Do I need a lawyer to incorporate a company?
While there is no legal requirement to consult with a lawyer in order to incorporate a company in BC, having a lawyer’s assistance from the beginning will ensure that your company is structured appropriately for your business. If your company isn’t properly incorporated from the outset, you may encounter costly issues down the road.
Your company will need Articles of Incorporation. The Articles are the “rules” that govern the company, the shareholders, the directors and officers, and the conduct of the company’s business. A lawyer will ensure that your company’s Articles suit the needs of your company.
Your company will need to have an authorized share structure. A lawyer will, in consultation with your accountant, assist you in determining what share structure is most suitable to your business at the time of incorporation as well as for the future growth of your company. Every class of shares should have its own set of special rights and restrictions which specify things like voting rights, dividend entitlements, priorities among shares on wind-up of the company, and more.
Once your company is incorporated, there is still more work to do. Post-incorporation documents must be prepared to issue shares, appoint directors and officers, and determine other basic company details such as the fiscal year end, the company’s address and Registered and Records Office. A lawyer will create your company’s Record Book and advise you on the ongoing obligations your company has in maintaining the company’s records. Recent changes to the Business Corporations Act and the enactment of the Land Owner Transparency Act have created additional obligations on most companies to keep up to date records and filings.
In addition to incorporating your company, a lawyer can advise you about the effect of incorporation on existing agreements such as leases, supplier contracts, and employment agreements. Your lawyer can also advise you on the preparation of a shareholders’ agreement to meet the specific needs of your business and the interests of the shareholders.
If you are considering incorporating a company, HSJ would be happy to work with you.