Commercial Law Canadian Organization

Question: Discuss about theCommercial Law for Canadian Organization. Answer: Introduction In order to incorporate a corporation in Canada there has been five expressed steps which should be followed by all the organizations. The steps include: Making a decision for granting name to the organization which has to be incorporated. Each organization must have a name which has been regarded as corporate name. The name must be distinctive and must not be misleading or confusing (Government of Canada,2016) . Structure of the organization should be made to which changes can be made. The articles would need to be signed by the incorporators and get a Business Number or a NEQ. Initial registered office address must be established with the first board of directors Canadian corporations must fill appropriate forms and pay the required fees for incorporation Application must be processed and when accepted then a corporation would be established (Ward, 2016). The acquisition of a Canadian corporation may be structured as a corporate dealing or a Take-over Bid. The rules for the acquisition of any Canadian organization have been complicated and it does include the aspects of securities, corporate and administrative law. A take-over bid is the Canadian equivalent of a U.S. tender offer. The acquirer must follow a prescribed process when launching and completing a bid. An overview of the rules and process has been provided below: Making the Bid; Necessities of Early caution; Investment circumstances; The circular of a proposal; Completion of the proposal made; Squeeze-outs and second phase attainments; and Defensive tactics (Elliot, 2016). So, it would be suggested that a person in order to form a organization have to follow the steps and the way of process which have been mentioned above and if the sane would be followed then he can take over a organization. In order to incorporate any business or trade a person needs to prepare some documents which includes: The Memorandum which sets out and outlines the rules for conducting a business; The Articles of Incorporation was the second most important document needed as it includes the rules and regulations that would govern the conduct of the corporation members. The Notice of Offices states the location of the two required offices for the corporation of an individual and the registered office and record office. There have been two types of structures of investment which has been made i.e. Debt and Equity. Debt can be regarded as the money which has been borrowed from an outside source with the promise of repayment such as bank in this case. Equity can be regarded as the money invested by the owner himself i.e. made by Rosa in this case. Pros and Cons of Debt and Equity: Debt financing can be used for all the type of business whereas equity is done for small business; Debts financing require repayment right away whereas equity dont; Loss of control has been regarded as a big problem for equity financers whereas it doesnt regard in case of debt; Debt financing have no say in business whereas equity financer do; Debt owners dont own percentage of trade whereas equity does (Palermo, 2014). In order to rectify and fix up the mistake which have been done by the owners by taking out money from the corporations bank account can be done by making necessary documents which would be made backdated. The process of doing so can be as follows: A meeting has to be conducted; Entry has to be made in back date on which the money was withdrawn; The money would be adjusted as a part of dividend or salary of the concern persons as there were 2 main ways in which money can be generally taken out from an incorporated business which can be salary and dividend. Dividends were the payments which were made out of the corporation paid to its stakeholders. When they would be declared in a proper manner then they could be paid out as cash, shares, warrants or land (Conduct Law, 2016). The documentation which has to be prepared includes the necessary directors resolution and advises which has to be given in order to administer the payment of dividends. So, the necessary document stating and adjusting the dividend amount and the amount which has been taken out should be fixed and settled so that the act can be rectified in the organization. Income Tax Act (Canada) deals with the dividends which each employee would get if the profits have been incurred by the organization. Therefore, in this way the mistake can be rectified and fixed against the corporation (Crosgrey, 2016). References: Conduct Law. (2016). Declaring Dividends and Directors Resolutions. Retrieved on 27th September, 2016 from: https://www.conductlaw.com/declaring-dividends-directors-resolutions/ Crosgrey, H. (2016). Declaring a Dividend on Shares of a Company. Retrieved on 27th September, 2016 from: https://www.canadianbusinessresources.ca/declaring-a-dividend/ Elliot, S. (2016) Chapter ThreeAcquiring a Public Company. Retrieved on 27th September, 2016 from: https://www.canadianmandalaw.com/ma-activity-canada/acquiring-a-public-company/ Government of Canada. (2016) Steps to incorporating. Retrieved on 27th September, 2016 from: https://www.ic.gc.ca/eic/site/cd-dgc.nsf/eng/cs06642.html Palermo, E. ( 2014) Debt vs. Equity Financing: What's the Best Choice for Your Business?. Retrieved on 27th September, 2016 from: https://www.businessnewsdaily.com/6363-debt-vs-equity-financing.html Ward, S. (2016) How to Incorporate Your Business in Canada. Retrieved on 27th September, 2016 from: https://www.thebalance.com/how-to-incorporate-your-business-in-canada-2948225