In a recent post, we explored some of the steps involved in incorporating a business in Ireland or Australia. Now we'd like to turn our attention to North America, specifically, Canada and the state of Delaware in the United States.
Both Canada and the US are attractive options for companies looking to open a subsidiary corporation on North American shores. Delaware, in particular, offers the prestige of an American company while providing business-friendly legislation designed to make managing a company from afar easier. Likewise, many view Canada as a potential bridge economy, linking the privileges of NAFTA with the trading access of the EU. But, as in all ventures of this kind, there are a number of complicated stipulations to be aware of in order to keep your company compliant with local governance. Below, we highlight three key concerns to keep in mind if you plan to incorporate in Canada or Delaware.
Advantages of Incorporating in Canada or Delaware
Here's a brief overview of the advantages a company can gain by choosing to incorporate in one of these locations. Canada- Has a strong and sustained record of economic growth, leading all G7 countries from 2006-2015
- Boasts the most highly educated workforce among the OECD
- Upon the full ratification of CETA (Comprehensive Economic and Trade Agreement), will have preferred access to both NAFTA and EU countries
- Has the most modern and up-to-date corporate statutes in the US
- Established the Court of Chancery, which rules exclusively on corporate law disputes
- Corporate cases resolved promptly by judges who are experts in corporate law
3 Steps for Incorporation Compliance
Now that we have reviewed some of the business benefits offered by these locations, let's look at the necessary steps a corporation must take in order to remain in compliance. #1 Registration of Business The first step to incorporating a business is registering it with the respective regulatory organization. Canada For companies wishing to incorporate in Canada, the process of registration begins with the selection of a company name. If a company prefers a numbered name, one will be issued at the time of incorporation. If you want a more traditional company name, then you must register with Corporations Canada. The prospective name must be unique to the company; it cannot be misleading or too closely resemble the names of other companies. In order to ensure your company name will qualify, all companies must submit a Nuans report. Nuans reports list all existing business and corporate names, including trademarks, which are similar to your company name. You may request a Nuans report online or contact a law firm to process the order. Once a company has decided upon an appropriate name, it must register for a nine-digit business number. This number will forever identify your company to provincial or federal governments. Business numbers can be obtained from the Canadian Business Registration Online (BRO) service. If incorporating in Quebec, a NEQ, or Quebec Enterprise Number, is required. If your business does $30,000 CAD a year or more in total revenue, you must also register for a GST/HST account. This account will allow you to receive a refund on taxes your company pays the government. Delaware Companies planning to incorporate in Delaware must register their proposed entity name with the State of Delaware Division of Corporations. Again, all names must be distinct from any existing entities registered in the State of Delaware. Company names must include a suffix that best describes the type of business entity. Common suffixes for corporations include:- Incorporated
- Corporation
- Company
- Limited
- Articles of amendment
- Bylaws and their amendments
- Any unanimous shareholder agreement
- Minutes of meetings and shareholder resolutions
- A share register listing the names and addresses of all shareholders and shares held
- A security register listing the names and addresses of all those who are or have been security holders
- The physical address of the company's location
- The name and address of one corporate officer
- The names and addresses of all directors
- Authorization by an officer to file a report
Leverage Technology to Streamline Incorporation
Incorporating your company in a new locale is a big step in the life of your business. Laws and regulations concerning incorporation can be complicated, and staying abreast of changes can be time-consuming. Entity management software can ease the burden of this process by monitoring these specifications and automating many of the tasks involved in incorporation. A trusted entity management program can save you time and hassle while keeping your newly formed corporation compliant with local governance.![](https://annyazommq.cloudimg.io/https://dg-staging-450520-cd.azurewebsites.net/-/media/project/diligent/master/au-whitepaper-images/whitepaper-images/a-buyers-guide-to-esg-data-management-software.png?h=511&iar=0&w=765&rev=263be577-e761-4e63-96ef-8ab461f2c7d1&org_if_sml=1&force_format=webp&hash=66FFC6017BFA4AEF4FEB228C028B7AA2)
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