If you have read a couple of our other articles already, you know that we often compare a corporation to a robot person to help explain how it’s organized (with the hope that it will help people to see corporations in a different light).
Continuing with this analogy, this article will discuss Extra-Provincial registrations—what is it, who needs to do it, and how does it happen?
If a robot person functioned just as a corporation does, then it would only be able to live in the jurisdiction (province/territory) that it is registered in. So, if the robot is created in Ontario, it can’t just walk on over to Saskatchewan and start doing robot things over there. It will risk paying a fine or, worse, getting shut down.
A corporation can only do business in the jurisdiction that it is registered in. This may make you wonder, “Then why don’t I just register as a Federal company so I can do business across the country?” Unfortunately, it is not quite that simple. Even though incorporating your business federally is a great choice with many benefits—it’s not a ‘one-stop shop’ type of situation.
You must still register your company in every province where you plan to conduct business. For example: if you are based in Vancouver and decide to incorporate your business federally, you will still have to make sure you are registered as an extra-provincial company in British Columbia, as this is where your business’ registered office is located. If you then decide to expand your company to set up an office in Ontario, you will need to register as an extra-provincial company in Ontario, and so on. The good news is that your filing requirements are generally much less for your extra-provincial registrations than that of your home jurisdiction.
How do I know if I need to register as an extra-provincial company?
You need to register your business as an extra-provincial company in another province or territory if you are conducting business in that jurisdiction.
The definition of “conducting business” can vary from one province to the next, so you always want to check with the jurisdiction in which you plan to do business to confirm what is required. For example, “conducting business” in another jurisdiction might include:
- Having an address for your business in that jurisdiction (e.g., Your ice cream shop is incorporated in PEI, but you plan to expand and open up a shop in New Brunswick—you will need to register as an extra-provincial company there before you do that)
- Having a phone number in that jurisdiction that is used to carry on business
When do I need to Register as an Extra-Provincial Corporation?
If you incorporate federally, then you will immediately register as an extra-provincial corporation in whichever province or territory you are based in.
If you incorporate provincially, you don’t need to register as an extra-provincial corporation in any other province or territory until you plan to do business in that jurisdiction (so maybe never). Many businesses go their whole lives without ever registering as an extra-provincial corporation—an example could be your favourite neighbourhood café. But if you plan to do business across multiple jurisdictions, it’s important to know your corporate requirements before you start so that you can give your company the best chance at success.
With more registrations comes more paperwork and more things to keep track of. This is why getting support from a service provider, such as Tobuso, is a valuable investment—especially as there may be consequences for not properly registering your business or maintaining your minute book. Let us take some of that weight off your shoulders so that you can focus on what you do best—running your business.
Sources
https://www.ic.gc.ca/eic/site/cd-dgc.nsf/eng/cs04578.html
https://www.corporateonline.gov.bc.ca/WebHelp/overview_xp.htm
