(1) What is the difference between Provincial and Federal incorporation in Canada?
There are two types of incorporation in Canada; provincial and federal incorporation.The main difference between the two is that federal incorporation gives your business increased business name protection and wider rights to carry on business. Federal incorporations are able to do business all across Canada under the same business name, even if some other company is already using a similar name in some province or territory. But you are only entitled to operate your business in that jurisdiction if you incorporated your company provincially. In addtion, charge for Ontario government fee $360 and $200 for Federal government fee
(2) Advantages and Disadvantages for Federal incorporation?
Advantages: Federal incorporation will be an excellent choice if your business needs the nation-wide business name protection that federal incorporation provides, or if your business is or will be operating internationally; secondly, the government fee only $200 is less, compared to the ontario government fee $360.00; you can use the same corporate name to do business anywhere in Canada, although you will be required to follow any licensing and registration requirements in the different provinces and territories; federal corporation names are pre-screened and is better than Ontario name protection as the examiners with the Federal Government check your Canadian corporate name against all Canadian corporations, Trademarks and Canadian business registrations (Master Business Licences) and trademarks across; with a Federal Incorporation only 25% of the directors are required to be Canadian Citizens; no charge for the corporation dissolution
Disadvantages: the proposed name should be very specific, it takes longer time to have a particular name; there is a $20 fee every year for keeping your corporate records up to date
(3) Advantages and Disadvantages for Ontario incorporation?
Advantages: Ontario only stops exact matches; no charge for annual filings; Ontario Corporations are better known than federal ones to the people you will be dealing with.
Disadvantages: Ontario name protection is weaker than federal name protection; more charge for government fee of $360, compared to government fee of $200 for federal corporation; with a Ontario Incorporation more than 50% of the directors are required to be Canadian Citizens; government charge of $25 for ontario corporation dissolution, it takes longer to get a corporation dissolved completely
(4) What is a numbered incorporation?
A numbered company is a corporation, most commonly found in Canada, given a generic name based on its sequentially-assigned certificate number. For instance, an entity incorporated under the CBCA and assigned the corporation number 7654321 would be entitled to register “7654321 Canada Inc.” as its legal name. The only way to avoid the need for a NUANS report is if a company designs to forgo the use of a name and become a numbered company instead. Although the company may operate under a business trade name, all legal documentation will use the number to reference the company. The primary purpose of this system is to speed up the process of incorporation.
(5) Why a NUANS (name search report) required for incorporation?
A NUANS report is required for incorporation with exception of the Quebec province, all companies trying to incorporate in Canada are required to provide what is known as a NUANS name search report. The term NUANS stands for “New Updated Automated Name Search.” It is a database that keeps track of all the names of companies operating out of Canada. The NUANS name search report is a document that accompanies the incorporation application, verifying that a company’s chosen name is free to use. In fact, even names that are similar to existing companies; names may be rejected. Depending upon where you are doing business, the NUANS search can be limited to a particular province or cover all of Canada