Doing Business in Canada Setting Up & Operating a Canadian Subsidiary

Transcription

1 Doing Business in Canada Setting Up & Operating a Canadian Subsidiary Canada Food Day Zeist, The Netherlands - November 14, 2007 presented by Andrew Frei Dale & Lessmann LLP, Lawyers and Trade-Mark Agents

2 Table of Contents 1. How to get started 2. Food Industry Concerns 3. Conducting Business in Canada 2

3 Table of Contents 1. How to get started 1.1 Establishing a Corporation 1.2 Acquiring an Existing Business 1.3 Operational Considerations 2. Food Legislation 3. Conducting Business in Canada 3

4 1. How to get started Establishing a Corporation Legal Entities Corporation Branch General or Limited Partnership Joint Venture not a legal entity 4

5 1. How to get started Establishing a Corporation What is a Corporation? Public versus Private Corporation Capital: $1, not

6 1. How to get started Establishing a Corporation Who are the players in a Corporation? Shareholders Liability limited to investment In Private Corporation: No public disclosure of financial information No public disclosure of shareholder identity (except Alberta and Quebec) No legal shareholder residency requirement, but tax rates double if foreign control 6

7 1. How to get started Establishing a Corporation Who are the players in a Corporation? Directors Director directeur, but commissaris Personal liability: under legislation for torts (onrechtmatige daden) Overall business direction and policy 7

8 1. How to get started Establishing a Corporation Who are the players in a Corporation? Officers President / CEO = directeur Day-to-day management 8

9 1. How to get started Establishing a Corporation Where do you incorporate? Under provincial or federal law But: Canadian residency requirements for directors (except: e.g. New Brunswick) Quick and easy to incorporate & maintain once practical differences between Canadian and Dutch corporations are understood! 9

10 1. How to get started Acquiring an Existing Business Acquiring an Existing Business Notice formality Approval required for large acquisitions (> ~$275 million) Beware of anti-competition regulation Public take-over bid: provincial securities legislation 10

11 1. How to get started Operational Considerations Contracts No civil code (burgerlijk wetboek) Have a written contract! te goede trow stronger than Canadian good faith Early legal advice 11

12 1. How to get started Operational Considerations Immigration Short-term: Business Visitors (max. 6 months) Mid-term: Intra-company transfers for Executives (max. 7 years) Specialized Knowledge Workers (max. 5 years) Long-term: Landed immigrant 12

13 1. How to get started Operational Considerations Banking Stable & secure banking system Increased security after 9/11 Borrowing: security required, of course personal property security registration, not just real estate 13

14 Table of Contents 1. How to get started 2. Food Industry Concerns 2.1 Food and Drugs Act 2.2 Product Liability 2.3 Intellectual Property Protection 3. Conducting Business in Canada 14

15 2. Food Industry Concerns Food and Drugs Act Product Name - prescribed standards B [S].Hollands, Hollands Gin, Geneva, Geneva Gin, Genever, Genever Gin or Dutch-type Gin (a) shall be a potable alcoholic beverage obtained (i) by the redistillation of malt spirit with or over juniper berries, or by a mixture of the products of more than one such redistillation, (ii) by the redistillation of a combination of malt spirit and not more than four times its volume on an absolute alcohol basis of grain spirit with or over juniper berries, or by a mixture of the products of more than one such redistillation, or (iii) by the blending of malt spirit, redistilled with or over juniper berries, with not more than four times its volume on an absolute alcohol basis of grain spirit or molasses spirit, or by a mixture of the products of more than one such blending; (b) may contain (i) other aromatic botanical substances, added during the redistillation process, and (ii) caramel; (c) shall not contain more than two per cent sweetening agent; (d) may be labelled or advertised as being distilled, where subparagraph (a)(i) or (ii) is complied with; and (e) shall be described on the principal display panel of its label and in any advertisements as blended gin, where subparagraph (a)(iii) is complied with. SOR/93-145, s

16 2. Food Industry Concerns Food and Drugs Act Nutrition Labelling - New (courtesy Health Canada) 16

17 2. Food Industry Concerns Food and Drugs Act Natural Health Products - New For health foods, e.g. dietary supplements Government approval: Product Place (site licence) Approval backlog (affects product launch, distribution) 17

18 2. Food Industry Concerns Product Liability Product Liability Manufacturer liability under case law rather than statute Consumers more activist/litigious than in The Netherlands Potential for class actions Exposure reduction steps 18

19 2. Food Industry Concerns Intellectual Property Protection Protect your Brand! Trade-mark registration Patent 19

20 Table of Contents 1. How to get started 2. Food Industry Concerns 3. Conducting Business in Canada 3.1 Canadian Business Mentality 3.2 And If You Head South 20

21 3. Conducting Business in Canada Canadian Business Mentality Canadian Business Mentality Informal first name basis Canadians uncomfortable saying no botte Nederlanders Director directeur (commissaris vs. officer) Statute statuten (wet) common English words used in Dutch have stronger connotations in English sh** 21

22 3. Conducting Business in Canada Canadian Business Mentality And If You Head South Canada = mixture of US and Europe Be careful about political topics Laws are different Tougher entry to US since 9/11 Although language, customs and fast food outlets are the same, many large Canadian businesses have failed miserably in trying to expand to the US 22

23 Any questions? 23

24 TOT ZIENS! Andrew Frei Dale & Lessmann LLP Lawyers and Trade-Mark Agents 181 University Avenue Suite 2100 Toronto, Canada M5H 3M7 Tel: (416) Fax: (416)