Bank Act

Meaning of eligible votes

• 156.09 (1) In this section, eligible votes means the total number of votes that may be cast by or on behalf of shareholders on a vote of shareholders or a vote of holders of a class or series of shares, as the case may be, in respect of any particular matter, calculated without regard to subsection (2).

• Marginal note:Restriction

  (2) At a meeting of shareholders of a bank with equity of twelve billion dollars or more, no person and no entity controlled by any person may, in respect of any vote of shareholders or holders of any class or series of shares of the bank, cast votes in respect of any shares beneficially owned by the person or the entity that are, in aggregate, more than 20 per cent of the eligible votes that may be cast in respect of that vote.

• Marginal note:Exception — federal credit union

  (2.1) Subsection (2) does not apply in respect of a meeting of shareholders or members of a federal credit union.

• Marginal note:Proxyholders

  (3) No person who is a proxyholder for a person or for an entity controlled by a person may cast votes to which the proxy relates that the person or entity may not cast by reason of subsection (2).

• Marginal note:Exception

  (4) If a person is, with respect to a bank, a person referred to in subsection 375(1), subsections (2) and (3) do not apply with respect to votes cast by or on behalf of the person during any period that the person is entitled under section 375 to remain a major shareholder of the bank.

• Marginal note:Exception

  (5) Subsections (2) and (3) do not apply in respect of votes cast by or on behalf of any entity that controls the bank or any entity that is controlled by an entity that controls the bank.

• Marginal note:Exception

  (6) Subsection (2) does not apply in respect of a vote held under section 218.

• Marginal note:Validity of vote

  (7) A vote in respect of a particular matter is not invalid merely because a person voted contrary to subsection (2) or (3).

• Marginal note:Disposition of shareholdings

  (8) If, with respect to any bank, a person contravenes subsection (2) or (3), the Minister may, by order, direct the shareholder of the shares to which the contravention relates or any person controlled by that shareholder to dispose of any number of shares of the bank beneficially owned by any of those persons that the Minister specifies in the order, within the time specified in the order and in the proportion, if any, as between the shareholder and the persons controlled by that shareholder that is specified in the order.

• Marginal note:Restriction on voting rights

  (9) If the Minister makes an order under subsection (8), the person to whom the order relates may not, in person or by proxy, exercise any voting rights that are attached to shares of the bank beneficially owned by the person.

• Marginal note:Subsection (9) ceases to apply

  (10) Subsection (9) ceases to apply in respect of a person when the shares to which the order relates have been disposed of.

• Marginal note:Reliance on number in notice

  (11) For the purpose of this section, a person is entitled to rely on the number of eligible votes set out in a notice of a meeting under subsection 138(1.1).

• Marginal note:Designation of persons

  (12) For the purpose of this section, the Minister may, with respect to a particular bank, designate two or more persons who are parties to an agreement, commitment or understanding referred to in section 9 to be a single person.