name if the Superintendent is of the opinion that that other name is a name referred to in any of paragraphs 42(1)(a) to (e).
	70. Sections 46 to 48 of the Act are replaced by the following:
Directing change of name	46. (1) If through inadvertence or otherwise a company or society
	(a) comes into existence or is continued with a name, or
	(b) on an application to change its name, is granted a name
	that is prohibited by section 42, the Superintendent may, by order, direct the company or society to change its name and the company or society shall comply with that direction.
Revoking name	(2) Where a company or society has been directed under subsection (1) to change its name and has not, within sixty days after the service of the direction, changed its name to a name that is not prohibited by this Act, the Superintendent may revoke the name of the company or society and assign to it a name and, until changed in accordance with subsection 224(1), the name of the company or society is thereafter the name so assigned.
Restriction on use of name	47. (1) No entity incorporated or formed by or under an Act of Parliament shall use the word ``assurance'', ``assurances'', ``insurance'' or ``lifeco'' or any word or words of import equivalent to any of those words in its name.
Exceptions	(2) Subsection (1) does not apply to
	(a) a company or society;
	(b) an entity the business of which is not financial activities;
	(c) an entity that is primarily engaged in insurance brokerage or insurance agency services; or
	(d) an entity that was, on the day immediately preceding the day on which that subsection comes into force, using the word ``assurance'', ``assurances'', ``insurance'' or ``lifeco'' or any word or words of import equivalent to any of those words in its name.
Subsidiaries	48. Notwithstanding subsection 47(1), a subsidiary of a company or society, may, with the approval in writing of the Superintendent, use the word ``assurance'', ``assurances'', ``insurance'' or ``lifeco'' or any word or words of import equivalent to any of those words in its name.
Definition of ``reserved name''	48.1 (1) In this section, ``reserved name'' means a name that includes as part thereof the word ``assurance'', ``assurances'', ``insurance'', ``lifeco'', ``fiduciaire'', ``fiduciary'', ``fiducie'', ``trust'', ``trustco'', ``loan'', ``loanco'' or ``prêt'' or any word or words of import equivalent to any of those words.
Termination of control required in certain cases	(2) No person, other than a financial institution, who
	(a) is carrying on business in Canada under a reserved name, and
	(b) has control or acquires control of a company,
	shall control the company on the later of
	(c) one year after this section comes into force, and
	(d) one year after the date of acquisition of the control.
Prohibition	(3) No person, other than a financial institution, who
	(a) controls an entity that is not a financial institution that carries on business in Canada under a reserved name, and
	(b) has control or acquires control of a company,
	shall control the company on the later of
	(c) one year after this section comes into force, and
	(d) one year after the date of the acquisition of the control.
Continuing control prohibited	(4) Notwithstanding subsection (3), where a financial institution controls an entity that
	(a) is not a financial institution,
	(b) carries on business in Canada under a reserved name, and
	(c) has control or acquires control of a company,
	the entity shall not control the company on the later of
	(d) one year after this section comes into force, and
	(e) one year after the date on which the entity acquires control of the company.
Exceptions	(5) Subsections (2) to (4) do not apply with respect to a person or entity that was carrying on business in Canada under a reserved name on the day immediately preceding the day on which those subsections come into force.
	71. Subsections 59(2) to (6) of the Act are repealed.
	71.1 Paragraph 92(1)(a) of the Act is replaced by the following:

	(a) a restriction on its transfer except a constraint under any provision of Part VII other than section 427, or
	72. (1) Paragraph 147(5)(h) of the Act is amended by adding the word ``or'' at the end of subparagraph (i) and by repealing subparagraph (iii).
	(2) Subsection 147(5) of the Act is amended by striking out the word ``or'' at the end of paragraph (g) and by adding the following after paragraph (h):
	(i) in the case of a proposal submitted by a policyholder or a shareholder of a mutual company, the proposal would result in the mutual company being converted into a company with common shares.
	73. The Act is amended by adding the following after section 170:
Affiliated director determina- tion	170.1 (1) Notwithstanding section 170, the Superintendent may determine that a particular director is affiliated with a company for the purposes of this Act if, in the opinion of the Superintendent, the director has a significant or sufficient commercial, business or financial relationship with the company or with an affiliate of the company to the extent that the relationship can be construed as being material to the director and can reasonably be expected to affect the exercise of the director's best judgment.
Notification by Superin- tendent	(2) A determination by the Superintendent under subsection (1)
	(a) becomes effective on the day of the next annual meeting of the shareholders and policyholders unless a notice in writing by the Superintendent revoking the determination is received by the company prior to that day; and
	(b) ceases to be in effect on the day of the next annual meeting of the shareholders and policyholders after a notice in writing by the Superintendent revoking the determination is received by the company.
	74. Section 173 of the Act is amended by adding the following after subsection (4):
Mutual company	(4.1) Where the shareholders of a mutual company are entitled to elect one or more directors of the company, not more than one third of the directors may be elected by the shareholders.
	74.1 Subsection 176(2) of the Act is replaced by the following:
Mandatory cumulative voting	(2) Where the aggregate of the voting shares beneficially owned by a person and any entities controlled by the person carries more than 10 per cent of the voting rights attached to all the outstanding voting shares of a company, the directors to be elected by shareholders shall be elected by cumulative voting.
	75. Subsections 302(2) to (4) of the Act are repealed.
	76. The Act is amended by adding the following after section 359:
Officer precluded	359.1 (1) The chief executive officer or chief operating officer or a person performing like functions may not be appointed or hold the position of actuary of a company unless authorized in writing by the Superintendent.
Duration of authorization	(2) An authorization under subsection (1) ceases to be in effect on the day specified therein but not later than the day that is six months after it is issued, and a person appointed or holding the position of actuary pursuant to the authorization shall not hold that position after that day.
Chief financial officer	359.2 (1) The chief financial officer or a person performing like functions may not be appointed as or hold the position of actuary of a company unless
	(a) the audit committee of the company has provided the Superintendent with a written statement indicating that it is satisfied that the duties of both positions in the company will be adequately performed and that the actuarial duties will be performed in an independent manner; and
	(b) the appointment or holding of the position is authorized by the Superintendent.
Authoriza- tion	(2) An authorization under paragraph (1)(b) may contain limitations and conditions, including a limitation on the time during which the person referred to in the authorization may hold the position of actuary of the company.
Termination of holding of position	(3) A person holding the position of actuary pursuant to an authorization under paragraph (1)(b) shall not hold that position after the time limit referred to in subsection (2).
	77. The Act is amended by adding the following after section 365:
Special valuation	365.1 (1) Where the Superintendent is of the opinion that an actuary, other than the actuary of the company, should value the matters referred to in paragraph 365(1)(a) or (b), the Superintendent may appoint a person qualified under section 358 or 359 to carry out the valuation.
Expenses payable by company	(2) The expenses incurred in carrying out a valuation under subsection (1) are payable by the company on being approved in writing by the Superintendent.
	77.1 The Act is amended by adding the following after section 426:
Mutual company constraints	427. Subject to such regulations as the Governor in Council may make for the purpose, a mutual company may by by-law impose, change or remove restrictions on the issue, transfer or ownership of shares of any class issued under section 63, in order to prevent a person from having a significant interest in that class.
	78. The portion of subsection 432(1) of the Act before paragraph (a) is replaced by the following:
Disposition of shareholdings	432. (1) Where, with respect to any company, a person contravenes section 48.1 or 407 or fails to comply with an undertaking referred to in subsection 416(2) or with any terms and conditions imposed pursuant to section 421, the Minister may, if the Minister deems it in the public interest to do so, by order,
	79. Section 449 of the Act is amended by adding the following after subsection (1):

Bill C-15

INSURANCE COMPANIES ACT