Bill C-82

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	(5) Section 554 of the Act is amended by adding the following after subsection (2):
Approval for indirect investments	(2.1) For the purpose of paragraph (2)(a), if a society obtains the prior written approval of the Minister for the society to acquire or increase a substantial investment in a body corporate that is engaged in an insurance business and through that acquisition or increase the society indirectly acquires or increases a substantial investment in another body corporate referred to in any of paragraphs (1)(b) to (i), and that indirect acquisition or increase is disclosed in writing to the Minister before that approval is obtained, the society is deemed to have obtained the prior written approval of the Minister for that indirect acquisition or increase.
Other permitted substantial investments	(2.2) Subject to any terms and conditions that may be imposed by the Minister, a society may, with the approval of the Minister, acquire or increase a substantial investment in an entity that is not a body corporate if the activities of the entity are the same as or substantially similar to those of a body corporate referred to in any of paragraphs (1)(b) to (i).
	(6) Subsection 554(4) of the Act is repealed.
	292. (1) The portion of subsection 558(1) of the Act after paragraph (d) is replaced by the following:
	but the society shall, within five years after acquiring the shares or ownership interests, do all things necessary to ensure that the society does not have a substantial investment in any entity referred to in paragraphs (a) to (d).
	(2) Subsections 558(2) and (3) of the Act are replaced by the following:
Transitional	(2) Notwithstanding subsection (1), where on September 27, 1990 a former-Act society had an investment in an entity that is a substantial investment within the meaning of section 10 and the society later increases that substantial investment by way of an investment made under subsection (1), the society shall, within five years after increasing the substantial investment, do all things necessary to ensure that its substantial investment in the entity is no greater than it was on September 27, 1990.
Extension	(3) The Superintendent may, in the case of any particular society, extend the period of five years referred to in subsections (1) and (2) for such further period or periods, and on such terms and conditions, as the Superintendent considers necessary.
Exception	(4) Where under subsection (1) a society acquires a substantial investment in an entity that it would otherwise be permitted to acquire or increase under section 554, the society may continue to hold the substantial investment if the approval in writing of the Minister is obtained before the end of the period referred to in subsection (1) or (2), including any extension of it granted under subsection (3).
	293. Subsections 559(2) to (4) of the Act are replaced by the following:
Disposition	(2) Where a society acquires a substantial investment in an entity through the realization of a security interest held by the society, the society shall, within five years after the day on which the substantial investment is acquired, do all things necessary to ensure that the society no longer has a substantial investment in the entity.
Transitional	(3) Notwithstanding subsection (2), where on September 27, 1990 a former-Act society had an investment in an entity that is a substantial investment within the meaning of section 10 and the society later increases that substantial investment by way of the realization of a security interest pursuant to subsection (1), the society shall, within five years after increasing the substantial investment, do all things necessary to ensure that its substantial investment in the entity is no greater than it was on September 27, 1990.
Extension	(4) The Superintendent may, in the case of any particular society, extend the period of five years referred to in subsections (2) and (3) for such further period or periods, and on such terms and conditions, as the Superintendent considers necessary.
	294. Paragraph 561(1)(b) of the Act is replaced by the following:
	(b) for a period of five years after the day on which the loan, investment or interest was acquired, in the case of a loan, investment or interest, other than an interest in real property.
1993, c. 34, s. 84(F)	295. Paragraph 565(d) of the Act is replaced by the following:

	(d) all ownership interests in unincorporated entities, other than ownership interests acquired under section 554 in entities in which the society has a substantial investment,
	296. Subparagraph 566(a)(ii) of the Act is replaced by the following:
	(ii) ownership interests in an unincorporated entity, other than ownership interests acquired under section 554 in an entity in which the society has a substantial investment, or
	297. Section 568 of the Act is renumbered as subsection 568(1) and is amended by adding the following:
Approved holding of investment	(2) The society may continue to hold the substantial investment after the end of the period referred to in subsection 557(1) or (2) that applies in respect of the investment, including any extension of the period granted under subsection 557(4), with the approval in writing of the Minister obtained before the end of that period or that extended period.
	298. The Act is amended by adding the following after section 570:
	Liquidation and Dissolution of a Society
	Interpretation
Definition of ``court''	570.01 In sections 570.02 to 570.3, ``court'' means a court having jurisdiction in the place where the society has its head office.
	Application
Application of sections 570.03 to 570.3	570.02 (1) Sections 570.03 to 570.3 do not apply to a society that is insolvent within the meaning of the Winding-up and Restructuring Act.
Staying proceedings on insolvency	(2) Any proceedings taken under sections 570.04 to 570.3 to dissolve or to liquidate and dissolve a society shall be stayed if the society is at any time found to be insolvent within the meaning of the Winding-up and Restructuring Act.
	Duty to Provide Information
Returns to Superin- tendent	570.03 A liquidator appointed under this Part to wind up the business of a society shall provide the Superintendent with such information relating to the business and affairs of the society as the Superintendent requires, in such form as the Superintendent requires.
	Simple Liquidation
No property and no liabilities	570.04 (1) A society that has no property and no liabilities may, if authorized by a special resolution or, if there are no members, by a resolution of the society's supreme governing body, apply to the Minister for letters patent dissolving the society.
Dissolution by letters patent	(2) Where the Minister has received an application under subsection (1) and is satisfied that all the circumstances so warrant, the Minister may issue letters patent dissolving the society.
Effect of letters patent	(3) A society in respect of which letters patent are issued under subsection (2) is dissolved and ceases to exist on the day stated in the letters patent.
Proposing liquidation	570.05 (1) The voluntary liquidation and dissolution of a society, other than a society referred to in subsection 570.04(1),
	(a) may be proposed by its supreme governing body; or
	(b) may be initiated by way of a proposal made in accordance with the society's by-laws by a member who is entitled to vote at a meeting of the society's members at which the proposal may be voted on.
Terms must be set out	(2) A notice of any meeting of members at which the voluntary liquidation and dissolution of a society is to be proposed shall set out the terms of the proposal.
Members' resolution	570.06 Where the voluntary liquidation and dissolution of a society is proposed, the society may apply to the Minister for letters patent dissolving the society if authorized by a special resolution.
Approval of Minister required	570.07 (1) No action directed toward the voluntary liquidation and dissolution of a society shall be taken by a society, other than as provided in sections 570.05 and 570.06, until an application made by the society under section 570.06 has been approved by the Minister.
Conditional approval	(2) If the Minister is satisfied, on the basis of an application made under section 570.06, that the circumstances warrant the voluntary liquidation and dissolution of a society, the Minister may approve the application.
Effect of approval	(3) If the Minister approves an application made under section 570.06 with respect to a society, the society shall not carry on business except to the extent necessary to complete its voluntary liquidation.
Liquidation process	(4) If the Minister approves an application made under section 570.06 with respect to a society, the society shall
	(a) cause notice of the approval to be sent to each known claimant, except members, against the society and to each known creditor of the society;
	(b) publish notice of the approval once a week for four consecutive weeks in the Canada Gazette and once a week for two consecutive weeks in one or more newspapers in general circulation in each province in which the company transacted any business within the preceding twelve months;
	(c) proceed to collect its property, dispose of property that is not to be distributed in kind to its members, discharge or provide for all its obligations and do all other acts required to liquidate its business; and
	(d) after giving the notice required under paragraphs (a) and (b) and adequately providing for the payment or discharge of all its obligations, distribute its remaining property, either in money or in kind, among its members according to their respective rights.
Dissolution instrument	570.08 (1) Unless a court has made an order in accordance with subsection 570.09(1), the Minister may, if satisfied that the society has complied with subsection 570.07(4) and that all the circumstances so warrant, issue letters patent dissolving the society.
Society dissolved	(2) A society in respect of which letters patent are issued under subsection (1) is dissolved and ceases to exist on the day stated in the letters patent.
	Court-supervised Liquidation
Application for court supervision	570.09 (1) The Superintendent or any interested person may, at any time during the liquidation of a society, apply to a court for an order for the continuance of the voluntary liquidation under the supervision of the court in accordance with this section and sections 570.1 to 570.21. On that application, the court may so order and make any further order it thinks fit.
Application to state reasons	(2) An application under subsection (1) to a court to supervise a voluntary liquidation shall state the reasons, verified by an affidavit of the applicant, why the court should supervise the liquidation.
Notice to Superin- tendent	(3) Where a person, other than the Superintendent, makes an application under subsection (1), the person shall give the Superintendent notice of the application and the Superintendent may appear and be heard in person or by counsel at the hearing of the application.
Court supervision	570.1 (1) If a court makes an order under subsection 570.09(1), the liquidation of the society shall continue under the supervision of the court.
Beginning of liquidation	(2) The supervision of the liquidation of a society by the court under an order made under subsection 570.09(1) begins on the day the order is made.
Powers of court	570.11 In connection with the liquidation and dissolution of a society, if the court is satisfied that the society is able to pay or adequately provide for the discharge of all its obligations and to make satisfactory arrangements for the protection of its policyholders, the court may make any order it thinks fit, including
	(a) an order to liquidate;
	(b) an order appointing a liquidator, with or without security, fixing a liquidator's remuneration and replacing a liquidator;
	(c) an order appointing inspectors or referees, specifying their powers, fixing their remuneration and replacing inspectors or referees;
	(d) an order determining the notice to be given to any interested person, or dispensing with notice to any person;
	(e) an order determining the validity of any claims made against the society;
	(f) an order, at any stage of the proceedings, restraining the directors and officers of the society from
	(i) exercising any of their powers, or
	(ii) collecting or receiving any debt or other property of the society, and from paying out or transferring any property of the society, except as permitted by the court;
	(g) an order determining and enforcing the duty or liability of any present or former director, officer or member
	(i) to the society, or
	(ii) for an obligation of the society;
	(h) an order approving the payment, satisfaction or compromise of claims against the society and the retention of assets for that purpose, and determining the adequacy of provisions for the payment, discharge or transfer of any obligation of the society, whether liquidated, unliquidated, future or contingent;
	(i) with the concurrence of the Superintendent, an order providing for the disposal or destruction of the documents, records or registers of the society;
	(j) on the application of a creditor, an inspector or the liquidator, an order giving directions on any matter arising in the liquidation;
	(k) after notice has been given to all interested parties, an order relieving the liquidator from any omission or default on such terms as the court thinks fit and confirming any act of the liquidator;
	(l) subject to sections 570.18 to 570.2, an order approving any proposed, interim or final distribution to members, if any, or to incorporators, in money or in kind;
	(m) an order disposing of any property belonging to creditors, members and incorporators who cannot be found;
	(n) on the application of any director, officer, member, incorporator or creditor or the liquidator,
	(i) an order staying the liquidation proceedings on such terms and conditions as the court thinks fit,
	(ii) an order continuing or discontinuing the liquidation proceedings, or
	(iii) an order to the liquidator to restore to the society all of its remaining property; and
	(o) after the liquidator has rendered the liquidator's final account to the court, an order directing the society to apply to the Minister for letters patent dissolving the society.
Cessation of business and powers	570.12 (1) Where a court makes an order for the liquidation of a society,
	(a) the society continues in existence but shall cease to carry on business, except the business that is, in the opinion of the liquidator, required for an orderly liquidation; and
	(b) the powers of the directors and members, if any, are vested in the liquidator and cease to be vested in the directors or members, except as specifically authorized by the court.
Delegation by liquidator	(2) A liquidator may delegate any of the powers vested by paragraph (1)(b) to the directors or members, if any.
Appointment of liquidator	570.13 When making an order for the liquidation of a society or at any later time, the court may appoint any person, including a director, an officer or a member of the society or any other society, as liquidator of the society.
Vacancy in liquidator's office	570.14 Where an order for the liquidation of a society has been made and the office of liquidator is or becomes vacant, the property of the society is under the control of the court until the office of liquidator is filled.
Duties of liquidator	570.15 (1) A liquidator shall

Bill C-82

Liquidation and Dissolution of a Society