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Business Corporations Act
Loi sur les sociétés par actions

ONTARIO REGULATION 665/05

Health Profession Corporations

Consolidation Period: From December 12, 2014 to the e-Laws currency date.

Last amendment: O. Reg. 263/14.

This Regulation is made in English only.

CONTENTS

1.

Definitions

2.

Physician corporations

3.

Dentist corporations

Definitions

1. In this Regulation,

“child”, in relation to a shareholder of a health profession corporation, includes a person whom the shareholder has demonstrated a settled intention to treat as a child of his or her family, except under an arrangement where the child is placed for valuable consideration in a foster home by a person having lawful custody;

“family member” means, in relation to a shareholder of a health profession corporation, the shareholder’s spouse, child or parent;

“dentist corporation” means a health profession corporation that holds a certificate of authorization issued by the Royal College of Dental Surgeons of Ontario under the Regulated Health Professions Act, 1991 or under Schedule 2 to that Act;

“parent”, in relation to a shareholder of a health profession corporation, includes a person who has demonstrated a settled intention to treat the shareholder as a child of his or her family, except under an arrangement where the child is placed for valuable consideration in a foster home by a person having lawful custody;

“physician corporation” means a health profession corporation that holds a certificate of authorization issued by the College of Physicians and Surgeons of Ontario under the Regulated Health Professions Act, 1991 or under Schedule 2 to that Act;

“voting dentist shareholder” means, in relation to a dentist corporation, a member of the Royal College of Dental Surgeons of Ontario who owns voting shares of the corporation;

“voting physician shareholder” means, in relation to a physician corporation, a member of the College of Physicians and Surgeons of Ontario who owns voting shares of the corporation.  O. Reg. 665/05, s. 1; O. Reg. 263/14, s. 1.

Physician corporations

2. (1) A physician corporation is exempt from the application of paragraph 1 of subsection 3.2 (2) of the Act and, in lieu of that paragraph, the following rules apply:

1. Each issued and outstanding voting share of the corporation shall be legally and beneficially owned, directly or indirectly, by a member of the College of Physicians and Surgeons of Ontario.

2. Each issued and outstanding non-voting share of the corporation shall be owned in one of the following ways:

i. It shall be legally and beneficially owned, directly or indirectly, by a member of the College of Physicians and Surgeons of Ontario.

ii. It shall be legally and beneficially owned, directly or indirectly, by a family member of a voting physician shareholder.

iii. It shall be owned legally by one or more individuals, as trustees, in trust for one or more children of a voting physician shareholder who are minors, as beneficiaries.  O. Reg. 665/05, s. 2 (1).

(2) A physician corporation and its directors and officers are exempt from the application of paragraph 2 of subsection 3.2 (2) of the Act and, in lieu of that paragraph, the following rule applies:

1. All officers and directors of the corporation shall be shareholders of the corporation who are members of the College of Physicians and Surgeons of Ontario.  O. Reg. 665/05, s. 2 (2).

(3) A physician corporation is exempt from the application of subsection 3.2 (4) of the Act and, in lieu of that subsection, the following rule applies:

1. An agreement or proxy that vests the right to vote the rights attached to a voting share of a physician corporation in a person other than a shareholder of the corporation who is a member of the College of Physicians and Surgeons of Ontario is void.  O. Reg. 665/05, s. 2 (3).

(4) A physician corporation and its shareholders are exempt from the application of subsection 3.2 (5) of the Act and, in lieu of that subsection, the following rule applies:

1. A unanimous shareholder agreement in respect of a physician corporation is void unless each voting shareholder of the corporation is a member of the College of Physicians and Surgeons of Ontario and each non-voting shareholder of the corporation is,

i. a member of the College of Physicians and Surgeons of Ontario,

ii. a family member of a voting physician shareholder, or

iii. a trustee under a trust described in subparagraph 2 iii of subsection 2 (1).  O. Reg. 665/05, s. 2 (4).

(5) A non-voting shareholder of a physician corporation who is not a member of the College of Physicians and Surgeons of Ontario is exempt from the application of subsections 3.4 (2), (4) and (6) of the Act.  O. Reg. 665/05, s. 2 (5).

(6) A physician corporation, its shareholders and its directors and officers are exempt from the application of subsection 108 (5) of the Act and, in lieu of that subsection, the following rule applies:

1. A shareholder of a physician corporation who is a party to a unanimous shareholder agreement in respect of the corporation and who is a member of the College of Physicians and Surgeons of Ontario has all the rights, powers, duties and liabilities, whether arising under this Act or otherwise, of a director of the corporation to the extent that the agreement restricts the discretion or powers of the directors to manage or supervise the management of the business and affairs of the corporation, and the directors are thereby relieved of their duties and liabilities, including any liabilities under section 131 of the Act, to the same extent.  O. Reg. 665/05, s. 2 (6).

Dentist corporations

3. (1) A dentist corporation is exempt from the application of paragraph 1 of subsection 3.2 (2) of the Act and, in lieu of that paragraph, the following rules apply:

1. Each issued and outstanding voting share of the corporation shall be legally and beneficially owned, directly or indirectly, by a member of Royal College of Dental Surgeons of Ontario.

2. Each issued and outstanding non-voting share of the corporation shall be owned in one of the following ways:

i. It shall be legally and beneficially owned, directly or indirectly, by a member of the Royal College of Dental Surgeons of Ontario.

ii. It shall be legally and beneficially owned, directly or indirectly, by a family member of a voting dentist shareholder.

iii. It shall be owned legally by one or more individuals, as trustees, in trust for one or more children of a voting dentist shareholder who are minors, as beneficiaries.  O. Reg. 665/05, s. 3 (1).

(2) A dentist corporation and its directors and officers are exempt from the application of paragraph 2 of subsection 3.2 (2) of the Act and, in lieu of that paragraph, the following rule applies:

1. All officers and directors of the corporation shall be shareholders of the corporation who are members of the Royal College of Dental Surgeons of Ontario.  O. Reg. 665/05, s. 3 (2).

(3) A dentist corporation is exempt from the application of subsection 3.2 (4) of the Act and, in lieu of that subsection, the following rule applies:

1. An agreement or proxy that vests the right to vote the rights attached to a voting share of a dentist corporation in a person other than a shareholder of the corporation who is a member of the Royal College of Dental Surgeons of Ontario is void.  O. Reg. 665/05, s. 3 (3).

(4) A dentist corporation and its shareholders are exempt from the application of subsection 3.2 (5) of the Act and, in lieu of that subsection, the following rule applies:

1. A unanimous shareholder agreement in respect of a dentist corporation is void unless each voting shareholder of the corporation is a member of the Royal College of Dental Surgeons of Ontario and each non-voting shareholder of the corporation is,

i. a member of the Royal College of Dental Surgeons of Ontario,

ii. a family member of a voting dentist shareholder, or

iii. a trustee under a trust described in subparagraph 2 iii of subsection 3 (1).  O. Reg. 665/05, s. 3 (4).

(5) A non-voting shareholder of a dentist corporation who is not a member of the Royal College of Dental Surgeons of Ontario is exempt from the application of subsections 3.4 (2), (4) and (6) of the Act.  O. Reg. 665/05, s. 3 (5).

(6) A dentist corporation, its shareholders and its directors and officers are exempt from the application of subsection 108 (5) of the Act and, in lieu of that subsection, the following rule applies:

1. A shareholder of a dentist corporation who is a party to a unanimous shareholder agreement in respect of the corporation and who is a member of the Royal College of Dental Surgeons of Ontario has all the rights, powers, duties and liabilities, whether arising under this Act or otherwise, of a director of the corporation to the extent that the agreement restricts the discretion or powers of the directors to manage or supervise the management of the business and affairs of the corporation, and the directors are thereby relieved of their duties and liabilities, including any liabilities under section 131 of the Act, to the same extent.  O. Reg. 665/05, s. 3 (6).

4. Omitted (provides for coming into force of provisions of this Regulation).  O. Reg. 665/05, s. 4.