Written by: Talia Bernbaum

Incorporating an entity comes with a lot of considerations, whether it is your first venture or the latest in a string of business pursuits. Certain aspects of incorporation have become less encumbered, as of late, making incorporating a company in Alberta more desirable, especially for those thinking of operating a business from afar.

Prior to recent amendments, the applicable legislation required that the board of directors for Alberta business corporations be comprised of at least 25% resident Canadians. Similarly, non-profit companies required a board comprised of at least 50% resident Albertans.  This meant individuals living and running their Alberta businesses from abroad had to add resident Canadians or Albertans, as applicable, to their board.  If the presence of an individual on the board was merely to satisfy resident requirements, issues could arise; as such individuals are often less intimately familiar or invested in the corporation. This, in turn, lead to many entities putting in place complex shareholder agreements, to satisfy residence requirements, but restrict directors control over the entity, instead putting the power in the hands of shareholders.   The residency requirements have now been removed for Alberta corporations and non-profits, by the Red Tape Reduction Implementation Act, 2020, SA 2020, c 25, allowing boards of directors to operate without the appointment of Canadians or Albertans. This not only allows new entities to select their directors unrestricted by residency, but also allows existing entities to critically re-assess their board and decide whether changes should be instituted.

Given that a residency requirement no longer exists, all Alberta business corporations and non-profit companies must appoint an “Agent for Service” who is a resident Albertan. The name and address of the Agent for Service must be registered with Alberta Corporate Registry. The Agent for Service is a valid person for service of legal documents within Alberta. Our office is pleased to provide this service to our clients, as part of our role maintaining minute books and acting as the corporation’s or non-profit’s Registered Office.

We look forward to working through the nuanced process of incorporation with our new and existing clients.