Winding-up and Restructuring Act

The Winding-up and Restructuring Act is a statute of the Parliament of Canada that provides for the winding up of certain corporations and the restructuring of financial institutions.

The Act - originally known as An Act Respecting Insolvent Banks, Insurance Companies Loan Companies, Building Societies and Trading Corporations (eventually shortened to the Winding-Up Act) - was originally enacted in 1882. Until the passage of the Bankruptcy Act in 1919, it was the only federal statute governing bankruptcy and insolvency, and it only extended to corporations. The 1919 Act covered individuals and corporations, so corporations had a choice as to how to proceed with the liquidation of their affairs.

In 1996, the Bankruptcy Act was amended to give precedence to its proceedings over those of the Winding-Up Act. In 1996, the Act was retitled as the Winding-up and Restructuring Act.

The Act applies to:

excepting for:

where any of those bodies are:

and a company is deemed insolvent when:

The Act cannot be used when proceedings have already been instituted under the Bankruptcy and Insolvency Act.

The Act is the only route for insolvent financial institutions to take, as they are not covered by the BIA. It also offers a little-used route for corporations (other than those governed by the CBCA or the CNPCA) to seek liquidation or winding-up that does not necessarily call for being insolvent (except for provincially incorporated companies, where the insolvency requirement is mandatory).

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