1994 Legislative Session: 3rd Session, 35th Parliament
THIRD READING


The following electronic version is for informational purposes only.
The printed version remains the official version.


Certified correct as passed Third Reading on the 4th day of July, 1994
Ian D. Izard, Law Clerk.


HONOURABLE GLEN CLARK
MINISTER OF EMPLOYMENT
AND INVESTMENT

BILL 41 -- 1994

COMMUNITY FINANCIAL SERVICES ACT

Contents

Section  
 
Part 1 -- Definitions
1  Definitions
 
Part 2 -- B.C. Community Financial Services Corporation
2  Corporation established
3  Authorized capital
4  Purpose of the corporation
5  Powers and capacity
6  Management
7  Officers and employees
8  Director's statement on resignation
9  Directors and officers
10  Advisory council
11  Nominations of directors
12  Records
 
Part 3 -- Corporate Operations
13  Business plan
14  Borrowing powers
15  Temporary borrowing
16  Borrowing subordinated
17  Guarantees by corporation
18  Dividends
19  Guarantee
20  Taxation of corporation
 
Part 4 -- Reports and Inspections
21  Accounting system
22  Auditor
23  Audit committee
24  Appointment and removal of auditor
25  Financial statements
26  Amendment of financial statement and report
27  Financial statements and report to Legislative Assembly
28  Additional reports
 
Part 5 -- General
29  Act prevails
30  Offences
31  Penalties
32  Power to make regulations
 
Part 6 -- Applicability of Other Enactments
33  Applicability of other Acts
34  Applicability of Company Act
35  Applicability of Financial Administration Act
36  Applicability of Financial Institutions Act
37  Other Acts
38-41  Consequential Amendments
42  Commencement

 HER MAJESTY, by and with the advice and consent of the Legislative Assembly of the Province of British Columbia, enacts as follows:

 
Part 1 -- Definitions

Definitions

1 In this Act:

"advisory council" means the advisory council appointed or elected under section 10;

"auditor" means the auditor appointed under section 22;

"commission" means the Financial Institutions Commission established under section 200 of the Financial Institutions Act;

"community" means those persons who

(a) are underserviced by existing financial institutions,

(b) are in a state of suffering, neglect or poverty, or

(c) share and promote the principles, goals and purposes of the corporation;

"corporation" means, except in this section, the B.C. Community Financial Services Corporation established under section 2;

"director" means a director appointed under section 2;

"entity" includes a corporation, trust, partnership, aboriginal organization, fund or other unincorporated association or organization, the Crown in right of Canada or of a province, a Crown agency, a foreign government and an agency of a foreign government, but does not include an individual;

"financial institution" has the same meaning as in the Financial Institutions Act;

"government organization" means

(a) a corporation

(i) that is under a federal Act or an Act of a province other than British Columbia, an agent of the Crown in right of Canada or of that province, as the case may be,

(ii) of which the federal government or a government of a province other than British Columbia owns, directly or indirectly, more than 50% of the issued voting shares, or

(iii) of which the federal government or a government of a province other than British Columbia appoints or controls the appointment of a majority of the members, the board of directors or the board of management, or

(b) any prescribed agency, board, commission, authority or other organization of the federal government or of a government of a province other than British Columbia;

"public body" means

(a) a municipality or a regional district under the Municipal Act,

(b) the City of Vancouver,

(c) the Municipal Finance Authority of British Columbia under the Municipal Finance Authority Act,

(d) a government body under the Financial Administration Act,

(e) a government organization, or

(f) a board, commission, authority or similar body established or authorized under an Act to administer, regulate, manage or undertake the operation of schools, libraries, hospitals, health facilities, irrigation systems, drainage systems, water supply systems, local improvements or public utilities, or to regulate or facilitate the regulation of agricultural and other natural products marketing or to levy or raise taxes under the authority of an Act;

"public sector pension plan" means a plan organized and administered by a public body to provide pensions for its employees and former employees and under which the public body is required to make contributions on behalf of members;

"superintendent" means the Superintendent of Financial Institutions appointed under section 206 (1) of the Financial Institutions Act;

"unaffiliated director" has the same meaning as in the Financial Institutions Act;

"Vancouver inner city" means all that portion of the City of Vancouver that is contained within the boundaries set out in Schedule 1.

 
Part 2 -- B.C. Community Financial Services Corporation

Corporation established

2 (1) There is established a corporation known as the B.C. Community Financial Services Corporation with a board of directors consisting of 11 individuals appointed for a term of 2 years by the Lieutenant Governor in Council.

(2) Subject to subsection (5), the board of directors appointed under subsection (1) must include

(a) at least 4 unaffiliated directors, and

(b) 3 individuals nominated as directors by the advisory council in accordance with section 11 (2).

(3) The Lieutenant Governor in Council may appoint

(a) one of the directors as chair of the board of directors and may designate that director or any other director as chief executive officer of the corporation, and

(b) an individual as president and may designate that individual as chief operating officer of the corporation.

(4) Subject to subsection (5), if a director of the corporation ceases, for any reason, to be a director before the end of the term for which that individual was appointed, the Lieutenant Governor in Council

(a) may appoint a replacement director to hold office for the unexpired portion of the term, and

(b) must, if the replaced director was one of the directors referred to in subsection (2) (b), ensure that the replacement director is an individual nominated by the advisory council for the corporation in accordance with section 11 (2).

(5) If, in respect of the appointment of a director under subsection (2) (b) or the replacement of a director under subsection (4) (b), the advisory council does not comply with section 11 (2) within 60 days after receiving the notice referred to in section 11 (1), the Lieutenant Governor in Council may appoint any individual the Lieutenant Governor in Council considers appropriate to fill the required position or vacancy.

(6) The corporation may pay a director

(a) a prescribed allowance for reasonable travelling and incidental expenses necessarily incurred in attending the meetings of the directors, and

(b) if the director is not a member of the Legislative Assembly or a public servant, remuneration at rates fixed by the Lieutenant Governor in Council.

(7) An unaffiliated director must resign as a director on ceasing to be an unaffiliated director unless, at the time that the director ceases to be an unaffiliated director, there are at least 4 unaffiliated directors of the corporation.

(8) The fiscal year of the corporation is the period of 12 months beginning on April 1 in each year and ending on March 31 in the next succeeding year.

(9) The commission must not issue a business authorization to the corporation under the Financial Institutions Act unless the commission is satisfied that the board of directors has been appointed in accordance with this section.

Authorized capital

3 (1) The authorized share capital of the corporation is 10 million shares with a par value of $1 for each share.

(2) The corporation must not allot or issue any of its shares to any person other than the Minister of Finance and Corporate Relations.

(3) Despite section 37 of the Financial Administration Act, the Minister of Finance and Corporate Relations may subscribe for not more than 5 million shares and may pay the amount of that subscription out of the consolidated revenue fund without further appropriation.

(4) The Minister of Finance and Corporate Relations may, with the approval of the Lieutenant Governor in Council, purchase shares in the capital stock of the corporation that are additional to the shares subscribed for under subsection (3) and may pay the amount of that purchase out of the consolidated revenue fund without further appropriation.

(5) The shares in the corporation subscribed for under subsection (3) or purchased under subsection (4) must be issued to and registered in the name of the Minister of Finance and Corporate Relations and must be held by the Minister of Finance and Corporate Relations on behalf of the government.

Purpose of the corporation

4 The purpose of the corporation is to encourage and facilitate the use of savings institutions by, and to provide a full range of financial and related services to, members of the community.

Powers and capacity

5 (1) Subject to any limitation or restriction imposed by this Act, the corporation has the power and capacity of an individual of full capacity.

(2) Without limiting the power and capacity of the corporation under subsection (1), the corporation may, for the purposes of this Act,

(a) subject to section 70 of the Financial Institutions Act, engage in trust business within the meaning of that Act,

(b) subject to section 81 of the Financial Institutions Act, engage in deposit business within the meaning of that Act,

(c) conduct any business ancillary or related to the businesses referred to in paragraphs (a) and (b), and

(d) provide one or more other financial or related services.

(3) The corporation must not

(a) issue a note payable to bearer, or a promissory note intended to be circulated as money or as the note of a bank,

(b) deal in goods, wares or merchandise or engage in any trade,

(c) operate a branch outside of the Vancouver inner city, or

(d) engage in any prescribed business.

(4) The Minister of Finance and Corporate Relations is the fiscal agent of the corporation.

Management

6 (1) The directors of the corporation must manage the affairs of the corporation or supervise the management of those affairs and may

(a) exercise the powers conferred on them under this Act,

(b) exercise the powers of the corporation on behalf of the corporation, and

(c) delegate the exercise or performance of any power or duty conferred or imposed on them to

(i) a committee appointed by the directors,

(ii) a person appointed under this Act, or

(iii) a person employed by the corporation.

(2) The directors may pass the resolutions or bylaws they consider necessary or advisable for the management and conduct of the affairs of the corporation and for the exercise of their powers or performance of their duties including, without limitation, resolutions or bylaws respecting the calling and holding of meetings of the directors and the procedure to be followed at the meetings.

(3) A resolution under this section approved by the required number of directors by telex, telegraph, facsimile or other electronic transmission, telephone or any other similar means of communication confirmed in writing or other graphic communication, is as valid and effectual as if it had been passed at a meeting of the directors properly called and constituted.

(4) The directors must prepare and maintain records containing minutes of meetings and resolutions of the directors and any committee appointed by the directors.

(5) No act or proceeding of the directors is invalid by reason only of there being in office less than the number of directors required by section 2.

Officers and employees

7 (1) Subject to section 2 (3) (b), the chief executive officer of the corporation, to the extent authorized by the directors, may

(a) appoint other officers and employees considered necessary to carry on the business and operations of the corporation,

(b) define the duties and determine the remuneration of the individuals appointed under paragraph (a), and

(c) provide a system of organization to establish responsibility and promote efficiency.

(2) The Public Service Act, the Public Service Benefit Plan Act, the Pension (Public Service) Act and the Public Service Labour Relations Act do not apply to the corporation or to a director, officer or employee of the corporation.

Director's statement on resignation

8 (1) A director of the corporation who resigns is entitled to submit to the corporation a written director's statement stating the reasons for the resignation or the reasons why the director opposes any proposed action or resolution.

(2) If a director of the corporation resigns as the result of a disagreement with the other directors or the management of the corporation and does not take action under subsection (1), the director must submit to the superintendent and the minister a written director's statement stating the reasons for the resignation.

(3) On receiving a written director's statement under subsection (1), the corporation must deliver copies of it to the superintendent and the minister immediately.

Directors and officers

9 (1) The superintendent may order that a director or officer of the corporation or of its subsidiary cease to be a director or officer if the superintendent is satisfied that the director or officer

(a) is not qualified to be a director under section 138 of the Company Act as it applies for the purposes of this Act,

(b) within the last 5 years has been bankrupt in Canada or elsewhere,

(c) has a conflicting interest that prevents the director or officer from properly discharging the duties as director or officer,

(d) is contravening or has contravened an undertaking given to or an order made by the superintendent, or

(e) is an individual who ought not to be in a position to control or influence a financial institution.

(2) If the superintendent makes an order under subsection (1), the director or officer ceases to be a director or officer of the corporation or of the subsidiary, as the case may be, on the date of the order.

(3) An individual who ceases to be a director or officer of the corporation under subsection (2) is not, despite the Company Act as it applies for the purposes of this Act, eligible to again be or act as a director or officer of a financial institution without first applying for and receiving the consent of the superintendent.

(4) The corporation must promptly deliver written notice

(a) to the superintendent of the resignation or appointment of a director or the resignation, removal, election or appointment of a senior officer, and

(b) to the minister of the removal of a director by the superintendent under this section.

(5) The superintendent may require the corporation to provide any information the superintendent considers necessary to determine if there are grounds to take action under subsection (1).

Advisory council

10 (1) In this section "depositor" means a person in whose name a deposit account with the corporation is in existence and has been in existence for a period of not less than 90 consecutive days.

(2) To ensure the community interest is served, an advisory council consisting of not more than 7 individuals must, subject to subsection (3), be elected for the corporation in accordance with this section to

(a) provide advice and make recommendations to the directors about the matters specified in subsections (6) and (7) (a) and (b),

(b) provide reports to the minister under subsection (7) (c), and

(c) make nominations for directors to the Lieutenant Governor in Council under section 11.

(3) The first advisory council is to consist of individuals appointed by the Lieutenant Governor in Council to reflect the diverse cultural, geographic and economic needs of the community and is to be appointed for a term of one year.

(4) Subject to subsection (5), members of the advisory council, other than the members appointed under subsection (3) who are in their first term of office, must be elected for a term of 2 years

(a) from individuals who are depositors with the corporation,

(b) by British Columbia residents who are depositors with the corporation, and

(c) in the manner prescribed.

(5) At least 5 of the individuals elected to the advisory council under subsection (4) must, at the time of their election to the advisory council, maintain their principal residence in the Vancouver inner city.

(6) The directors must, at least quarterly, consult with the advisory council about general policy, the delivery of services and other matters relating to the functions of the corporation.

(7) The advisory council may

(a) receive and consider any complaints made with respect to the corporation,

(b) make general policy recommendations to the directors about the strategic direction and functions of and the effectiveness of the delivery of services by the corporation, and

(c) report to the minister from time to time on matters relating to the functions and performance of the corporation.

(8) The corporation may pay the members of the advisory council

(a) a prescribed allowance for reasonable travelling and incidental expenses necessarily incurred in carrying out the business of the council, and

(b) remuneration for their services in the prescribed amount.

Nominations of directors

11 (1) Before individuals are appointed as directors in accordance with section 2 (2) (b) or (4) (b), the minister must, in the prescribed manner, notify the advisory council of the upcoming appointments and specify the number of positions that are to be filled.

(2) Promptly after receiving the notice referred to in subsection (1), the advisory council must

(a) nominate for each position to be filled one individual who is a resident of British Columbia, and

(b) provide to the minister nominations for the individuals nominated along with a consent to act as a director for the corporation from each nominee, signed and dated by the nominee within 90 days before the date on which the nomination is provided to the Lieutenant Governor in Council.

Records

12 (1) The corporation must maintain at a location in the Vancouver inner city that is accessible to the public during normal business hours the following records in current form:

(a) the full name of and mailing address for each of the directors, senior officers and advisory council members;

(b) the bylaws of the corporation.

(2) Any person may, without charge, examine any of the records referred to in subsection (1).

 
Part 3 -- Corporate Operations

Business plan

13 (1) The corporation must, on or before January 31 of each year, submit to Treasury Board for review and approval a 3 year business plan with respect to the business activities to be undertaken by or on behalf of the corporation.

(2) The corporation must not amend an approved business plan unless the proposed amendment is first approved by Treasury Board.

(3) A business plan under this section must be consistent with the business authorization, if any, provided to the corporation under the Financial Institutions Act and must include

(a) proposed operating and capital budgets for the next following fiscal year, including any projected borrowings,

(b) the investment and lending policy established under section 134 (4) of the Financial Institutions Act,

(c) details on any investment the corporation proposes to make in shares of any other entity or any class of entities,

(d) financial statements dated no earlier than 60 days with comparisons to budget, financial statements projected to March 31 and a budget for the next fiscal year, and

(e) any other information that Treasury Board may require.

(4) If a business plan submitted to Treasury Board under subsection (1) contains expenditure proposals, the plan must also include revenue proposals indicating how the expenditures are to be funded.

(5) The corporation must not carry on any business or undertake any activity that is not authorized by the business plan approved for the corporation under this section.

Borrowing powers

14 (1) Subject to section 13, the corporation may, for the purpose of carrying out any of the objects or powers referred to in this Act or for the exercise or performance of any power, right, function or duty conferred or imposed on it under this or any other Act,

(a) borrow money, including, without limitation, money from the government, and any money borrowed by the corporation must be borrowed in the amounts and on the terms and conditions that the Minister of Finance and Corporate Relations has, at or before the time that the money is borrowed, approved, and

(b) issue notes, bonds, debentures and other securities and any notes, bonds, debentures and other securities issued must be issued in the form and on the terms and conditions that the Minister of Finance and Corporate Relations has, at or before the time that the securities are issued, approved.

(2) The acceptance by the corporation of a deposit under section 5 (2) (b) does not constitute borrowing for the purposes of this Part.

Temporary borrowing

15 (1) Subject to section 13, the corporation may enter into a line of credit arrangement with the persons and on the terms and conditions that the Minister of Finance and Corporate Relations has, at or before the time that the line of credit arrangement is entered into, approved.

(2) If a line of credit arrangement is entered into under subsection (1), the corporation may, from time to time, borrow money for its temporary purposes under but within the limits of that line of credit without further approval of that minister.

Borrowing subordinated

16 In the event of the insolvency or winding up of the corporation, the indebtedness arising from borrowings under this Act is subordinated in right of payment to all deposits to which the guarantee referred to in section 19 applies.

Guarantees by corporation

17 The corporation must not guarantee on behalf of any person other than itself the payment or repayment of any sum of money unless

(a) the sum of money is a fixed sum of money that, with any interest that may be payable on it, is not more than the prescribed amount, and

(b) the person on whose behalf the corporation has undertaken to guarantee the payment or repayment has an unqualified obligation to reimburse the corporation for the full amount of the payment or repayment to be guaranteed.

Dividends

18 (1) Subject to subsection (2), the directors must, at the times and in the amounts the Lieutenant Governor in Council may require, declare dividends to be payable out of the profits of the corporation and may fix the date for the payment of those dividends.

(2) The Lieutenant Governor in Council must not require the corporation to declare or pay a dividend if there are reasonable grounds for believing that

(a) the corporation is, or the payment of the dividend would render the corporation, unable to pay its liabilities as they come due,

(b) the realizable value of the corporation's assets would, as a result, be less than the aggregate of its liabilities and capital, or

(c) the payment of the dividend would reduce the corporation's capital base to an amount less than the amount that constitutes an adequate capital base for the corporation in accordance with the regulations.

Guarantee

19 (1) In this section:

"depositor" includes 2 or more depositors, considered together as a single unit, who own a separate deposit in the corporation;

"qualifying funds" means a prescribed deposit deposited with the corporation by a depositor that

(a) is payable by or redeemable or withdrawable from the corporation under the terms of the agreement under which it was deposited, and

(b) the corporation fails, refuses or neglects to pay to the depositor despite demand having been made in accordance with the agreement for that payment.

(2) Subject to the regulations, the government guarantees the repayment to depositors, in accordance with the regulations, of qualifying funds, including any interest on that money.

(3) The maximum amount payable by the government under subsection (2) is

(a) $2 million, if the depositor is

(i) a public sector pension plan, or

(ii) an entity prescribed by the Lieutenant Governor in Council, on the recommendation of the Minister of Finance and Corporate Relations, or

(b) $100 000, if the depositor is not a depositor referred to in paragraph (a).

(4) The government may deduct from an amount to which a depositor is entitled under the guarantee any indebtedness of the depositor to the corporation.

(5) On payment by the government of the amount to which a depositor is entitled under the guarantee,

(a) neither the government nor the corporation is obliged to see to the proper application of the payment,

(b) the government is discharged from further liability to the depositor for the separate deposits for which payment is made, and

(c) the government is subrogated for the amount paid to all the rights and interests of the depositor as against the corporation in respect of the separate deposits for which payment is made.

(6) The government's liability to depositors in respect of deposits in the corporation is limited to its liability under the guarantee as set out in this section.

(7) Section 56 (3) of the Financial Administration Act does not apply to a guarantee given under this section.

Taxation of corporation

20 (1) Despite any other enactment, the corporation must pay all taxes and imposts, other than income tax under the Income Tax Act and the Income Tax Act (Canada), that the corporation would be required to pay in respect of its business, property or otherwise to the same extent and in the same manner as if the corporation were not owned or controlled by the government.

(2) The corporation shall pay to the government, on or before April 30 of each year, an amount of money that is equal to the amount of tax that the corporation would be obliged to pay under the Income Tax Act and the Income Tax Act (Canada) were the corporation not owned or controlled by the government.

 
Part 4 -- Reports and Inspections

Accounting system

21 (1) The corporation must establish and maintain an accounting system satisfactory to the Comptroller General and must, whenever required by the Comptroller General, submit detailed accounts of its revenues and expenditures for the period or to the day that the Comptroller General designates.

(2) All of the corporation's books or records of account, documents and other financial records must at all times be open for inspection by the auditor and by the Comptroller General or a person designated by the Comptroller General.

(3) The Minister of Finance and Corporate Relations may direct the Comptroller General or any other person appointed by that minister to examine and report to that minister on any or all of the financial and accounting operations of the corporation.

Auditor

22 (1) The corporation must have an auditor.

(2) The directors of the corporation must, on or before the end of each fiscal year, appoint an auditor for the corporation for the following fiscal year and must promptly give notice to that auditor of the auditor's appointment.

(3) The remuneration of the auditor must be fixed by the board of directors and must be paid by the corporation.

(4) In addition to the remuneration fixed under subsection (3), the corporation must pay the auditor additional remuneration at a rate fixed by the board for any work required under section 122 (1) of the Financial Institutions Act.

(5) The auditor must ensure that a copy of any report made by the auditor to the directors or the superintendent under section 121 or 122 (1) of the Financial Institutions Act is provided to the minister.

(6) The auditor must be given notice of, and has the right to appear before and to be heard at, every meeting of the audit committee, and must appear before the audit committee when requested to do so by that committee.

(7) The directors, if requested to do so by the auditor, must call a meeting of the board of directors within 30 days after the request, to consider a report made by the auditor regarding any matter arising out of the financial affairs of the corporation.

(8) An oral or written statement or report made under this Act by the auditor or a former auditor of the corporation has qualified privilege.

Audit committee

23 (1) Before considering a financial statement for the corporation, the directors must ensure that the financial statement has been submitted to the audit committee for review with the auditor and that the report of the audit committee on the financial statement has been submitted to the directors after the completion of that review.

(2) In addition to the requirements of subsection (1), the audit committee must review, in addition to the reports, transactions or matters that it is obliged to review under the regulations to the Financial Institutions Act

(a) returns of the corporation that are to be filed with the superintendent under section 125 (1) of the Financial Institutions Act, and

(b) reports that have been made by the auditor under section 121 of the Financial Institutions Act.

Appointment and removal of auditor

24 (1) The corporation must promptly deliver written notice to the superintendent of the appointment, removal or resignation of an auditor and of any other occurrence that causes a vacancy in the office of auditor and, in the case of a removal, of the reasons for the removal.

(2) If the office of auditor is vacant, the superintendent by order delivered to the corporation, may require the appointment of an auditor by a deadline stipulated in the order.

(3) If an auditor is not appointed by the deadline stipulated in the order referred to in subsection (2), the superintendent may appoint an auditor to hold office until an auditor is appointed by the directors and until an auditor is appointed by the directors, the corporation must pay the auditor appointed by the superintendent remuneration at a rate directed by the superintendent.

Financial statements

25 (1) The corporation must prepare and deliver to Treasury Board and to the minister, promptly after the end of each fiscal year of the corporation,

(a) a report on the operations of the corporation for the preceding fiscal year, and

(b) a financial statement approved by the directors and audited by the auditor, in the form and with the content

(i) set out in section 169 of the Company Act as if the corporation were a reporting company within the meaning of that Act, and

(ii) required by the superintendent.

(2) Without limiting subsection (1), if the corporation is a holding company within the meaning of the Company Act, the corporation must include in each financial statement prepared under this section (a) the name of each corporation that is its subsidiary within the meaning of the Company Act,

(b) the assets and liabilities, and income and expense, of its subsidiaries, making due provision for minority interests, if any, and indicating in the statement that it is presented in consolidated form, and

(c) if the fiscal year of any of its subsidiaries does not coincide with the fiscal year of the corporation, the date of the fiscal year end of that subsidiary and the reason why the fiscal years do not coincide.

(3) In addition to any other reports the auditor is required to make under this Part, the auditor must, promptly after a financial statement is prepared under subsection (1), provide to the minister a report on that financial statement and must state in that report whether, in the auditor's opinion,

(a) the financial statement presents fairly the financial position of the corporation and the results of its operations for the period under review,

(b) the financial statement is in accordance with generally accepted accounting principles applied on a basis consistent with that of the preceding period, and

(c) if the financial statement contains a statement of changes in net assets or a statement of source and application of funds, that statement of changes in net assets or statement of source and application of funds presents fairly that information.

(4) If the report of the auditor under subsection (3) does not contain the unqualified opinion required by that subsection, the auditor must state in the report the reasons that that unqualified opinion could not be given.

Amendment of financial statement and report

26 (1) If facts come to the attention of the directors that could reasonably have been determined before the completion of a financial statement and that, if known before the financial statement was completed, would have required a material adjustment to that financial statement, the directors must

(a) communicate the facts to the auditor, and

(b) promptly amend the financial statement and send it to the auditor.

(2) If facts described in subsection (1) come to the attention of the auditor, the auditor must, if in the auditor's opinion it is necessary to amend the report referred to in section 25 (3),

(a) inform the superintendent and the minister in writing, and

(b) amend the report so that it complies with this Part.

(3) If the auditor amends the report under subsection (2), the directors must promptly provide to the minister and to the Minister of Finance and Corporate Relations a copy of the amended report and a statement explaining the effect of the amendment on the financial position and results of the operations of the corporation.

Financial statements and report to Legislative Assembly

27 The financial statement and the reports referred to in sections 25 and 26 must be laid before the Legislative Assembly by the minister as soon as practicable.

Additional reports

28 (1) In addition to any other reports it is required to provide to the minister under this Act, the corporation must, at the request of the minister, report to the minister on the business and operation of the corporation in the manner and at the times required by the minister.

(2) Nothing in this Part relieves the corporation or its directors or auditor from any reporting obligations imposed by the Financial Institutions Act as it applies to those persons under this Act.

 
Part 5 -- General

Act prevails

29 Despite section 11 of the Financial Institutions Act, if a provision of this Act or the regulations made under this Act is inconsistent with or in conflict with a provision of the Financial Institutions Act or the regulations made under that Act, the provision of this Act or the regulations made under this Act applies.

Offences

30 (1) Section 5 of the Offence Act does not apply to this Act or to the regulations.

(2) An individual commits an offence who

(a) contravenes section 102, 120 (1) or 145 (2) of the Financial Institutions Act as that Act applies for the purposes of this Act,

(b) contravenes section 90 (1) or (2), 103 or 149 (1), (2) (d), (3), (4), (5), (6), (7) or (8) of the Financial Institutions Act as that Act applies for the purposes of this Act,

(c) neglects or refuses to comply with an order made by the superintendent under section 243 (2) or 244 (1) of the Financial Institutions Act as that Act applies for the purposes of this Act,

(d) neglects or refuses to comply with an order made by the superintendent under section 105, 122 (1), 135 or 214 of the Financial Institutions Act as that Act applies for the purposes of this Act,

(e) neglects or refuses to comply with a requirement under the Financial Institutions Act as that Act applies for the purposes of this Act that the individual file or provide information or any record,

(f) being a member of the conduct review committee of the corporation authorizes, permits or acquiesces in giving an approval under section 147 (2) of the Financial Institutions Act as it applies for the purposes of this Act that the conduct review committee, by section 147 (3) or (4) of the Financial Institutions Act as it applies for the purposes of this Act, is prohibited from giving, or

(g) makes a statement in a record filed or provided under this Act or the Financial Institutions Act as that Act applies for the purposes of this Act that, at the time and in light of the circumstances under which the statement is made, is false or misleading with respect to a material fact or that omits to state a material fact, the omission of which makes the statement false or misleading.

(3) An individual does not commit an offence under subsection (1) (g) if at the time of the statement the individual did not know that the statement was false or misleading and, in the exercise of reasonable diligence, could not have known that the statement was false or misleading.

Penalties

31 (1) An individual who commits an offence under section 30 (2) (a), (c), (f) or (g) is liable

(a) on a first conviction to a fine of not more than $100 000 or to imprisonment for not more than 2 years or to both, and

(b) on each subsequent conviction, to a fine of not more than $200 000 or to imprisonment for not more than 2 years or to both.

(2) An individual who commits an offence under section 30 (2) (b), (d) or (e) is liable to a fine of not more than $2 000.

Power to make regulations

32 (1) The Lieutenant Governor in Council may make regulations as authorized by section 41 of the Interpretation Act.

(2) Without limiting subsection (1), the Lieutenant Governor in Council may make any regulations in relation to the corporation that could be made in relation to a financial institution under the Financial Institutions Act.

 
Part 6 -- Applicability of Other Enactments

Applicability of other Acts

33 Unless expressly made applicable to the corporation in this Act, the provisions of the Company Act and the Company Clauses Act do not apply to the corporation.

Applicability of Company Act

34 Sections 124 to 126, 128, 130, 133, 138, 141 (2), 143 to 149, 153, 159 to 161, 204 to 206, 207 (1) to (3), (5) and (6), 226, 227 and 228 (1) of the Company Act apply to the corporation and its directors and officers as if the corporation were a company within the meaning of that Act.

Applicability of Financial Administration Act

35 Sections 6.1, 59 and 59.2 of the Financial Administration Act and the regulations made under those sections do not apply to the corporation.

Applicability of Financial Institutions Act

36 (1) Subject to this section, the Financial Institutions Act and the regulations made under that Act apply to the corporation as if it were a trust company.

(2) The following do not apply to the corporation:

(a) sections 3, 12 to 30, 32 to 58, 61 (1) to (6), (8) and (9) (b) to (d), 65, 66, 75 to 80, 89, 96 to 99, 104, 106 to 109, 115, 119, 122 (2), 125 (1) (a), (c) and (f) and (2) (b), 126, 129, 130, 142 (1) (c) and (d), 151, 152, 155, 156, 158 to 199, 219 to 233, 251 to 257, 258 (1) (b) and (c) (i), 259 to 287, 288 (3) (j), 289 and 292 of the Financial Institutions Act;

(b) the regulations made under the sections referred to in paragraph (a);

(c) the regulations made under the Financial Institutions Act to the extent that they apply for the purposes of the sections referred to in paragraph (a).

(3) If a provision of the Financial Institutions Act or of the regulations made under that Act that applies for the purposes of this Act contains a reference to a provision of the Financial Institutions Act, the Company Act or a regulation made under either of those Acts that does not apply for the purposes of this Act, the applicable provision is to be read as if the reference to the inapplicable provision was omitted.

(4) The corporation must include with a return provided to the superintendent under section 125 of the Financial Institutions Act, the corporation's financial statement for that fiscal year and the reports of the auditor provided in respect of that financial statement under section 25 (3) of this Act.

(5) The corporation must, at the time that it files its investment and lending policy with the superintendent under section 134 (6) of the Financial Institutions Act, provide a copy of that policy to the minister.

(6) The superintendent must provide to the minister a report of the superintendent's findings resulting from any examination, inquiry or investigation conducted under section 211, 212 or 214 of the Financial Institutions Act.

(7) For the purposes of subsection (1), a reference to "minister" in section 213 of the Financial Institutions Act as it applies for the purposes of this Act is to be read as a reference to the Minister of Finance and Corporate Relations or the Minister of Employment and Investment.

(8) Section 241 of the Financial Institutions Act applies to an order of the superintendent made under section 9 of this Act.

(9) Sections 253 to 257 of the Financial Institutions Act apply to the offences and penalties referred to in sections 30 and 31 of this Act.

Other Acts

37 The corporation is exempt from the provisions of the following Acts to the extent that any other savings institution is exempt from them:

(a) the Debt Collection Act;

(b) the Mortgage Brokers Act;

(c) the Real Estate Act;

(d) the Securities Act.

 
Consequential Amendments

 
Corporation Capital Tax Act

38 Section 1 (1) of the Corporation Capital Tax Act, S.B.C. 1992, c. 4, is amended in the definition of "trust company"

(a) by striking out ", and includes" and substituting "or the B.C. Community Financial Services Corporation established under the Community Financial Services Act, and includes", and

(b) by repealing paragraph (a) and substituting the following:

(a) an extraprovincial trust corporation as defined in the Financial Institutions Act, and .

 
Financial Information Act

39 Schedule 2 of the Financial Information Act, S.B.C. 1985, c. 8, is amended by adding "B.C. Community Financial Services Corporation".

 
Financial Institutions Act

40 Section 72 of the Financial Institutions Act, S.B.C. 1989, c. 47, is repealed and the following substituted:

Common trust funds authorized

72 A trust company or credit union shall keep any asset acquired or held in trust by it separate and distinct from the assets of the trust company or credit union not held in trust and shall keep a separate account for each trust, but, unless the instrument creating a trust otherwise provides, a trust company or credit union may, subject to the regulations, co-mingle assets held in trust in a common trust fund for the purposes of investment.

 
Interpretation Act

41 Section 29 of the Interpretation Act, R.S.B.C. 1979, c. 206, is amended in the definition of "savings institution" by striking out "or" at the end of paragraph (c), by adding ", or" at the end of paragraph (d) and by adding the following:

(e) the B.C. Community Financial Services Corporation established under the Community Financial Services Act; .

Commencement

42 This Act comes into force by regulation of the Lieutenant Governor in Council.

 
SCHEDULE 1

The Vancouver inner city is that portion of the
City of Vancouver contained within the following boundaries:

Commencing at Burrard Inlet; then southwesterly along Broughton Street to Pacific Street; then in a general easterly direction along Pacific Street to Beatty Street; then northeasterly along Beatty Street to Pender Street; then in a general easterly direction along Pender Street to Columbia Street; then southerly along Columbia Street to Quebec Street; then southerly along Quebec Street to Terminal Avenue; then southeasterly along Terminal Avenue to Clark Drive; then northerly along Clark Drive to Hastings Street; then easterly along Hastings Street to Nanaimo Street; then northerly along Nanaimo Street to Burrard Inlet.


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