Financial Administration Act (R.S.C., 1985, c. F-11)

Marginal note:Security interests

• 100 (1) Subject to subsection (2), no agent corporation, for the purposes of securing payment of a debt or performance of an obligation, shall charge, mortgage, hypothecate, cede and transfer, pledge or otherwise create an interest in or charge on any property held by the corporation.

• Marginal note:Exception

  (2) Subject to any terms and conditions set out in the designation, an agent corporation designated by the Minister may pledge any securities or cash that it holds, or give deposits, as security for the payment or performance of any obligation of the corporation arising out of any derivative that it enters into or guarantees for the management of financial risks.

Marginal note:Borrowing

• 101 (1) No agent corporation shall borrow money otherwise than from the Crown, unless the corporation is both

  • (a) empowered by an Act of Parliament to so borrow money; and

  • (b) specifically authorized by any Act of Parliament, including an appropriation Act, to so borrow money.

• Marginal note:Leases

  (2) Despite any regulations made under paragraph 127(4)(b), subsection (1) does not apply in respect of leases, as defined in the Handbook of the Chartered Professional Accountants of Canada, as amended from time to time.

Third Parties

Marginal note:Assertions

• 102 (1) A Crown corporation may not assert against a person dealing with the corporation or with any person who has acquired rights from the corporation that

  • (a) this Part or the regulations, the charter or by-laws of the corporation or any directive given to the corporation have not been complied with,

  • (b) a person held out by the corporation as a director, officer or agent of the corporation has not been duly appointed or has no authority to exercise the powers and perform the duties that are customary in the business or activity of the corporation or usual for such a director, officer or agent, or

  • (c) a document issued by any director, officer or agent of the corporation having apparent authority to issue the document is not valid or genuine by reason only that the director, officer or agent lacked actual authority to issue the document,

  except where the person has knowledge that the facts asserted are true.

• Marginal note:Certificate

  (2) A certificate stating that

  • (a) any particular transaction has been authorized by the Governor in Council pursuant to section 91 or 99, has or has not been directed by the Governor in Council pursuant to section 94 or has been approved by the Minister of Finance pursuant to subsection 127(3),

  • (b) any particular transaction is consistent with a corporate plan or any amendment thereto approved pursuant to section 122, or

  • (c) any particular capital expenditure or commitment to make a capital expenditure is included in a capital budget, an item in a capital budget or an amendment to a capital budget that has been approved pursuant to section 124

  and that is signed by the chairperson or chief executive officer of a Crown corporation is sufficient confirmation of the statement to any person, except where the person has knowledge to the contrary.

• Marginal note:Absence of authorization, direction or approval

  (3) The absence of any authorization, direction or approval referred to in subsection (2) does not affect any right or remedy otherwise available to any person, except where the person knows of such absence.

• Marginal note:Invalidity

  (4) No action of a Crown corporation, including a transfer of property, is invalid by reason only that the corporation was without the capacity or power to so act.

• Marginal note:No constructive notice

  (5) No person dealing with a Crown corporation or with any person who has acquired rights from a Crown corporation shall be deemed to have notice or knowledge of the contents of a document, other than an Act of Parliament or any instrument required to be published in the Canada Gazette pursuant to the Statutory Instruments Act, concerning the corporation by reason only that the document has been made public.

Application

Marginal note:Provision not applicable

103 Section 268 of the Canada Business Corporations Act does not apply to a parent Crown corporation.

Marginal note:Act not applicable

104 The Canada Corporations Act, chapter C-32 of the Revised Statutes of Canada, 1970, does not apply to a parent Crown corporation.

DIVISION IIDirectors and Officers

Interpretation

Marginal note:Definition of officer-director

104.1 In this Division, officer-director, in respect of a parent Crown corporation, means the chairperson and the chief executive officer of the corporation, by whatever name called.

Appointment

Marginal note:Appointment of directors

• 105 (1) Each director, other than an officer-director, of a parent Crown corporation shall be appointed by the appropriate Minister, with the approval of the Governor in Council, to hold office during pleasure for a term not exceeding four years that will ensure, as far as possible, the expiration in any one year of the terms of office of not more than one half of the directors of the corporation.

• Marginal note:Officer or employee not to be director

  (2) No officer or employee of a Crown corporation or any of its affiliates, other than the chief executive officer of a parent Crown corporation, shall be a director of the parent Crown corporation.

• Marginal note:Transitional provision

  (2.1) Any officer or employee of a Crown corporation or any of its affiliates, other than the chief executive officer of a parent Crown corporation, who was a director of the parent Crown corporation immediately before the day on which this subsection comes into force may continue as a director of that corporation for six months after that day or, if it is shorter, the remainder of his or her term.

• Marginal note:Re-appointment

  (3) A director of a parent Crown corporation is eligible for re-appointment on the expiration of his term of office.

• Marginal note:Continuation in office

  (4) Despite subsection (1), if a director of a parent Crown corporation is not appointed to take office on the expiration of the term of an incumbent director, other than an officer-director, the incumbent director continues in office until his or her successor is appointed.

• Marginal note:Appointment of officer-directors

  (5) Each officer-director of a parent Crown corporation shall be appointed by the Governor in Council to hold office during pleasure for such term as the Governor in Council considers appropriate.

• Marginal note:Consultation

  (6) Before an officer-director of a parent Crown corporation is appointed, the appropriate Minister shall consult the board of directors of the corporation with respect to the appointment.

• Marginal note:Appointment of subordinate officers

  (7) Subject to any other Act of Parliament that was in force on September 1, 1984, the board of directors of a parent Crown corporation is responsible for the appointment of officers of the corporation, other than officer-directors.

• Marginal note:Qualifications preserved

  (8) Nothing in this section is to be construed as empowering the appointment or re-appointment as a director or officer-director of a parent Crown corporation, or the continuation in office as a director of a parent Crown corporation, of any person who does not meet any qualifications for the appointment, re-appointment or continuation established by any other Act of Parliament.

• Marginal note:Exception

  (9) This section does not apply to an ex officio director or officer-director of a parent Crown corporation.

• (10) [Repealed, 1991, c. 24, s. 30]

Marginal note:Validity of acts

106 An act of a director, chairperson, chief executive officer or other officer of a parent Crown corporation is not invalid by reason only of an irregularity in his appointment or a defect in his qualifications.

Resignation

Marginal note:Resignation

• 107 (1) A resignation of a director, chairperson or chief executive officer of a parent Crown corporation becomes effective at the time the corporation receives a written resignation from him or at the time specified in the resignation, whichever is later.

• Marginal note:Copy of resignation

  (2) A parent Crown corporation shall send a copy of the resignation to the Clerk of the Privy Council within fifteen days after the parent Crown corporation receives it.

Remuneration

Marginal note:Remuneration

• 108 (1) The rate of any remuneration paid to a director, chairperson or chief executive officer of a parent Crown corporation for his services in respect of that office and, in the case of a chairperson or chief executive officer, any other office of the corporation or an affiliate thereof shall be fixed by the Governor in Council.

• Marginal note:Other benefits

  (2) Any benefits, other than remuneration, provided to a director, chairperson or chief executive officer of a parent Crown corporation for his services in respect of that office and, in the case of a chairperson or chief executive officer, any other office of the corporation or an affiliate thereof shall be fixed by the board of directors of the corporation in accordance with the regulations.

• Marginal note:Wholly-owned subsidiary

  (2.1) The rate of any remuneration paid to a director, chairperson or chief executive officer of a wholly-owned subsidiary who is not also an officer-director of the parent Crown corporation for the director’s, chairperson’s or officer’s services in respect of that subsidiary shall be fixed by the board of directors of the parent Crown corporation.

• Marginal note:Regulations

  (3) For the purposes of this section, the Governor in Council may make regulations

  • (a) defining the term remuneration; and

  • (b) respecting the provision and fixing of benefits, other than remuneration, to or for any director, chairperson or chief executive officer.

Management

Marginal note:Management

109 Subject to this Part, the board of directors of a Crown corporation is responsible for the management of the businesses, activities and other affairs of the corporation.

Marginal note:Resolution in lieu of meeting

• 110 (1) A resolution in writing, signed by all the directors of a Crown corporation entitled to vote on that resolution at a meeting of the board of directors or a committee of directors of the corporation is as valid as if it had been passed at a meeting of the board of directors or a committee of directors, as the case may be.

• Marginal note:Filing resolution

  (2) A copy of every resolution referred to in subsection (1) shall be kept with the minutes of the proceedings of the board of directors or committee of directors, as the case may be.

Marginal note:Dissent

• 111 (1) A director of a Crown corporation who is present at a meeting of the board of directors or a committee of directors of the corporation is deemed to have consented to any resolution passed or action taken at that meeting unless the director

  • (a) requests that written notice of his dissent be or written notice of his dissent is entered in the minutes of the meeting;

  • (b) gives written notice of his dissent to the secretary of the meeting before the meeting is adjourned; or

  • (c) sends written notice of his dissent by registered mail or delivers it to the head office of the corporation immediately after the meeting is adjourned.

• Marginal note:Loss of right of dissent

  (2) A director of a Crown corporation who votes for or consents to a resolution is not entitled to dissent in respect of that resolution pursuant to subsection (1).

Marginal note:Dissent of absent director

112 A director of a Crown corporation who was not present at a meeting of the board of directors or a committee of directors of the corporation at which a resolution was passed or action taken is deemed to have consented thereto unless within seven days after becoming aware of the resolution or action the director

• (a) causes written notice of his dissent to be placed with the minutes of the meeting; or

• (b) sends written notice of his dissent by registered mail or delivers it to the head office of the corporation.

Marginal note:Participation by telephone, etc.

113 A director of a Crown corporation may, subject to the by-laws of the corporation, participate in a meeting of the board of directors or a committee of directors of the corporation by means of such telephone or other communications facilities as permit all persons participating in the meeting to hear each other, and a director participating in such a meeting by such means is deemed for the purposes of this Part to be present at the meeting.

Marginal note:Public meeting

• 113.1 (1) The board of directors of a parent Crown corporation shall hold a public meeting within 18 months after the day on which the board holds its first meeting or, if it is later, the day on which this section comes into force and, subsequently, within 15 months after the day on which the last preceding public meeting was held.

• Marginal note:By-laws

  (2) The meeting shall be held in Canada in the manner provided for in the by-laws or, if no manner is provided for, in the manner determined by the board of directors.

• Marginal note:Notice of meeting

  (3) The corporation shall publish a notice of the meeting at least 30 days before the day on which the meeting is to be held. The notice shall indicate the location, if any, and the date and time of the meeting, the means of participating in the meeting and how copies of the corporation’s most recent annual report may be obtained.

• Marginal note:Director and chief executive officer to attend

  (4) One or more directors of the corporation and its chief executive officer, whether or not he or she is a director of the corporation, shall participate in the meeting to answer questions from the public.