The Tara Corporation
The majority of the firm’s clients are US-based trucking and bus companies. Unfortunately, all American corporations carrying on business in Ontario -and trucking to or from this province constitutes "carrying on business" for purposes of this Act- are obliged to register as foreign corporations under the Extra-Provincial Corporations Act. We have confirmed this with officials at the MGS Companies Branch and their Legal Department. This is a fairly simple matter but there are still a couple of reasons for making sure this is done fairly soon. Firstly, there is the chance the company might be charged. This is unlikely but the fine can be as high as $25,000 so it isn't worth taking the risk (especially now). Secondly, the company cannot maintain or initiate an action in an Ontario court (for example, against a customer, supplier or other driver) unless it is properly registered or first obtains the leave of the Court. (See the decision of the Ontario Court General Division in Success International Inc. v Environmental Export International of Canada Inc. [1995], 41 CPC [3d] 244.)
Consequently, we do have to make sure our clients are in compliance with this regulatory requirement and if you are not properly registered we urge you to contact us as soon as possible.
The good news is that it is not a complicated or expensive process. It is simply a question of executing two copies of the "Application for Extra-Provincial Licence" form and the "Appointment of Agent" forms and seeing to their filing with the Ministry of Consumer and Business Services- Companies Branch. These documents must be accompanied by an original and current Certificate of Good Standing or Certificate of Status from the applicant’s home jurisdiction making reference to the company's date of incorporation and just confirming that it has not been dissolved for non-payment of taxes or any other reason. We also have to obtain and file a NUANS or name-search report showing that the applicant’s name is available for registration in Ontario. The total cost for this registration – including the $330.00 filing fee and the $59.09 name search cost- is usually only about $800.00.
This registration as a foreign corporation under this Act does not expose a company to Ontario taxes provided they do not maintain any employees or a place of business in this jurisdiction. Registered companies may receive a request for a CT-23 Tax Return but those go out automatically from the Ministry of Finance Corporations Tax Branch computers. We just send the Ministry of Finance a note explaining why the company is EFF (exempt from filing) when we get that request.
The process is even simpler – and cheaper - for an LLC. They only have to register under our Business Names Act. Similarly, companies incorporated in other Canadian provinces need only to file under the Corporations Information Act. Total costs in both those cases would only be in the range of $600.00.
We have incorporated a company - The Tara Corporation - to act as registered agent-for-service as required for our “foreign” clients. Tara renders an account each year for acting in this capacity and the annual fee is $150.00 (USD). We are advised that some other Toronto firms are charging between $750.00 and $990.00 for this service but we realize that this has been a challenging time for many of our trucking clients. We will continue to work to keep our costs down and our fees reasonable. Our goal, as always, is to represent our clients’ interests as effectively, efficiently and economically as possible.
Consequently, we do have to make sure our clients are in compliance with this regulatory requirement and if you are not properly registered we urge you to contact us as soon as possible.
The good news is that it is not a complicated or expensive process. It is simply a question of executing two copies of the "Application for Extra-Provincial Licence" form and the "Appointment of Agent" forms and seeing to their filing with the Ministry of Consumer and Business Services- Companies Branch. These documents must be accompanied by an original and current Certificate of Good Standing or Certificate of Status from the applicant’s home jurisdiction making reference to the company's date of incorporation and just confirming that it has not been dissolved for non-payment of taxes or any other reason. We also have to obtain and file a NUANS or name-search report showing that the applicant’s name is available for registration in Ontario. The total cost for this registration – including the $330.00 filing fee and the $59.09 name search cost- is usually only about $800.00.
This registration as a foreign corporation under this Act does not expose a company to Ontario taxes provided they do not maintain any employees or a place of business in this jurisdiction. Registered companies may receive a request for a CT-23 Tax Return but those go out automatically from the Ministry of Finance Corporations Tax Branch computers. We just send the Ministry of Finance a note explaining why the company is EFF (exempt from filing) when we get that request.
The process is even simpler – and cheaper - for an LLC. They only have to register under our Business Names Act. Similarly, companies incorporated in other Canadian provinces need only to file under the Corporations Information Act. Total costs in both those cases would only be in the range of $600.00.
We have incorporated a company - The Tara Corporation - to act as registered agent-for-service as required for our “foreign” clients. Tara renders an account each year for acting in this capacity and the annual fee is $150.00 (USD). We are advised that some other Toronto firms are charging between $750.00 and $990.00 for this service but we realize that this has been a challenging time for many of our trucking clients. We will continue to work to keep our costs down and our fees reasonable. Our goal, as always, is to represent our clients’ interests as effectively, efficiently and economically as possible.