Bill 151, Budget Measures Act, 2006 (No. 2)

Sorbara, Hon Greg Minister of Finance

Current Status: Royal Assent received Chapter Number: S.O. 2006 C.33

Viewing: Royal Assent (current version) pdf

Bill 151 2006

An Act to enact various 2006 Budget measures and to enact, amend or repeal various Acts

Note: This Act amends or repeals more than one Act. For the legislative history of these Acts, see Public Statutes - Detailed Legislative History on www.e-Laws.gov.on.ca.

Her Majesty, by and with the advice and consent of the Legislative Assembly of the Province of Ontario, enacts as follows:

Contents of this Act

1.  This Act consists of this section, sections 2 and 3 and the Schedules to this Act.

Commencement

2.  (1)  Subject to subsections (2) and (3), this Act comes into force on the day it receives Royal Assent.

Same

(2)  The Schedules to this Act come into force as provided in each Schedule.

Same

(3)  If a Schedule to this Act provides that any provisions are to come into force on a day to be named by proclamation of the Lieutenant Governor, a proclamation may apply to one or more of those provisions, and proclamations may be issued at different times with respect to any of those provisions.

Short title

3.  The short title of this Act is the Budget Measures Act, 2006 (No. 2).

SCHEDULE A
ASSESSMENT ACT

1.  (1)  The definition of "assessor" in section 1 of the Assessment Act is repealed.

(2)  The definition of "locality" in section 1 of the Act is repealed and the following substituted:

"locality" means non-municipal territory that is within the jurisdiction of a board as defined in section 1 of the Education Act; ("localité")

(3)  The definition of "municipality" in section 1 of the Act is repealed and the following substituted:

"municipality" means a local municipality; ("municipalité")

(4)  Section 1 of the Act is amended by adding the following definition:

"non-municipal territory" means territory without municipal organization; ("territoire non municipalisé")

(5)  The definition of "subclass of real property" in section 1 of the Act is repealed and the following substituted:

"subclass of real property" means, for land located in a municipality, a subclass prescribed under subsection 8 (1) and, for land located in non-municipal territory, a subclass prescribed under subsection 8 (2.1); ("sous-catégorie de biens immeubles")

(6)  The definition of "tax roll" in section 1 of the Act is repealed and the following substituted:

"tax roll" means, for a municipality, a tax roll prepared in accordance with the Municipal Act, 2001 and, for non-municipal territory, a tax roll prepared in accordance with the Provincial Land Tax Act, 2006; ("rôle d'imposition")

2.  (1)  This section applies only if Bill 130 (Municipal Statute Law Amendment Act, 2006), introduced on June 15, 2006, receives Royal Assent.

(2)  References in this section to provisions of Bill 130 are references to those provisions as they were numbered in the first reading version of the Bill.

(3)  On the later of the day this section comes into force and the day subsection 2 (1) of Schedule C to Bill 130 comes into force, the definition of "tax roll" in section 1 of the Act, as re-enacted by subsection 1 (6), is repealed and the following substituted:

"tax roll" means, for a municipality, a tax roll prepared in accordance with the Municipal Act, 2001 or the City of Toronto Act, 2006 and, for non-municipal territory, a tax roll prepared in accordance with the Provincial Land Tax Act, 2006; ("rôle d'imposition")

3.  Subclause 2 (2) (d.3) (i) of the Act is amended by striking out "or an assessor".

4.  (1)  Subsection 3 (1) of the Act is amended by adding the following paragraph:

Children's treatment centres

6.1 Land used and occupied by a children's treatment centre that receives provincial aid under the Ministry of Community and Social Services Act, but not any portion of the land that is occupied by a tenant of the children's treatment centre.

(2)  Paragraph 19 of subsection 3 (1) of the Act is amended,

(a) by striking out "in one municipality" and substituting "in any one municipality or in non-municipal territory"; and

(b) by striking out "the assessor" and substituting "the assessment corporation".

(3)  Section 3 of the Act is amended by adding the following subsection:

Same

(5)  The following apply to land described in subsection 5 (2) of the Provincial Land Tax Act, 2006:

1. The land is liable to taxation but only as provided under section 5 of the Provincial Land Tax Act, 2006 or Division B of Part IX of the Education Act.

2. No assessed value or classification is required for the land.

(4)  Section 3 of the Act is amended by adding the following subsection:

Certain Crown land, non-municipal territory

(6)  Despite subsection (1), land in non-municipal territory that is not registered under the Land Titles Act or the Registry Act is not liable to assessment, taxation or classification unless the land is described in subsection 18 (1) or (1.1) of this Act.

5.  Section 4 of the Act is repealed and the following substituted:

Exemption for religious organizations

4.  (1)  The land of a religious organization is exempted from taxation in the circumstances and to the extent described in this section if the land is owned by the organization and occupied and used solely for recreational purposes.

Land in a municipality

(2)  The council of a municipality may pass by-laws exempting from taxation, other than school taxes and local improvement rates, land owned by the religious organizations named in the by-law on such conditions as may be set out in the by-laws.

Land in non-municipal territory

(3)  The Minister may make regulations exempting from taxation, other than school taxes, land in non-municipal territory owned by the religious organizations named in the regulations on such conditions as may be set out in the regulations.

6.  Section 5 of the Act is amended by striking out "the assessor" in the portion before clause (a) and substituting "the assessment corporation".

7.  Section 6 of the Act is repealed and the following substituted:

Exemption for the Navy League of Canada

6.  (1)  The land owned by the Navy League of Canada is exempted from taxation in the circumstances and to the extent described in this section if the land is occupied and used solely for the purposes of carrying out the activities of the Ontario Division of the Navy League.

Land in a municipality

(2)  The council of a municipality may pass by-laws exempting from taxation, other than school taxes and local improvement rates, land owned by the Navy League of Canada on such conditions as may be set out in the by-laws.

Land in non-municipal territory

(3)  The Minister may make regulations exempting from taxation, other than school taxes, land in non-municipal territory owned by the Navy League of Canada on such conditions as may be set out in the regulations.

Exemption for land used by veterans

6.1  (1)  Land that is used and occupied as a memorial home, clubhouse or athletic grounds by persons who served in the armed forces of His or Her Majesty or an ally of His or Her Majesty in any war is exempted from taxation in the circumstances and to the extent described in this section.

Land in a municipality

(2)  The council of a municipality may pass by-laws exempting from taxation, other than school taxes and local improvement rates, land described in subsection (1) on such conditions as may be set out in the by-laws.

Restriction

(3)  An exemption under subsection (2) must not exceed 10 years but may be renewed at any time during the last year of the exemption.

Exception

(4)  An exemption under subsection (2) does not affect the obligation to pay fees or charges that have priority lien status.

Land in non-municipal territory

(5)  The Minister may make regulations exempting from taxation, other than school taxes, land described in subsection (1) in non-municipal territory on such conditions as may be set out in the regulations.

8.  (1)  Subsection 8 (1) of the Act is amended by striking out the portion before paragraph 1 and substituting the following:

Subclasses for tax reductions

(1)  For the purposes of providing tax reductions, the Minister shall prescribe the following subclasses of real property for land located in municipalities:

. . . . .

(2)  Section 8 of the Act is amended by adding the following subsection:

Same, non-municipal territory

(2.1)  For the purposes of providing tax reductions, the Minister may prescribe subclasses of real property for land located in non-municipal territory.

(3)  Subsection 8 (3) of the Act is amended by striking out "subsection (1) or (2)" and substituting "subsection (1), (2) or (2.1)".

9.  Subsection 9 (2) of the Act is amended by striking out "the assessor" and substituting "the assessment corporation".

10.  Subsection 10 (1) of the Act is amended by striking out "An assessor, and any assistant of and designated by an assessor" at the beginning and substituting "A person authorized by the assessment corporation".

11.  (1)  Subsection 11 (1) of the Act is amended by striking out "an assessor" and substituting "the assessment corporation".

(2)  Subsection 11 (2) of the Act is amended by striking out "the assessor" and substituting "the assessment corporation".

12.  Section 12 of the Act is repealed and the following substituted:

Effect of statements under s. 10 or 11

12.  The assessment corporation is not bound by any statement delivered under section 10 or 11 nor does it excuse the assessment corporation from making due inquiry to ascertain the correctness of the statement and, despite any such statement, the assessment corporation may assess every person for the amount that the assessment corporation believes to be just and correct and may omit from the assessment roll the person's name or any land that the person claims to own or occupy if the assessment corporation has reason to believe that the person is not entitled to be placed on the roll or to be assessed for the land.

13.  (1)  Subsection 14 (1) of the Act is repealed and the following substituted:

Assessment roll

Contents

(1)  The assessment corporation shall prepare an assessment roll for each municipality, for each locality and for non-municipal territory and the assessment roll shall contain the following information as well as the information required under subsections (1.1) and (1.2):

1. The name and surnames, in full, if they can be ascertained, of all persons who are liable to assessment in the municipality or in the non-municipal territory, as the case may be.

2. The amount assessable against each person who is liable to assessment, opposite the person's name.

3. A description of each property sufficient to identify it.

4. The number of acres, or other measures showing the extent of the land.

5. The current value of the land.

6. The value of the land liable to taxation.

7. The value of land exempt from taxation.

8. The classification of the land.

9. Such other information as may be prescribed by the Minister.

Additional contents, land in a municipality or locality

(1.1)  The assessment roll shall also contain the following information respecting land in a municipality or locality:

1. The name of every tenant who is a supporter of a school board.

2. The type of school board the owner or tenant, as the case may be, supports under the Education Act.

3. Whether the owner or tenant, as the case may be, is a French-language rights holder.

4. Religion of the owner or tenant, as the case may be, if he or she is Roman Catholic.

5. In the case of a corporation, whether the corporation is a designated ratepayer under the Education Act.

6. Whether the land is liable to school taxes only.

7. The value of the land leased to tenants referred to in subsection 4 (3) of the Municipal Tax Assistance Act.

Additional contents, land in non-municipal territory

(1.2)  The assessment roll shall also contain the following information respecting land in non-municipal territory:

1. Whether the land is located in an area within the jurisdiction of a local services board, a local roads board or a district social services administration board.

(2)  Paragraph 1 of subsection 14 (2) of the Act is amended,

(a) by striking out "the assessor" and substituting "the assessment corporation"; and

(b) by striking out "he or she may enter" and substituting "the assessment corporation may enter".

14.  Paragraph 5 of subsection 19.2 (1) of the Act is repealed and the following substituted:

5. For the 2006, 2007 and 2008 taxation years, land is valued as of January 1, 2005.

6. For the 2009 and subsequent taxation years, land is valued as of January 1 of the year preceding the taxation year.

15.  (1)  Subsection 24 (1) of the Act is amended by striking out "supplying water, heat, light and power to municipalities and the inhabitants thereof" and substituting "supplying water, heat, light and power to municipalities and to inhabitants of municipalities or non-municipal territory".

(2)  Subsection 24 (3) of the Act is repealed and the following substituted:

Apportionment of assessment

(3)  If the property extends through two or more municipalities or through a municipality and non-municipal territory, the property shall be assessed as a whole and the assessment apportioned between them based on the relative value of the portion of the property that is located in each of them.

16.  (1)  Subsection 25 (2) of the Act is amended by striking out "in each municipality on January 1 of that year" and substituting "on January 1 of that year in each municipality and in non-municipal territory".

(2)  Subsections 25 (12) and (13) of the Act are repealed and the following substituted:

Apportionment of assessment and taxation

(12)  If a pipe line extends through two or more municipalities or through a municipality and non-municipal territory, the portion of the pipe line located in each respective municipality or in the non-municipal territory is liable to assessment and taxation in the respective municipality or non-municipal territory.

Same

(13)  If a pipe line is located,

(a) on a boundary between two municipalities or between a municipality and non-municipal territory;

(b) so close to the boundary that it is on one side of the boundary in some places and on the other side of it in other places; or

(c) on or in a road that lies between the municipalities or between the municipality and the non-municipal territory, and even if the road deviates so that in some places it is wholly or partly within either of them,

the pipe line shall be assessed in each municipality or in the municipality and the non-municipal territory, as the case may be, for one-half of the total amount assessable under this section in respect of the pipe line.

(3)  Subsection 25 (14) of the Act is amended by striking out "in the municipality" at the end and substituting "in the applicable municipality or in the non-municipal territory, as the case may be".

17.  Section 26 of the Act is repealed and the following substituted:

Apportionment of assessment for structures, pipes, poles, etc.

26.  (1)  If a structure, pipe, pole, wire or other property is erected or placed on, in, over or under or affixed to any highway forming the boundary line between two municipalities or between a municipality and non-municipal territory, the property shall be assessed in each municipality or in the municipality and the non-municipal territory, as the case may be, for one-half of the total amount assessable for the property.

Same

(2)  Subsection (1) applies even if,

(a) the property is located so close to the boundary that it is on one side of the boundary in some places and on the other side of it in other places; or

(b) the highway deviates so that it is wholly or partly on one side of the boundary in some places and on the other side of it in other places.

18.  (1)  Section 27 of the Act is amended by adding the following subsection:

Annual payment re non-municipal territory

(7.1)  If land or buildings owned by a commission are located in non-municipal territory, the commission shall pay in each year to the Minister an amount equal to the taxes that would be payable under the Provincial Land Tax Act, 2006 if the land and buildings were taxable and classified in the commercial property class.

(2)  Subsection 27 (8) of the Act is repealed and the following substituted:

Mode of assessment, appeals

(8)  Subject to subsections (3), (7.1) and (10), the property on which payment is to be made under subsection (3) or (7.1) shall be assessed according to this Act and the provisions of this Act respecting appeals apply.

(3)  Subsection 27 (10) of the Act is amended by striking out "subsection (3)" wherever it appears and substituting in each case "subsection (3) or (7.1)".

(4)  Section 27 of the Act is amended by adding the following subsection:

Same

(15)  The provisions of this Act and the Provincial Land Tax Act, 2006 with respect to the collection of taxes apply with necessary modifications to the payments required to be made under this section to the Minister.

19.  Section 29 of the Act is repealed and the following substituted:

Apportionment of assessment for bridges and tunnels

29.  If a bridge or tunnel extends into two municipalities or into a municipality and non-municipal territory, the bridge or tunnel shall be assessed as a whole and the assessment apportioned between the municipalities or the municipality and non-municipal territory, as the case may be, based on the relative value of the portion of the bridge or tunnel that is located in each of them.

20.  (1)  Subsection 30 (1) of the Act is amended by striking out the portion before clause (a) and substituting the following:

Annual statement by railway company

(1)  Every year on or before March 1 or such other date as the Minister may prescribe, every railway company shall give the assessment corporation a statement with respect to any part of the roadway or other land of the company that is located in each municipality or in non-municipal territory and the statement must show,

. . . . .

(2)  Subsection 30 (4) of the Act is repealed and the following substituted:

Exemption from other assessments

(4)  A railway company assessed under this section is exempt from assessment in any other manner for the purposes of taxation under the Provincial Land Tax Act, 2006 and for the purposes of taxation for municipal purposes other than local improvements.

21.  (1)  Subsection 31 (1) of the Act is amended by striking out the portion before clause (a) and substituting the following:

Notice of assessment

(1)  If there is a change in any information described in subsection 14 (1), (1.1) or (1.2) in respect of a parcel of land and the change is not reflected in the last assessment roll as returned, the assessment corporation shall deliver to every person described in subsection 14 (1) who is affected by the change a notice, in a form approved by the Minister, showing,

. . . . .

(2)  Clause 31 (1) (b) of the Act is amended by adding "if applicable" after "school support".

(3)  Subsection 31 (1) of the Act is amended by striking out "or assessor" in the portion after clause (c).

(4)  Subsection 31 (1.1) of the Act is amended by striking out "or an assessor" in the portion before clause (a).

(5)  Subsections 31 (2) and (3) of the Act are repealed and the following substituted:

Delivery of notice, residents

(2)  If the person assessed is resident in the municipality or non-municipal territory, as the case may be, in which the land is located, the notice shall be delivered by leaving it at the person's residence or place of business or by mailing it addressed to the person at the person's residence or place of business.

Same, non-residents

(3)  If the person assessed is not resident in the municipality or non-municipal territory, as the case may be, in which the land is located, the notice shall be delivered by mailing it addressed to the person at the person's last known address.

(6)  Subsection 31 (5) of the Act is amended by striking out the portion before clause (a) and substituting the following:

Information notice

(5)  The assessment corporation shall deliver with the notice required by subsection (1), or publish in a newspaper having general circulation in the municipality or area in which the land assessed is situated, a notice setting out,

. . . . .

(7)  Clause 31 (5) (b) of the Act is repealed and the following substituted:

(b) the times and places where the information in the assessment roll may be examined and discussed with the assessment corporation;

(8)  Subsection 31 (7) of the Act is amended by striking out "the assessor" and substituting "the assessment corporation".

22.  Subsections 32 (2), (3) and (4) of the Act are repealed and the following substituted:

Change in classification

(2)  The following rules apply if, as a result of a change in the regulations made under section 7, the classification of land is changed for the current year or for all or part of the preceding year and taxes have been levied on the land that exceed the amount of taxes that would have been levied on the land if it had been classified in accordance with the change in the regulations:

1. The assessment corporation shall make any assessment necessary to change the classification.

2. If the land is located in a municipality, the clerk of the municipality shall alter the tax roll upon receiving notice of the change, and the municipality shall refund or credit to the owner the amount of any overpayment and any interest paid by the owner on the amount of the overpayment.

3. If the land is located in non-municipal territory, the Minister shall alter the tax roll upon receiving notice of the change, and shall refund or credit to the owner the amount of any overpayment and any interest paid by the owner on the amount of the overpayment.

Change in tax liability

(3)  The following rules apply if, as a result of an amendment to this Act or the regulations, land becomes exempt from taxation for the current year or for all or part of the preceding year:

1. The assessment corporation shall make any assessment necessary to change the tax liability for the land.

2. If the land is located in a municipality, the clerk of the municipality shall alter the tax roll upon receiving notice of the change, and the municipality shall refund or credit to the owner the amount of any overpayment of taxes and any interest paid by the owner on the amount of the overpayment.

3. If the land is located in non-municipal territory, the Minister shall alter the tax roll upon receiving notice of the change, and shall refund or credit to the owner the amount of any overpayment of taxes and any interest paid by the owner on the amount of the overpayment.

Change in methodology

(4)  The following rules apply if, as a result of an amendment to this Act or the regulations, the method of determining the assessed value of land for the current year or for all or part of the preceding year is changed:

1. The assessment corporation shall make any assessment necessary to change the assessed value.

2. If the land is located in a municipality, the clerk of the municipality shall alter the tax roll upon receiving notice of the change, and the municipality shall,

i. refund or credit to the owner the amount of any overpayment of taxes and any interest paid by the owner on the amount of the overpayment, or

ii. levy and collect from the owner any additional taxes that have become payable as a result of the change.

3. If the land is located in non-municipal territory, the Minister shall alter the tax roll upon receiving notice of the change, and shall,

i. refund or credit to the owner the amount of any overpayment of taxes and any interest paid by the owner on the amount of the overpayment, or

ii. collect from the owner any additional taxes that have become payable as a result of the change.

23.  (1)  Subsection 33 (1) of the Act is repealed and the following substituted:

Change re land omitted from tax roll

(1)  The following rules apply if land liable to assessment has been in whole or in part omitted from the tax roll for the current year or for all or part of either or both of the last two preceding years, and no taxes have been levied for the assessment omitted:

1. The assessment corporation shall make any assessment necessary to correct the omission.

2. If the land is located in a municipality, the clerk of the municipality shall alter the tax roll upon receiving notice of the change, and the municipality shall levy and collect the taxes that would have been payable if the assessment had not been omitted.

3. If the land is located in non-municipal territory, the Minister shall alter the tax roll upon receiving notice of the change, and shall collect the taxes that would have been payable if the assessment had not been omitted.

(2)  Subsection 33 (3) of the Act is repealed and the following substituted:

Change re incorrect exemption from tax

(3)  The following rules apply if land liable to taxation has been entered on the tax roll for the current year or for all or part of either or both of the last two preceding years as exempt from taxation, and no taxes have been levied on that land:

1. The assessment corporation shall make any assessment necessary to correct the omission. However, no change shall be made if a court or tribunal has decided that the land is not liable to taxation.

2. If the land is in a municipality, the clerk of the municipality shall alter the tax roll upon receiving notice of the change, and the municipality shall levy and collect the taxes that would have been payable if the land had been entered in the tax roll as being liable to taxation.

3. If the land is in non-municipal territory, the Minister shall alter the tax roll upon receiving notice of the change, and shall collect the taxes that would have been payable if the land had been entered in the tax roll as being liable to taxation.

(3)  Subsection 33 (5) of the Act is repealed and the following substituted:

Reassessment re managed forests, conservation land

(5)  The following rules apply if land described in clause (4) (a) or (b) ceases to be described by any of those clauses:

1. The assessment corporation shall make any change to the assessment and classification required as a result. However, any change to the assessment and classification shall not affect a taxation year that ends more than four years before the assessment and classification is made.

2. If the land is in a municipality, the clerk of the municipality shall alter the tax roll upon receiving notice of the change, and the municipality shall levy and collect the taxes payable for the years affected by the change.

3. If the land is in non-municipal territory, the Minister shall alter the tax roll upon receiving notice of the change, and shall collect the taxes payable for the years affected by the change.

(4)  Subsection 33 (6) of the Act is amended by striking out "an assessor" and substituting "the assessment corporation".

24.  (1)  Subsection 34 (1) of the Act is amended by striking out "and the clerk of the municipality upon notification thereof shall enter a supplementary assessment" in the portion after clause (d) and substituting "and upon receiving notice of the further assessment, the clerk of the municipality or, in the case of land in non-municipal territory, the Minister shall enter a supplementary assessment".

(2)  Subsection 34 (2) of the Act is amended by striking out "and the clerk of the municipality, upon notification of that change, shall enter it" and substituting "and, upon receiving notice of the change, the clerk of the municipality or, in the case of land in non-municipal territory, the Minister shall enter it".

(3)  Subsection 34 (2.3) of the Act is repealed.

(4)  Subsection 34 (3) of the Act is amended by striking out "the assessor" and substituting "the assessment corporation".

(5)  Subsection 34 (4) of the Act is amended by striking out "an assessor" and substituting "the assessment corporation".

25.  Section 36 of the Act is repealed and the following substituted:

Time for annual assessment and return of roll

Assessment

36.  (1)  Except as provided in section 32, 33 or 34, assessments of land under this Act shall be made annually at any time between January 1 and the second Tuesday following December 1.

Return of the assessment roll

(2)  The assessment roll for a municipality and any area attached to the municipality under clause 56 (b) or subsection 58.1 (2) of the Education Act shall be returned to the clerk of the municipality, the assessment roll for a locality or a local roads area under the Local Roads Boards Act shall be returned to the secretary of the applicable board and the assessment roll for non-municipal territory shall be returned to the Minister, not later than the second Tuesday following December 1 in the year in which the assessment is made.

Extension

(3)  If in any year it appears that the assessment roll for a municipality or for non-municipal territory, as the case may be, will not be or has not been returned within the time required by subsection (2), the assessment corporation may extend the time for the return of the roll for such period of time as the assessment corporation considers necessary.

Notice of extension

(4)  The following rules apply if the assessment corporation extends the time for the return of the roll:

1. If the extension relates to the assessment roll for a municipality, the assessment corporation shall ensure that a notice of the extension is published in a daily or weekly newspaper that, in its opinion, has sufficient circulation within the municipality to provide reasonable notice of the extension to persons affected by it.

2. If the extension relates to the assessment roll for non-municipal territory, the assessment corporation shall ensure that a notice of the extension is given in a manner specified by the Minister that he or she considers appropriate to provide reasonable notice of the extension to persons affected by it.

3. The notice must state the date on which the roll will be returned and the final date for making a complaint to the Assessment Review Board.

Duty re appeals

(5)  As soon as practicable after the return of the assessment roll for a municipality or for non-municipal territory, as the case may be, the Assessment Review Board shall hear and dispose of all appeals respecting assessments for the year for which the roll is returned.

Certification of municipal assessment roll

(6)  When the Assessment Review Board disposes of all appeals respecting assessments in a municipality for the year for which the assessment roll is returned, the registrar of the Board shall certify the roll to be the last revised assessment roll of the municipality for the year for which the assessments on the roll are made.

26.  (1)  Subsections 37 (3), (4) and (5) of the Act are repealed and the following substituted:

Last revised assessment roll, non-municipal territory

(3)  The yearly assessment roll for non-municipal territory last returned to the Minister, when corrected and revised under this Act, is for all purposes the last revised assessment roll for non-municipal territory.

Use of last revised roll, municipality

(4)  In every municipality, the rates of taxation for each year shall be fixed and the taxes shall be levied on the assessment made for the year according to the last revised assessment roll.

Use of roll as returned, municipality

(4.1)  Despite subsection (4), the council of the municipality may fix the rates of taxation and levy the taxes for a year (the "taxation year") on the assessment made in the preceding year according to the assessment roll as returned for the taxation year.

Use of last revised roll, non-municipal territory

(4.2)  In non-municipal territory, the rates of taxation for each year shall be levied on the assessment made for the year according to the last revised assessment roll.

Use of roll as returned, non-municipal territory

(4.3)  Despite subsection (4.2), the rates of taxation for each year may be levied on the assessment made in the preceding year according to the assessment roll as returned for the taxation year.

Rights of appeal preserved

(5)  Nothing in this section deprives a person of a right of appeal provided for in this Act, which may be exercised and the appeal proceeded with in accordance with this Act, despite the fact that the assessment roll has become the last revised assessment roll.

(2)  Subsection 37 (6) of the Act is amended by adding after "by the municipality" at the end "or the Minister, as the case may be".

27.  (1)  Subsection 38 (1) of the Act is repealed and the following substituted:

Assessment of annexed areas

(1)  This section applies if land is detached from one municipality or from non-municipal territory and annexed to another municipality and the annexation occurs after the return of the assessment roll for the annexing municipality (the "transitional assessment roll").

By-law requirement

(1.1)  In the year in which taxation is to be levied by the annexing municipality on the transitional assessment roll, the council of the annexing municipality shall pass a by-law adopting the assessment of the annexed land, as it was last revised before the annexation, as the basis of the assessment of the annexed land for taxation in that year by the annexing municipality.

(2)  Subsection 38 (2) of the Act is amended by striking out "subsection (1)" and substituting "subsection (1.1)".

28.  Section 39 of the Act is repealed and the following substituted:

Delivery of assessment roll

39.  (1)  The assessment corporation shall deliver the assessment roll for a municipality and any area attached to the municipality under clause 56 (b) or subsection 58.1 (2) of the Education Act to the clerk of the municipality, the assessment roll for a locality to the secretary of the applicable board and the assessment roll for non-municipal territory to the Minister, and shall do so on or before the date fixed for the return of the roll.

Public inspection, municipality

(2)  Immediately upon receiving the assessment roll for the municipality, the clerk shall make it available for inspection by the public during office hours.

Same, non-municipal territory

(3)  As soon as is practicable after receiving the assessment roll for non-municipal territory, the Minister shall make it available for inspection by the public in the manner and at the locations and times the Minister considers appropriate.

29.  (1)  Subsection 39.1 (3) of the Act is amended by striking out "or an assessor".

(2)  Subsections 39.1 (5) and (6) of the Act are repealed and the following substituted:

Notice of settlement

(5)  If the assessment corporation and the person making the request agree to a settlement, the assessment corporation shall give notice of the settlement to the clerk of the municipality in which the land is located or to the Minister, if the land is located in non-municipal territory.

Alteration of tax roll

(6)  Upon receiving notice of the settlement, the clerk or the Minister, as the case may be, shall alter the tax roll accordingly and taxes shall be levied in accordance with the amended assessment.

(3)  Subsection 39.1 (8) of the Act is repealed and the following substituted:

Objection to settlement

(8)  The following rules apply if the municipality or the Minister, as the case may be, objects to the settlement:

1. The municipality or the Minister, as the case may be, shall complain to the Assessment Review Board within 90 days after receiving notice of the settlement.

2. Section 40 applies, with necessary modifications, as though the assessment roll had been changed to reflect the settlement and the municipality or the Minister complained about the change.

(4)  Subsection 39.1 (9) of the Act is amended by striking out "or an assessor".

30.  (1)  Subsection 40 (1) of the Act is amended by striking out "including a municipality or a school board" in the portion before clause (a) and substituting "including a municipality, a school board or, in the case of land in non-municipal territory, the Minister".

(2)  Subsection 40 (5) of the Act is repealed and the following substituted:

Parties

(5)  The following persons are parties to a proceeding:

1. The assessment corporation.

2. All persons complaining and all persons whose assessment is complained of.

3. The municipality in which the land is located or, if the land is located in non-municipal territory, the Minister.

(3)  Subsection 40 (8) of the Act is amended by striking out "the assessor" and substituting "the assessment corporation".

(4)  Subsection 40 (12) of the Act is repealed and the following substituted:

Alteration of assessment roll, municipality

(12)  If the land is located in a municipality, the Board shall forward its decision to the clerk of the municipality and the clerk shall forthwith,

(a) alter the assessment roll in accordance with the decisions of the Board from which no appeal is taken;

(b) indicate on the roll that the alteration has been made; and

(c) complete the roll by totalling the amounts of the assessments in the roll and inserting the total.

Same, non-municipal territory

(12.1)  If the land is located in non-municipal territory, the Board shall forward its decision to the Minister and the Minister shall alter the assessment roll in accordance with the decisions of the Board from which no appeal is taken, indicate on the roll that the alteration has been made and complete the roll by totalling the amounts of the assessments in the roll and inserting the total.

(5)  Subsections 40 (14), (14.1), (15) and (15.1) of the Act are repealed and the following substituted:

Deemed complaints, 2006, etc.

(14)  If a complaint relates to the 2006 taxation year, the complainant shall be deemed to have made the same complaint,

(a) in relation to assessments under sections 33 and 34 for the 2006 taxation year;

(b) in relation to the assessment, including assessments under sections 33 and 34, for the 2007 taxation year if the complaint is not finally disposed of before the last day for complaining with respect to that taxation year; and

(c) in relation to the assessment, including assessments under sections 33 and 34, for the 2008 taxation year if the complaint is not finally disposed of before the last day for complaining with respect to that taxation year.

Deemed complaints, 2007, etc.

(15)  If a complaint relates to the 2007 taxation year and subsection (14) does not apply, the complainant shall be deemed to have made the same complaint,

(a) in relation to assessments under sections 33 and 34 for the 2007 taxation year; and

(b) in relation to the assessment, including assessments under sections 33 and 34, for the 2008 taxation year if the complaint is not finally disposed of before the last day for complaining with respect to that taxation year.

(6)  Subsection 40 (16.1) of the Act is amended by striking out "(14), (14.1) and (15)" and substituting "(14) and (15)".

(7)  Subsection 40 (17) of the Act is repealed.

31.  Clause 40.1 (b) of the Act is amended by striking out "the assessor" and substituting "the assessment corporation".

32.  Section 41 of the Act is amended,

(a) by striking out "The roll as finally revised by the Assessment Review Board and certified by the registrar" at the beginning and substituting "The last revised assessment roll"; and

(b) by striking out "the assessment commissioner" and substituting "the assessment corporation".

33.  Section 42 of the Act is repealed and the following substituted:

Certified copies as evidence

42.  The following documents may be received in evidence by a court or tribunal, without proof of the signature of the person certifying the document and without production of the original of which the document purports to be a copy:

1. A document that is a copy of all or part of the assessment roll for a municipality, certified by the clerk of the municipality to be a true copy of it.

2. A document that is a copy of all or part of the assessment roll for non-municipal territory, certified by the Minister to be a true copy of it.

34.  Subsection 44 (1) of the Act is amended by striking out "and if necessary the roll of the municipality" and substituting "and if necessary the assessment roll".

35.  Subsection 45 (1) of the Act is amended by striking out "the assessor" wherever it appears and substituting in each case "the assessment corporation".

36.  (1)  Subsections 46 (1) and (2) of the Act are repealed and the following substituted:

Application to court

(1)  Subject to subsection (1.1), any of the following persons may apply to the Superior Court of Justice for the determination of any matter relating to an assessment:

1. Any person against whom the land is assessed.

2. The assessment corporation.

3. The municipality in which the land is located or, if the land is located in non-municipal territory, the Minister.

Exception

(1.1)  No application to court may be made for the determination of a matter that could be the subject of a complaint under subsection 40 (1) or for a determination that lands are conservation lands for the purposes of paragraph 25 of subsection 3 (1).

Service of notice

(2)  The persons to be served with notice of the application are the persons against whom the land is assessed, the assessment corporation and the clerk of the municipality in which the land is located or, if the land is located in non-municipal territory, the Minister.

(2)  Subsection 46 (5) of the Act is repealed and the following substituted:

Effect of appeal

(5)  An appeal shall not delay the final revision of the assessment roll.

Alteration of roll after appeal

(5.1)  When the appeal is finally determined, the clerk of the municipality or the Minister, as the case may be, shall alter the assessment roll, if necessary, to reflect the final determination of the application under this section.

37.  Section 48 of the Act is repealed and the following substituted:

Alteration of roll re court decision

48.  (1)  If the Superior Court of Justice declares any part of an assessment of land to be invalid or in error, the whole assessment is not thereby invalidated and the court may direct that the assessment roll be altered to reflect its decision.

Same

(2)  If the land is located in a municipality, the clerk of the municipality shall alter the assessment roll for the municipality to reflect the court's decision, if the decision is not appealed, and shall indicate on the roll that the alteration has been made.

Same

(3)  If the land is located in non-municipal territory, the Minister shall alter the assessment roll for the territory to reflect the court's decision, if the decision is not appealed.

38.  Section 49 of the Act is amended by adding at the end "or, in the case of land in non-municipal territory, by the Minister".

39.  The Act is amended by adding the following section:

Delegation of powers

50.  (1)  The Minister may delegate to a public servant within the meaning of the Public Service Act any of the Minister's powers or duties under this Act relating to land in non-municipal territory, other than the power to make a regulation under this Act.

Same

(2)  The delegation must be made in writing and is subject to such limitations, conditions and requirements as are set out in it.

Subdelegation

(3)  In a delegation, the Minister may authorize a person to whom a power or duty is delegated to delegate the power or duty to others, subject to such limitations, conditions and requirements as the person may impose.

Presumption

(4)  A person who purports to exercise a delegated power or perform a delegated duty shall be presumed conclusively to act in accordance with the delegation.

40.  The Act is amended by adding the following section:

Transitional Matters

Land in non-municipal territory

58.  (1)  Despite subsection 3 (1), land in non-municipal territory is not liable to assessment under this Act before 2007 and is not liable to taxation based on assessment under this Act before 2009.

Same

(2)  Sections 31, 32, 33, 34, 35, 36, 39.1, 40 and 40.1 do not apply before 2008 in respect of land located in non-municipal territory.

Regulations

(3)  The Minister may make regulations providing for transitional matters which, in the opinion of the Minister, are necessary or desirable to deal with problems or issues arising under this Act as a result of the repeal of the Provincial Land Tax Act and the enactment of the Provincial Land Tax Act, 2006.

Conflicts

(4)  If there is a conflict between a regulation providing for a transitional matter under this section and a provision of this Act or another regulation made under this Act, the regulation made under this section prevails.

Commencement

41.  (1)  Subject to subsections (2), (3) and (4), this Schedule comes into force on the day the Budget Measures Act, 2006 (No. 2) receives Royal Assent.

Same

(2)  Subsection 4 (1) shall be deemed to have come into force on April 1, 2004.

Same

(3)  Subsections 1 (3) and (6), section 2, subsection 4 (3), section 18, subsection 20 (2) and sections 23, 27 and 33 come into force on January 1, 2009.

Same

(4)  Subsection 18 (2) and sections 22, 24, 25, 26, 28, 29, 30, 36, 37, 38 and 39 come into force on January 1, 2008.

SCHEDULE B
AUDITOR GENERAL ACT

1.  The definition of "Crown controlled corporation" in section 1 of the Auditor General Act is amended by adding at the end "or one or more members of the Executive Council of Ontario".

2.  Clause 12 (2) (f) of the Act is amended by striking out "the Crown, Crown controlled corporations" in the portion before subclause (i) and substituting "the Crown, agencies of the Crown, Crown controlled corporations".

Commencement

3.  This Schedule comes into force on the day the Budget Measures Act, 2006 (No. 2) receives Royal Assent.

SCHEDULE C
BUSINESS REGULATION REFORM ACT, 1994

1.  Section 8 of the Business Regulation Reform Act, 1994 is repealed and the following substituted:

Business identifiers

8.  (1)  The Lieutenant Governor in Council may by order in council establish a system of business identifiers.

Agreements with Canada

(2)  The Minister responsible for the administration of this section may enter into agreements with the Government of Canada or an agent of the Government of Canada for the purpose of integrating a system of business identifiers established under this section with any system of business identifiers established by the Government of Canada or an agent of the Government of Canada.

Agreements re use of business identifiers

(3)  The Minister responsible for the administration of this section may enter into agreements with a Minister of another Ministry of the Government of Ontario or with an agency, board or commission established under an Act of Ontario respecting whether the Ministry, agency, board or commission must,

(a) assign business identifiers to businesses in accordance with the system of business identifiers established under this section; and

(b) use the system of business identifiers for any other purpose.

Regulations

(4)  The Lieutenant Governor in Council may make regulations providing for the use that businesses are required to make of the system of business identifiers established under this section.

General or particular

(5)  A regulation made under subsection (4) may be general or particular.

Business information

8.1  (1)  In this section,

"business information" means,

(a) the business identifier, if any, assigned to a business by the system of business identifiers established under section 8 or by a system of business identifiers established by the Government of Canada or an agent of the Government of Canada,

(b) the name of the business and any operating names or other business names used by it,

(c) the legal structure of the business,

(d) the mailing address of the business,

(e) the telephone and fax numbers, if any, of the business,

(f) if the business is a corporation,

(i) the date of its incorporation,

(ii) the jurisdiction under whose laws it is incorporated and its incorporation number in that jurisdiction,

(iii) for a business incorporated in a jurisdiction other than Ontario, a copy of its licence under the Extra-Provincial Corporations Act, if required to carry on any of its business in Ontario,

(iv) the names of its directors,

(g) if the business is a partnership, the names of the partners,

(h) if the business is an unincorporated organization other than a partnership, the name of at least one individual who alone or together with others is responsible for the management of the business or affairs of the organization, and

(i) any other prescribed information.

Minister may require business information

(2)  If an agreement mentioned in subsection 8 (3) is entered into in relation to any Act, the Minister responsible for the administration of that Act may require that a person subject to that Act provide prescribed business information to him or her.

Disclosure of business information

(3)  Business information received under subsection (2),

(a) shall be disclosed to the Minister responsible for the administration of this section, for the purposes of this Act; and

(b) may be disclosed to the Government of Canada or an agent of the Government of Canada.

Same

(4)  After an agreement referred to in subsection (2) is entered into in relation to an Act, subsection (3) applies to all business information received by the Minister responsible for that Act, regardless of whether the business information was received before or after the agreement referred to in subsection (2) was entered into.

Regulations

(5)  The Lieutenant Governor in Council may make regulations,

(a) prescribing information for the purposes of clause (i) of the definition of "business information" in subsection (1);

(b) prescribing business information for the purposes of subsection (2);

(c) authorizing, for specified purposes, the collection, use and disclosure, by specified persons and entities, of specified business information received under any Act.

General or particular

(6)  A regulation made under subsection (5) may be general or particular.

Confidentiality provisions do not apply

(7)  Any requirement or authority under this section, or under a regulation made under clause (5) (c), to disclose business information applies despite any confidentiality provision in another Act.

Same

(8)  Unless it is expressly provided in any other Act that its provisions and regulations, rules or by-laws made under it apply despite subsection (7), subsection (7) prevails over the provisions of such other Act and over regulations, rules or by-laws made under such other Act which conflict with it.

Commencement

2.  (1)  Subject to subsection (2), this Schedule comes into force on the day the Budget Measures Act, 2006 (No. 2) receives Royal Assent.

Same

(2)  Section 1 comes into force on a day to be named by proclamation of the Lieutenant Governor.

SCHEDULE D
CANADIAN PUBLIC ACCOUNTABILITY BOARD ACT (ONTARIO), 2006

Purpose of Act

1.  The purpose of this Act is to promote the integrity of financial reporting in Ontario's capital markets.

Definitions

2.  (1)  In this Act,

"audit" means an examination by a public accounting firm that is intended to be in compliance with generally accepted auditing standards of financial statements of a reporting issuer that are intended to be filed with a Canadian or foreign securities regulator; ("vérification")

"Board" means the Canadian Public Accountability Board as described in section 3; ("Conseil")

"Commission" means the Ontario Securities Commission; ("Commission")

"designated professional" means an officer of a participating audit firm, or a partner, employee or independent contractor of a participating audit firm who is involved in a professional capacity in audits of the financial statements of reporting issuers; ("professionnel désigné")

"document" means any physical embodiment of information or ideas and includes written or electronic documents, electronic or computerized data compilations and any disc, tape, film or other device in which sound, visual images or other data is embodied; ("document")

"foreign auditor oversight body" means an auditor oversight body carrying out a mandate substantially similar to the Board's in a foreign jurisdiction, in respect of which the Board has determined under its rules, that to the extent specified by the Board, reliance may be placed upon inspections, investigations and determinations carried out by such a foreign auditor oversight body; ("organe étranger de surveillance des vérificateurs")

"generally accepted auditing standards" means,

(a) in the case of an audit report which references auditing standards generally accepted in Canada, the auditing standards for audits of corporations, the shares of which are publicly traded, as set out in the Assurance Handbook of the Canadian Institute of Chartered Accountants, or

(b) in the case of an audit report which references generally accepted auditing standards of a jurisdiction other than Canada, the standards generally accepted in that jurisdiction; ("normes de vérification généralement reconnues")

"Minister" means the Minister responsible for the administration of this Act; ("ministre")

"Ontario securities law" means the Securities Act and the regulations and rules under that Act and, in respect of a person or company, a decision of the Commission or of a Director, as defined in the Securities Act, to which the person or company is subject; ("droit ontarien des valeurs mobilières")

"participating audit firm" means a public accounting firm that has entered into a participation agreement with the Board and has not had its status terminated, or, if its participant status was terminated, has been reinstated in accordance with the Board's rules; ("cabinet de vérification participant")

"participation agreement" means a written agreement between the Board and a public accounting firm in connection with the Board's program of practice inspections and the establishment of practice requirements; ("convention de participation")

"professional regulatory authority" means an entity, other than a securities regulator, that has, in a province or territory of Canada, statutory inspection, investigatory or disciplinary responsibility for a participating audit firm, a practice office of the firm or a designated professional of the firm; ("autorité de réglementation professionnelle")

"professional standards" means the auditing, ethical and independence standards applicable to participating audit firms under the Board's rules; ("normes professionnelles")

"public accounting firm" means a sole proprietorship, partnership, corporation or other legal entity engaged in the business of providing services as public accountants and authorized under the laws of Ontario to issue audit reports on financial statements; ("cabinet d'experts-comptables")

"reporting issuer" means a reporting issuer as defined under Ontario securities law; ("émetteur assujetti")

"violation event" means,

(a) an act or practice, or omission to act, by a participating audit firm or a designated professional in violation of the Board's rules or professional standards that in either case may have a negative effect on the provision of audit services to reporting issuers,

(b) a failure by a participating audit firm or a designated professional to supervise appropriately a person with a view to preventing violations of the Board's rules or professional standards, and that person has committed an act or has failed to act, such that in either case there is a violation of the Board's rules or professional standards that may have a negative effect on the provision of audit services to reporting issuers,

(c) a failure by a participating audit firm or a designated professional to co-operate in an inspection or investigation by the Board, or

(d) a failure by a participating audit firm or a designated professional to comply with the terms of any requirement, restriction or sanction imposed by the Board. ("cas de violation")

Same

(2)  In the definition of "Ontario securities law", clause 6 (3) (b) and section 13, "person" and "company" have the same meanings as in the Securities Act.

Documents

(3)  For the purposes of this Act,

(a) a draft document or non-identical copy is a separate document within the meaning of the term "document"; and

(b) the term "document" is not limited to audit working papers.

Board's mandate in Ontario established

3.  The Canadian Public Accountability Board, a corporation without share capital incorporated under the Canada Corporations Act by letters patent dated April 15, 2003, with the object of contributing to public confidence in the integrity of financial reporting by public companies, among other things, is hereby authorized to,

(a) maintain a register of public accounting firms that audit reporting issuers; and

(b) oversee the audit of the financial statements of reporting issuers.

Chair of OSC, member of Governing Council

4.  Despite subsection 3 (7) of the Securities Act, the Chair of the Commission may be a member of the Board's Council of Governors so long as the Board's by-laws provide that he or she is a member of the Council.

Not a Crown agency

5.  (1)  The Board is not an agent of Her Majesty nor a Crown agent for the purposes of the Crown Agency Act.

Independent from but accountable to the Government of Ontario

(2)  The Board, in carrying out its mandate and in exercising its powers and duties under this Act, is independent from, but accountable to, the Commission and the Government of Ontario as set out in this Act.

Powers and duties

General

6.  (1)  The Board may, subject to this Act, its by-laws and its rules, do such things as are necessary to carry out its functions under section 3.

Specific duties

(2)  Without limiting the generality of subsection (1), the Board shall, subject to this Act, its by-laws and its rules,

(a) establish and maintain requirements for the participation of public accounting firms that audit reporting issuers in the Board's oversight program;

(b) publish and maintain on its website a register of public accounting firms that are participants in the Board's oversight program;

(c) conduct inspections of participating audit firms directly or through or in co-operation with professional regulatory authorities in order to assess the compliance of each participating audit firm with professional standards, the Board's rules and the firm's own quality control policies in connection with the issuance of audit reports on the financial statements of reporting issuers and,

(i) receive and evaluate reports and recommendations resulting from such inspections, and

(ii) require remedial action by participating audit firms when necessary or appropriate, following an inspection;

(d) conduct investigations of participating firms and impose, where indicated, restrictions, sanctions or requirements to upgrade supervision, training or education;

(e) conduct review proceedings when the recommendations made by the Board or the requirements, restrictions or sanctions applied by the Board in connection with an application for membership, an inspection or an investigation are contested by the participating audit firm that is the subject of the Board's decision; and

(f) account to the Commission and the Government of Ontario on its activities in the manner set out in this Act.

Specific powers

(3)  Without limiting the generality of subsection (1) or (2), the Board may, subject to this Act, its by-laws and its rules,

(a) assist professional regulatory authorities in their supervision of public accounting firms, including referring cases of individual conduct to a professional regulatory authority and co-ordinating its disciplinary measures for a designated professional or an audit firm with those of the professional regulatory authority;

(b) notify the Commission, any regulatory authority, any law enforcement agency and any professional regulatory authority if, in the circumstances set out in section 13, it appears that there may have been a contravention of the law by any person or company;

(c) assist, and receive assistance from, foreign auditor oversight bodies in investigations of participating audit firms; and

(d) provide comments and recommendations on accounting and assurance standards to professional regulatory authorities and other relevant standard setting and oversight bodies.

Board's letters patent, by-laws, rules

7.  (1)  The Board, in carrying out its mandate and in exercising its powers and carrying out its duties under this Act, shall operate in accordance with its letters patent, its by-laws and its rules, all as amended from time to time.

Rule changes

(2)  No rule made by the Board after the coming into force of this Act, including any amendment or repeal of any rule of the Board, takes effect in Ontario until it has been approved by the Minister and notice of the approval has been published in The Ontario Gazette and on the Board's website.

Repeal of Act

(3)  The Lieutenant Governor, on the recommendation of the Minister, may by proclamation repeal this Act if the Board's letters patent or its by-laws are amended and the Minister is of the opinion that the amendments have a negative effect on the operation of this Act.

Contents of notice

(4)  The notice of approved change required by subsection (2) shall set out the date of the approval, the date the approved change takes effect and the text of the change.

Regulations Act not to apply

(5)  The Regulations Act does not apply to the by-laws or rules of the Board nor to any notice of the Minister under subsection (2).

Publication of documents

(6)  The Board shall publish and maintain on its website its letters patent, its by-laws, and its rules, each as amended from time to time and, if an amendment is made, the Board shall also maintain on its website a copy of the relevant document as it read before the amendment.

Duty of audit firms

8.  Every participating audit firm shall comply with the applicable by-laws and rules of the Board, the terms of its participation agreement, the terms of any inspection report or investigation report made by the Board as a result of an inspection or investigation of the firm and the decision of any review panel under the Board's oversight program.

Annual report

9.  (1)  Within 90 days of the end of its fiscal year, the Board shall prepare and submit to the Commission, in accordance with this section and the regulations made under this Act, an annual report on the affairs of the Board for that fiscal year. 

Contents of report

(2)  The annual report shall contain,

(a) information regarding the register of public accounting firms in the Board's oversight program, including the number of firms that were registered in the year and the number whose registration was terminated;

(b) the aggregate amount of fees collected by the Board from participating audit firms and the method used by the Board in the determination of those fees;

(c) the number of inspections and the number of investigations of participating audit firms carried out by the Board during the year and a summary of the results of the inspections and investigations, including a summary of the recommendations, requirements and sanctions determined by the Board;

(d) the number of review proceedings conducted in respect of Board decisions and the outcome of those proceedings;

(e) the status of any appeals, applications for judicial review and arbitrations in respect of the decisions made by a review panel;

(f) a copy of the Board's audited financial statements for the fiscal year to which the annual report relates and a copy of its budget for the current year; and

(g) such other information related to the work of the Board as may be prescribed by the regulations made under this Act.

Review by Council of Governors

(3)  The Board's Council of Governors shall certify to the Commission that it has examined the annual report and that it has satisfied itself through such meetings with the Board and the Board's directors, officers and staff and through such other review as the Council considers necessary to support its opinion that, based on the information available to it,

(a) the Board has carried out its mandate in a manner that is consistent with the public interest in maintaining the integrity of financial reporting by reporting issuers and the objectives of National Instrument 52-108 of the Canadian Securities Administrators as adopted as a rule of the Ontario Securities Commission on March 30, 2004 or of such other instrument as may be named in the regulations made under this Act; or

(b) the Board has failed to satisfy the requirements set out in clause (a).

Limitation

(4)  Despite subsection (3), the members of the Council of Governors are not entitled to, and shall not be given access to, any documents or information relating to any specific audit of a reporting issuer.

Submission of certificate

(5)  The certificate of the Council of Governors shall be submitted to the Commission at the same time as the annual report.

Commission oversight

(6)  Within six weeks of receiving the annual report from the Board, the Commission shall assess the report and determine if there are any issues arising from the report that require action, and it shall provide a copy of the Board's report together with a report on the Commission's assessment of the Board's report and the Commission's recommendations, if any, to the Minister.

No participation by Chair of Commission

(7)  The Chair of the Commission shall not participate in the Commission's assessment of the Board's annual report or in any meeting of the Commission at which the report or the assessment are considered.

Report to be laid before Assembly

(8)  The Minister shall lay the Board's report and the Commission's report before the Assembly by delivering them to the Clerk.

Rules

10.  (1)  The Board shall govern the conduct of its oversight program in accordance with its rules.

Same

(2)  In addition to any matters that the Board is entitled to deal with in its rules, for the purposes of, and subject to the provisions of, this Act, the rules shall deal with the following aspects of its oversight program:

1. The participation and withdrawal or termination of participation by participating audit firms, including the application process, the form of the participation agreement and eligibility for audit firms to become participating audit firms.

2. The collection of personal information from designated professionals.

3. The designation of professional standards applicable to participating audit firms.

4. Procedures to be followed by the Board in conducting inspections, including the persons entitled to be present, co-operation obligations, documents to be produced, dispute procedures where the Board's request for documents is contested, confidentiality of the Board's inspection reports, reporting on violation events, and joint inspections with foreign auditor oversight bodies.

5. Procedures to be followed by the Board in conducting investigations, including the issuance of investigation orders, the designation of persons entitled to conduct investigations, the taking of testimony, demands for production, dispute procedures where the Board's demand for information is contested, requests for testimony from reporting issuers, methods of notifying the Commission or any regulatory authority, law enforcement agency or professional regulatory authority or foreign auditor oversight body for the purposes of sections 13 and 14, the imposition of sanctions in case of a violation event, and assistance to foreign auditor oversight bodies in investigations of participating audit firms under laws of foreign jurisdictions.

6. The establishment of appropriate restrictions, sanctions or requirements that the Board may impose upon a participating audit firm if the Board determines that a violation event has occurred, procedures for the notification of decisions, the rights of participating audit firms to request a review of disciplinary decisions of the Board, provisions regarding public disclosure of disciplinary decisions, and reliance upon findings of a foreign auditor oversight body.

7. Review proceedings where a participating audit firm disagrees with a decision of the Board, the appointment of hearing officers to review panels, the powers of a review panel to establish its own processes, the evidence to be considered by a review panel, the authority of a review panel to substitute its own decisions for those of the Board, the maintenance of a record of review proceedings and the responsibility to pay costs of proceedings.

8. Requiring participating audit firms to pay membership fees to the Board and establishing the types of fees, the method of calculating the fees, the manner in which the fees will be collected and penalties for non-payment of fees.

Same

(3)  For the purposes of this Act, the rules of the Board consist of,

(a) the rules of the Board and the form of the participation agreement, as adopted by the Board, as they read before the coming into force of this Act;

(b) article 11 of the by-laws of the Board as it read before the coming into force of this Act;

(c) amendments made after this section comes into force to the rules described in clause (a), the form of the participation agreement and article 11 of the Board's by-laws that have been approved and published in accordance with subsection 7 (2); and

(d) regulations made under this Act which specify that they shall be deemed to be rules of the Board for the purposes of this Act.

Board's access to information

11.  (1)  The Board may require a participating audit firm to provide it with all the documents and information that the audit firm obtained or prepared in order to perform the audit firm's audit of a reporting issuer and that,

(a) in the case of a reporting issuer to which the Business Corporations Act applies, are required to be supplied by the reporting issuer to the auditor under subsections 153 (5), (6) and (7) of that Act or under any other Act; or

(b) in the case of any other reporting issuer, are required to be supplied by the reporting issuer to the auditor under the laws of the jurisdiction under which it is incorporated or organized.

Confidentiality of documents, etc.

(2)  All documents and other information prepared for or received by the Board in the exercise of its mandate and all deliberations of the Board and its employees and agents, in connection with an inspection, investigation or review panel proceeding carried out under the Board's oversight program, are confidential and may not be disclosed without,

(a) the written consent of all persons whose interests might reasonably be affected by the disclosure; or

(b) a court order authorizing the disclosure.

Testimony, production of documents

(3)  No member of the Council of Governors or the Board and no officer, employee, agent or representative of the Board shall be required in any proceeding, except a proceeding under this Act, to give testimony or produce any document with respect to documents or information that the person is prohibited from disclosing under this Act.

Restriction on disclosure

(4)  The Board may require the provision of information or the production of documents under subsection (1) that is, or are, the subject of solicitor-client privilege if access to the information or the documents is absolutely necessary to the purpose of the review of the audit.

Privilege preserved

(5)  Disclosure of information or documents under subsection (1) does not negate or constitute a waiver of any privilege and the privilege continues for all other purposes.

Appeal to Divisional Court

12.  (1)  A party to a hearing before a review panel established by the Board may appeal from the panel's decision to the Divisional Court in accordance with the rules of court.

Question of law only

(2)  An appeal under subsection (1) may be made on a question of law only.

Arbitration

(3)  In lieu of an appeal under subsection (1), a party, other than the Board, may refer the matter to binding arbitration.

Application of Arbitration Act, 1991

(4)  Subject to the regulations made under this Act, the Arbitration Act, 1991 applies to an arbitration proceeding under this Act.

Board a party

(5)  The Board is a party to an appeal or arbitration.

Right to be heard

(6)  The Minister is entitled to be heard, by counsel or otherwise, upon an argument of the appeal or at an arbitration hearing.

Notification of securities regulators

13.  (1)  Despite subsection 11 (2), if the Board is provided with any document or other information that provides reasonable grounds to believe that any person or company may have contravened any law, the Board may notify the Commission, any regulatory authority, law enforcement agency or professional regulatory authority as the Board considers appropriate that it has discovered evidence of a contravention of the law, but the Board shall not disclose,

(a) privileged documents, privileged information or information based on privileged information or documents; or

(b) any specific information relating to the business, affairs or financial condition of a participating audit firm or of the client of any participating audit firm except to the extent that the disclosure is authorized in writing by all persons and companies whose interests might reasonably be affected by the disclosure.

Same

(2)  For greater certainty, the Board shall not use privileged documents or information in determining if it has reasonable grounds to believe that any person or company may have contravened any law for the purposes of subsection (1).

Disclosure to foreign auditor oversight bodies

14.  (1)  Despite subsection 11 (2), the Board may provide documents or other information to a foreign auditor oversight body relevant to that body's review of an audit carried out on a reporting issuer that carries on business in that body's jurisdiction.

Exception

(2)  The Board shall not provide privileged documents, privileged information or information based on privileged information to a foreign auditor oversight body.

Immunity from liability

15.  (1)  No action or other proceeding for damages may be instituted against any member of the Council of Governors, any industry member as defined in the by-laws of the Board, any member of the Board's board of directors or any officer, employee or agent of the Board for any act done in good faith in the performance or intended performance of any duty or in the exercise or the intended exercise of any power under this Act, or for any neglect or default in the performance or exercise in good faith of such duty or power.

Liability of Board

(2)  Subsection (1) does not relieve the Board of liability in respect of a tort committed by a person mentioned in subsection (1) to which it would otherwise be subject.

Regulations

16.  (1)  The Minister may make regulations,

(a) governing the preparation and submission of annual reports and budgets under section 9 and prescribing information to be included in the reports;

(b) naming instruments for the purposes of clause 9 (3) (a);

(c) prescribing rules in relation to the oversight program of the Board and providing that they shall be deemed to be rules of the Board;

(d) governing arbitrations under section 12.

Same

(2)  A regulation made under subsection (1) has effect only in Ontario.

Bill 14 - Access to Justice Act, 2006

17.  (1)  This section applies only if Bill 14 (Access to Justice Act, 2006), introduced on October 27, 2005, receives Royal Assent.

Same

(2)  References in this section to provisions of Bill 14 are references to those provisions as they were numbered in the first reading version of the Bill.

Same

(3)  On the later of the day subsection 7 (5) of this Act comes into force and the day section 130 of Schedule F to Bill 14 comes into force, subsection 7 (5) of this Act is amended by striking out "The Regulations Act" at the beginning and substituting "Part III (Regulations) of the Legislation Act, 2006".

Commencement

18.  (1)  Subject to subsection (2), this Schedule comes into force on the day the Budget Measures Act, 2006 (No. 2) receives Royal Assent.

Same

(2)  Sections 1 to 16 come into force on a day to be named by proclamation of the Lieutenant Governor.

Short title

19.  The short title of the Act set out in this Schedule is the Canadian Public Accountability Board Act (Ontario), 2006.

SCHEDULE E
CAPITAL INVESTMENT PLAN ACT, 1993

1.  The definition of "public body" in subsection 29 (1) of the Capital Investment Plan Act, 1993 is repealed and the following substituted:

"public body" means,

(a) a corporation referred to in section 2 or another Crown agency,

(b) a hospital as defined in the Public Hospitals Act or another facility receiving funding for capital purposes from the Minister of Health and Long-Term Care,

(c) a municipality,

(d) a university that receives regular and ongoing operating funds from the Crown in right of Ontario for the purposes of providing post-secondary education, a college of applied arts and technology established under the Ontario Colleges of Applied Arts and Technology Act, 2002, Algoma University College, le Collège de Hearst or the Ontario College of Art & Design,

(e) a school board, or

(f) an entity named or described as a public body in the regulations made under this Act; ("organisme public")

Commencement

2.  This Schedule comes into force on the day the Budget Measures Act, 2006 (No. 2) receives Royal Assent.

SCHEDULE F
COMMUNITY SMALL BUSINESS INVESTMENT FUNDS ACT

1.  (1)  The definition of "eligible business" in subsection 18.11 (1) of the Community Small Business Investment Funds Act is repealed and the following substituted:

"eligible business" means a taxable Canadian corporation or Canadian partnership that meets the criteria described in subsection (2); ("entreprise admissible")

(2)  Subsection 18.11 (2) of the Act is amended by striking out the portion before paragraph 1 and substituting the following:

Eligible business

(2)  A taxable Canadian corporation or Canadian partnership must meet the following criteria in order to be an eligible business in relation to an Ontario commercialization investment fund:

. . . . .

(3)  Paragraphs 1 and 2 of subsection 18.11 (2) of the Act are amended by striking out "the corporation" wherever it appears and substituting in each case "the corporation or partnership".

(4)  Paragraph 3 of subsection 18.11 (2) of the Act is repealed and the following substituted:

3. The corporation or partnership has a total revenue determined in accordance with generally accepted accounting principles of less than the prescribed amount or, if no amount is prescribed, $500,000 from the time of its incorporation or formation until the time of the initial investment by an Ontario commercialization investment fund.

(5)  Paragraphs 4 and 5 of subsection 18.11 (2) of the Act are amended by striking out "the corporation" wherever it appears and substituting in each case "the corporation or partnership".

(6)  Paragraphs 6, 7 and 8 of subsection 18.11 (2) of the Act are repealed and the following substituted:

6. At the time of an initial or follow-on investment, at least 50 per cent of the full-time employees of the corporation or partnership are employed in respect of eligible business activities carried on by the corporation or partnership in Ontario.

7. In the case of a taxable Canadian corporation, the value of the total tangible assets of the corporation, together with the total tangible assets of all related corporations and the total tangible assets of all partnerships in which the corporation or a related corporation is a member, as determined at the time of the initial investment by an Ontario commercialization investment fund, does not exceed the prescribed amount or, if no amount is prescribed, $500,000.

8. In the case of a Canadian partnership, the value of the total tangible assets of the partnership, together with the total tangible assets of all affiliated persons, within the meaning of section 251.1 of the Income Tax Act (Canada), as determined at the time of the initial investment by an Ontario commercialization investment fund, does not exceed the prescribed amount or, if no amount is prescribed, $500,000.

9. In the case of a taxable Canadian corporation, the corporation was incorporated under the Business Corporations Act or the Canada Business Corporations Act.

10. In the case of a Canadian partnership, the partnership is in compliance with the laws of Ontario relating to partnerships.

(7)  Clause 18.11 (4) (a) of the Act is amended by striking out "January 1, 2009" and substituting "January 1, 2011".

(8)  Clause 18.11 (4) (b) of the Act is repealed and the following substituted:

(b) in the case of an investment in an eligible business that is a taxable Canadian corporation, the investment is,

(i) the purchase from the eligible business by the Ontario commercialization investment fund of shares issued by the eligible business in exchange for a consideration paid in money, or

(ii) the purchase of a warrant, option or right granted by the eligible business, in conjunction with the issue of a share that is an eligible investment, to acquire a share of the eligible business that would be an eligible investment if that share were issued at the time that the warrant, option or right was granted;

(b.1) in the case of an investment in an eligible business that is a Canadian partnership, the investment is the contribution of capital, paid in money, to the eligible business by the Ontario commercialization investment fund in exchange for an interest in the partnership; and

(9)  Subclause 18.11 (4) (c) (vi) of the Act is repealed and the following substituted:

(vi) the return of capital to a shareholder or partner of the eligible business or the payment of the principal amount of outstanding liabilities owing to a shareholder or partner of the eligible business by the eligible business,

Commencement

2.  This Schedule comes into force on the day the Budget Measures Act, 2006 (No. 2) receives Royal Assent.

SCHEDULE G
CORPORATIONS TAX ACT

1.  Subclause 43 (2) (b) (iii) of the Corporations Tax Act is repealed and the following substituted:

(iii) the corporation's aggregate investment income for the year, as defined in subsection 129 (4) of the Income Tax Act (Canada).

2.  (1)  Subsections 43.11 (3) and (4) of the Act are repealed and the following substituted:

Amount of tax credit

(3)  The amount of a qualifying corporation's Ontario interactive digital media tax credit for a taxation year is the sum of,

(a) 20 per cent of the amount of the corporation's qualifying expenditure for the taxation year; and

(b) if the corporation is a qualifying small corporation, 10 per cent of the amount that would be determined under subclause (4) (b) (i) for the taxation year if the amounts referred to in that subclause were determined by reference only to expenditures incurred after March 23, 2006 and before January 1, 2010.

Qualifying expenditure

(4)  The qualifying expenditure of a qualifying corporation for a taxation year is the sum of,

(a) the amount, if any, that would be its eligible labour expenditure for the taxation year in respect of eligible products that are specified products if that amount were determined by reference only to expenditures incurred after March 23, 2006 and before January 1, 2010; and

(b) the amount, if any, of,

(i) its eligible labour expenditure and eligible marketing and distribution expenditure for the taxation year in respect of eligible products, other than specified products, if the corporation is a qualifying small corporation for the taxation year, or

(ii) the amount that would be its eligible labour expenditure and the amount that would be its eligible marketing and distribution expenditure for the taxation year in respect of eligible products, other than specified products, if those amounts were determined by reference only to expenditures incurred after March 23, 2006 and before January 1, 2010, if the corporation is not a qualifying small corporation for the taxation year. 

Who claims amount in respect of specified product

(4.1)  For the purposes of subsection (4), if a qualifying corporation develops a specified product under a contract entered into after March 23, 2006, only the qualifying corporation is entitled to claim an amount under this section in respect of the specified product.

(2)  The definition of "B" in subsection 43.11 (5) of the Act is repealed and the following substituted:

"B" is the amount, if any, by which "C" exceeds "D" where,

"C" is the total of all amounts, if any, each of which is the Ontario labour expenditure incurred for the eligible product by the qualifying corporation in a previous taxation year or by a qualifying predecessor corporation before the disposition, merger or wind-up, as the case may be, to the extent that the expenditure is incurred in the 25-month period ending at the end of the month in which development of the eligible product is completed, and

"D" is the total of all amounts, if any, each of which is the eligible labour expenditure for the eligible product that was included in the determination of the amount of a tax credit claimed under this section for a previous taxation year by the qualifying corporation or by a qualifying predecessor corporation, and

(3)  The definition of "C" in subsection 43.11 (5.2) of the Act is repealed and the following substituted:

"C" is the total of all amounts, if any, each of which is a marketing and distribution expenditure in respect of the eligible product incurred by the qualifying corporation in the taxation year or in a previous taxation year or by a qualifying predecessor corporation before the disposition, merger or wind-up, as the case may be, to the extent that it was incurred,

(a) in the month in which development of the eligible product is completed, and

(b) in the period of 24 months before, or in the period of 12 months after, the month in which development of the eligible product is completed,

(4)  The definition of "E" in subsection 43.11 (5.2) of the Act is repealed and the following substituted:

"E" is the total of all amounts, if any, each of which is an eligible marketing and distribution expenditure for the eligible product that was included in the determination of a tax credit claimed under this section for a previous taxation year by the qualifying corporation or by a qualifying predecessor corporation, and

(5)  The definition of "eligible product" in subsection 43.11 (15) of the Act is repealed and the following substituted:

"eligible product" means, in respect of a qualifying corporation, a product,

(a) that satisfies the conditions prescribed by the regulations or that is a specified product, and

(b) for which public financial support would not be contrary to public policy in the opinion of the Ontario Media Development Corporation or, if another person is designated under subsection (6), in the opinion of that person; ("produit admissible")

(6)  The definition of "qualifying corporation" in subsection 43.11 (15) of the Act is amended by adding "and" at the end of clause (b), by striking out "and" at the end of clause (c) and by repealing clause (d).

(7)  Subsection 43.11 (15) of the Act is amended by adding the following definition:

"qualifying small corporation" means, subject to subsection (18), a qualifying corporation to which subsection 57.2 (1) would not apply for the immediately preceding taxation year,

(a) if the references to $5 million in clause 57.2 (1) (a) and in subclause 57.2 (1) (c) (i) were read as $10 million, and

(b) if the references to $10 million in clause 57.2 (1) (b) and in subclause 57.2 (1) (c) (ii) were read as $20 million. ("petite société admissible")

(8)  Section 43.11 of the Act is amended by adding the following subsection:

Specified product

(15.1)  A product developed by a qualifying corporation is a specified product for the purposes of this section if the following conditions are satisfied:

1. The product satisfies the conditions prescribed by the regulations.

2. The product is developed by the qualifying corporation under the terms of an agreement between the qualifying corporation and a purchaser that is a corporation that deals at arm's length with the qualifying corporation.

3. The product is developed under the agreement for the purpose of sale or license by the purchaser to one or more persons, each of whom deals at arm's length with the purchaser.

4. All or substantially all of the product is developed in Ontario by the qualifying corporation.

5. The development of the product is completed by the qualifying corporation after March 23, 2006.

(9)  Section 43.11 of the Act is amended by adding the following subsection:

Amalgamations

(18)  Despite the definition of "qualifying small corporation" in subsection (15), a corporation formed as a result of an amalgamation of two or more predecessor corporations is not a qualifying small corporation for the taxation year commencing at the time of the amalgamation unless each predecessor corporation would be considered, but for this subsection, to be a qualifying small corporation for its last taxation year ending immediately before the amalgamation and, for the purposes of this subsection, each predecessor corporation is deemed to have been associated with every other predecessor corporation during the taxation year ending immediately before the amalgamation.

3.  Subsection 43.13 (10) of the Act is amended by striking out "paragraph 4 of subsection (9)" and substituting "subparagraphs 1 iv and 2 iii of subsection (9)".

4.  Section 50 of the Act is repealed and the following substituted:

Income Tax Act (Canada) ss. 135 and 135.1 applicable

50.  (1)  Sections 135 and 135.1 of the Income Tax Act (Canada) apply for the purposes of this Act, to the extent those sections apply to corporations, with respect to,

(a) the deduction from income of payments made pursuant to allocations in proportion to patronage; and

(b) the inclusion in income of payments received pursuant to allocations in proportion to patronage.

Exception

(2)  Despite subsection (1), in the application of sections 135 and 135.1 of the Income Tax Act (Canada),

(a) subsections 135 (3) and 135.1 (7) of that Act do not apply for the purposes of this Act; and

(b) paragraph 135.1 (4) (b) of that Act applies only to indebtedness entered into by a corporation after December 31, 2005.

5.  Subsection 56.1 (5) of the Act is amended by striking out "if the corporation is liable to a penalty" in the portion before clause (a) and substituting "if any person is liable to a penalty".

6.  Subclause 57.4 (1) (b) (v) of the Act is amended by adding the following sub-subclause:

(E) the amount of any gain in respect of the disposition of property by the corporation after May 1, 2006, if the disposition is described in subparagraph 38 (a.1) (i) or (a.2) (i) of the Income Tax Act (Canada),

7.  (1)  Subclause 80 (11) (b) (i) of the Act is repealed and the following substituted:

(i) the assessment, reassessment or additional assessment is required under subsection (16) or (16.1) or would be required if the corporation had claimed an amount by filing the written request referred to in that subsection on or before the day referred to in that subsection,

(2)  Clause 80 (15) (a) of the Act is repealed and the following substituted:

(a) a written request under subsection (16) or (16.1);

(3)  Subsection 80 (16) of the Act is repealed and the following substituted:

Reassessment for loss carried back

(16)  If a corporation has delivered the return required by section 75 for a particular taxation year and, within three years after the day on or before which it was required to deliver the return, has delivered to the Minister a written request that the Minister permit any of the following deductions, the Minister shall reassess the tax payable by the corporation for any relevant taxation year, other than a taxation year preceding the particular taxation year, in order to take into account the deduction claimed:

1. A deduction under section 41 of the Income Tax Act (Canada), as made applicable by section 14 of this Act, in respect of the corporation's listed-personal-property loss for a subsequent taxation year.

2. A deduction under section 111 of the Income Tax Act (Canada), as made applicable by section 34 of this Act, in respect of a loss for a subsequent taxation year.

Reassessment, reduction in amount included in income under s. 91 (1), Income Tax Act (Canada)

(16.1)  If there is a reduction in the amount included under subsection 91 (1) of the Income Tax Act (Canada), as made applicable by subsection 30 (1) of this Act, in computing the income of a corporation for a particular taxation year, the Minister shall reassess the tax payable by the corporation for any relevant taxation year, other than a taxation year preceding the particular year, in order to take into account the reduction if,

(a) the corporation has delivered the return required under section 75 for the particular taxation year;

(b) the reduction is because of a reduction in the foreign accrual property income of a foreign affiliate of the corporation for a taxation year of the affiliate that ends in the particular year (in this subsection referred to as the affiliate's "earlier year"),

(i) that is attributable to the amount prescribed under the Income Tax Regulations (Canada) to be the deductible loss of the affiliate for the affiliate's earlier year that arose in a subsequent taxation year of the affiliate that ends in a subsequent taxation year of the corporation, and

(ii) that is included in the description of "F" in the definition of "foreign accrual property income" in subsection 95 (1) of the Income Tax Act (Canada), as it applies for the purposes of this Act, in respect of the affiliate for the affiliate's earlier year; and

(c) within three years after the day on or before which the corporation was required to deliver the return for the particular year, the corporation has delivered to the Minister a written request to amend the return to take into account the reduction in the foreign accrual property income.

(4)  Section 80 of the Act is amended by adding the following subsection:

Reassessment, illegal payments

(25.2)  Despite subsections (11), (12) and (15), the Minister may reassess and make additional assessments or assess tax, interest or penalties at any time in respect of any taxation year ending before or after this subsection comes into force to give effect to subsection 67.5 (1) of the Income Tax Act (Canada), as made applicable by subsection 26 (1) of this Act.

8.  Paragraph 1 of subsection 84 (1.0.1) of the Act is amended by striking out "subsection 80 (16), (20), (22) or (25)" and substituting "subsection 80 (16), (20), (22), (25) or (25.2)".

9.  Paragraph 1 of subsection 85 (1.1) of the Act is amended by striking out "subsection 80 (16), (20), (22) or (25)" and substituting "subsection 80 (16), (20), (22), (25) or (25.2)".

10.  (1)  Section 91 of the Act is amended by striking out the portion before clause (a) and substituting the following:

Extension of time

91.  The time within which a notice of objection is to be served or an appeal is to be instituted may be extended by the Minister if application for extension is made,

. . . . .

(2)  Clause 91 (b) of the Act is repealed and the following substituted:

(b) with respect to an appeal, before the expiry of the time allowed under subsection 85 (1) for instituting the appeal.

11.  Part V of the Act is amended by adding the following section:

Application under subrule 14.05 (2), Rules of Civil Procedure

92.1  (1)  If the following conditions are satisfied, a person may make an application under subrule 14.05 (2) of the Rules of Civil Procedure to a judge of the Superior Court of Justice:

1. The application is to determine one or more issues of law that depend solely on the interpretation of,

i. this Act or the regulations, or

ii. this Act or the regulations and another Ontario statute or regulation.

2. The Minister has indicated in writing that the Minister is satisfied that it is in the public interest for the applicant to make the application.

3. The Minister and the applicant have executed a statement of agreed facts on which they both intend to rely and the applicant files the statement as part of the applicant's application record.

4. No facts remain in dispute between the Minister and the applicant that either of them believes may be relevant to the determination of any issue of law that is a subject of the application.

Application of rule 38.10, Rules of Civil Procedure

(2)  Rule 38.10 of the Rules of Civil Procedure does not apply to an application referred to in this section, except that the presiding judge may, on the hearing of the application, adjourn the application in whole or in part and with or without terms under clause 38.10 (1) (a) of that rule.

Disposition of application

(3)  The court may dispose of an application that is authorized under this section by,

(a) making a declaration of law in respect of one or more issues of law forming the subject of the application;

(b) declining to make a declaration of law in respect of any of the issues of law forming the subject of the application; or

(c) dismissing the application.

Effect of declaration of law

(4)  No declaration of law made on an application under this section,

(a) shall be binding on the Minister and the applicant except in relation to the facts agreed to by them in the proceeding; or

(b) shall otherwise affect the rights of the Minister or the applicant in any appeal instituted under this Act.

No applications under subrule 14.05 (3)

(5)  No person other than the Minister may bring an application under subrule 14.05 (3) of the Rules of Civil Procedure on or after the day this section comes into force, in respect of any matter arising under this Act.

Other proceedings

(6)  On the motion of the Minister, the court shall dismiss a proceeding commenced by an application under rule 14.05 of the Rules of Civil Procedure relating to a matter under this Act or the regulations if any condition in subsection (1) has not been satisfied or the application is prohibited under subsection (5).

Commencement

12.  (1)  Subject to subsections (2), (3), (4) and (5), this Schedule comes into force on the day the Budget Measures Act, 2006 (No. 2) receives Royal Assent.

Same

(2)  Section 2 shall be deemed to have come into force on March 24, 2006.

Same

(3)  Section 3 shall be deemed to have come into force on December 16, 2004.

Same

(4)  Section 4 shall be deemed to have come into force on January 1, 2006.

Same

(5)  Section 6 shall be deemed to have come into force on May 1, 2006.

SCHEDULE H
DEVELOPMENT CHARGES ACT, 1997

1.  Subsection 5 (5) of the Development Charges Act, 1997 is amended by adding the following paragraph:

7.1 Toronto-York subway extension, as defined in subsection 5.1 (1).

2.  The Act is amended by adding the following section:

Toronto-York subway extension

Definition

5.1  (1)  In this section,

"Toronto-York subway extension" means an extension of the subway service located in the City of Toronto beyond its terminus at Downsview subway station further north in the City of Toronto and into The Regional Municipality of York, and works and equipment directly related to that extension.

Provision does not apply

(2)  Paragraph 4 of subsection 5 (1) does not apply in determining the estimate for the increase in the need for the Toronto-York subway extension.

Applicable restriction

(3)  For the purposes of section 5, the estimate for the increase in the need for the Toronto-York subway extension shall not exceed the planned level of service over the 10-year period immediately following the preparation of the background study required under section 10.

Regulations

(4)  The method of estimating the planned level of service for the Toronto-York subway extension and the criteria to be used in doing so may be prescribed by regulation.

3.  Subsection 60 (1) of the Act is amended by adding the following clauses:

(m.1) further clarifying or defining the term "Toronto-York subway extension" in subsection 5.1 (1);

(m.2) prescribing the method and criteria to be used to estimate the planned level of service for the Toronto-York subway extension;

Commencement

4.  This Schedule comes into force on a day to be named by proclamation of the Lieutenant Governor.

SCHEDULE I
EMPLOYER HEALTH TAX ACT

1.  The English version of subsection 10 (5) of the Employer Health Tax Act is amended by striking out "the time for commencing an appeal" and substituting "a time for instituting an appeal".

2.  The Act is amended by adding the following section:

Application under subrule 14.05 (2), Rules of Civil Procedure

10.1  (1)  If the following conditions are satisfied, a person may make an application under subrule 14.05 (2) of the Rules of Civil Procedure to a judge of the Superior Court of Justice:

1. The application is to determine one or more issues of law that depend solely on the interpretation of,

i. this Act or the regulations, or

ii. this Act or the regulations and another Ontario statute or regulation.

2. The Minister has indicated in writing that the Minister is satisfied that it is in the public interest for the applicant to make the application.

3. The Minister and the applicant have executed a statement of agreed facts on which they both intend to rely and the applicant files the statement as part of the applicant's application record.

4. No facts remain in dispute between the Minister and the applicant that either of them believes may be relevant to the determination of any issue of law that is a subject of the application.

Application of rule 38.10, Rules of Civil Procedure

(2)  Rule 38.10 of the Rules of Civil Procedure does not apply to an application referred to in this section, except that the presiding judge may, on the hearing of the application, adjourn the application in whole or in part and with or without terms under clause 38.10 (1) (a).

Disposition of application

(3)  The court may dispose of an application that is authorized under this section by,

(a) making a declaration of law in respect of one or more issues of law forming the subject of the application;

(b) declining to make a declaration of law in respect of any of the issues of law forming the subject of the application; or

(c) dismissing the application.

Effect of declaration of law

(4)  No declaration of law made on an application under this section,

(a) shall be binding on the Minister and the applicant except in relation to the facts agreed to by them in the proceeding; or

(b) shall otherwise affect the rights of the Minister or the applicant in any appeal instituted under this Act.

No applications under subrule 14.05 (3)

(5)  No person other than the Minister may bring an application under subrule 14.05 (3) of the Rules of Civil Procedure on or after the day this section comes into force, in respect of any matter arising under this Act.

Other proceedings

(6)  On the motion of the Minister, the court shall dismiss a proceeding commenced by an application under rule 14.05 of the Rules of Civil Procedure relating to a matter under this Act or the regulations if any condition in subsection (1) has not been satisfied or the application is prohibited under subsection (5).

Commencement

3.  This Schedule comes into force on the day the Budget Measures Act, 2006 (No. 2) receives Royal Assent.

SCHEDULE J
FINANCIAL ADMINISTRATION ACT

1.  The definition of "ministry" in section 1 of the Financial Administration Act is repealed and the following substituted:

"ministry" means a ministry of the Government of Ontario and, unless otherwise provided in this Act, includes a board, commission, authority, corporation and any other agency of the Government of Ontario; ("ministère")

2.  The Act is amended by adding the following section:

Authority to pay interest on overdue amounts

Interpretation

11.4.1  (1)  In this section,

"ministry" does not include a board, commission, authority, corporation or any other agency of the Government of Ontario.

Treasury Board may direct payment of interest

(2)  The Treasury Board may authorize and direct the payment of interest, on such terms and conditions as it may specify, on overdue amounts payable by ministries.

Exception

(3)  Despite subsection (2), the Treasury Board shall not authorize and direct the payment of interest under this section,

(a) in respect of a period before April 1, 2007; or

(b) in respect of a financial obligation,

(i) incurred contrary to subsection 11.3 (1) or section 18, or

(ii) to which subsection 28 (2) applies.

Same

(4)  This section does not affect the authority of the Minister of Finance to agree to pay interest on an overdue amount in relation to a transaction to which section 3 applies or a borrowing of money in accordance with section 18.

Interest deemed to be expenditure for same purpose as overdue amount

(5)  An interest payment authorized under this section shall be deemed to be an expenditure for the same purpose as the overdue amount to which it relates and shall be reported as such in the Public Accounts.

Not a charge on Consolidated Revenue Fund

(6)  Section 19 does not apply to a payment of interest authorized under this section.

3.  Paragraph 1 of section 21 of the Act is repealed and the following substituted:

1. The payment, renewal, repayment or replacement of the whole or any part of any loan raised or securities issued under this or any other Act, if the money is borrowed or the securities are issued for that purpose within the period commencing one year before and ending one year after the date the loan or security being paid, renewed, repaid or replaced becomes due or matures or is purchased and cancelled by Ontario before the date it becomes due or matures, even if the money borrowed or the issue and sale of securities for that purpose may increase the amount of the public debt or extend the term of years, if any, fixed by the Act that authorized the raising of the loan or the issue and sale of the securities being paid, renewed, repaid or replaced.

4.  (1)  Subsection 43 (1) of the Act is amended by adding the following definition:

"overpayment" means a payment of money to which the recipient is not entitled at the time of the payment or to which the recipient ceases to be entitled at any time after the payment. ("paiement en trop")

(2)  Subsection 43 (2) of the Act is amended by striking out the portion before clause (a) and substituting the following:

Set-off

(2)  If, in the opinion of the Minister of Finance, a person is indebted to the Crown or the Crown in right of Canada in any specific sum of money or has received an overpayment of a specified sum from the Crown, the Minister of Finance may,

. . . . .

5.  The Act is amended by adding the following Part:

PART V
RECIPROCAL TAXATION AGREEMENTS

Reciprocal taxation agreements

46.  (1)  The Minister of Finance may enter into reciprocal taxation agreements with the Government of Canada relating to the payment, collection and remittance of taxes, including provisions relating to,

(a) the payment by the Crown of tax payable under the Excise Tax Act (Canada), other than tax payable under Part IX of that Act, as though that Act, other than Part IX, applied to Ontario;

(b) the payment by the Crown of tax under Part IX of the Excise Tax Act (Canada), as if that Act applied to Ontario in respect of,

(i) supplies of property or services acquired by provincial entities, and

(ii) supplies of property or services acquired in the name of a person or entity other than the Crown;

(c) the application by Ontario provincial entities to receive refunds, input tax credits, rebates and remissions under the Excise Tax Act (Canada);

(d) the collection and remittance by the Crown of tax payable by third parties under the Excise Tax Act (Canada);

(e) the payment of interest, but not penalties, in respect of any amount collectible by the Crown under the Excise Tax Act (Canada);

(f) the payment or the collection and remittance by the Crown in right of Canada of any tax, interest or fee imposed under the laws of Ontario or required to be collected and remitted under the laws of Ontario.

Payment out of Consolidated Revenue Fund

(2)  All amounts authorized to be paid by the Crown under a reciprocal taxation agreement may be paid out of the Consolidated Revenue Fund at such times and in such manner as the agreement provides.

Commencement

6.  This Schedule comes into force on the day the Budget Measures Act, 2006 (No. 2) receives Royal Assent.

SCHEDULE K
FUEL TAX ACT

1.  Section 4 of the Fuel Tax Act is amended by adding the following subsection:

Penalty, unregistered importer

(4.1)  Every person who operates as an importer in Ontario without being registered under this section shall pay a penalty, when assessed for it, equal to 110 per cent of the tax that would be payable under section 2 had the fuel that the person imported into Ontario during the period when the person was not registered been sold to a consumer liable to pay tax under this Act.

2.  Section 4.1 of the Act is amended by adding the following subsection:

Penalty, unregistered exporter

(3)  Every person who operates as an exporter in Ontario without being registered under this section shall pay a penalty, when assessed for it, equal to the amount of tax that would be payable under section 2 had the fuel that the person exported out of Ontario during the period when the person was not registered been sold to a consumer liable to pay tax under this Act.

3.  The English version of subsection 4.6 (1) of the Act is amended by striking out "the certificate or notarial copy" and substituting "the certificate or true copy".

4.  (1)  Subsection 14 (15) of the Act is amended by striking out the portion before clause (a) and substituting the following:

Extension of time

(15)  The time within which a notice of objection is to be served or an appeal is to be instituted may be extended by the Minister if application for extension is made,

. . . . .

(2)  Clause 14 (15) (b) of the Act is repealed and the following substituted:

(b) with respect to an appeal, before the expiry of the time allowed under subsection (5) for instituting the appeal.

5.  The Act is amended by adding the following section:

Application under subrule 14.05 (2), Rules of Civil Procedure

14.1  (1)  If the following conditions are satisfied, a person may make an application under subrule 14.05 (2) of the Rules of Civil Procedure to a judge of the Superior Court of Justice:

1. The application is to determine one or more issues of law that depend solely on the interpretation of,

i. this Act or the regulations, or

ii. this Act or the regulations and another Ontario statute or regulation.

2. The Minister has indicated in writing that the Minister is satisfied that it is in the public interest for the applicant to make the application.

3. The Minister and the applicant have executed a statement of agreed facts on which they both intend to rely and the applicant files the statement as part of the applicant's application record.

4. No facts remain in dispute between the Minister and the applicant that either of them believes may be relevant to the determination of any issue of law that is a subject of the application.

Application of rule 38.10, Rules of Civil Procedure

(2)  Rule 38.10 of the Rules of Civil Procedure does not apply to an application referred to in this section, except that the presiding judge may, on the hearing of the application, adjourn the application in whole or in part and with or without terms under clause 38.10 (1) (a).

Disposition of application

(3)  The court may dispose of an application that is authorized under this section by,

(a) making a declaration of law in respect of one or more issues of law forming the subject of the application;

(b) declining to make a declaration of law in respect of any of the issues of law forming the subject of the application; or

(c) dismissing the application.

Effect of declaration of law

(4)  No declaration of law made on an application under this section,

(a) shall be binding on the Minister and the applicant except in relation to the facts agreed to by them in the proceeding; or

(b) shall otherwise affect the rights of the Minister or the applicant in any appeal instituted under this Act.

No applications under subrule 14.05 (3)

(5)  No person other than the Minister may bring an application under subrule 14.05 (3) of the Rules of Civil Procedure on or after the day this section comes into force, in respect of any matter arising under this Act.

Other proceedings

(6)  On the motion of the Minister, the court shall dismiss a proceeding commenced by an application under rule 14.05 of the Rules of Civil Procedure relating to a matter under this Act or the regulations if any condition in subsection (1) has not been satisfied or the application is prohibited under subsection (5).

Application

(7)  Subsections (1) to (6) do not apply in respect of applications to the Superior Court of Justice authorized under any other section of this Act.

6.  Subsection 18 (4) of the Act is repealed and the following substituted:

Copies

(4)  If a book, record or other document is examined or produced under this section, the person by whom it is examined or to whom it is produced, or any officer of the Ministry of Finance, may make or cause to be made one or more copies of it, and a document purporting to be signed by the Minister, or by a person authorized by the Minister, certifying the document to be a copy made under this subsection is admissible in evidence and has the same probative force as the original document would have had if it had been proved in the ordinary way.

7.  Section 21 of the Act is amended by adding the following subsection:

Offence

(5.1)  Every person who, by deceit, falsehood or any other fraudulent means, obtains or attempts to obtain a refund under this Act or the regulations to which the person is not entitled is guilty of an offence and on conviction is liable to a fine of not less than $500 and not more than $10,000, to which may be added a fine of not more than double the amount of the refund the person obtained or sought to obtain, or to imprisonment for a term of not more than two years, or to both.

8.  Subsections 26 (2) and (3) of the Act are repealed and the following substituted:

Penalty

(2)  Every dealer who possesses fuel in bulk from which the dye or a component of the dye has been removed or destroyed, or who possesses fuel that is a mixture of coloured fuel and another type or grade of fuel, shall pay a penalty, when the penalty is assessed, equal to three times the tax that would be payable under section 2 if the fuel were clear fuel sold to a purchaser in Ontario.

Subsequent penalty

(3)  If a penalty is assessed against a dealer under subsection (2) and it is not the first time a penalty under that subsection has been assessed against the dealer, the dealer shall, in addition to the penalty under subsection (2), pay a penalty under this subsection, when the penalty under this subsection is assessed, equal to 10 times the tax that would be payable under section 2 if the fuel were clear fuel sold to a purchaser in Ontario.

Commencement

9.  This Schedule comes into force on the day the Budget Measures Act, 2006 (No. 2) receives Royal Assent.

SCHEDULE L
GASOLINE TAX ACT

1.  Clause (d) of the definition of "gasoline" in subsection 1 (1) of the Gasoline Tax Act is repealed and the following substituted:

(d) ethanol that is or is intended to be mixed or combined with a gas or liquid that is gasoline but only if there is a requirement under Ontario Regulation 535/05 (Ethanol in Gasoline) made under the Environmental Protection Act or another statutory requirement that ethanol be mixed or combined with a gas or liquid that is gasoline, and

2.  Section 4.1 of the Act is amended by adding the following subsection:

Penalty, unregistered importer

(4.1)  Every person who operates as an importer in Ontario without being registered under this section shall pay a penalty, when assessed for it, equal to 110 per cent of the tax that would be payable under section 2 had the gasoline that the person imported into Ontario during the period when the person was not registered been sold to a consumer liable to pay tax under this Act.

3.  Section 4.2 of the Act is amended by adding the following subsections:

Penalty, unregistered exporter

(3)  Every person who operates as an exporter in Ontario without being registered under this section shall pay a penalty, when assessed for it, equal to the amount of tax that would be payable under section 2 had the gasoline that the person exported out of Ontario during the period when the person was not registered been sold to a consumer liable to pay tax under this Act.

Offence, unregistered exporter

(4)  Every person who contravenes subsection (1) is guilty of an offence and on conviction is liable to a fine of not less than $200 and not more than $10,000, plus an amount equal to three times the tax that would be payable under section 2 if the gasoline, aviation fuel or propane were sold to a purchaser in Ontario. 

4.  Section 4.9 of the Act is repealed.

5.  (1)  Subsection 14 (11) of the Act is amended by striking out the portion before clause (a) and substituting the following:

Extension of time

(11)  The time within which a notice of objection is to be served or an appeal is to be instituted may be extended by the Minister if application for extension is made,

. . . . .

(2)  Clause 14 (11) (b) of the Act is repealed and the following substituted:

(b) with respect to an appeal, before the expiry of the time allowed under subsection (1) for instituting the appeal.

6.  The Act is amended by adding the following section:

Application under subrule 14.05 (2), Rules of Civil Procedure

14.1  (1)  If the following conditions are satisfied, a person may make an application under subrule 14.05 (2) of the Rules of Civil Procedure to a judge of the Superior Court of Justice:

1. The application is to determine one or more issues of law that depend solely on the interpretation of,

i. this Act or the regulations, or

ii. this Act or the regulations and another Ontario statute or regulation.

2. The Minister has indicated in writing that the Minister is satisfied that it is in the public interest for the applicant to make the application.

3. The Minister and the applicant have executed a statement of agreed facts on which they both intend to rely and the applicant files the statement as part of the applicant's application record.

4. No facts remain in dispute between the Minister and the applicant that either of them believes may be relevant to the determination of any issue of law that is a subject of the application.

Application of rule 38.10, Rules of Civil Procedure

(2)  Rule 38.10 of the Rules of Civil Procedure does not apply to an application referred to in this section, except that the presiding judge may, on the hearing of the application, adjourn the application in whole or in part and with or without terms under clause 38.10 (1) (a).

Disposition of application

(3)  The court may dispose of an application that is authorized under this section by,

(a) making a declaration of law in respect of one or more issues of law forming the subject of the application;

(b) declining to make a declaration of law in respect of any of the issues of law forming the subject of the application; or

(c) dismissing the application.

Effect of declaration of law

(4)  No declaration of law made on an application under this section,

(a) shall be binding on the Minister and the applicant except in relation to the facts agreed to by them in the proceeding; or

(b) shall otherwise affect the rights of the Minister or the applicant in any appeal instituted under this Act.

No applications under subrule 14.05 (3)

(5)  No person other than the Minister may bring an application under subrule 14.05 (3) of the Rules of Civil Procedure on or after the day this section comes into force, in respect of any matter arising under this Act.

Other proceedings

(6)  On the motion of the Minister, the court shall dismiss a proceeding commenced by an application under rule 14.05 of the Rules of Civil Procedure relating to a matter under this Act or the regulations if any condition in subsection (1) has not been satisfied or the application is prohibited under subsection (5).

Application

(7)  Subsections (1) to (6) do not apply in respect of applications to the Superior Court of Justice authorized under any other section of this Act.

7.  Subsection 16 (5) of the Act is repealed and the following substituted:

Copies

(5)  If a book, record or other document is examined or produced under this section, the person by whom it is examined or to whom it is produced, or any officer of the Ministry of Finance, may make or cause to be made one or more copies of it, and a document purporting to be signed by the Minister, or by a person authorized by the Minister, certifying the document to be a copy made under this subsection is admissible in evidence and has the same probative force as the original document would have had if it had been proved in the ordinary way.

8.  Section 29 of the Act is amended by adding the following subsection:

Offence

(2)  Every person who, by deceit, falsehood or any other fraudulent means, obtains or attempts to obtain a refund under this Act or the regulations to which the person is not entitled is guilty of an offence and on conviction is liable to a fine of not less than $500 and not more than $10,000, to which may be added a fine of not more than double the amount of the refund the person obtained or sought to obtain, or to imprisonment for a term of not more than two years, or to both.

Commencement

9.  (1)  Subject to subsection (2), this Schedule comes into force on the day the Budget Measures Act, 2006 (No. 2) receives Royal Assent.

Same

(2)  Section 1 shall be deemed to have come into force on May 18, 2006.

SCHEDULE M
HIGHWAY TRAFFIC ACT

1.  (1)  Subsection 5 (1) of the Highway Traffic Act is amended by adding the following clause:

(h) prescribing fees for anything done or provided by or on behalf of the Minister, the Ministry or the Registrar under this Act.

(2)  Section 5 of the Act is amended by adding the following subsection:

Fees may include cost recovery portion

(3)  A fee prescribed or set under this Act for the issuance or renewal of any permit or licence or for the validation of any permit may include a portion that is for the recovery of costs related to public highway infrastructure.

2.  (1)  Subsection 7 (9) of the Act is amended by striking out "the Treasurer of the Province of Ontario" and substituting "the Minister of Finance".

(2)  Clause 7 (24) (d) of the Act is amended by striking out "and for any additional administrative proceedings arising therefrom" at the end.

Commencement

3.  This Schedule comes into force on the day the Budget Measures Act, 2006 (No. 2) receives Royal Assent.

SCHEDULE N
INCOME TAX ACT

1.  (1)  Subsection 4 (3.1) of the Income Tax Act is amended by adding the following paragraph:

9.1 An adoption expense credit if the individual is entitled to a deduction under subsection 118.01 (2) of the Federal Act for the year.

(2)  Paragraph 20 of subsection 4 (3.1) of the Act is repealed.

(3)  Paragraph 3 of subsection 4 (3.2) of the Act is amended by striking out "No pension credit" at the beginning and substituting "No pension credit or adoption expense credit".

(4)  Subparagraph 5 i of subsection 4 (3.2) of the Act is amended by striking out "paragraphs 8, 9, 13" and substituting "paragraphs 8, 9, 9.1, 13".

(5)  Subparagraph 7 i of subsection 4 (3.2) of the Act is amended by striking out "paragraphs 8, 9, 13" and substituting "paragraphs 8, 9, 9.1, 13".

(6)  Paragraphs 9 and 10 of subsection 4 (3.2) of the Act are repealed and the following substituted:

9. An individual who is not resident in Canada at any time in the taxation year is not entitled to deduct a credit under any of paragraphs 1 to 7, 9, 9.1, 10, 11, 14, 15, 16 and 17 of subsection (3.1) for the taxation year unless all or substantially all of the individual's income for the year is included in computing his or her taxable income earned in Canada for the year for the purposes of the Federal Act.

10. If a separate return of income with respect to an individual is filed under subsection 70 (2), 104 (23) or 150 (4) of the Federal Act, as it applies for the purposes of this Act, for a particular period and another return of income with respect to the individual is filed under this Act for a period ending in the calendar year in which the particular period ends, the total of all credits under paragraphs 8, 9, 9.1, 10, 11, 12, 13, 14, 15, 17, 18 and 19 of subsection (3.1) claimed in the returns must not exceed the total that could be deducted under those paragraphs for the year with respect to the individual if no separate returns were filed.

(7)  Subsection 4 (3.4.1) of the Act is amended by striking out the portion before clause (a) and substituting the following:

Dividend tax credit, 2001 to 2005

(3.4.1)  In determining the amount of tax payable for a taxation year ending after December 31, 2000 and before January 1, 2006, an individual who is resident in Ontario on the last day of the taxation year may deduct an amount equal to the lesser of,

. . . . .

(8)  Section 4 of the Act is amended by adding the following subsections:

Dividend tax credit, 2006 and later years

(3.4.2)  In determining the amount of tax payable for a taxation year ending after December 31, 2005, an individual who is resident in Ontario on the last day of the year may deduct an amount equal to the lesser of,

(a) the amount of tax payable by the individual for the taxation year under paragraph 1, 2, 3 or 4 of subsection (3), less all amounts deductible for the year under subsection (3.1); and

(b) the sum of,

(i) 38.4828 per cent of the amount determined in respect of the individual for the year under paragraph 121 (a) of the Federal Act, and

(ii) the specified percentage of the amount determined in respect of the individual for the year under paragraph 121 (b) of the Federal Act.

Specified percentage

(3.4.3)  For the purposes of subclause (3.4.2) (b) (ii), the specified percentage is,

(a) 34.2727 per cent for a taxation year ending in 2006;

(b) 35.3273 per cent for a taxation year ending in 2007;

(c) 36.9091 per cent for a taxation year ending in 2008;

(d) 39.0182 per cent for a taxation year ending in 2009; and

(e) 40.6 per cent for a taxation year ending after 2009.

(9)  Subsections 4 (6) and (7) of the Act are repealed and the following substituted:

Foreign tax credit

(6)  An individual who was resident in Ontario on the last day of a taxation year and who had income for the year that included income earned in a country other than Canada in respect of which an amount of non-business-income tax was paid by the individual to the government of that country for the year, may deduct in computing the individual's tax payable under this Act for the year, a foreign tax credit equal to the lesser of "A" and "B" where,

"A" is the amount, if any, by which the non-business-income tax paid by the individual for the year to the government of each country other than Canada exceeds the sum of,

(a) all amounts, if any, deductible by the individual from tax under the Federal Act for the year under subsection 126 (1), (2.2), (2.21) or (2.22) of that Act, and

(b) the amount of the individual's special foreign tax credit for the year as determined under subsection 127.54 (2) of the Federal Act, and

"B" is the amount, if any, determined by multiplying the tax otherwise payable by the individual for the taxation year by the ratio of "C" to "D" where,

"C" is the total amount, if any, determined in respect of the individual for the year under subparagraph 126 (1) (b) (i) of the Federal Act, and

"D" is the amount, if any, by which "E" exceeds "F" where,

"E" is,

(a) if section 114 of the Federal Act is not applicable to the individual for the year, the individual's income earned in Ontario for the year, or

(b) if section 114 of the Federal Act is applicable to the individual for the year, the amount that would be the individual's income earned in Ontario for the year if the amount determined under the Federal Act were equal to the individual's income determined under paragraph 114 (a) of the Federal Act, and

"F" is the amount, if any, determined under subclause 126 (1) (b) (ii) (A) (III) of the Federal Act in respect of the individual for the taxation year.

Rules re foreign tax credit

(7)  The following rules apply in respect of an individual's foreign tax credit for a taxation year:

1. Subsection 126 (6) of the Federal Act and the definition of "non-business-income tax" in subsection 126 (7) of the Federal Act apply for the purposes of subsection (6).

2. For the purposes of subsection (6), the expressions "tax payable" and "tax otherwise payable" by an individual for a taxation year mean the amount of tax payable under this Act, other than the Ontario Health Premium, by the individual for the taxation year before deducting all amounts, if any, deductible by the individual for the year under subsection 4 (3.4), (3.5) or (6) or section 8.

2.  (1)  Section 4.0.1 of the Act is amended by adding the following subsections:

Credit, adoption expense

(10.1)  The amount of an individual's adoption expense credit in respect of an eligible child for a taxation year is the amount calculated using the formula,

A × II

in which,

"A" is the lowest tax rate for the year, and

"II" is the lesser of,

(a) $10,000, and

(b) the amount determined using the formula,

JJ - KK

in which,

"JJ" is the total of all eligible adoption expenses in respect of the eligible child included in computing a deduction under subsection 118.01 (2) of the Federal Act for the year, and

"KK" is the sum of all amounts each of which is the amount of a reimbursement or any other form of assistance (other than an amount that is included in computing the individual's income and that is not deductible in computing the individual's taxable income) that any individual is or was entitled to receive in respect of an amount included in computing the amount of "JJ".

Apportionment of adoption expense credit

(10.2)  If more than one individual is entitled to an adoption expense credit for a taxation year in respect of the same eligible child, the total amount of all adoption expense credits claimed by the individuals in respect of that child shall not exceed the maximum amount that any one of them would be entitled to claim for the year in respect of that child if that individual were the only individual entitled to an adoption expense credit for the year, and if the individuals cannot agree on the portion of the total credit amount to which each is entitled, the Provincial Minister may fix the portions.

Definitions

(10.3)  For the purposes of subsections (10.1) and (10.2), "eligible adoption expense" and "eligible child" have the meanings assigned by subsection 118.01 (1) of the Federal Act.

(2)  Subsections 4.0.1 (26), (27), (28) and (29) of the Act are repealed.

3.  (1)  Paragraph 1.1 of subsection 4.0.2 (1) of the Act is repealed and the following substituted:

1.1 Clause (a) of the definition of "II" in subsection 4.0.1 (10.1).

(2)  Paragraph 5 of subsection 4.0.2 (6) of the Act is repealed and the following substituted:

5. The dollar amount referred to in clause (a) of the definition of "II" in subsection 4.0.1 (10.1) that applies for a taxation year ending before January 1, 2006.

4.  (1)  Subsection 8 (1) of the Act is amended by adding the following definition:

"adjusted income" means, in respect of an individual for a taxation year, the amount that would be the sum of the individual's income for the year and the income of a qualifying spouse or common-law partner with whom the individual resides on December 31 in the year, if no amount were included under subsection 56 (6) of the Federal Act and no amount were deductible under paragraph 60 (y) of that Act in computing their incomes for the year; ("revenu rajusté")

(2)  Clause (a) of the definition of "municipal tax" in subsection 8 (1) of the Act is repealed and the following substituted:

(a) taxes for municipal or school purposes that are levied in respect of real property in Ontario,

(3)  Subsection 8 (2) of the Act is repealed.

(4)  Subsection 8 (3.1) of the Act is amended,

(a) by striking out "December 31, 2004" in the portion before clause (a) and substituting "December 31, 2005"; and

(b) by striking out "$22,250" in the portion before clause (a) and substituting "$23,090".

5.  (1)  The definition of "adjusted income" in subsection 8.5 (1) of the Act is repealed and the following substituted:

"adjusted income" means, in respect of an individual for a base taxation year, the amount that is his or her adjusted income for the year for the purposes of subdivision a.1 of Division E of the Federal Act; ("revenu modifié")

(2)  The definition of "child care services" in subsection 8.5 (1) of the Act is repealed and the following substituted:

"child care services" means the prescribed services as listed in paragraphs 5 to 7 of subsection 66.1 (2) of Regulation 262 of the Revised Regulations of Ontario, 1990 (General), made under the Day Nurseries Act; ("services de garde d'enfants")

(3)  Subparagraph 3 i of subsection 8.5 (2) of the Act is repealed.

Commencement

6.  (1)  Subject to subsections (2) and (3), this Schedule comes into force on the day the Budget Measures Act, 2006 (No. 2) receives Royal Assent.

Same

(2)  Subsections 1 (1), (2), (3), (4), (5) and (6) and sections 2 and 3 shall be deemed to have come into force on January 1, 2005.

Same

(3)  Subsections 1 (7), (8) and (9), section 4 and subsection 5 (1) shall be deemed to have come into force on January 1, 2006.

SCHEDULE O
INSURANCE ACT AND CORPORATIONS ACT

1.  Section 1 of the Insurance Act is amended by adding the following definitions:

"debt obligation" means a bond, debenture, note or other evidence of indebtedness, whether the debt is secured or unsecured; ("titre de créance")

"entity" includes a corporation, trust, partnership, fund, unincorporated association or organization, the Crown, a Crown agency, the government of a foreign country or of a political subdivision of a foreign country and any agency of that government; ("entité")

"financial institution" means,

(a) an insurer that is incorporated or organized under the laws of Canada or of any province of Canada,

(b) a bank or authorized foreign bank within the meaning of section 2 of the Bank Act (Canada),

(c) a loan or trust corporation incorporated or organized under the laws of Canada or any province of Canada,

(d) an entity that,

(i) is incorporated or organized under the laws of Canada or of any province of Canada, and

(ii) primarily engages in dealing in securities, including portfolio management and investment counselling,

(e) a credit union or caisse populaire incorporated under the laws of any province of Canada or an association to which the Cooperative Credit Associations Act (Canada) applies,

(f) an entity that is prescribed or is a member of a class that is prescribed; ("institution financière")

"participating share" means a share of a corporation that carries the right to participate in the earnings of the corporation to an unlimited degree and to participate in a distribution of the remaining property of the corporation on dissolution; ("action participante")

"security" means, when used to refer to a form of investment,

(a) a share of any class of shares of a corporation or a debt obligation of a corporation, and includes a warrant of a corporation, but does not include a deposit with a financial institution, any instrument evidencing a deposit with a financial institution or a policy, or

(b) any ownership interest in or debt obligation of an unincorporated entity, but does not include a policy; ("titre"or "valeur mobilière")

"security interest" means an interest in or charge upon property by way of mortgage, hypothec, pledge or otherwise, to secure the payment of a debt or the performance of another obligation; ("sûreté")

"voting share" means a share of a corporation carrying voting rights under all circumstances or by reason of an event that has occurred and is continuing or by reason of a condition that has been fulfilled; ("action avec droit de vote")

2.  The English version of subsections 36 (4) and (5) of the Act are amended by striking out "real estate" wherever it appears and substituting in each case "real property".

3.  Section 102 of the Act is amended by adding the following subsection:

Contributions to the Fire Mutuals Guarantee Fund

(10)  The contribution by a member of the Fire Mutuals Guarantee Fund to the Fund shall be treated as if it were an asset of the member for the purposes of the statements required under this section and shall be subject to examination by the Superintendent in the same manner as the other assets and property of a licensed insurer.

4.  The heading immediately before section 107 and section 107 of the Act are repealed and the following substituted:

Real Property

Powers of insurer to hold real property

107.  An insurer incorporated and licensed under the laws of Ontario may hold, manage and otherwise deal with real property, subject to any restrictions on doing so under Parts XVII and XVII.1 or the regulations.

5.  Subsection 109 (7) of the Act is repealed.

6.  (1)  Subsection 121 (1) of the Act is amended by adding the following paragraphs:

2. prescribing entities or classes of entities for the purposes of clause (f) of the definition of "financial institution" in section 1;

. . . . .

7.0.1 prescribing restrictions on insurers holding, managing or otherwise dealing with real property;

(2)  Paragraph 8 of subsection 121 (1) of the Act is repealed and the following substituted:

8. prescribing terms, conditions and limitations with respect to the reinsurance of risk;

(3)  Subsection 121 (1) of the Act is amended by adding the following paragraph:

14.0.1 governing the investment and valuation of the assets of the Fire Mutuals Guarantee Fund;

(4)  Paragraph 26.1 of subsection 121 (1) of the Act is amended by striking out "381" and substituting "380.1".

(5)  Paragraphs 30, 31 and 32 of subsection 121 (1) of the Act are repealed.

(6)  Section 121 of the Act is amended by adding the following subsections:

Regulations, Part II.2

(5)  The Lieutenant Governor in Council may make regulations,

1. prescribing the circumstances in which an individual is affiliated with an insurer for the purposes of Part II.2;

2. governing the establishment and operation of committees of insurers, including setting out requirements respecting the composition, membership, quorum, powers and duties of committees established by the directors of insurers;

3. exempting any insurer or class of insurers from Part II.2 or from any provision of that Part or the regulations made for the purposes of that Part, subject to such conditions as may be set out in the exempting regulations;

4. prescribing anything that is referred to in Part II.2 as being prescribed by the regulations or determined under the regulations.

Regulations, Part XVII

(6)  The Lieutenant Governor in Council may make regulations,

1. with respect to the definition of "commercial loan" in subsection 432 (1),

i. prescribing an amount for the purposes of subclause (a) (i) of the definition,

ii. prescribing international agencies and other entities for the purposes of subclauses (a) (iii) and (b) (ii) of the definition,

iii. prescribing rules for determining amounts for the purposes of subclause (a) (v) and sub-subclauses (a) (vi) (A), (a) (vii) (A) and (a) (viii) (A) of the definition, and

iv. defining "widely distributed" for the purposes of subclauses (b) (iv) and (c) (i) of the definition;

2. prescribing classes of subsidiaries of insurers for the purposes of the definition of "prescribed subsidiary" in subsection 432 (1);

3. prescribing permitted entities and classes of permitted entities in which an insurer may acquire, hold or increase a substantial investment and prescribing any circumstances or conditions that must be satisfied for an entity to be a permitted entity for the purposes of Part XVII;

4. prescribing interests in real property for the purposes of Part XVII;

5. respecting the investment by insurers in permitted entities, including restrictions and limits on investments in permitted entities and rules relating to the form of the investments in permitted entities;

6. prescribing undertakings and information for the purposes of subsections 435.1 (4) and (5);

7. prescribing circumstances in which an insurer or a member of a class of insurers may acquire, hold or increase a substantial investment in an entity or a class of entities;

8. prescribing conditions for the purposes of clauses 435.3 (1) (c) and (d);

9. prescribing circumstances for the purposes of clause 435.3 (4) (a), 435.4 (4) (a) or 435.6 (4) (a);

10. for the purposes of section 435.5, prescribing rules for determining which investments are specialized financing, prescribing entities as specialized financing entities and governing an insurer's specialized financing investments, including venture capital investments;

11. prescribing circumstances for the purposes of clause 435.6 (1) (f);

12. prescribing rules for determining the various financial limits referred to in Part XVII;

13. prescribing restrictions or conditions on the making of investments or loans or on acquiring an interest in property for the purposes of section 435.7;

14. prescribing circumstances for the purposes of subsection 435.8 (1);

15. prescribing requirements for the purposes of subsection 435.8 (3);

16. prescribing an amount or rules for determining an amount for the purposes of,

i. subsection 435.9 (1),

ii. subsection 435.9 (2),

iii. section 435.10,

iv. subsection 435.11 (2),

v. subsection 435.12 (2);

17. prescribing rules for determining the value of assets and an insurer's total assets for the purposes of section 435.14;

18. prescribing rules and circumstances for the purposes of clause 435.14 (3) (c);

19. exempting any insurer or class of insurers from Part XVII or from any provision of that Part or the regulations made for the purposes of that Part, subject to such conditions as may be set out in the exempting regulations;

20. providing that one or more of the financial limits prescribed for the purposes of Part XVII do not apply in respect of an insurer or class of insurers or with respect to an investment or class of investments, or both, and prescribing when the financial limit does not apply and any conditions that must be satisfied for the financial limit not to apply;

21. prescribing criteria that the Superintendent shall consider in determining whether to give an approval for the purposes of any provision in Part XVII that refers to the approval of the Superintendent, other than subsection 435.1 (2);

22. prescribing anything that is referred to in Part XVII as being prescribed by the regulations or determined under the regulations.

Regulations, Part XVII.1

(7)  The Lieutenant Governor in Council may make regulations,

1. exempting any insurer or class of insurers from Part XVII.1 or from any provision of Part XVII.1 or the regulations made for the purposes of that Part, subject to such conditions as may be set out in the exempting regulations;

2. prescribing holding companies and circumstances for the purposes of clause 437.13 (2) (c);

3. prescribing circumstances in which an insurer may enter into a transaction with a related party and setting out conditions respecting such transactions;

4. prescribing conditions and circumstances under which a transaction entered into by a subsidiary of an insurer will not be deemed to have been entered into by the insurer;

5. prescribing rules and conditions relating to transactions between insurers and related parties;

6. prescribing, for the purposes of paragraph 1 of subsection 437.18 (1),

i. a nominal amount or rules for determining what constitutes a nominal amount, and

ii. what constitutes a transaction that is immaterial to an insurer or rules for determining what constitutes an immaterial transaction;

7. prescribing conditions for the purposes of subparagraph 4 i and rules for the purposes of subparagraph 4 ii of subsection 437.18 (1);

8. prescribing permitted transactions for the purposes of paragraphs 10 and 16 of subsection 437.18 (1);

9. prescribing transactions between an insurer and a related party that are permitted for the purposes of subsection 437.18 (4) despite the fact that they are not on terms and conditions at least as favourable to the insurer as market terms and conditions;

10. prescribing an amount or rules for determining an amount for the purposes of subsection 437.19 (2);

11. prescribing for the purposes of subsection 437.19 (6),

i. types or classes of transactions,

ii. rules for determining the total value of transactions, and

iii. an amount or rules for determining an amount;

12. prescribing for the purposes of subsection 437.19 (7),

i. types or classes of transactions that require approval of the directors of an insurer,

ii. rules for determining the total value of transactions,

iii. an amount or rules for determining an amount, and

iv. what constitutes approval, including prescribing a minimum percentage of directors who must approve;

13. prescribing criteria that the Superintendent shall consider in determining whether to give an approval for the purposes of any provision in Part XVII.1 that refers to the approval of the Superintendent;

14. prescribing anything that is referred to in Part XVII.1 as being prescribed by the regulations or determined under the regulations.

General or particular

(8)  A regulation made under subsection (5), (6) or (7) may be general or particular.

Same - classes

(9)  For greater certainty, a regulation made under subsection (5), (6) or (7) with respect to a class of insurers may be made with respect to any class as described in the regulation and is not limited to the classes of insurers set out in subsection 42 (1).

7.  The Act is amended by adding the following Part:

PART II.2
DIRECTORS OF AN INSURER

Determination

121.23  (1)  In this Part,

"insurer" means an insurer that is incorporated and licensed under the laws of Ontario; ("assureur")

"person" includes an entity; ("personne")

"reporting issuer" means an insurer that is a reporting issuer under the Securities Act. ("émetteur assujetti")

Affiliated individual

(2)  An individual is affiliated with an insurer for the purposes of this Part in the circumstances prescribed by the regulations.

Affiliate

(3)  An entity is an affiliate of an insurer for the purposes of this Part if it is an affiliate of the insurer for the purposes of Part XVII.

Superintendent may determine individual is affiliated

(4)  Despite subsection (2), the Superintendent may determine that an individual is affiliated with an insurer for the purposes of this Part if, in the opinion of the Superintendent, the individual has such a significant or sufficient commercial, business or financial relationship with the insurer or an affiliate of the insurer that the relationship can be construed as being material to the individual and can reasonably be expected to affect the exercise of the individual's best judgment.

Appeal

(5)  The individual or the insurer may appeal a decision of the Superintendent to the Tribunal.

Duration of determination

(6)  A determination by the Superintendent under subsection (4),

(a) becomes effective on the day of the next annual meeting of the shareholders and policyholders unless a notice in writing by the Superintendent revoking the determination is received by the insurer before that day; and

(b) ceases to be in effect on the day of the next annual meeting of the shareholders and policyholders after a notice in writing by the Superintendent revoking the determination is received by the insurer.

Directors' duties

121.24  (1)  Subject to this Act and the regulations, the directors of an insurer shall,

(a) establish an audit committee;

(b) establish a conduct review committee;

(c) establish such other committees as may be required by the regulations;

(d) establish procedures to resolve conflicts of interest, including procedures for the identification of potential conflict situations, and establish or designate a committee of the directors to monitor the application of the procedures and the results of their application.

Committees

(2)  In establishing a committee, the directors shall comply with any requirements prescribed by the regulations relating to the composition, membership, quorum, powers and duties of the committee.

Quorum of executive committee

(3)  Despite subsection 70 (3) of the Corporations Act, a quorum of the members of the executive committee must include at least one member of the executive committee who is not affiliated with the insurer.

8.  (1)  Clause 169 (4) (c) of the Act is repealed.

(2)  Clause 169 (4) (d) of the Act is amended by striking out "in the same manner and be subject to the same restrictions as the assets of a member of the Fund" and substituting "in accordance with the regulations".

9.  The Act is amended by adding the following section:

Exchange agreement - required elements

380.1  An agreement between subscribers shall,

(a) provide for the establishment of an advisory board to be responsible for the supervision of the exchange;

(b) set out the powers and duties of the advisory board;

(c) describe how the exchange will establish the investment and lending policies, standards and procedures required under subsection 387 (3); and

(d) contain such other elements as may be prescribed.

10.  (1)  Subsection 386 (1) of the Act is repealed and the following substituted:

Amount of cash or investments

(1)  The exchange shall at all times maintain a sum in cash or investments permitted under section 387 amounting to not less than an amount that is,

(a) prescribed by the regulations; or

(b) determined in a manner prescribed by the regulations.

(2)  Subsection 386 (7) of the Act is repealed.

11.  Section 387 of the Act is repealed and the following substituted:

Investment of funds

387.  (1)  If the principal office of the exchange is in Ontario, the exchange may invest its funds in accordance with Part XVII as if the exchange,

(a) was an insurer to which that Part applied; and

(b) was licensed to transact any insurance other than life insurance.

Application of Part XVII

(2)  Part XVII applies to the exchange with necessary modifications.

Investment standards

(3)  The exchange shall establish and the funds of the exchange shall be invested in accordance with investment and lending policies, standards and procedures that a reasonable and prudent person would apply in respect of a portfolio of investments and loans to avoid undue risk of loss and obtain a reasonable return.

Annual review by committee

(4)  The advisory board of an exchange shall review the investment and lending policies, standards and procedures at least once a year and shall make such revisions as may be necessary to ensure that they satisfy the requirements of subsection (3).

12.  The Act is amended by adding the following section:

Divestment order

389.1  (1)  The Superintendent may, by order, direct an exchange to dispose of any loan, investment or interest within the time specified in the order if,

(a) the loan, investment or interest was made or acquired in contravention of this Act or the regulations;

(b) the exchange fails to provide information or undertakings required by the Superintendent under this Part; or

(c) the Superintendent believes on reasonable grounds that the making or holding of the loan or investment or the holding of the interest is inconsistent with prudent investment standards.

Appeal

(2)  The exchange may appeal the order of the Superintendent to the Tribunal.

13.  Subsection 393 (13.1) of the Act is repealed and the following substituted:

Same

(13.1)  The following corporations and insurers are deemed to be an affiliated group of insurers carrying on business as a common undertaking for the purposes of subsection (13):

1. Every mutual insurance corporation that participates in the Fire Mutuals Guarantee Fund.

2. Every insurer that is controlled by one or more mutual insurance corporations that participate in the Fire Mutuals Guarantee Fund as a result of investments made under Part XVII.

14.  Part XVII of the Act is amended by adding the following section:

Transition to New Investment Rules

Interpretation

431.1  (1)  In this section,

"changeover date" means the day on which the new investment rules first apply to an insurer in accordance with this section; ("date de changement")

"new investment rules" means,

(a) the provisions of this Act and the Corporations Act that are amended or enacted by the specified provisions of Schedule O to the Budget Measures Act, 2006 (No. 2) on the coming into force of the specified provisions, and

(b) regulations made under the provisions of this Act and the Corporations Act amended or enacted as described in clause (a); ("nouvelles règles de placement")

"old investment rules" means,

(a) the provisions of this Act and the Corporations Act that are amended or repealed by the specified provisions of Schedule O to the Budget Measures Act, 2006 (No. 2) as they read immediately before the coming into force of the specified provisions, and

(b) regulations made under the provisions of this Act and the Corporations Act amended or repealed as described in clause (a); ("anciennes règles de placement")

"specified provisions" means all provisions of Schedule O to the Budget Measures Act, 2006 (No. 2) other than section 3 and subsection 8 (1) of that Schedule. ("dispositions déterminées")

Old rules continue to apply

(2)  Despite the coming into force of the new investment rules, the old investment rules continue to apply to an insurer until the day preceding the insurer's changeover date.

New rules apply after four years

(3)  The new investment rules apply to every insurer on the fourth anniversary of the day they come into force.

New rules may apply earlier

(4)  Despite subsection (3), an insurer may choose to have the new investment rules to apply to it at any time once they are in force and before the fourth anniversary of their coming into force.

Insurer to give notice of intent

(5)  If an insurer intends to have the new investment rules apply to it before the fourth anniversary of their coming into force, the insurer shall give notice, in writing, to the Superintendent of its proposed changeover date at least 30 days before that day.

Insurer may revoke notice

(6)  At any time after giving notice under subsection (5) but before the proposed changeover date indicated in its notice, an insurer may give notice, in writing, to the Superintendent that the notice is revoked and that the insurer intends to continue to have the old investment rules apply to it.

New rules apply on indicated changeover date

(7)  The new investment rules shall apply to an insurer who gives notice under subsection (5) and that does not revoke that notice under subsection (6) on and after the changeover date indicated by the insurer in its notice.

Clarification - no return to old rules

(8)  For greater certainty, once the new investment rules apply to an insurer, the insurer does not have the option to choose to have the old investment rules apply to it.

Clarification - new rules apply as amended

(9)  For greater certainty, once the new investment rules apply to an insurer, the new investment rules continue to apply as they may be subsequently amended from time to time.

Clarification - application of unrelated provisions

(10)  This section does not affect the application to an insurer of,

(a) any provision of this Act or the Corporations Act if the provision is not amended, enacted or repealed by the specified provisions of Schedule O to the Budget Measures Act, 2006 (No. 2); and

(b) regulations made under the provisions of this Act or the Corporations Act described in clause (a).

Exemption

(11)  The Lieutenant Governor in Council may make regulations exempting any insurer from the application of the new investment rules and specifying that the old investment rules continue to apply to an insurer so exempted.

15.  Sections 432 to 436 of the Act are repealed and the following substituted:

Interpretation and Application

Interpretation

432.  (1)  In this Part and except as otherwise provided,

"affiliate" means, in respect of a particular entity, another entity who is affiliated with the particular entity for the purposes of this Part; ("membre du même groupe")

"commercial loan" means, in respect of an insurer,

(a) a loan made or acquired by the insurer other than,

(i) a loan to an individual in an amount that is equal to or less than the amount prescribed by the regulations,

(ii) a loan to the Government of Canada, the government of a province of Canada, a municipality or any agency of any of them, or to the government of a foreign country or any political subdivision of a foreign country or to any of their agencies,

(iii) a loan to an entity that is an international agency prescribed by the regulations or to another entity prescribed by the regulations,

(iv) a loan that is guaranteed by, or fully secured by securities issued by, any government, a municipality or an agency or other entity referred in subclause (ii) or (iii),

(v) a loan that is secured by a mortgage on residential real property where the amount of the loan, together with the amount then outstanding of any mortgage having an equal or prior claim against the same property, does not exceed 80 per cent of the value of the property at the time the loan is made or acquired or such other amount as may be determined under the regulations,

(vi) a loan that is secured by a mortgage on real property that is not residential property where,

(A) the amount of the loan, together with the amount then outstanding of any mortgage having an equal or prior claim against the property, does not exceed 80 per cent of the value of the property at the time the loan is made or acquired, or such other amount as may be determined under the regulations, and

(B) at the time the loan is made or acquired, the property provides an annual income sufficient to pay all annual expenses related to the property, including the payments owing under the mortgage and any mortgages having an equal or prior claim against the property,

(vii) a loan that is secured by a mortgage on residential real property where,

(A) the amount of the loan, together with the amount then outstanding of any mortgage having an equal or prior claim against the property, exceeds 80 per cent of the value of the property at the time the loan is made or acquired, or such other amount as may be determined under the regulations, and

(B) repayment of the amount of the loan that exceeds 80 per cent of the value of the property, or such other amount as may be determined under the regulations, is guaranteed or insured by a government agency or is insured by an insurance company licensed under this Act or the Insurance Companies Act (Canada) to undertake mortgage insurance,

(viii) a loan that is secured by a mortgage on real property that is not residential property where,

(A) the amount of the loan, together with the amount then outstanding of any mortgage having an equal or prior claim against the property, exceeds 80 per cent of the value of the property at the time the loan is made or acquired, or such other amount as may be determined under the regulations,

(B) repayment of the amount of the loan that exceeds 80 per cent of the value of the property, or such other amount as may be determined under the regulations, is guaranteed or insured by a government agency or is insured by an insurance company licensed under this Act or the Insurance Companies Act (Canada) to undertake mortgage insurance, and

(C) at the time the loan is made or acquired, the real property provides an annual income sufficient to pay all annual expenses related to the property, including the payments owing under the mortgage and any mortgages having an equal or prior claim against the real property,

(ix) a loan that is secured by a mortgage where the mortgage is taken back by the insurer as security on the disposition of real property by the insurer,

(x) a loan that,

(A) consists of a deposit made by the insurer with another financial institution,

(B) is fully secured by a deposit with a financial institution,

(C) is fully secured by debt obligations guaranteed by a financial institution other than the insurer, or

(D) is fully secured by a guarantee of a financial institution other than the insurer,

(xi) an advance on the security of or against the cash surrender value of a policy, or

(xii) a loan to an entity controlled by the insurer,

(b) an investment in debt obligations other than,

(i) debt obligations that are guaranteed by a financial institution other than the insurer, that are fully secured by deposits with a financial institution or that are fully secured by debt obligations that are guaranteed by a financial institution other than the insurer,

(ii) debt obligations issued by the Government of Canada, the government of a province of Canada, a municipality, or any of their agencies, or by the government of a foreign country or any of its agencies, or by an international agency prescribed by the regulations or another entity prescribed by the regulations,

(iii) debt obligations that are guaranteed by, or fully secured by securities issued by, a government, a municipality or an agency referred to in subclause (ii),

(iv) debt obligations that are widely distributed, or

(v) debt obligations of an entity controlled by the insurer,

(c) an investment in shares of a corporation or in ownership interests in an unincorporated entity other than,

(i) shares or ownership interests that are widely distributed,

(ii) shares or ownership interests of an entity controlled by the insurer, or

(iii) participating shares; ("prêt commercial")

"guarantee" includes a letter of credit; ("garantie")

"loan" includes an acceptance, advance on the security of or against the cash surrender value of a policy, an endorsement or another guarantee, a deposit, a financial lease, a conditional sales contract, a repurchase agreement and any other similar arrangement for obtaining funds or credit, but does not include investments in securities; ("prêt")

"permitted entity" means, in respect of an insurer, a financial institution or another entity that is prescribed by the regulations to be a permitted entity with respect to the insurer; ("entité admissible")

"person" includes an entity; ("personne")

"prescribed subsidiary" means, in respect of an insurer, a subsidiary of the insurer that is a prescribed subsidiary or a member of a prescribed class of subsidiaries under the regulations. ("filiale prescrite")

Affiliated entities

(2)  Two entities are affiliated for the purposes of this Part if one of them is controlled by the other or if both of them are controlled by the same person.

Control, corporations

(3)  For the purposes of this Part, a corporation is controlled by a person if,

(a) voting shares of the corporation carrying more than 50 per cent of the votes for the election of directors are held, other than by way of only security for a debt, by or for the benefit of the person; and

(b) the votes carried by those shares are sufficient, if exercised, to elect a majority of the directors of the corporation.

Control, unincorporated entities

(4)  For the purposes of this Part, an unincorporated entity other than a limited partnership is controlled by a person if the person,

(a) has more than 50 per cent of the beneficial ownership interests, however designated, in the entity; and

(b) is able to direct the business and affairs of the entity.

Control, limited partnership

(5)  For the purposes of this Part, a limited partnership is controlled by its general partner.

Deemed control

(6)  A person that controls a particular entity is deemed to control any entity that is controlled or deemed to be controlled by the particular entity.

Same

(7)  A person is deemed to control a particular entity if the aggregate of all securities of the particular entity that are beneficially owned by that person or by an entity controlled by that person would be sufficient, if they were held by that person, to permit the person to control the particular entity.

Subsidiary

(8)  An entity is a subsidiary of another entity if it is controlled by the other entity.

Substantial investment

(9)  For the purposes of this Part, a person has a substantial investment in an entity,

(a) in the case of an entity that is a corporation, if the person and any entities controlled by the person beneficially own, in total,

(i) voting shares of the corporation carrying more than 10 per cent of the voting rights attached to all of the outstanding voting shares of the corporation, or

(ii) shares of the corporation representing more than 25 per cent of the shareholders' equity of the corporation; and

(b) in the case of an entity that is unincorporated, if the aggregate of any ownership interests into which the entity is divided, however designated, that are beneficially owned by the person and any entities controlled by the person exceeds 25 per cent of all the ownership interests into which the entity is divided.

Application

433.  (1)  This Part applies only to insurers that are incorporated and licensed under the laws of Ontario.

Exceptions

(2)  This Part does not apply to insurers with respect to,

(a) the holding of an asset in a separate and distinct fund under section 109;

(b) the holding of a security interest in real property unless the security interest belongs to a class of security interests that are prescribed by the regulations to be interests in real property;

(c) the holding of a security interest in a security issued by an entity;

(d) a contribution to the assets of the Fire Mutuals Guarantee Fund.

Separate and distinct funds under s. 109

(3)  Any reference in this Part or the regulations to the assets or liabilities of an insurer does not include a reference to,

(a) assets held in a separate and distinct fund under section 109; or

(b) liabilities of the insurer under the policies and for the amounts in respect of which a fund referred to in clause (a) is maintained.

Investment Standards

Investment standards

434.  (1)  The directors of an insurer shall establish and the insurer shall adhere to investment and lending policies, standards and procedures that a reasonable and prudent person would apply in respect of a portfolio of investments and loans to avoid undue risk of loss and obtain a reasonable return.

Annual review by directors

(2)  The directors of every insurer shall review the insurer's investment and lending policies and standards at least once a year and shall make such revisions as may be necessary to ensure that the investment policies and standards satisfy the requirements of subsection (1).

Acquiring, Holding or Increasing Substantial Investments

General restriction on substantial investment

435.  No insurer shall acquire, hold or increase a substantial investment in any entity except in accordance with this Part and the regulations.

Substantial investment in permitted entity

435.1  (1)  Subject to subsection (4), an insurer may acquire, hold or increase a substantial investment in a permitted entity,

(a) if the insurer is permitted by the regulations to acquire, hold or increase the substantial investment; and

(b) with the approval of the Superintendent, if the regulations specify that the approval of the Superintendent is required.

Criteria

(2)  In determining whether to give an approval, the Superintendent may consider such matters as he or she considers relevant and shall consider the following:

1. The business record and experience of the insurer and the permitted entity.

2. The impact of any integration of the business and operations of the permitted entity with the business and operations of the insurer.

3. The future business plans for the operation and growth of the permitted entity.

4. Whether, in the Superintendent's opinion, the investment would expose the insurer to undue risk.

5. Whether, in the Superintendent's opinion, the investment would hinder the supervision and regulation of the insurer.

Appeal

(3)  An insurer may appeal a decision of the Superintendent not to give an approval under this section to the Tribunal.

Provision of undertakings and information

(4)  Prior to acquiring or increasing a substantial investment under this section, an insurer shall provide the Superintendent with all undertakings and information required by the regulations and such additional undertakings and information as the Superintendent may request, including an undertaking from the permitted entity to provide access to the Superintendent to the permitted entity's books and records.

Same

(5)  An insurer that controls a permitted entity shall provide the Superintendent with all undertakings and information required by the regulations and such additional undertakings and information as the Superintendent may request, including an undertaking from the permitted entity to provide access to the Superintendent to the permitted entity's books and records.

Indirect substantial investment

435.2  An insurer may acquire, hold or increase a substantial investment in an entity in any of the following circumstances:

1. The insurer, in accordance with this Part and the regulations, acquires control of a financial institution or another permitted entity that is prescribed for the purposes of this section that has a substantial investment in the entity.

2. The insurer controls a financial institution or another permitted entity that is prescribed for the purposes of this section, is permitted to do so under this Part and the regulations, and that financial institution or other permitted entity acquires shares or ownership interests that result in a substantial investment in the entity.

Acquiring Shares or Ownership Interests Through Loan Workouts and Realization of Security Interests

Loan workouts

435.3  (1)  If an insurer or any of its prescribed subsidiaries has made a loan to an entity and, under the terms of the agreement between the insurer or subsidiary and the entity in respect of the loan and any other documents governing the terms of the loan, a default has occurred, the insurer may acquire,

(a) all or any of the shares of the entity, if the entity is a corporation;

(b) all or any of the ownership interests in the entity, if the entity is unincorporated;

(c) subject to any conditions set out in the regulations, all or any of the shares or all or any of the ownership interests in another entity that is an affiliate of the entity; or

(d) subject to any conditions set out in the regulations, all or any of the shares of a corporation that is primarily engaged in holding shares of, ownership interests in or assets acquired from the entity or any of the entity's affiliates.

Required disposition

(2)  If an insurer acquires or increases a substantial investment in an entity as a result of an acquisition permitted under subsection (1), the insurer shall do all things necessary to ensure that the insurer does not have a substantial investment in the entity at the end of five years after acquiring it.

Same - time extension

(3)  The Superintendent may, on such terms and conditions as he or she considers appropriate, extend the period of time that would otherwise apply under subsection (2).

Exceptions

(4)  Subsection (2) does not apply,

(a) in such circumstances as may be prescribed by the regulations; or

(b) if the insurer would be entitled to acquire or increase the substantial investment under section 435.1 or 435.2 or the regulations and the insurer obtains the approval of the Superintendent before the date on which the insurer would otherwise be required to take action under subsection (2).

Criteria

(5)  In determining whether to give an approval under clause (4) (b), the Superintendent shall consider such criteria as are set out in the regulations.

Conditions

(6)  If the Superintendent gives an approval under clause (4) (b), he or she may specify that the approval is subject to any terms or conditions that he or she considers appropriate in the circumstances.

Acquisition of shares or ownership interests on realization of security interest

435.4  (1)  An insurer may acquire an investment in a corporation, an ownership interest in an unincorporated entity or an interest in real property if the investment or interest is acquired through the realization of a security interest held by the insurer.

Required disposition

(2)  If an insurer acquires or increases a substantial investment in an entity as a result of an acquisition permitted under subsection (1), the insurer shall do all things necessary to ensure that the insurer does not have a substantial investment in the entity at the end of five years after acquiring it.

Same - time extension

(3)  The Superintendent may, on such terms and conditions as he or she considers appropriate, extend the period of time that would otherwise apply under subsection (2).

Exceptions

(4)  Subsection (2) does not apply,

(a) in such circumstances as may be prescribed by the regulations; or

(b) if the insurer would be entitled to acquire or increase the substantial investment under section 435.1 or 435.2 or the regulations and the insurer obtains the approval of the Superintendent before the date on which the insurer would otherwise be required to take action under subsection (2).

Criteria

(5)  In determining whether to give an approval under clause (4) (b), the Superintendent shall consider such criteria as are set out in the regulations.

Conditions

(6)  If the Superintendent gives an approval under clause (4) (b), he or she may specify that the approval is subject to any terms or conditions that he or she considers appropriate in the circumstances.

Acquiring Substantial Investments in other Specified Circumstances

Specialized financing

435.5  An insurer that is licensed to transact the business of life insurance may, in accordance with the regulations governing specialized financing investments, acquire, hold or increase a substantial investment in an entity that is a specialized financing entity prescribed for the purposes of this section.

Authorized investments

435.6  (1)  Subject to subsection (2), an insurer may acquire, hold or increase a substantial investment in an entity,

(a) with the approval of the Superintendent, in payment or part payment for securities sold by the insurer or a subsidiary of the insurer;

(b) with the approval of the Superintendent, under an arrangement made in good faith for the reorganization of a corporation whose securities were previously owned by the insurer or a subsidiary of the insurer;

(c) with the approval of the Superintendent, under an amalgamation where one of the amalgamating parties is a corporation whose securities were previously owned by the insurer or a subsidiary of the insurer;

(d) with the approval of the Superintendent, for the purpose of protecting the investments of the insurer or a subsidiary of the insurer;

(e) on an amalgamation of the insurer with another insurer or by virtue of the purchase by the insurer of the assets of another insurer as permitted under this Act or the regulations; or

(f) in such other circumstances as may be prescribed by the regulations.

Required disposition

(2)  If an insurer acquires or increases a substantial investment in an entity in accordance with subsection (1), the insurer shall do all things necessary to ensure that the insurer does not have a substantial investment in the entity at the end of two years after acquiring it.

Same

(3)  The Superintendent may, on such terms and conditions as he or she considers appropriate, extend the period of time that would otherwise apply under subsection (2).

Exceptions

(4)  Subsection (2) does not apply,

(a) in such circumstances as may be prescribed by the regulations; or

(b) if the insurer would be entitled to acquire or increase the substantial investment under section 435.1 or 435.2 or the regulations and the insurer obtains the approval of the Superintendent before the date on which the insurer would otherwise be required to take action under subsection (2).

Criteria

(5)  In determining whether to give an approval under clause (1) (a), (b), (c) or (d) or clause (4) (b), the Superintendent shall consider such criteria as are set out in the regulations.

Conditions

(6)  If the Superintendent gives an approval referred to in subsection (5), he or she may specify that the approval is subject to any terms or conditions that he or she considers appropriate in the circumstances.

Portfolio and Lending Limits

Restrictions on loans, etc.

435.7  An insurer shall not make an investment or loan or acquire an interest in any property if doing so would cause the insurer to contravene any provision of this Act or any restrictions or conditions prescribed by the regulations.

Exclusion from portfolio limits

435.8  (1)  Subject to subsection (3), the value of all loans, investments and interests in property acquired by an insurer or a prescribed subsidiary in accordance with section 435.3 as a result of a loan workout, in accordance with section 435.4 as a result of a realization of a security interest or in such other circumstances as may be prescribed, shall not be included in calculating the value of the loans, investments and interests in property acquired by the insurer or subsidiary for the purposes of sections 435.9 to 435.12,

(a) for a period of 12 years after the day on which interest is acquired, in the case of an interest in real property; or

(b) for a period of five years after the day the loan, investment or interest in property was acquired, in the case of a loan, investment or interest in property other than real property.

Time extension

(2)  The Superintendent may, on such terms and conditions as he or she considers appropriate, extend the period of time that would otherwise apply under subsection (1).

Exception

(3)  Subsection (1) does not apply to a loan, investment or interest in property if the requirements prescribed by the regulations are satisfied.

Lending limits

Life insurers

435.9  (1)  An insurer licensed to transact the business of life insurance, other than a fraternal society, shall not, and shall not permit its prescribed subsidiaries to, make or acquire a commercial loan or acquire control of a permitted entity that holds commercial loans if the aggregate value of all commercial loans held by the insurer and its prescribed subsidiaries exceeds, or the making or acquisition of the loan or the acquisition of control of the permitted entity would cause the aggregate value of all commercial loans held by the insurer and its prescribed subsidiaries to exceed an amount determined under the regulations.

Other insurers

(2)  An insurer that is a fraternal society or is not licensed to transact the business of life insurance shall not, and shall not permit its prescribed subsidiaries to, make or acquire a commercial loan or a loan to an individual or acquire control of a permitted entity that holds commercial loans, loans to individuals or both types of loans, if the aggregate value of all commercial loans and loans to individuals that are held by the insurer and its prescribed subsidiaries exceeds, or the making or acquisition of the loan or the acquisition of control of the permitted entity would cause the aggregate value of all commercial loans and loans to individuals that are held by the insurer and its prescribed subsidiaries to exceed, an amount determined under the regulations.

Limit on interests in real property

435.10  (1)  An insurer shall not, and shall not permit its prescribed subsidiaries to, purchase or otherwise acquire an interest in real property or make an improvement to any real property in which the insurer or any of its prescribed subsidiaries has an interest if the aggregate value of all interests of the insurer and its prescribed subsidiaries in real property exceeds, or the acquisition of the interest or the making of the improvement would cause that aggregate value to exceed, an amount determined under the regulations.

Exception

(2)  Subsection (1) does not apply if,

(a) the insurer is a mutual insurance corporation that participates in the Fire Mutuals Guarantee Fund;

(b) the real property in question is the head office or intended head office of the mutual insurance corporation; and

(c) the mutual insurance corporation obtains the approval of the Superintendent to purchase or otherwise acquire an interest in or make an improvement to the real property.

Criteria

(3)  In determining whether to give an approval under clause (2) (c), the Superintendent shall consider such criteria as are set out in the regulations.

Conditions

(4)  If the Superintendent gives an approval under clause (2) (c), he or she may specify that the approval is subject to any terms or conditions that he or she considers appropriate in the circumstances.

Limit on equity acquisitions

435.11  (1)  If this section applies to an insurer, the insurer shall not, and shall not permit its prescribed subsidiaries to,

(a) purchase or otherwise acquire any participating shares of any corporation or any ownership interests in any unincorporated entity, other than those of a permitted entity in which the insurer has, or by virtue of the acquisition would have, a substantial investment; or

(b) acquire control of an entity that holds shares or ownership interests referred to in clause (a).

Same

(2)  This section applies to an insurer only if the aggregate value of all participating shares, excluding participating shares of permitted entities in which the insurer has a substantial investment, and all ownership interests in unincorporated entities, other than ownership interests in permitted entities in which the insurer has a substantial investment, that are beneficially owned by the insurer and its prescribed subsidiaries exceeds, or the purchase or acquisition described in subsection (1) would cause that aggregate value to exceed, an amount determined under the regulations.

Aggregate investment limit

435.12  (1)  If this section applies to an insurer, the insurer shall not, and shall not permit its prescribed subsidiaries to,

(a) purchase or otherwise acquire,

(i) participating shares of a corporation, other than those of a permitted entity in which the insurer has, or by virtue of the acquisition would have, a substantial investment,

(ii) ownership interests in an unincorporated entity, other than ownership interests in a permitted entity in which the insurer has, or by virtue of the acquisition would have, a substantial investment, or

(iii) interests in real property; or

(b) make an improvement to real property in which the insurer or any of its prescribed subsidiaries has an interest.

Same

(2)  This section applies to an insurer if the aggregate value of all participating shares and ownership interests referred to in subclauses (1) (a) (i) and (ii) that are beneficially owned by the insurer and its prescribed subsidiaries and all interests of the insurer in real property referred to in subclause (1) (a) (iii) exceeds, or the acquisition or the making of the improvement would cause that aggregate value to exceed, an amount determined under the regulations.

Divestment order

435.13  (1)  The Superintendent may, by order, direct an insurer to dispose of any loan, investment or interest within the time specified in the order if,

(a) the loan, investment or interest was made or acquired in contravention of this Act or the regulations;

(b) the insurer fails to provide information or undertakings required by the Superintendent under this Part; or

(c) the Superintendent believes on reasonable grounds that the making or holding of the loan or investment or the holding of the interest is inconsistent with prudent investment standards.

Appeal

(2)  The insurer may appeal the order of the Superintendent to the Tribunal.

Limit on asset transactions

435.14  (1)  An insurer shall not, and shall not permit its subsidiaries to enter into transactions acquiring assets from or transferring assets to an individual or entity in any 12-month period if the value of the assets exceeds 10 per cent of the value of the insurer's total assets.

Calculation of total assets

(2)  For the purposes of subsection (1), the value of assets that are acquired or transferred and the total value of the insurer's assets shall be calculated in accordance with the regulations.

Exception

(3)  Subsection (1) does not apply if,

(a) the insurer obtains the approval of the Superintendent for the acquisition or transfer;

(b) the asset is a debt obligation described in subclause (b) (i), (ii), (iii), (iv) or (v) of the definition of "commercial loan" in subsection 432 (1); or

(c) the acquisition or transfer satisfies the rules prescribed by the regulations or occurs in circumstances prescribed by the regulations.

Criteria

(4)  In determining whether to give an approval under clause (3) (a), the Superintendent shall consider such criteria as are set out in the regulations.

Conditions

(5)  If the Superintendent gives an approval under clause (3) (a), he or she may specify that the approval is subject to any terms or conditions that he or she considers appropriate in the circumstances.

Transitional provisions

Interpretation

436.  (1)  In this section,

"changeover date" has the same meaning as in section 431.1; ("date de changement")

"old investment rules" has the same meaning as in section 431.1. ("anciennes règles de placement")

Existing loans and investments

(2)  Nothing in this Part or in the regulations requires an insurer to,

(a) terminate a loan made before its changeover date;

(b) terminate a loan made on or after its changeover date as a result of a commitment made before that day;

(c) dispose of an investment made before its changeover date; or

(d) dispose of an investment made on or after its changeover date as a result of a commitment made before that day.

Requirements re existing loans, investments

(3)  Every insurer is, in respect of a loan or investment referred to in subsection (2), subject to the old investment rules.

No increase to existing loans, investments

(4)  Despite subsection (2), if a loan or investment described in that subsection would be precluded or limited by this Part, the amount of the loan or investment may not be increased on or after the insurer's changeover date.

Exception - substantial investments

(5)  Despite subsection (4), if an insurer held an investment before its changeover date that is a substantial investment, the insurer may increase that substantial investment on or after its changeover date as a result of an acquisition permitted under subsection 435.3 (1), 435.4 (1) or 435.6 (1).

Required disposition

(6)  Except as otherwise provided in the regulations, if an insurer increases an investment as described in subsection (5), the insurer shall do all things necessary to ensure that its investment in the relevant entity is no greater than it was on its changeover date,

(a) in respect of an acquisition permitted under subsection 435.3 (1) or 435.4 (1), at the end of five years after acquiring the shares or ownership interests;

(b) in respect of an acquisition permitted under subsection 435.6 (1), at the end of two years after acquiring the shares or ownership interests.

Same

(7)  The Superintendent may on such terms and conditions as he or she considers appropriate, extend the period of time that would otherwise apply under subsection (6).

16.  The Act is amended by adding the following Part:

PART XVII.1
RELATED PARTY TRANSACTIONS

Interpretation and Application

Definitions

437.12  (1)  In this Part,

"guarantee" includes a letter of credit; ("garantie")

"holding company" means, in respect of an entity, a corporation that controls the entity; ("société mère")

"loan" includes a deposit, a financial lease, a conditional sales contract, a repurchase agreement and any other similar arrangement for obtaining funds or credit, but does not include investments in securities or the making of an acceptance, endorsement or other guarantee; ("prêt", "emprunt")

"person" includes an entity; ("personne")

"senior officer" means, in respect of a corporation,

(a) an individual who is both a director and a full-time employee of the corporation,

(b) an individual who holds the office of chief executive officer, president, vice president, chief operating officer, secretary, treasurer, chief financial officer, controller, chief accountant, chief auditor or chief actuary of the corporation,

(c) the manager, in the case of a corporation that is a mutual insurance corporation,

(d) an individual who performs functions for the corporation similar to those performed by an individual referred to in clause (b) or (c),

(e) the head of the strategic planning unit of the corporation,

(f) the head of the unit of the corporation that provides legal services or human resources services to the corporation, or

(g) any other officer of the corporation who reports directly to the corporation's board of directors, chief executive officer, president or chief operating officer. ("cadre dirigeant")

Application of other provisions

(2)  Subsections 432 (3) to (9) apply for the purposes of this Part.

Significant interest

(3)  For the purposes of this Part, a person has a significant interest in a class of shares of a corporation if the total of all shares of the class beneficially owned by that person and by all entities controlled by that person exceeds 10 per cent of all outstanding shares of the class of shares.

Related parties

437.13  (1)  Each of the following persons is a related party in respect of an insurer:

1. Subject to subsection (4), a person that has a significant interest in a class of shares of the insurer.

2. An individual who is a director or senior officer of the insurer or of a holding company of the insurer or is acting in a similar capacity in respect of an unincorporated entity that controls the insurer.

3. The spouse of an individual described in paragraph 1 or 2 or a child under the age of 18 years of an individual described in paragraph 1 or 2.

4. An entity controlled by a person described in paragraph 1 or 2.

5. An entity in which the person that controls the insurer has a substantial investment.

6. An entity in which the spouse of an individual who controls the insurer has a substantial investment or in which a child under the age of 18 years of that individual has a substantial investment.

7. A person that is deemed to be a related party of the insurer under subsection (4) or is designated as a related party of the insurer under subsection (5) or (6).

Exceptions

(2)  Despite subsection (1), an entity is not a related party in respect of an insurer if,

(a) the insurer has a substantial investment in the entity, and,

(i) the entity would otherwise be a related party of the insurer only because a person who controls the insurer also controls the entity or has a substantial investment in the entity, and

(ii) the person referred to in subclause (i) does not control the entity or have a substantial investment in it otherwise than through the person's controlling interest in the insurer;

(b) the entity is a holding company of the insurer and is incorporated and licensed under the laws of Ontario; or

(c) the entity is a holding company that is prescribed for the purposes of this clause and the circumstances prescribed in the regulations apply.

Deemed not to be related party

(3)  The Superintendent may make an order providing that the holders of shares of a class of non-voting shares of an insurer are deemed not to be related parties of the insurer if the class of shares is designated in the order and, but for the order, the holders of the shares would have been related parties of the insurer by reason only of having a significant interest in the class of shares.

Deemed related party

(4)  If an insurer enters into or is deemed under section 437.17 to have indirectly entered into a transaction with a person in contemplation of the person becoming a related party of the insurer, the person is deemed to be a related party of the insurer for the purposes of this Part in respect of that transaction.

Designation of related party

(5)  The Superintendent may make an order designating a person to be a related party of an insurer for the purposes of this Part if the Superintendent is of the opinion that,

(a) an interest or relationship exists between the person and the insurer that can reasonably be expected to affect the exercise of the best judgment of the insurer with respect to a transaction; or

(b) the person is acting in concert with a related party of the insurer with respect to entering into a transaction with the insurer and it would be contrary to this Part or the regulations for the related party to enter into the transaction with the insurer.

Same

(6)  If the Superintendent makes an order designating a person as a related party of an insurer, the Superintendent may make an order designating as a related party of the insurer,

(a) an entity in which the person designated by the Superintendent has a substantial investment; and

(b) a subsidiary of an entity in which the person designated by the Superintendent has a substantial investment.

Appeal

(7)  The insurer to which an order under this section relates or a person that is designated a related party of the insurer by the order may appeal the order to the Tribunal.

Transactions

437.14  For the purposes of this Part, a transaction between an insurer and a person includes,

(a) a transfer of property between the insurer and the person;

(b) a loan by the insurer to the person;

(c) giving or renewing a guarantee that is on behalf of the person;

(d) making an investment in any securities of the person, if the person is an entity;

(e) taking an assignment of or otherwise acquiring a loan made by a third party to the person;

(f) taking or renewing a security interest in the securities of the person, if the person is an entity;

(g) fulfilling an obligation on behalf of the person, including paying interest on a loan or a deposit, making a payment under a policy and paying an advance under a policy;

(h) arranging for the insurer to be reinsured by the person against any risk undertaken by the insurer;

(i) renewing any loan owed by the person to the insurer or amending the terms of the loan; and

(j) amending the terms of any arrangement that is otherwise a transaction for the purposes of this Part.

Application

437.15  (1)  Subject to subsection (2), this Part applies only with respect to transactions entered into by an insurer incorporated and licensed under the laws of Ontario on and after the insurer's changeover date within the meaning of section 431.1.

Transactions not subject to this Part

(2)  This Part does not apply to the following transactions:

1. Transactions involving assets held in a separate and distinct fund under section 109 where all the policies in respect of which the fund is maintained are held by one person or all the amounts in respect of which the fund is maintained are retained on the direction of one person.

2. The issue by an insurer of shares of any class if the shares are fully paid for in money or are issued,

i. in accordance with any provisions for the conversion of other issued and outstanding securities of the insurer into shares of that class,

ii. as a share dividend,

iii. in accordance with the terms of an amalgamation to which Part XVI applies,

iv. as consideration under the terms of a transfer agreement to which Part XVI applies, or

v. with the approval of the Superintendent, in exchange for shares of another corporation.

3. The payment of dividends, policy dividends or bonuses by an insurer.

4. The payment or provision by an insurer of salaries, fees, stock options, policy premiums, pension benefits, incentive benefits or other benefits or remuneration to individuals in their capacity as directors, officers or employees of the insurer if the payment is in consideration for the carrying out of duties that are not outside the ordinary course of business of the insurer.

Criteria

(3)  In determining whether to give an approval under subparagraph 2 v of subsection (2), the Superintendent shall consider such criteria as are set out in the regulations.

Conditions

(4)  If the Superintendent gives an approval under subparagraph 2 v of subsection (2), he or she may specify that the approval is subject to any terms or conditions that he or she considers appropriate in the circumstances.

Rules for Transactions with Related Parties

General rule re transactions with related party

437.16  Except as otherwise permitted under this Part or the regulations, no insurer incorporated and licensed under the laws of Ontario shall directly or indirectly enter into a transaction with a person that is a related party of the insurer.

Subsidiary's transactions deemed to be those of insurer

437.17  (1)  Except as otherwise provided in this Part or the regulations, an insurer is deemed for the purposes of this Part to have indirectly entered into any transaction entered into by a subsidiary of the insurer.

Exceptions

(2)  Subsection (1) does not apply if any of the following conditions are satisfied:

1. The subsidiary that entered into the transaction is a federal financial institution within the meaning of subsection 2 (1) of the Insurance Companies Act (Canada).

2. The transaction entered into by the subsidiary satisfies conditions prescribed by the regulations or the transaction was entered into under circumstances prescribed by the regulations.

Transactions permitted with related parties

437.18  (1)  Despite section 437.16 and subject to subsection (4), any of the following transactions between an insurer and a related party are not prohibited under this Part:

1. A transaction between an insurer and a related party where the value of the transaction is, in accordance with the regulations, nominal or immaterial to the insurer.

2. The reinsurance by a related party of an insurer against any risk undertaken by the insurer where,

i. the related party is an insurer within the meaning of section 1 that is licensed under this Act, or

ii. the reinsurance by the related party is approved by the Superintendent.

3. The reinsurance by an insurer of a related party against any risk undertaken by the related party.

4. A loan by an insurer to a related party, the acquisition by an insurer of a loan to a related party or the provision by an insurer of a guarantee of a loan to a related party if,

i. the related party is an individual and the loan is secured by a mortgage on the individual's principal residence and any conditions prescribed by the regulations are satisfied, and

ii. in any case other than the one described in subparagraph i, the loan or guarantee satisfies the rules prescribed by the regulations.

5. A loan to an insurer from a related party or the issue of debt obligations by an insurer to a related party.

6. The issuing of policies by an insurer to a related party.

7. The purchase by an insurer from a related party of goods or services for use in the ordinary course of the insurer's business.

8. Subject to section 435.14, the sale by an insurer of property to a related party if the consideration for the property is fully paid in money and there is an active market for the property.

9. The purchase or sale of assets other than real property by an insurer in the normal course of business from or to a related party that is a financial institution, if the purchase or sale is pursuant to arrangements that have been approved by the Superintendent.

10. The purchase or sale of assets by an insurer from or to a related party if the transaction is permitted under the regulations.

11. The acquisition or disposition of property by an insurer from or to a related party as part of or in the course of a restructuring if the Superintendent has approved the acquisition or disposition.

12. The provision by the insurer to a related party of services normally offered by the insurer to the public in the ordinary course of the insurer's business, other than services that involve the making of loans or guarantees.

13. The entering into of a written contract by an insurer and by a financial institution or other entity referred to in clause 141 (5) (a) of the Corporations Act that is a related party if the contract relates to,

i. the provision of services by the insurer or by the financial institution or other entity, or

ii. the referral by the insurer of a person to the financial institution or other entity or the referral by the financial institution or other entity of a person to the insurer.

14. The entering into of a written contract by the insurer for a pension or benefit plan for directors or employees of the insurer or any subsidiary of the insurer or for the management or administration of the plan.

15. The provision by the insurer of management, advisory, accounting, information processing or other services in relation to any business carried on by a related party.

16. A transaction between an insurer and a related party that is permitted under section 437.19 or 437.20 or under the regulations.

Criteria

(2)  In determining whether to give an approval under subparagraph 2 ii, paragraph 9 or paragraph 11 of subsection (1), the Superintendent shall consider such criteria as are set out in the regulations.

Conditions

(3)  If the Superintendent gives an approval mentioned in subsection (2), he or she may specify that the approval is subject to any terms or conditions that he or she considers appropriate in the circumstances.

Market terms and conditions

(4)  Except as otherwise permitted under this Part or the regulations, every transaction between an insurer and a related party shall be on terms and conditions that are at least as favourable to the insurer as market terms and conditions.

Same

(5)  For the purposes of this Part, a transaction is on terms and conditions that are at least as favourable to the insurer as market terms and conditions if the following conditions are satisfied:

1. If the transaction involves the provision to the related party of a service or a loan facility normally offered by the insurer to the public in the ordinary course of business, the terms and conditions are no more or less favourable than the terms and conditions offered to the public by the insurer in the ordinary course of business.

2. In any other case,

i. if the transaction is one that could reasonably be expected to occur in an open market, the terms and conditions of the transaction, including any applicable price, rent or interest rate, are comparable to the terms and conditions that can reasonably be expected to apply in a fair transaction between parties dealing at arm's length who are acting prudently, knowledgeably and willingly, or

ii. if the transaction is not one that can reasonably be expected to occur in an open market or between parties dealing at arm's length, the terms and conditions of the transaction, including any applicable price, rent or interest rate, can reasonably be expected to provide the insurer with fair value, having regard to all of the circumstances of the transaction, and are consistent with the parties to the transaction acting prudently, knowledgeably and willingly.

Transactions with directors, senior officers, etc.

437.19  (1)  Subject to subsection 437.18 (4) and to subsections (6) and (7), an insurer may enter into any transaction with,

(a) an individual who is a related party of the insurer only because the individual is,

(i) a director or senior officer of the insurer or of an entity that controls the insurer,

(ii) the spouse of a director or senior officer described in subclause (i), or

(iii) an individual under the age of 18 years who is the child of a director or senior officer described in subclause (i); or

(b) an entity that is a related party of the insurer only because the entity is controlled by an individual described in subclause (a) (i) or (ii).

Exception, loan to full-time senior officer

(2)  Despite subsection (1), an insurer may, with respect to a related party referred to in subsection (1) who is a full-time senior officer of the insurer, make or acquire a qualifying loan to the related party only if the aggregate principal amount of all outstanding qualifying loans to the related party that are held by the insurer and its subsidiaries, together with the principal amount of the proposed qualifying loan, does not exceed an amount prescribed by the regulations or determined in a manner prescribed by the regulations.

Qualifying loan

(3)  For the purposes of subsection (2), a qualifying loan is any loan other than,

(a) a loan on the security of a mortgage on a principal residence referred to in subparagraph 4 i of subsection 437.18 (1); and

(b) a margin loan.

Preferred terms, loan to senior officer

(4)  Despite subsection 437.18 (4), an insurer may make any of the following loans on terms and conditions that are more favourable to the borrower than market terms and conditions if the terms and conditions have been approved by the insurer's conduct review committee:

1. A loan other than a margin loan to a senior officer of the insurer.

2. A loan on the security of a mortgage on a principal residence referred to in subparagraph 4 i of subsection 437.18 (1) that is made to the spouse of a senior officer of the insurer.

Preferred terms, other financial services

(5)  Despite subsection 437.18 (4), an insurer may offer financial services other than loans or guarantees to a senior officer of the insurer, to the spouse of a senior officer of the insurer or to a child of a senior officer who is less than 18 years of age on terms and conditions more favourable than market terms and conditions if,

(a) the financial services are offered by the insurer to employees of the insurer on the same favourable terms and conditions; and

(b) the insurer's conduct review committee has approved the practice of making the financial services available on the favourable terms and conditions to senior officers of the insurer or to their spouses or children.

Regulations may limit transactions

(6)  An insurer shall not enter into a transaction described in subsection (1) if,

(a) the transaction is of a type or class prescribed by the regulations for the purposes of this subsection; and

(b) immediately following the transaction, the total value as determined under the regulations of all transactions prescribed for the purposes of this subsection would exceed the amount determined under the regulations.

Transactions requiring directors' approval

(7)  An insurer shall not enter into a transaction described in subsection (1) if,

(a) the transaction is of a type or class prescribed by the regulations as requiring the approval of the directors of the insurer for the purposes of this subsection;

(b) immediately following the transaction, the total value as determined under the regulations of all transactions prescribed for the purposes of this subsection would exceed the amount determined under the regulations; and

(c) the directors have not approved the transaction in accordance with the regulations.

Margin loans

(8)  The Superintendent may establish, and insurers shall comply with, terms and conditions with respect to the making of margin loans by an insurer or a subsidiary of an insurer to a director or senior officer of the insurer.

Transactions exempt under Superintendent's order

437.20  (1)  The Superintendent may, by order, provide that a transaction between an insurer and a related party is not subject to one or more provisions in this Part and may impose such terms and conditions in respect of the transaction as the Superintendent considers advisable in the circumstances.

Conditions

(2)  The Superintendent shall not make an order under subsection (1) unless he or she is satisfied that the decision of the insurer to enter into the transaction has not been and is unlikely to be influenced in a significant way by a related party of the insurer and does not involve in a significant way the interests of any related party of the insurer.

Determining if related party involved

437.21  (1)  If an insurer knows or has reason to believe that another party to a transaction or proposed transaction, other than a transaction described in paragraph 1 of subsection 437.18 (1), is a related party of the insurer, the insurer shall take all reasonable steps to obtain from the other party full disclosure in writing of any interest or relationship, direct or indirect, that would make the other party a related party of the insurer.

No liability if rely on information

(2)  An insurer and any director, officer, employee or agent of the insurer may rely on any information contained in any disclosure received by the insurer pursuant to subsection (1) and on any information otherwise acquired in respect of any matter that might be the subject of a disclosure referred to in subsection (1) and no action lies against the insurer or any director, officer, employee or agent of the insurer for anything done or omitted in good faith in reliance on that information.

Contravention

437.22  (1)  If an insurer enters into a transaction contrary to this Part or the regulations, the insurer shall notify the Superintendent as soon as the insurer becomes aware of the contravention.

Order to void contract or grant other relief

(2)  If an insurer enters into a transaction contrary to this Part or the regulations, the insurer or the Superintendent may apply to the Superior Court of Justice for an order setting aside the transaction or for any other appropriate remedy, including an order directing that the related party of the insurer involved in the transaction account to the insurer for any profit or gain realized or that any director or senior officer of the insurer who authorized the transaction compensate the insurer for any loss or damage incurred by the insurer.

Same

(3)  An order may be made under subsection (2) despite anything in subsections 71 (4) and (5) of the Corporations Act.

Time limit

(4)  An application under subsection (2) in respect of a particular transaction may only be made within the period of three months following the day the notice referred to in subsection (1) in respect of the transaction is given to the Superintendent or, if no notice is given, the day the Superintendent becomes aware of the transaction.

Directors' liability, related party transactions

(5)  The directors of an insurer who vote for or consent to a resolution of the directors authorizing any transaction contrary to this Part are jointly and severally liable to restore to the insurer any amounts distributed or paid in connection with the transaction that are not otherwise recovered by the insurer and any amounts in relation to any loss suffered by the insurer in connection with the transaction.

Contribution

(6)  A director who has satisfied a judgment in relation to the liability of two or more directors under subsection (5) is entitled to contribution from the other directors who voted for or consented to the transaction on which the judgment was found.

Recovery

(7)  A director who is liable under subsection (5) is entitled to apply to the Superior Court of Justice for an order compelling a shareholder or other person to pay to the director an amount equal to the value of the loss suffered by the insurer in connection with the transaction.

Court order

(8)  Where an application is made to the court under subsection (7), the court, where it is satisfied that it is equitable to do so,

(a) may order a shareholder or other person to pay to the director an amount in respect of the loss referred to in subsection (7); and

(b) may make such other order as it thinks fit.

Due diligence

(9)  A director, officer or employee of an insurer is not liable under this section if the director, officer or employee exercised the care, diligence and skill that a reasonably prudent person would have exercised in comparable circumstances, including reliance in good faith on,

(a) financial statements of the insurer that were represented to them by an officer of the insurer or in a written report of an auditor of the insurer fairly to reflect the financial condition of the insurer; or

(b) a report of a person whose profession lends credibility to a statement made by the person.

Corporations Act

17.  Section 140 of the Corporations Act is amended by adding the following subsection:

Meaning of "affiliated"

(3)  For the purposes of this Part, an individual is affiliated with an insurer if he or she is affiliated with the insurer for the purposes of Part II.2 of the Insurance Act.

18.  (1)  Subsection 141 (2) of the Act is repealed and the following substituted:

Application of Act

(2)  Except as otherwise provided in this Part, the provisions of this Act that are not inconsistent with this Part apply to all insurers to which this Part applies.

(2)  Section 141 of the Act is amended by adding the following subsection:

Exception, s. 24

(2.1)  Section 24 does not apply to an insurer.

(3)  Clause 141 (5) (a) of the Act is repealed and the following substituted:

(a) act as an agent for any person in respect of the provision of a service that is provided by,

(i) a financial institution,

(ii) an entity that is a permitted entity with respect to the insurer for the purposes of Part XVII of the Insurance Act, or

(iii) another entity if regulations have been made under the Insurance Act that will apply to the networking arrangements between the insurer and that entity;

19.  The Act is amended by adding the following sections:

Application of ss. 141.2 to 141.4

141.1  (1)  Except as otherwise provided by this section, sections 141.2, 141.3 and 141.4 apply to all insurers to which this Part applies.

Pension funds and employees' mutual benefit societies

(2)  For the purposes of subsection (1), pension funds and employees' mutual benefit societies incorporated under section 185 are not considered to be insurers.

Exemptions

(3)  Subsections 141.2 (2) to (9) do not apply to,

(a) an insurer who is a reporting issuer under the Securities Act;

(b) an insurer who is exempt from section 121.24 of the Insurance Act.

Board of directors of insurer

Number of directors

141.2  (1)  Despite subsection 283 (2) and subject to subsection 165 (1) and subsection 210 (2), the board of directors of an insurer shall be composed of at least six persons.

Limit on affiliated directors

(2)  Not more than two-thirds of the directors of an insurer shall be affiliated with the insurer.

Determination of whether a person is affiliated

(3)  The determination of whether an individual is affiliated with an insurer,

(a) shall be made annually, as of the day the notice of the annual general meeting of the insurer is sent to the members, participating policyholders or shareholders of the insurer; and

(b) shall apply for the period commencing on the day of that annual general meeting and ending on the day before the next following annual general meeting of the insurer, irrespective of whether the individual would have otherwise become affiliated or ceased to be affiliated with the insurer during that period.

If person deemed affiliated under Insurance Act

(4)  Despite subsection (3), if the Superintendent makes a determination under section 121.23 of the Insurance Act that an individual is affiliated with an insurer, the individual continues to be affiliated with the insurer for the period determined under that section.

Quorum must include non-affiliated director

(5)  Despite subsection 70 (3), section 173 and subsection 288 (1), a quorum of the board of directors of an insurer must include at least one director who is not affiliated with the insurer.

Exception

(6)  Up to four employees of an insurer or a subsidiary of the insurer may be directors of the insurer, but any such directors must not constitute a majority of the board.

Rules when second election required

(7)  Despite subsection 288 (2), if there is a failure to elect a board of directors that complies with the requirements of this Part, the following rules apply:

1. The directors holding office immediately before the election shall continue in office until their successors are elected.

2. The directors then in office shall, without delay, call a special meeting of the members, participating policyholders or shareholders, as the case may be, to fill the vacancy or vacancies, and if they fail to call a meeting or if there are no directors then in office, any member, participating policyholder or shareholder, as the case may be, may call the special meeting.

3. Despite clause (3) (b), the determination of whether an individual is affiliated shall apply commencing on the day of that special meeting and ending on the day before the next following annual general meeting of the insurer, irrespective of whether the individual would have otherwise become affiliated or ceased to be affiliated with the insurer during that period.

Vacancy

(8)  Despite subsection 288 (2), a vacancy occurring in the board of directors must be filled for the remainder of the term by the directors then in office as soon as practicable after the vacancy occurs if the vacancy results in more than two-thirds of the directors of the insurer being affiliated with the insurer.

Determination of whether new director is affiliated

(9)  The determination of whether an individual who fills a vacancy occurring in the board of directors is affiliated with an insurer shall be made as of the day the individual fills the vacancy and shall apply until the day before the next following annual general meeting of the insurer, irrespective of whether the individual would have otherwise become affiliated or ceased to be affiliated with the insurer during that period.

Committees

141.3  The directors of an insurer shall establish such committees of the directors as may be required under the Insurance Act or under the regulations made under that Act.

Validity of decisions

141.4  No decision of the board of directors or executive committee of an insurer is invalid by reason of any failure to comply with any requirement in section 141.2 or 141.3.

20.  Subsection 149 (9) of the Act is repealed and the following substituted:

First meeting of directors

(9)  As soon as convenient after the meeting, the acting secretary shall call a meeting of the directors for the election from among themselves of a president or the appointment of a person as president who is not a director, for the appointment of a secretary and a treasurer or a secretary-treasurer and for the transaction of such other business as may be brought before the meeting.

21.  Subsection 164 (1) of the Act is repealed.

22.  Section 169 of the Act is repealed and the following substituted:

Manager may be a director and be paid salary

169.  The manager or president of the corporation may be a director of the corporation and may be paid an annual salary under a by-law passed in accordance with section 166.

23.  Section 170 of the Act is amended by striking out "other than the manager" and substituting "other than the manager or president".

24.  Subsection 171 (4) of the Act is repealed and the following substituted:

President

(4)  At the first meeting after each election of directors, the directors shall elect or appoint a president of the corporation.

Same

(5)  A person who is not a director may be appointed as the president or the directors may elect a president from among themselves.

Same

(6)  If the directors elect a president from among themselves, the election shall be by ballot and the secretary shall preside at the election.

Manager

(7)  The president of the corporation may also be given the title of manager.

25.  Section 209 of the Act is repealed.

26.  Subsection 210 (4) of the Act is repealed.

27.  Subsection 286 (3) of the Act is repealed and the following substituted:

Exception, hospitals, stock exchanges and insurers

(3)  A corporation may by by-law provide that a person may, with his or her consent in writing, be a director of the corporation even though the person is not a shareholder or member of the corporation if the corporation,

(a) operates a hospital within the meaning of the Public Hospitals Act;

(b) operates a recognized stock exchange; or

(c) is an insurer to which Part V applies, other than a pension fund or employees' mutual benefit society.

Commencement

28.  (1)  Subject to subsection (2), this Schedule comes into force on the day the Budget Measures Act, 2006 (No. 2) receives Royal Assent.

(2)  Sections 1 to 27 come into force on a day to be named by proclamation of the Lieutenant Governor.

SCHEDULE P
LAND TRANSFER TAX ACT

1.  Section 2 of the Land Transfer Tax Act is amended by adding the following subsection:

Conveyance after tax deferral and cancellation

(3)  If tax in respect of the disposition of a beneficial interest in land has been deferred under subsection 3 (9) and cancelled under subsection 3 (11), the value of the consideration on the tender or submission for registration of a conveyance that transfers legal title to the land to the beneficial owner whose tax liability was cancelled under subsection 3 (11) or to a trustee for the beneficial owner shall be determined under clause (a), (b), (b.1), (c) or (g) of the definition of "value of the consideration" in subsection 1 (1) as if the value of the consideration were being determined in respect of the disposition of the beneficial interest in the land.

2.  (1)  Section 3 of the Act is amended by adding the following subsection:

Registration of instrument evidencing disposition of beneficial interest in land

(13.1)  For the purposes of clauses (9) (c) and (11) (a) and (b), the registration of a conveyance of legal title to the land to the beneficial owner of the land or a trustee for the beneficial owner is deemed to be a conveyance which evidences the disposition of a beneficial interest in land.

(2)  Subsection 3 (14) of the Act is repealed and the following substituted:

Affiliate

(14)  For the purposes of this section, a corporation is an affiliate of another corporation if one of them is the subsidiary of the other, if both are subsidiaries of the same corporation or if each of them is controlled by the same person or persons.

Same

(15)  The following rules apply for the purposes of determining if corporations are affiliates:

1. A corporation is a subsidiary of another corporation if,

i. it is controlled by,

A. that other,

B. that other and one or more corporations each of which is controlled by that other, or

C. two or more corporations each of which is controlled by that other, or

ii. it is a subsidiary of a corporation that is that other's subsidiary.

2. A corporation is controlled by another person or corporation or by two or more corporations if,

i. voting securities of the first-mentioned corporation carrying more than 50 per cent of the votes for the election of directors are held, otherwise than by way of security only, by or for the benefit of the other person or corporation or by or for the benefit of the other corporations, and

ii. the votes carried by the voting securities described in subparagraph i are entitled, if exercised, to elect a majority of the board of directors of the first-mentioned corporation.

3. For the purposes of paragraph 2,

i. a person is deemed to own beneficially securities that are beneficially owned by a corporation controlled by the person or by an affiliate of that corporation, and

ii. a corporation is deemed to own beneficially securities that are beneficially owned by its affiliates.

4. Unless the regulations provide otherwise, references in paragraphs 2 and 3 to securities are references to securities within the meaning of the Securities Act.

3.  (1)  Subsection 14 (10) of the Act is amended by striking out the portion before clause (a) and substituting the following:

Extension of time

(10)  The time within which a notice of objection is to be served or an appeal is to be instituted may be extended by the Minister if application for extension is made,

. . . . .

(2)  Clause 14 (10) (b) of the Act is repealed and the following substituted:

(b) with respect to an appeal, before the expiry of the time allowed under subsection (1) for instituting the appeal.

4.  The Act is amended by adding the following section:

Application under subrule 14.05 (2), Rules of Civil Procedure

14.1  (1)  If the following conditions are satisfied, a person may make an application under subrule 14.05 (2) of the Rules of Civil Procedure to a judge of the Superior Court of Justice:

1. The application is to determine one or more issues of law that depend solely on the interpretation of,

i. this Act or the regulations, or

ii. this Act or the regulations and another Ontario statute or regulation.

2. The Minister has indicated in writing that the Minister is satisfied that it is in the public interest for the applicant to make the application.

3. The Minister and the applicant have executed a statement of agreed facts on which they both intend to rely and the applicant files the statement as part of the applicant's application record.

4. No facts remain in dispute between the Minister and the applicant that either of them believes may be relevant to the determination of any issue of law that is a subject of the application.

Application of rule 38.10, Rules of Civil Procedure

(2)  Rule 38.10 of the Rules of Civil Procedure does not apply to an application referred to in this section, except that the presiding judge may, on the hearing of the application, adjourn the application in whole or in part and with or without terms under clause 38.10 (1) (a).

Disposition of application

(3)  The court may dispose of an application that is authorized under this section by,

(a) making a declaration of law in respect of one or more issues of law forming the subject of the application;

(b) declining to make a declaration of law in respect of any of the issues of law forming the subject of the application; or

(c) dismissing the application.

Effect of declaration of law

(4)  No declaration of law made on an application under this section,

(a) shall be binding on the Minister and the applicant except in relation to the facts agreed to by them in the proceeding; or

(b) shall otherwise affect the rights of the Minister or the applicant in any appeal instituted under this Act.

No applications under subrule 14.05 (3)

(5)  No person other than the Minister may bring an application under subrule 14.05 (3) of the Rules of Civil Procedure on or after the day this section comes into force, in respect of any matter arising under this Act.

Other proceedings

(6)  On the motion of the Minister, the court shall dismiss a proceeding commenced by an application under rule 14.05 of the Rules of Civil Procedure relating to a matter under this Act or the regulations if any condition in subsection (1) has not been satisfied or the application is prohibited under subsection (5).

5.  Subsection 22 (2) of the Act is amended by adding the following clause:

(c) prescribing the meaning of "security" for the purposes of subsection 3 (15);

Commencement

6.  This Schedule comes into force on the day the Budget Measures Act, 2006 (No. 2) receives Royal Assent.

SCHEDULE Q
LIQUOR CONTROL ACT

1.  The definition of "manufacturer" in section 1 of the Liquor Control Act is repealed and the following substituted:

"manufacturer" means a person who produces liquor for sale; ("fabricant")

2.  Subsection 2 (1) of the Act is amended by striking out "seven members appointed by the Lieutenant Governor in Council." and substituting "11 members appointed by the Lieutenant Governor in Council who shall form its board of directors".

3.  Subsection 3 (1) of the Act is amended by adding the following clause:

(o) to do all things necessary or incidental to the attainment of any of the purposes set out in clauses (a) to (n).

4.  Section 4 of the Act is repealed and the following substituted:

Duties of Chair, members

4.  (1)  The Chair shall preside at all meetings of the Board or, in his or her absence or if the office of Chair is vacant, the Vice-Chair has all the powers and shall perform all the duties of the Chair.

Same

(2)  The Chair and the other members of the Board shall devote such time as is necessary for the due performance of their duties as members of the Board.

Chief executive officer

4.0.1  (1)  Subject to the approval of the Minister, the Board shall appoint a person to be the chief executive officer of the Board to be responsible for its operation and for the performance of such other functions as are assigned by the Board.

Attend meetings

(2)  The chief executive officer may attend and participate at any meeting of the Board but shall not have a vote with respect to any matter to be decided at the meeting.

Exception

(3)  Despite subsection (2), the Board may exclude the chief executive officer from attending any meeting if a matter to be discussed at the meeting involves the position, performance or functions and duties of the chief executive officer.

Staff

4.0.2  (1)  The Board may appoint such officers, inspectors and employees and retain such assistance as is considered necessary and may, subject to the approval of the Lieutenant Governor in Council, establish job categories, salary ranges and conditions of employment.

Approval by Minister

(2)  Despite subsection (1), job categories, salary ranges and conditions of employment of officers, inspectors and employees appointed by the Board who are not members of a bargaining unit, as defined in the Labour Relations Act, 1995, must be approved by the Minister and not by the Lieutenant Governor in Council.

Pension plan

(3)  The Board shall be deemed to have been designated by the Lieutenant Governor in Council under the Public Service Pension Act as a board whose permanent and full time probationary staff are required to be members of the Public Service Pension Plan.

Status of Board

4.0.3  (1)  The Board is a corporation to which the Corporations Act does not apply.

Crown agent

(2)  The Board is for all purposes an agent of Her Majesty and its powers may be exercised only as an agent of Her Majesty.

Delegation

4.0.4  (1)  The Board may delegate its powers under this Act, as it considers appropriate, to a committee of the Board, to its chief executive officer or to any other person.

Further delegation

(2)  The powers delegated to the chief executive officer or other person may be further delegated to an officer, employee or agent of the Board upon such terms as may be specified by the Board.

Restriction

(3)  Despite subsection (1), the Board may not delegate the power to,

(a) appoint or remove the chief executive officer or the internal auditor of the Board;

(b) make, amend or repeal a by-law of the Board; or

(c) approve the business plan, financial statements or annual report of the Board.

Protection from personal liability

4.0.5  (1)  No action or other proceeding may be instituted against any member of the Board or any officer or employee of the Board for any act done in good faith in the execution or intended execution of the person's duty or for any alleged neglect or default in the execution in good faith of the person's duty under this Act. 

Board liability

(2)  Subsection (1) does not relieve the Board of any liability to which it would otherwise be subject in respect of a tort committed by a person referred to in subsection (1). 

Commencement

5.  This Schedule comes into force on the day the Budget Measures Act, 2006 (No. 2) receives Royal Assent.

SCHEDULE R
MINING ACT

1.  Subsection 176 (1) of the Mining Act is amended by adding the following paragraphs:

24.1 governing the valuation of rough diamonds;

24.2 prescribing requirements respecting the manner in which rough diamonds must be handled, prepared and processed before valuation;

24.3 governing the collection and maintenance of records relating to rough diamond production;

Commencement

2.  This Schedule comes into force on the day the Budget Measures Act, 2006 (No. 2) receives Royal Assent.

SCHEDULE S
MINING TAX ACT

1.  (1)  Subsection 3 (15) of the Mining Tax Act is amended by striking out "and" at the end of clause (c), by adding "and" at the end of clause (d) and by adding the following clause:

(e) a fine or penalty, other than a prescribed fine or penalty, imposed after March 23, 2006 under the law of a country or of a political subdivision of a country, including a state, province and territory, by any person or public body that has authority to impose the fine or penalty;

(2)  Subsection 3 (15) of the Act is amended by striking out "and" at the end of clause (d), by adding "and" at the end of clause (e) and by adding the following clause:

(f) an outlay made or expense incurred, before or after the day this clause comes into force, for the purpose of doing anything that is an offence under section 3 of the Corruption of Foreign Public Officials Act (Canada) or under any of sections 119 to 121, 123 to 125, 393 and 426 of the Criminal Code (Canada) or an offence under section 465 of the Criminal Code (Canada) as it relates to an offence described in any of those sections.

2.  Clause 9 (1) (a) of the Act is amended by striking out "or" at the end of subclause (iii), by striking out "and" at the end of sub-subclause (iv) (B) and substituting "or" and by adding the following subclause:

(v) has claimed a deduction described in clause 3 (15) (f) before or after the day on which that clause comes into force; and

3.  Section 10 of the Act is amended by striking out "90 and 91 of the Corporations Tax Act" in the portion before paragraph 1 and substituting "90, 91 and 92.1 of the Corporations Tax Act".

Commencement

4.  (1)  Subject to subsection (2), this Schedule comes into force on the day the Budget Measures Act, 2006 (No. 2) receives Royal Assent.

Same

(2)  Subsection 1 (1) shall be deemed to have come into force on March 23, 2006.

SCHEDULE T
MINISTRY OF HEALTH AND LONG-TERM CARE ACT

1.  The Ministry of Health and Long-Term Care Act is amended by adding the following section:

Agreements re certain indemnifications

8.  (1)  The Minister may, on behalf of the Government of Ontario, enter into agreements to indemnify CBSCI, or any other person or entity approved by the Lieutenant Governor in Council, for Ontario's pro rata share of amounts payable by CBSCI, the person or entity under the terms of one or more insurance policies issued by it in favour of the Canadian Blood Services and other persons or entities named in the insurance policy.

Limit on indemnification

(2)  An indemnification provided pursuant to an agreement under subsection (1) shall not exceed Ontario's pro rata share of the greater of the following:

1. $750,000,000.

2. An amount prescribed in the regulations made under subsection (3).

Regulations

(3)  The Lieutenant Governor in Council may make regulations prescribing an amount for the purposes of paragraph 2 of subsection (2).

Order in Council

(4)  Order in Council number 1061/2006, made on May 17, 2006 by the Lieutenant Governor in Council under the Financial Administration Act, is revoked, and any agreement concerning indemnification entered into on behalf of Ontario under the authority of that order shall be deemed to be an agreement entered into by the Minister under subsection (1), with effect from the date of the agreement.

Definitions

(5)  In this section,

"CBSCI" means Canadian Blood Services Captive Insurance Company Limited - Compagnie d'assurance captive de la Société canadienne du sang limitée, a corporation incorporated under the laws of British Columbia; ("CACSCS")

"Ontario's pro rata share" means the liability of Ontario as provided for in an agreement under subsection (1) and as expressed as a percentage of the total liability assumed under that agreement. ("part proportionnelle de l'Ontario")

Commencement

2.  This Schedule shall be deemed to have come into force on May 31, 2006.

SCHEDULE U
MINISTRY OF REVENUE ACT

1.  (1)  Subsection 11 (1) of the Ministry of Revenue Act is amended by adding the following definition:

"other debt" means an amount owing to Her Majesty in right of Ontario other than,

(a) a tax, fee or penalty, and

(b) a recoverable grant as defined in subsection 12 (1); ("autre créance")

(2)  Subsection 11 (2) of the Act is amended by striking out "any tax, fee or penalty" and substituting "any tax, fee, penalty or other debt".

(3)  Clauses 11 (3) (a) and (4) (a) and (e) of the Act are amended by striking out "the tax, fee or penalty" wherever it appears and substituting in each case "the tax, fee, penalty or other debt".

(4)  Subsection 11 (5) of the Act is amended by striking out "the tax, fee or penalty" and substituting "the tax, fee, penalty or other debt".

(5)  Subsection 11 (6) of the Act is amended by striking out "the tax, fee or penalty" and substituting "the tax, fee, penalty or other debt".

Commencement

2.  This Schedule comes into force on the day the Budget Measures Act, 2006 (No. 2) receives Royal Assent.

SCHEDULE V
MUNICIPAL ACT, 2001

1.  Section 308 of the Municipal Act, 2001 is amended by adding the following subsection:

If transition ratio is in allowable range for property class

(11.1)  If the Minister of Finance prescribes a transition ratio for the purposes of this section that is within the allowable range prescribed for a property class, the tax ratio for the property class must be within the allowable range prescribed for the property class.

2.  Section 325 of the Act is repealed.

Commencement

3.  This Schedule comes into force on the day the Budget Measures Act, 2006 (No. 2) receives Royal Assent.

SCHEDULE W
OIL, GAS AND SALT RESOURCES ACT

1.  Section 10.2 of the Oil, Gas and Salt Resources Act is repealed and the following substituted:

Prohibition on construction, etc.

10.2  (1)  No person shall erect, locate or construct a building or structure of a type prescribed by the regulations within 75 metres of a well or facility unless the well or facility has been decommissioned in accordance with this Act and the regulations.

Unlicensed wells and facilities

(2)  Subsection (1) does not apply if,

(a) the well or facility is not licensed; and

(b) the well or facility is not located on the same property as the building or structure.

Commencement

2.  This Schedule comes into force on the day the Budget Measures Act, 2006 (No. 2) receives Royal Assent.

SCHEDULE X
ONTARIO ENERGY BOARD ACT, 1998

1.  Subsection 33 (6) of the Ontario Energy Board Act, 1998 is repealed and the following substituted:

Order to take effect despite appeal

(6)  Subject to subsection (7), every order made by the Board takes effect at the time prescribed in the order, and its operation is not stayed by an appeal, unless the Board orders otherwise.

Court may stay the order

(7)  The Divisional Court may, on an appeal of an order made by the Board,

(a) stay the operation of the order; or

(b) set aside a stay of the operation of the order that was ordered by the Board under subsection (6).

2.  (1)  Subsection 98 (1) of the Act is repealed and the following substituted:

Right to enter land

(1)  The following persons may enter on land at the intended location of any part of a proposed work and may make such surveys and examinations as are necessary for fixing the site of the work:

1. Any person who has leave under this Part or a predecessor of this Part to construct the work.

2. Any person who is exempted under section 95 from the requirement to obtain leave to construct the work.

3. Where the proposed work is the expansion or reinforcement of a transmission or distribution system, any person who is required by the Board, pursuant to a condition of the person's licence, to expand or reinforce the transmission or distribution system.

4. The officers, employees and agents of a person described in paragraph 1, 2 or 3.

(2)  Section 98 of the Act is amended by adding the following subsection:

Interim order

(1.1)  The Board may, upon application, issue an interim order authorizing a person and the officers, employees and agents of that person to enter on land at the intended location of any part of a proposed work and to make such surveys and examinations as are necessary for fixing the site of the work and as are specified in the order if,

(a) the person has applied for leave under section 90 or 92 and has complied with section 94;

(b) the person has applied to the Board for an exemption under section 95; or

(c) the Board has commenced a proceeding to determine whether to require the person, pursuant to a condition of the person's licence, to expand or reinforce a transmission or distribution system.

(3)  Subsection 98 (2) of the Act is repealed and the following substituted:

Damages

(2)  Any damages resulting from an entry onto land carried out under subsection (1) or pursuant to an order under subsection (1.1) shall be determined by agreement or, failing agreement, in the manner set out in section 100.

3.  Subsection 101 (1) of the Act is repealed and the following substituted:

Crossings with leave

(1)  The following persons may apply to the Board for authority to construct a work upon, under or over a highway, utility line or ditch:

1. Any person who has leave to construct the work under this Part.

2. Any person who intends to construct the work and who is exempted under section 95 from the requirement to obtain leave.

3. Where the proposed work is the expansion or reinforcement of a transmission or distribution system, any person who is required by the Board, pursuant to a condition of the person's licence, to expand or reinforce the transmission or distribution system.

4. The officers, employees and agents of a person described in paragraph 1, 2 or 3.

Commencement

4.  (1)  Subject to subsection (2), this Schedule comes into force on the day the Budget Measures Act, 2006 (No. 2) receives Royal Assent.

Same

(2)  Sections 1 to 3 come into force on a day to be named by proclamation of the Lieutenant Governor.

SCHEDULE Y
ONTARIO INFRASTRUCTURE PROJECTS CORPORATION ACT, 2006

1.  Subsection 1 (1) of the Ontario Infrastructure Projects Corporation Act, 2006 is amended by adding the following definition:

"public work" means a public work as defined in the Ministry of Government Services Act; ("ouvrage public")

2.  The French version of paragraph 5 of section 3 of the Act is amended by striking out "confie" and substituting "attribue".

3.  The Act is amended by adding the following sections:

Public work projects

3.1  Despite any other Act, the Corporation may carry out its objects in respect of an infrastructure project concerning a public work that is assigned to the Corporation by the Minister under paragraph 5 of section 3, subject to such terms as are set out in the assignment.

Exemption, public works

3.2  Section 16 of the Ministry of Government Services Act does not apply with respect to an infrastructure project concerning a public work that is assigned to the Corporation by the Minister.

4.  Section 4 of the Act is amended by adding the following subsections:

Interest in public work

(1.1)  Without limiting the generality of subsection (1) and despite subsections 6 (1) and 8 (1) of the Ministry of Government Services Act, the Corporation may acquire, hold, lease or dispose of an interest in real or other property with respect to an infrastructure project concerning a public work that is assigned to the Corporation.

Disposal of real property

(1.2)  Any disposal by the Corporation of real property or any interest in real property by way of a grant, sale, lease or otherwise is subject to the approval of the Lieutenant Governor in Council.

Same

(1.3)  Subsection (1.2) does not apply to a grant of a lease for a term of less than 21 years or to a grant of easement.

Design, etc., of public works

(1.4)  Without limiting the generality of subsection (1) and despite subsection 6 (2) of the Ministry of Government Services Act, the Corporation may design, construct, renovate, service, maintain, repair, furnish, equip, manage and administer premises, buildings and structures that are public works relating to an infrastructure project that is assigned to the Corporation.

Commencement

5.  This Schedule comes into force on the day the Budget Measures Act, 2006 (No. 2) receives Royal Assent.

SCHEDULE Z
ONTARIO LOTTERY AND GAMING CORPORATION ACT, 1999

1.  (1)  Subsection 14 (1) of the Ontario Lottery and Gaming Corporation Act, 1999 is amended by adding the following paragraph:

4. Payments required to be made by the Corporation under an agreement relating to the distribution of a portion of the Corporation's revenues to First Nations of Ontario that is,

i. entered into by the Province of Ontario and representatives of First Nations of Ontario, and

ii. approved by the Lieutenant Governor in Council on the recommendation of the Minister and the Minister of Finance.

(2)  Subsection 14 (4) of the Act is amended by adding the following paragraph:

6. Payments required to be made by the Corporation under an agreement relating to the distribution of a portion of the Corporation's revenues to First Nations of Ontario that is,

i. entered into by the Province of Ontario and representatives of First Nations of Ontario, and

ii. approved by the Lieutenant Governor in Council on the recommendation of the Minister and the Minister of Finance.

2.  The Act is amended by adding the following sections:

Payments out of Consolidated Revenue Fund

14.1  The Minister of Finance shall pay out of the Consolidated Revenue Fund all amounts payable by the Province of Ontario under an agreement relating to the distribution of a portion of the Corporation's revenues to First Nations of Ontario that is,

(a) entered into by the Province of Ontario and representatives of First Nations of Ontario; and

(b) approved by the Lieutenant Governor in Council on the recommendation of the Minister and the Minister of Finance.

Publication of certain agreements

14.2  The Minister shall publish any agreement described in paragraph 4 of subsection 14 (1), paragraph 6 of subsection 14 (4) and in section 14.1, and any amendments to such agreements, in The Ontario Gazette.

Commencement

3.  (1)  Subject to subsection (2), this Schedule comes into force on the day the Budget Measures Act, 2006 (No. 2) receives Royal Assent.

Same

(2)  Sections 1 and 2 come into force on a day to be named by proclamation of the Lieutenant Governor.

SCHEDULE Z.1
PENSION BENEFITS ACT

1.  Subsection 93 (4) of the Pension Benefits Act is amended by adding the following clauses:

(d) any matter that may be provided for in an agreement under section 95;

(e) the reciprocal exchange, between the Superintendent and a person who has supervisory or regulatory powers under the pension benefits legislation of a prescribed jurisdiction, of information necessary for the purposes of,

(i) complying with or implementing an agreement entered into under this section, or

(ii) the administration and enforcement of this Act and the regulations and the pension benefits legislation of the prescribed jurisdiction; and

(f) any prescribed matter.

Commencement

2.  This Schedule comes into force on the day the Budget Measures Act, 2006 (No. 2) receives Royal Assent.

SCHEDULE Z.2
PROVINCIAL LAND TAX ACT, 2006

Interpretation

Interpretation

1.  (1)  In this Act,

"assessed owner" means, with respect to land, a person whose name appears on the tax roll as owner of the land; ("propriétaire inscrit")

"Board" means the Assessment Review Board; ("Commission")

"Minister" means the Minister of Finance; ("ministre")

"non-municipal territory" means territory without municipal organization; ("territoire non municipalisé")

"prescribed" means prescribed by regulations made under this Act; ("prescrit")

"property class" means a class of real property prescribed under the Assessment Act; ("catégorie de biens")

"property tax" means, with respect to land for a taxation year, the amount of tax determined under section 5 and includes any amount payable under another Act in respect of the land that may be collected as if it were a tax imposed by this Act. ("impôt foncier")

Interpretation

(2)  Other words and expressions used in this Act have the same meaning as under the Assessment Act.

Taxation year

(3)  Each calendar year beginning with 2009 is a taxation year for the purposes of this Act.

Tax and Exemptions

Tax

2.  (1)  Each year, tax shall be levied in the amount determined under section 5 on land that is included in the tax roll for non-municipal territory and that, under the Assessment Act, is liable to assessment and taxation.

Same

(2)  Taxes shall be levied on all of the land described in subsection (1), unless an Act or regulation expressly provides otherwise, and shall be levied according to the assessed value of the land.

Same

(3)  Property taxes for a year shall be deemed to have been imposed on January 1 of the year and are payable in accordance with section 7.

Exemptions from taxation

3.  (1)  The following land is exempt from taxation under this Act:

Indian lands

1. Land that is held in trust for a band or body of Indians.

Community recreation centres

2. Land containing an athletics field, an outdoor swimming pool, an outdoor skating rink or a community hall, if the land is owned by a board as defined in the Education Act that has jurisdiction in non-municipal territory only.

Non-profit hospital service corporations

3. Land occupied by a non-profit hospital service corporation and used chiefly by the corporation for providing laundry or food services, or both.

Mining lands

4. Land that is liable to tax under Part XIII of the Mining Act, other than,

i. land that is used for a purpose other than mining or that is used for both mining and one or more other purposes, or

ii. land on which there is timber that has an average value of more than $2 per acre, other than timber in a Crown forest as defined in the Crown Forest Sustainability Act, 1994 or timber that is reserved to the Crown.

Definition

(2)  In this section,

"non-profit hospital service corporation" means a corporation without share capital that provides laundry or food services to one or more public hospitals, as defined in the Public Hospitals Act.

Tax rates

4.  (1)  The tax rates for land for a taxation year are determined in accordance with the regulations.

Same

(2)  The regulations may provide for different tax rates for land in different property classes, for land in the same property class but in different geographic areas, for land in which different portions are assessed in different property classes and in such other circumstances as may be set out in the regulations.

Calculation and Payment of Tax

Calculation of tax

5.  (1)  Subject to any regulation that may be made under subsection (3), the amount of tax that is payable under section 2 on land for a taxation year is calculated using the formula,

A × B

in which,

"A" is the prescribed tax rate for the taxation year for the property class in which the land is classified, and

"B" is the assessed value of the land for the taxation year according to the last revised assessment roll for the year.

Same, railway companies and power utilities

(2)  Despite subsection (1) and subject to any regulation that may be made under subsection (3), the amount of tax that is payable on the following land is calculated in accordance with the regulations:

1. The roadway or right-of-way of a railway company, other than the structures, substructures and superstructures, rails, ties, poles and other property on the roadway or right-of-way, not including land leased by the railway company to another person for rent or other valuable consideration.

2. Land owned by a prescribed power utility and used as a transmission or distribution corridor, not including land leased by the power utility to another person for rent or other valuable consideration.

Regulations

(3)  The Minister may make regulations,

(a) governing the minimum amount of tax payable on land for a taxation year and prescribing the manner for determining that amount;

(b) limiting the change in the amount of tax payable under section 2 for a taxation year from the amount of tax payable for the previous taxation year under section 2 or the provisions of the Provincial Land Tax Act, as the case may be, and may prescribe rules for calculating the amount of tax payable under section 2 for the taxation year.

Tax bill

6.  (1)  Each year, the Minister shall send to the assessed owner of land one or more tax bills for property tax payable for the period specified in the bill.

More than one owner

(2)  If there is more than one assessed owner and they notify the Minister in writing that one of them is designated to receive tax bills for the land, the Minister shall notify the assessment corporation which owner is the designated owner and shall send the tax bills to the designated owner. However, if the owners do not give this notice to the Minister, the Minister may choose the owner to be billed.

Contents

(3)  The tax bill must set out the amount of property tax payable for the billing period and the date on which payment is due and must also set out the amount of any unpaid taxes, interest and penalties for any previous billing period.

Payment of tax

7.  (1)  The owner shall pay to the Minister the property tax for which the owner is billed and shall do so when the payment is due and in accordance with the regulations.

Due date

(2)  Payment of the property tax is due on the date specified in the bill, but the Minister may extend the due date either before or after the date specified in the bill.

Interest on unpaid tax

(3)  If the property tax is not paid when it is due, interest is payable beginning on January 1 of the following year on the outstanding balance and is calculated in accordance with the regulations and the interest rate must not exceed 1 1/4 per cent each month, calculated on the amount of the unpaid tax.

Penalty on unpaid tax

(4)  If the property tax is not paid when it is due, a penalty is payable on the outstanding balance and is calculated in accordance with the regulations and the penalty must not exceed 1 1/4 per cent of the amount of the unpaid tax.

Costs relating to forfeiture

(5)  If the Minister takes any steps under section 15 relating to the forfeiture of the land for unpaid property taxes, the prescribed amounts relating to the costs of the forfeiture shall be deemed, for the purposes of this Act, to be property taxes which are due and payable in accordance with the regulations.

Fee for failure of payment

(6)  A fee that is payable under section 8.1 of the Financial Administration Act with respect to a payment required by this Act shall be deemed, for the purposes of this Act, to be property tax which is due and payable in accordance with the regulations.

Payment of interest, etc.

(7)  The owner shall pay to the Minister the amount of any interest and penalties for which the owner is billed and shall do so in accordance with the regulations.

Cancellation, etc., of tax

8.  (1)  Upon application, the Minister may cancel or refund all or part of the property tax levied on land for a specified taxation year, including interest and penalties, if,

(a) as a result of a change event, as defined in clause (a) of the definition of "change event" in subsection 34 (2.2) of the Assessment Act, during the taxation year, the property or portion of the property is eligible to be reclassified in a different class of real property, as defined in regulations made under that Act, and that class has a lower tax rate for the taxation year than the class the property or portion of the property is in before the change event, and no supplementary assessment is made in respect of the change event under subsection 34 (2) of the Assessment Act;

(b) the land has become vacant land or excess land during the year or during the preceding year after the return of the assessment roll for the preceding year;

(c) the land has become exempt from taxation during the year or during the preceding year after the return of the assessment roll for the preceding year;

(d) during the year or during the preceding year after the return of the assessment roll for the preceding year, a building on the land,

(i) was razed by fire, demolition or otherwise, or

(ii) was damaged by fire, demolition or otherwise so as to render it substantially unusable for the purposes for which it was used immediately before the damage;

(e) the applicant is unable to pay property tax because of sickness, financial hardship or extreme poverty;

(f) the Minister believes that the property tax constitutes an undue financial burden on the applicant in accordance with such criteria as may be prescribed;

(g) a mobile unit on the land was removed during the year or during the preceding year after the return of the assessment roll for the preceding year;

(h) a person was overcharged in the year due to a gross or manifest error in the assessment roll that is clerical or factual in nature, including the transposition of figures, a typographical error or a similar error, but not an error in judgment in assessing the property;

(i) repairs or renovations to the land prevented the normal use of the land for a period of at least three months during the year; or

(j) the conditions prescribed by the regulations are satisfied.

Application

(2)  An application may be made under this section only by the owner of the land or by another person who,

(a) has an interest in the land as shown on the records of the appropriate land registry office and the sheriff's office;

(b) is a tenant, occupant or other person in possession of the land; or

(c) is a spouse of the owner or a person described in clause (a) or (b).

Decision

(3)  The Minister shall decide the application in accordance with such requirements as may be prescribed and shall give written notice of the decision to the applicant.

Appeal of decision

(4)  If the regulations authorize an appeal of the Minister's decision, the applicant may appeal the decision to the Board in accordance with the regulations.

Appeal if no decision

(5)  If the Minister does not make a decision about the application by such deadline as may be prescribed, an applicant may appeal to the Board in accordance with the regulations.

Hearing

(6)  The Board shall hear the appeal, giving at least 14 days' notice of the hearing to the applicant and the Minister.

Decision by Board

(7)  The Board shall determine the appeal and may make any decision that the Minister could have made.

Delegation by Minister

(8)  The Minister may, in writing, authorize the Board to decide applications on his or her behalf, and subsections (4) to (7) do not apply to those decisions.

Decision final

(9)  A decision of the Board is final.

Notice to assessment corporation

(10)  The Minister or the Board, as the case may be, shall give a copy of their decisions under this section to the assessment corporation, but failure to comply with this requirement does not invalidate any proceedings taken under this section.

Notice to Minister

(11)  The Board shall give a copy of its decisions under this section to the Minister, but failure to comply with this requirement does not invalidate any proceedings taken under this section.

Alteration of tax roll

(12)  The Minister shall alter the tax roll for the year to reflect a decision made under this section.

Application to other rebates, deferrals, etc.

(13)  If a regulation providing for a rebate, deferral, refund or cancellation of any amount requires that an application must be made for the rebate, deferral, refund or cancellation, subsections (2) to (12) apply with necessary modifications.

Restoration of tax in specified circumstances

9.  (1)  The Minister or the Board may restore all or any part of the property tax for a year that has been rebated, cancelled or refunded, in whole or in part, under subsection 8 (1) by reason of circumstances described in clause 8 (1) (d) if the Minister or the Board, as the case may be, is satisfied that during the year the building has been reconstructed or repaired and is capable of being used for the purposes for which it was used immediately before it was destroyed or damaged.

Restriction

(2)  A decision to restore property tax cannot be made under subsection (1) unless it is made on or before February 28 in the year following the year in respect of which the tax was rebated, cancelled or refunded and every person who, according to the tax roll, would be liable for the restored tax is given an opportunity to make representations to the Minister or the Board, as the case may be.

Notice of decision

(3)  The Minister or the Board, as the case may be, shall give written notice of the decision to the affected persons.

Appeal

(4)  A decision of the Minister under subsection (1) to restore property tax may be appealed to the Board and subsections 8 (6), (7), (9), (10) and (11) apply with necessary modifications to the appeal.

Alteration of tax roll

(5)  The Minister shall alter the tax roll for the year to reflect a decision made under this section.

Tax increase re undercharge due to error

10.  (1)  The Minister may notify a taxpayer that the Minister proposes to increase the property tax levied on land for the year in respect of which the notice is given to the extent of any undercharge caused by a gross or manifest error on the assessment roll that is a clerical or factual error, including the transposition of figures, a typographical error or similar error, but not an error in judgment in assessing the land.

Exception

(2)  Notice of a proposed increase cannot be given if the Minister has issued a tax statement under section 19 with respect to the tax before the taxpayer is notified of the opportunity to make submissions with respect to the proposal.

Deadline for notice

(3)  Notice of the proposed increase must be given on or before December 31 of the year following the year in respect of which the notice is given.

Decision and appeal

(4)  The taxpayer may appeal the Minister's decision on the proposal to the Board in accordance with the regulations.

Same

(5)  Subsections 8 (6), (7), (9), (10) and (11) apply with necessary modifications with respect to the appeal.

Collection

(6)  The amount of an increase in property taxes under this section is collectible as if it had been levied and included on the original tax bill, except,

(a) the amount is not payable until the time for appealing has expired or, if an appeal is made, the Board has made its decision; and

(b) the amount is not subject to late-payment charges until the 22nd day after the amount becomes payable.

Definition

(7)  In this section,

"taxpayer" means a person who is liable to pay property tax.

Apportionment of tax, etc.

11.  (1)  This section applies if land in respect of which property tax, interest and penalties are owing has been assessed in one block.

Application for apportionment

(2)  Upon application by an owner of the land or any part of it, the Minister may divide the land into two or more parcels and apportion the current year's property tax and the arrears, including interest and penalties, between the parcels in proportion to the relative value of the parcels at the time the assessment roll was returned for the year in which the application is made.

Same

(3)  The application must be made in accordance with the regulations and must be filed with the Minister before the deadline specified by the regulations.

Statement of relative value

(4)  Upon the request of the Minister, the assessment corporation shall provide a statement of the relative value of the parcels and the statement is conclusive.

Decision

(5)  The Minister shall decide the application in accordance with such requirements as may be prescribed and shall give written notice of the decision to the applicant.

Alteration of tax roll

(6)  The Minister shall alter the tax roll to reflect any division into parcels and apportionment of taxes, interest and penalties on the land among the parcels made by the decision and shall give the assessment corporation notice of the division of the land.

Effect of alteration

(7)  Once the tax roll is altered, the taxes, interest and penalties shall be deemed to have been always levied in accordance with the altered roll.

Collection of Tax Arrears

Recovery of tax

12.  (1)  Any amount that may be collected under this Act may be recovered with costs as a debt due to the Crown from the owner originally assessed for the property tax and from any subsequent owner of the land or any part of it.

Interpretation

(2)  Subsection (1) does not affect the owner's recourse against any other person.

Special lien

(3)  Any amount that may be collected under this Act is a special lien on the land in priority to every claim, privilege, lien or encumbrance of every person, and the lien and its priority are not lost or impaired by any neglect, omission or error of the Crown or its agents or through taking no action to register a notice under section 15.

Proof of amount owed

(4)  In any action to recover an amount that may be collected under this Act, the production of the relevant part of the tax roll purporting to be certified by the Minister as a true copy is, in the absence of evidence to the contrary, proof of the amount owed.

Separate action

(5)  The Crown may treat each year's property tax as a separate amount owing and may bring a separate action for the purposes of recovering the amount owing.

Warrant re seizure and sale

13.  (1)  If any amount that may be collected under this Act remains unpaid for a period of two years or more, the Minister may issue a warrant, directed to the sheriff for the area in which any property of the person liable to pay the amount is located, for the amount the person is liable to pay under this Act together with interest on the amount from the date on which the warrant is issued and the costs and expenses of the sheriff.

Same

(2)  The warrant issued by the Minister has the same force and effect as a writ of seizure and sale issued out of the Superior Court of Justice.

Collection from third parties

Notice of duty to pay Minister

14.  (1)  If the Minister believes or suspects that a person is or is about to become a debtor of an assessed owner, the Minister may notify the person that he, she or it is required to pay the money otherwise payable to the assessed owner in whole or in part to the Minister on account of the assessed owner's liability under this Act.

Same

(2)  If a person who is or is about to become a debtor of an assessed owner carries on business under a name or style other than the person's own name, the Minister's notice under subsection (1) may be given by addressing it to the name or style under which the person carries on business and delivering it to the business or to an adult person employed at the place of business of the addressee.

Same

(3)  If the persons who are or are about to become debtors of an assessed owner carry on business in partnership, the Minister's notice under subsection (1) may be given by addressing it to the partnership name and delivering it to one of the partners or to an adult person employed at the place of business of the partnership.

Duty to pay

(4)  A person who is or is about to become a debtor of an assessed owner and who receives the Minister's notice shall comply with it.

Effect of payment by debtor

(5)  The receipt of the Minister for money paid by the debtor under this section discharges the assessed owner's original liability to the extent of the payment.

Liability of debtor

(6)  Every debtor who discharges a liability to an assessed owner without complying with this section is liable to pay to the Minister an amount equal to the liability discharged or the amount that the debtor was required by this section to pay to the Minister, whichever is the lesser.

Garnishment of wages

(7)  Subject to the Wages Act, if the Minister gives an employer notice under subsection (1) with respect to an employee's liability under this Act and the employer is required to pay to the Minister money otherwise payable to the employee as remuneration, the notice operates to require the employer to pay to the Minister the amount specified in the Minister's notice out of each payment of remuneration until the employee's liability under this Act is satisfied.

Failure to pay

(8)  If a person, without reasonable excuse, fails to pay the money as required under this section to the Minister, the Minister may apply to the Superior Court of Justice for an order directing the person to pay the money.

Forfeiture of land for tax arrears

Registration of notice of tax arrears

15.  (1)  If any amount that may be collected under this Act remains unpaid for a period of two years or more, the Minister may register a notice of tax arrears against the title to the applicable land no later than November 30 in any year.

Exception

(2)  If there is no patent issued by the Crown granting the land, the Minister is not required to register the notice.

Notice of possible forfeiture

(3)  The Minister shall notify the following persons that the land and every interest in it is liable to be forfeited to the Crown unless the total amount owing under this Act is paid before December 1 of the year following the year in which the related notice required by subsection (5) is published in The Ontario Gazette:

1. The owner of the land, as indicated in the records of the land registry office or, if there are no such records, as indicated on the last revised assessment roll.

2. Every other person who according to the records, if any, in the land registry office has an interest in the land.

Same

(4)  The notice required by subsection (3) must contain such additional information as may be prescribed and must be delivered by registered mail or by such other method as may be prescribed.

Publication of list

(5)  On or before December 31, the Minister shall publish in The Ontario Gazette a notice containing a list of the lands in respect of which the notice described in subsection (3) was given during the year and indicating the circumstances in which the lands are liable to be forfeited to the Crown.

Certificate of forfeiture

(6)  If any amount owing under this Act in respect of land remains unpaid on December 1 of the year following the year in which the applicable notice required by subsection (5) is published, the Minister may issue a certificate of forfeiture declaring that the land, and every interest in it, is forfeited to and vested in the Crown.

Effect of issuance of certificate

(7)  When the certificate of forfeiture is issued, the land and every interest in it vests in the Crown absolutely freed and discharged from every estate, right, title, interest, claim or demand therein or thereto, whether existing, arising or accruing before or after the certificate is issued, and the land may be granted, sold, leased or otherwise disposed of in the same manner as public lands may be dealt with under the laws of Ontario.

Restriction: mining lands

(8)  If the land, other than land held under a lease or licence of occupation, that is subject to forfeiture under this section is also subject to the acreage tax under the Mining Act, only the surface rights are forfeited under this section.

Restriction: easements

(9)  A forfeiture under this section does not affect any easement to which the forfeited land is subject.

Registration of certificate

(10)  The Minister shall register the certificate of forfeiture against the title to the land.

Effect of registration of certificate

(11)  Upon registration of the certificate of forfeiture, the Registry Act or the Land Titles Act, as the case may be, ceases to apply to the forfeited land, and the land registrar shall note that fact in his or her register.

Same

(12)  The registered certificate of forfeiture is absolute and conclusive evidence of the forfeiture to the Crown of the land and every interest therein so certified to be forfeited, and the forfeiture is not open to attack in any court by reason of the omission of any act or thing leading up to the forfeiture.

Revocation of forfeiture

16.  (1)  If land has been forfeited to the Crown under this Act or a predecessor Act, the Minister may issue a certificate revoking the forfeiture.

Effect of certificate

(2)  When the certificate is issued, ownership of the applicable land reverts to the owner of the land at the time of the forfeiture or the owners' heirs, successors or assigns, subject to any lien, mortgage or charge entered or registered on title before the forfeiture that is still outstanding.

Registration of certificate

(3)  The Minister shall register the certificate against the title to the applicable land.

Administration

Preparation of tax roll

17.  (1)  The Minister shall prepare a tax roll for non-municipal territory for each year based on the last returned assessment roll for the year.

Contents

(2)  The tax roll must set out the following information for separately assessed land in non-municipal territory:

1. The assessment roll number for the land.

2. A description of the land sufficient to identify it.

3. The name of every person against whom the land is assessed, including a tenant assessed under section 18 of the Assessment Act.

4. The assessed value of the land and, if the land is assessed in more than one property class, the assessed value in each property class.

5. The total amount payable under this or any other Act and, if the land is assessed in more than one property class, the total amount payable in respect of each property class.

6. In the case of land described in subsection 5 (2), the area of the land and the amount of tax calculated under that subsection.

7. The amount of taxes payable under this Act, including any penalties and interest, and any amounts payable under another Act, including any penalties and interest and, if the land is assessed in more than one property class, the amounts payable in respect of each property class.

Effect of change of assessment

18.  If the assessment of land for a year changes as a result of a request under section 39.1 of the Assessment Act, a complaint under section 40 of that Act or an application under section 46 of that Act,

(a) any tax relief provided under section 8 or any tax increase provided under section 9 shall be redetermined using the new tax on property for the year based on the new assessment; and

(b) the tax roll for the year shall be altered to reflect the redetermination.

Statement of amounts owing for taxes

19.  (1)  The Minister shall, at the request of any person, give to that person an itemized statement of all amounts owing for taxes in respect of any separately assessed land as of the day the statement is issued.

Effect

(2)  A statement given under subsection (1) is binding on the Minister.

Amounts collected on behalf of other bodies

20.  (1)  Subject to the regulations, if amounts payable under one or more prescribed Acts to one or more bodies specified in those Acts are to be collected as if the amounts were tax payable under this Act, the Minister shall apply all amounts collected under this Act in respect of a property firstly against amounts payable under this Act in respect of that property and shall pay any balance then remaining to those bodies proportionately, based on the amounts then owing to each of them.

Information

(2)  Every body referred to in subsection (1) shall, for the purposes of that subsection, give the Minister such information as the Minister may specify, in a form acceptable to the Minister.

Payment to affected municipality

21.  If land becomes part of a municipality in a year, the Minister may pay to the municipality any part of the property tax on the land for the year.

Deemed delivery of notices and documents

22.  (1)  A notice or other document that, under this Act, is required or permitted to be given or sent to a person may be mailed to the person at the person's most recent address in the records of the Ministry, and the person shall be deemed, in the absence of evidence to the contrary, to have received it on the day on which it is mailed.

Same, more than one owner

(2)  If there is more than one owner of land, a notice or other document that, under this Act, is given or sent to one of the owners shall be deemed to have been given or sent to all of them.

Affidavit as evidence

23.  For the purposes of a proceeding under this Act, the facts necessary to establish the Minister's compliance with this Act or to establish a person's failure to comply with this Act are, in the absence of evidence to the contrary, sufficiently proved by an affidavit of the Minister or of an officer of the Ministry of Finance.

Delegation by Minister

24.  (1)  The Minister may delegate to a public servant within the meaning of the Public Service Act any of the Minister's powers or duties under this Act.

Same

(2)  The delegation must be made in writing and is subject to such limitations, conditions and requirements as are set out in it.

Subdelegation

(3)  In a delegation, the Minister may authorize a person to whom a power or duty is delegated to delegate the power or duty to others, subject to such limitations, conditions and requirements as the person may impose.

Presumption

(4)  A person who purports to exercise a delegated power or perform a delegated duty shall be presumed conclusively to act in accordance with the delegation.

Regulations

25.  (1)  The Minister may make regulations,

(a) governing and clarifying the application of this Act;

(b) prescribing those matters which are required or permitted to be prescribed;

(c) governing those matters which are required or permitted to be done in accordance with the regulations;

(d) defining any word or expression in this Act that is not already defined;

(e) providing for the deferral or cancellation of, or other relief in respect of, all or part of a tax increase on property in the residential property class for persons assessed as owners who are, or whose spouses are,

(i) low-income seniors, as defined in the regulations, or

(ii) low-income persons with disabilities, as defined in the regulations;

(f) providing for tax rebates in whole or in part for eligible charities for the purpose of giving them relief from taxes or amounts paid on account of taxes on property they occupy and prescribing circumstances in which the tax rebate is available, the classes of property to which it applies and any conditions that must be satisfied;

(g) providing for tax rebates in whole or in part to owners of property that have vacant portions if that property is in the commercial property class or in the industrial property class and prescribing circumstances in which the tax rebate is available and any conditions that must be satisfied;

(h) providing for the cancellation of all or a portion of the taxes levied on property for the purposes of providing an incentive for the environmental remediation of the property and prescribing circumstances in which the cancellation is available, the classes of property to which a cancellation applies and any conditions that must be satisfied;

(i) providing for reductions or refunds of tax in respect of heritage properties and prescribing circumstances in which the tax reduction or refund is available, the classes of property to which it applies and any conditions that must be satisfied;

(j) governing the allocation and application of amounts collected under this Act in respect of amounts payable under this Act and amounts payable under one or more prescribed Acts.

Classes

(2)  A regulation may establish classes of persons or land and may impose different requirements or entitlements with respect to each class.

Scope of regulation

(3)  A regulation may be general or specific in its application.

Retroactivity

(4)  A regulation is effective with reference to a period before it was filed, if the regulation so provides.

Transitional Matters

Adjustments for amounts under predecessor Act

26.  Adjustments made after 2008 that relate to amounts payable but not paid before 2009 under the Provincial Land Tax Act or that relate to overpayments made before 2009 under that Act shall be charged or credited under this Act to the owner of the land as if the amounts had been payable or the overpayments made under this Act.

Commencement and Short Title

Commencement

27.  (1)  Subject to subsection (2), this Schedule comes into force on the day the Budget Measures Act, 2006 (No. 2) receives Royal Assent.

Same

(2)  Sections 1 to 26 come into force on January 1, 2009.

Short title

28.  The short title of the Act set out in this Schedule is the Provincial Land Tax Act, 2006.

SCHEDULE Z.3
PROVINCIAL LAND TAX ACT, 2006 - CONSEQUENTIAL REPEAL AND AMENDMENTS

Provincial Land Tax Act

1.  The Provincial Land Tax Act is repealed.

Ambulance Act

2.  (1)  Subsection 6.9 (7) of the Ambulance Act is amended by striking out "Provincial Land Tax Act" and substituting "Provincial Land Tax Act, 2006".

(2)  Paragraph 4 of subsection 22 (2.3) of the Act is amended by striking out "Provincial Land Tax Act" and substituting "Provincial Land Tax Act, 2006".

Assessment Review Board Act

3.  Section 9 of the Assessment Review Board Act is repealed and the following substituted:

Sittings of Board

9.  The Board shall hold sittings at such place or places in a county or district or a metropolitan, regional or district municipality or in territory without municipal organization as the chair from time to time may designate for the purpose of hearing and deciding all complaints relating to assessments in municipalities within the county or district or the metropolitan, regional or district municipality or in the territory without municipal organization in respect of which a person may appeal to the Board under the Assessment Act or any other Act.

Building Code Act, 1992

4.  (1)  Subsection 8 (8) of the Building Code Act, 1992 is amended by striking out "shall be deemed to be taxes imposed under section 3 of the Provincial Land Tax Act for the purposes of sections 26 and 27 of that Act" at the end and substituting "is a debt owing to the Crown and may be collected under the Provincial Land Tax Act, 2006 as if it was tax imposed under that Act".

(2)  Subsection 15.9 (11) of the Act is amended by striking out "shall be deemed to be taxes imposed under section 3 of the Provincial Land Tax Act for the purposes of sections 26 and 27 of that Act" at the end and substituting "is a debt owing to the Crown and may be collected under the Provincial Land Tax Act, 2006 as if it was tax imposed under that Act".

(3)  Subsection 15.10 (11) of the Act is amended by striking out "shall be deemed to be taxes imposed under section 3 of the Provincial Land Tax Act for the purposes of sections 26 and 27 of that Act" at the end and substituting "is a debt owing to the Crown and may be collected under the Provincial Land Tax Act, 2006 as if it was tax imposed under that Act".

(4)  Subsection 17.1 (4) of the Act is repealed and the following substituted:

In territory without municipal organization

(4)  If the building in respect of which money was spent is located in territory without municipal organization,

(a) the municipality, board of health, planning board or conservation authority may give the Minister of Finance written notice of the amount that was spent, requesting the collection of the amount under the Provincial Land Tax Act, 2006;

(b) the amount may be collected under that Act as if it was tax imposed under it; and

(c) the Minister of Finance shall pay the amount collected under that Act, less the costs reasonably attributable to the collection, to the municipality, board of health, planning board or conservation authority.

Day Nurseries Act

5.  Section 7.7 of the Day Nurseries Act is repealed and the following substituted:

Payment, territory without municipal organization

7.7  The amount required to be provided by persons living in territory without municipal organization with respect to the costs that are to be shared under section 7.3 may be collected under the Provincial Land Tax Act, 2006 as if the amount was tax imposed under that Act.

Development Corporations Act

6.  Subsection 14 (4) of the Development Corporations Act is repealed and the following substituted:

Deemed taxes

(4)  Amounts that are repayable under an agreement made under subsection (2) may be collected under the Provincial Land Tax Act, 2006 as if the amounts were taxes imposed under that Act.

District Social Services Administration Boards Act

7.  Subsection 8 (2) of the District Social Services Administration Boards Act is amended by striking out "as part of the taxes imposed on property taxable under the Provincial Land Tax Act" at the end and substituting "as if the amount was tax imposed under the Provincial Land Tax Act, 2006".

Education Act

8.  (1)  The definition of "education funding" in subsection 234 (14) of the Education Act is amended by striking out "or" at the end of subclause (b) (ii), by adding "or" at the end of subclause (b) (iii) and by adding the following subclause:

(iv) paying the board's share of any amount that was deferred, cancelled or refunded under section 8 of the Provincial Land Tax Act, 2006 by reason of clause 8 (1) (a), (b), (c), (d), (f) or (h) of that Act or under a regulation made under clause 25 (1) (f), (h) or (i) of that Act; and

(2)  Subsection (4) applies only if Bill 130 (Municipal Statute Law Amendment Act, 2006), introduced on June 15, 2006, receives Royal Assent.

(3)  References in subsection (4) to provisions of Bill 130 are references to those provisions as they were numbered in the first reading version of the Bill.

(4)  On the later of the day this section comes into force and the day subsection 15 (4) of Schedule C to Bill 130 comes into force, the definition of "education funding" in subsection 234 (14) of the Act is amended by striking out "or" at the end of subclause (b) (ii), by adding "or" at the end of subclause (b) (iii) and by adding the following subclause:

(iv) paying the board's share of any amount that was deferred, cancelled or refunded under section 8 of the Provincial Land Tax Act, 2006 by reason of clause 8 (1) (a), (b), (c), (d), (f) or (h) of that Act or under a regulation made under clause 25 (1) (f), (h) or (i) of that Act; and

(5)  Clause 255 (1) (a) of the Act is amended by striking out "and collecting taxes".

(6)  Subsections 255 (2) and (3) of the Act are repealed and the following substituted:

Collection of taxes

(2)  The rates levied under subsection (1) may be collected under the Provincial Land Tax Act, 2006 as if they were taxes imposed under that Act.

(7)  Section 257 of the Act is repealed.

(8)  Subsection 257.2.1 (4) of the Act is amended by striking out "the Provincial Land Tax Act" and substituting "the Provincial Land Tax Act, 2006 or the predecessor Act".

(9)  Section 257.6 of the Act is amended by adding the following subsections:

Exemption, non-profit hospital service corporations

(8)  Real property in territory without municipal organization occupied by a non-profit hospital service corporation that is used chiefly by the corporation for providing laundry or food services or both is exempt from taxes for school purposes.

Same

(9)  In subsection (8),

"non-profit hospital service corporation" means a corporation without share capital that provides laundry or food services to one or more public hospitals, as defined in the Public Hospitals Act.

(10)  Subsection 257.7 (1) of the Act is amended by striking out the portion before paragraph 1 and substituting the following:

Levying of taxes for school purposes

(1)  Subject to the regulations, the following shall, in each year, levy tax at the rates prescribed under section 257.12:

. . . . .

(11)  Section 257.7 of the Act is amended by adding the following subsection:

Collection

(1.1)  The taxes levied in a year under subsection (1) shall be collected as follows:

1. The municipality that levies taxes under paragraph 1 of subsection (1) shall collect the taxes.

2. The taxes levied under paragraphs 2 and 3 of subsection (1) shall be collected under the Provincial Land Tax Act, 2006 as if they were taxes imposed under that Act.

(12)  Subsection 257.8 (2) of the Act is amended by striking out the portion before paragraph 1 and substituting the following:

Same

(2)  Amounts levied for school purposes on business property under this Division by a municipality or board shall be distributed by the municipality or the Minister of Finance, as the case may be, in accordance with the following requirements:

. . . . .

(13)  Subsection 257.9 (1) of the Act is amended by striking out the portion before paragraph 1 and substituting the following:

Residential property, distribution of amounts levied

(1)  Amounts levied for school purposes on residential property under this Division by a municipality or board shall be distributed by the municipality or the Minister of Finance, as the case may be, in accordance with the following requirements:

. . . . .

(14)  Subsection 257.10 (1) of the Act is amended by striking out "or board".

(15)  Subsection 257.10 (2) of the Act is amended by striking out "or of a board".

(16)  Subsection 257.10 (4) of the Act is amended by striking out "of municipalities and boards and of the officers of municipalities and boards" at the end and substituting "of municipalities and their officers".

(17)  Subsection 257.10 (5) of the Act is repealed and the following substituted:

Where board levies taxes

(5)  Where a board levies taxes for school purposes under this Division, the Minister of Finance has under this Act the powers and duties of the Minister of Finance under the Provincial Land Tax Act, 2006 to collect the taxes, to cancel them in whole or in part and to charge amounts back to the board.

Transition

(6)  The Minister of Finance may exercise the powers and shall perform the duties of a board relating to the collection of arrears of taxes levied before January 1, 2009 under this Division and the board ceases to have those powers and duties on that date.

Same

(7)  Arrears of taxes levied before January 1, 2009 under this Division may be collected under the Provincial Land Tax Act, 2006 as if the arrears were taxes imposed under that Act.

Same

(8)  Every board shall give the Minister of Finance such information as he or she may request with respect to arrears of taxes levied before January 1, 2009 under this Division.

(18)  Section 257.10.1 of the Act is repealed.

(19)  Subsection 257.11 (1) of the Act is amended by striking out "a municipality or board shall pay" in the portion before paragraph 1 and substituting "a municipality shall pay".

(20)  Section 257.11 of the Act is amended by adding the following subsection:

When amounts paid to boards by the Minister of Finance

(1.1)  In each calendar year, the Minister of Finance shall pay to the boards amounts collected for school purposes within three months after collecting the amounts.

(21)  The definition of "tax rates for school purposes" in subsection 257.12 (1.1) of the Act is amended by striking out "or" at the end of clause (a.1), by adding "or" at the end of clause (b) and by adding the following clause:

(c) paying the board's share of any amount that is deferred, cancelled, refunded or rebated under section 8 of the Provincial Land Tax Act, 2006 by reason of clause 8 (1) (a), (b), (c), (d), (f) or (h) of that Act or under a regulation made under clause 25 (1) (f), (h) or (i) of that Act.

(22)  Subsection (24) applies only if Bill 130 (Municipal Statute Law Amendment Act, 2006), introduced on June 15, 2006, receives Royal Assent.

(23)  References in subsection (24) to provisions of Bill 130 are references to those provisions as they were numbered in the first reading version of the Bill.

(24)  On the later of the day this section comes into force and the day subsection 15 (18) of Schedule C to Bill 130 comes into force, the definition of "tax rates for school purposes" in subsection 257.12 (1.1) of the Act, as re-enacted by subsection 15 (18) of Schedule C to Bill 130, is amended by striking out "or" at the end of clause (b), by adding "or" at the end of clause (c) and by adding the following clause:

(d) paying the board's share of any amount that is deferred, cancelled, refunded or rebated under section 8 of the Provincial Land Tax Act, 2006 by reason of clause 8 (1) (a), (b), (c), (d), (f) or (h) of that Act or under a regulation made under clause 25 (1) (f), (h) or (i) of that Act.

(25)  Section 257.13.2 of the Act is amended by striking out "including unpaid taxes under section 21.1 of the Provincial Land Tax Act" in the portion before clause (a).

(26)  Clause 257.14 (1) (c) of the Act is repealed and the following substituted:

(c) providing that a board specified in the regulation perform the duties of a board mentioned in section 256 or subsection 255 (1) respecting the levying of rates in the area of jurisdiction of the board it is replacing;

(27)  Clause 257.14 (1) (c.1) of the Act is amended by striking out "or section 21.1 of the Provincial Land Tax Act".

(28)  Clause 257.14 (1) (f) of the Act is repealed and the following substituted:

(f) providing, despite any provision of this Act or the Provincial Land Tax Act, 2006, that parts of territory described in subsection (2) shall, for the purposes of this Division, be deemed to be attached to a municipality under section 56 or clause 58.1 (2) (m) until the territory becomes, or is included in, a municipality;

(29)  Clause 257.14 (1) (g) of the Act is amended by striking out "or under section 21.1 of the Provincial Land Tax Act".

(30)  Clause 257.14 (1) (i) of the Act is amended by striking out "the Municipal Act, 2001, or the Provincial Land Tax Act, that boards and municipalities may levy or collect rates" and substituting "or the Municipal Act, 2001, that boards and municipalities may levy rates".

(31)  Subsection 257.14 (4) of the Act is amended by striking out "may provide for the levying or collection of rates" and substituting "may provide for the levying of rates".

Electricity Act, 1998

9.  (1)  Subsection 92 (3) of the Electricity Act, 1998 is repealed and the following substituted:

Payments after Part V repealed

(3)  After Part V is repealed under section 84.1, all payments required to be made under this section to the Financial Corporation by Hydro One Inc., a subsidiary of Hydro One Inc., Ontario Power Generation Inc. or a subsidiary of Ontario Power Generation Inc. shall instead be paid to,

(a) one or more municipalities in the manner specified by the Minister of Finance, in respect of land located in a municipality; and

(b) Her Majesty in right of Ontario, in respect of land located in territory without municipal organization.

(2)  Subsection 92 (6) of the Act is repealed and the following substituted:

Payments under the Assessment Act and Provincial Land Tax Act, 2006

(6)  The references in subsection (1) to taxes for municipal and school purposes shall be deemed to include payments under section 27 of the Assessment Act and taxes under the Provincial Land Tax Act, 2006.

(3)  Subsection 92.1 (2.1) of the Act is repealed.

Environmental Protection Act

10.  Subsections 154 (8) and (9) of the Environmental Protection Act are repealed and the following substituted:

Collection, territory without municipal organization

(8)  If an order to pay costs is directed to a person who owns real property in territory without municipal organization and if the Director gives written notice to the Minister of Finance of the amounts specified in the order that relate to things done in connection with the property and requests that the amounts be collected under the Provincial Land Tax Act, 2006, the amounts may be collected under that Act as if they were taxes imposed under it.

Identification of amounts

(9)  An instruction under subsection (2) or a notice under subsection (8) shall state which of the amounts specified in the applicable order relate to things done in connection with the property.

Farming and Food Production Protection Act, 1998

11.  Subsection 6 (12) of the Farming and Food Production Protection Act, 1998 is repealed and the following substituted:

Same

(12)  For the purposes of subsection (9), the owner of land shall be deemed to be the person named on the last revised assessment roll prepared under the Assessment Act.

Fire Protection and Prevention Act, 1997

12.  (1)  Subsection 39 (1) of the Fire Protection and Prevention Act, 1997 is amended by striking out the portion before paragraph 1 and substituting the following:

Collection of costs

(1)  The Fire Marshal, an assistant to the Fire Marshall or a fire chief may give written notice to the Minister of Finance of the amount of any of the following expenses incurred by the Province of Ontario that relate to things done in connection with the land and premises in territory without municipal organization, requesting the collection of the amount under the Provincial Land Tax Act, 2006:

. . . . .

(2)  Subsections 39 (2) and (3) of the Act are repealed and the following substituted:

Same

(2)  When the Minister of Finance receives notice of an amount under subsection (1), the amount may be collected under the Provincial Land Tax Act, 2006 as if the amount was a tax imposed under that Act.

Health Protection and Promotion Act

13.  Clause 96 (5.1) (d) of the Health Protection and Promotion Act is repealed and the following substituted:

(d) provide for payment of the expenses referred to in subsection 72 (1) by residents of territory without municipal organization, provide that the expenses may be collected under the Provincial Land Tax Act, 2006 as if they were taxes imposed under that Act and provide for the remittance of the amounts collected under that Act to specified boards of health;

Income Tax Act

14.  (1)  Subclause (c) (i) of the definition of "housing unit" in subsection 8 (1) of the Income Tax Act is amended by striking out "the Provincial Land Tax Act" and substituting "the Provincial Land Tax Act, 2006".

(2)  Clause (c) of the definition of "municipal tax" in subsection 8 (1) of the Act is amended by striking out "the Provincial Land Tax Act" and substituting "the Provincial Land Tax Act, 2006 or the predecessor Act".

Lakes and Rivers Improvement Act

15.  (1)  Subsection 29 (8) of the Lakes and Rivers Improvement Act is amended by striking out "the Minister may direct the land tax collector appointed under the Provincial Land Tax Act to recover the amount specified" at the end and substituting "the Minister may give written notice to the Minister of Finance of the amount to be recovered, requesting the collection of the amount under the Provincial Land Tax Act, 2006, and the amount may be collected under that Act as if it was tax imposed under it".

(2)  Subsection 29 (9) of the Act is repealed.

Local Roads Boards Act

16.  (1)  Section 19 of the Local Roads Boards Act is repealed and the following substituted:

Liability to assessment and taxation

19.  All land, as defined in the Assessment Act, in a local roads area is liable to taxation under this Act, subject to the exemptions from taxation enumerated in subsection 3 (1) of the Assessment Act and those enumerated in section 3 of the Provincial Land Tax Act, 2006.

(2)  Section 20 of the Act is repealed and the following substituted:

Assessment of land

20.  The assessment made under the Assessment Act of land in a local roads area constitutes the assessment of the land for the purposes of this Act.

(3)  The Act is amended by adding the following section:

Delegation re tax collection

29.1  (1)  A board may enter into an agreement with the Minister of Finance providing for the delegation to the Minister of Finance of the board's powers under this Act to collect tax and, if the board does so, the agreement must be entered into at least 12 months before the beginning of the taxation year in respect of which the delegation applies.

Effect of delegation

(2)  When a delegation applies in respect of a taxation year, sections 23 to 29 do not apply for the year and the Minister of Finance may collect the tax under the Provincial Land Tax Act, 2006 as if it was tax imposed under that Act.

Payment to board

(3)  The Minister of Finance shall pay amounts owing to the board within three months after collecting the amounts.

Termination of delegation

(4)  A board or the Minister of Finance may terminate an agreement described in subsection (1), but the termination is effective for a taxation year only if notice of the termination is served on the board or the Minister, as the case may be, at least 12 months before the beginning of the taxation year.

Municipal Act, 2001

17.  The definition of "real property taxes" in subsection 371 (1) of the Municipal Act, 2001 is repealed and the following substituted:

"real property taxes" means the amount of taxes levied on real property under this Act and the Education Act and any amounts owed under the Drainage Act, the Tile Drainage Act and the Shoreline Property Assistance Act with respect to the real property and includes any amounts deemed to be taxes by or under any other Act and any amounts given priority lien status by or under any Act; ("impôts fonciers")

Municipal Elections Act, 1996

18.  (1)  Subsection 18 (2) of the Municipal Elections Act, 1996 is amended by striking out "the assessment commissioner" and substituting "the Municipal Property Assessment Corporation".

(2)  Section 20 of the Act is amended by striking out "The assessment commissioner" at the beginning and substituting "The Municipal Property Assessment Corporation".

(3)  Section 22 of the Act is amended by striking out "the assessment commissioner" and substituting "the Municipal Property Assessment Corporation".

(4)  Clause 27 (2) (b) of the Act is amended by striking out "the assessment commissioner" and substituting "the Municipal Property Assessment Corporation".

(5)  Subparagraph 4 i of subsection 65 (4) of the Act is amended by striking out "the assessment commissioner" and substituting "the Municipal Property Assessment Corporation".

(6)  Subparagraph 4 ii of subsection 65 (4) of the Act is repealed and the following substituted:

ii. the Municipal Property Assessment Corporation shall, at least 21 days before nomination day, give the clerk the preliminary list or the part of it that is required for the by-election, updated to the date the Municipal Property Assessment Corporation received the clerk's notice,

Municipal Extra-Territorial Tax Act

19.  (1)  The definition of "assessment commissioner" in subsection 1 (1) of the Municipal Extra-Territorial Tax Act is repealed.

(2)  Subsection 4 (3) of the Act is amended by striking out "the assessment commissioner" and substituting "the Municipal Property Assessment Corporation".

Municipal Health Services Act

20.  (1)  Subsection 8 (1) of the Municipal Health Services Act is amended by striking out "the assessment commissioner" and by striking out "the assessor" and substituting in each case "the Municipal Property Assessment Corporation".

(2)  Subsection 8 (2) of the Act is amended by striking out "the assessment commissioner" and substituting "the Municipal Property Assessment Corporation".

Municipal Property Assessment Corporation Act, 1997

21.  (1)  Subsection 9 (1) of the Municipal Property Assessment Corporation Act, 1997 is repealed and the following substituted:

Duties of the Corporation

(1)  The Corporation shall perform the duties assigned to it under the Assessment Act or any other Act and assigned to property assessors under any other Act.

(2)  The definition of "B" in subsection 12 (2) of the Act is amended by striking out "in the provincial land tax register or the provincial land tax roll, and" at the end and substituting "in the assessment roll returned to the Minister for territory without municipal organization, and".

Northern Services Boards Act

22.  (1)  Section 22 of the Northern Services Boards Act is repealed and the following substituted:

Interim assessment roll

22.  Every year, on or before October 15, the Municipal Property Assessment Corporation shall send to the secretary of each Board a copy of the portion of the interim assessment roll for the lands in the Board area that are liable to assessment and taxation under the Assessment Act and liable to taxation under the Provincial Land Tax Act, 2006 showing the amount of the interim assessment of those lands for the following year.

(2)  Subsection 23 (4) of the Act is amended by striking out "the Provincial Land Tax Act" and substituting "the Provincial Land Tax Act, 2006".

(3)  Subsection 25 (1) of the Act is repealed and the following substituted:

Rates under the Provincial Land Tax Act, 2006

(1)  If in any year the inhabitants have approved one or more rates to be levied under the Provincial Land Tax Act, 2006 as provided in section 23, the Board may by by-law passed before December 1 in the year request the Minister of Finance to collect under that Act in the following year the rate or rates in respect of land that is taxable under that Act.

(4)  Subsection 26 (1) of the Act is amended,

(a) by striking out "the Provincial Land Tax Act" and substituting "the Provincial Land Tax Act, 2006"; and

(b) by striking out "and shall be collected as though it were for all purposes provincial land tax" at the end and substituting "and shall be collected under the Provincial Land Tax Act, 2006 as if they were taxes imposed under that Act".

(5)  Subsections 26 (2) and (3) of the Act are repealed and the following substituted:

Exemption

(2)  Land belonging to the Board is exempt from taxation under the Provincial Land Tax Act, 2006.

Payment to Board

(3)  The Minister of Finance shall pay amounts owing to the board within three months after collecting the amounts.

(6)  Subsection 43 (1) of the Act is amended by striking out "or the Provincial Land Tax Act" at the end.

(7)  Subsection 43 (6) of the Act is amended by striking out "and of any register, roll or list under the Provincial Land Tax Act".

(8)  Subsection 44 (3) of the Act is repealed and the following substituted:

Collection in territory without municipal organization

(3)  With respect to territory without municipal organization in the Board area, the Minister of Finance shall, under the Provincial Land Tax Act, 2006, collect the amounts required to be raised by the Province for the Board's purposes and shall remit the amounts to the Board.

(9)  Clause 46 (a) of the Act is amended by striking out "the Provincial Land Tax Act" and substituting "the Provincial Land Tax Act, 2006".

(10)  Subsection 47 (3) of the Act is repealed and the following substituted:

Exemption

(3)  Land belonging to the Board is exempt from taxation under section 3 of the Assessment Act as if the Board were a municipality.

(11)  Subsection 49 (8) of the Act is amended by striking out "the Provincial Land Tax Act" and substituting "the Provincial Land Tax Act, 2006".

Nutrient Management Act, 2002

23.  (1)  Subsections 38 (8) and (9) of the Nutrient Management Act, 2002 are repealed and the following substituted:

Territory without municipal organization

(8)  If an order to pay costs is directed to a person who owns real property in territory without municipal organization and if the Director gives written notice to the Minister of Finance of the amounts specified in that order that relate to things done in connection with the property, requesting the collection of the amounts under the Provincial Land Tax Act, 2006, the amounts may be collected under that Act as if they were taxes imposed under it.

Identification of amounts

(9)  An instruction under subsection (2) or a notice under subsection (8) shall state which of the amounts specified in the order relate to things done in connection with the property.

(2)  Clause 39 (1) (b) of the Act is repealed and the following substituted:

(b) in the case of land owned by the farmer in territory without municipal organization, give written notice to the Minister of Finance of the amount of the costs, requesting the collection of the amount under the Provincial Land Tax Act, 2006.

(3)  Subsection 39 (3) of the Act is repealed and the following substituted:

Provincial land taxes

(3)  If the Director gives written notice under clause (1) (b) to the Minister of Finance, the amount may be collected under the Provincial Land Tax Act, 2006 as if it was tax imposed under that Act.

Ontario Disability Support Program Act, 1997

24.  Section 42 of the Ontario Disability Support Program Act, 1997 is repealed and the following substituted:

Collection, territory without municipal organization

42.  The amount required to be provided by persons living in territory without municipal organization with respect to the costs incurred under this Act may be collected under the Provincial Land Tax Act, 2006 as if the amount was tax imposed under that Act.

Ontario Water Resources Act

25.  Subsections 88 (8) and (9) of the Ontario Water Resources Act are repealed and the following substituted:

Territory without municipal organization

(8)  If an order to pay costs is directed to a person who owns land in territory without municipal organization and if the Director gives written notice to the Minister of Finance of the amounts specified in that order that relate to things done in connection with the land, requesting the collection of the amounts under the Provincial Land Tax Act, 2006, the amounts may be collected under that Act as if they were taxes imposed under it.

Identification of amounts

(9)  An instruction under subsection (2) or a notice under subsection (8) shall state which of the amounts specified in the order relate to things done in connection with the land.

Ontario Works Act, 1997

26.  (1)  Section 55 of the Ontario Works Act, 1997 is repealed and the following substituted:

Collection, territory without municipal organization

55.  The amount required to be provided by persons living in territory without municipal organization with respect to the costs incurred under this Act by delivery agents, persons under an agreement under section 49 and the Ministry may be collected under the Provincial Land Tax Act, 2006 as if the amount was tax imposed under it.

(2)  Subsection 3 (6) of Schedule D to the Act is repealed and the following substituted:

Collection, territory without municipal organization

(6)  The amount required to be provided by persons living in territory without municipal organization with respect to the costs incurred under the Family Benefits Act by the Ministry may be collected under the Provincial Land Tax Act, 2006 as if the amount was tax imposed under it.

Police Services Act

27.  Paragraph 11 of subsection 135 (1) of the Police Services Act is repealed and the following substituted:

11. requiring territories without municipal organization to pay for police services provided by the Ontario Provincial Police and,

i. governing the determination of the amounts payable for those services,

ii. governing the payment of those amounts, including providing for the calculation and payment of interest and penalties,

iii. governing the collection of those amounts, including providing for payment credits and refunds for overpayments, or providing that all or part of those amounts may be collected under the Provincial Land Tax Act, 2006 as if they were taxes imposed under that Act, and

iv. for the purposes described in subparagraphs i, ii and iii, establishing different requirements for different classes of territories;

Public Lands Act

28.  (1)  Section 36 of the Public Lands Act is repealed and the following substituted:

Annual list to Municipal Property Assessment Corporation

36.  The Minister shall in the month of February in every year transmit to the Municipal Property Assessment Corporation a list of all lands in the assessment region patented, sold or agreed to be sold by the Crown, or leased, or appropriated to any person, or in respect of which a licence of occupation was issued during the next preceding calendar year and a list of the cancellations of any licence of occupation, sale, lease, location or appropriation of land in the assessment region during the next preceding calendar year.

(2)  Section 43 of the Act is amended by striking out "Where any land forfeited to and vested in the Crown under the Provincial Land Tax Act" at the beginning and substituting "Where any land that is forfeited to the Crown under the Provincial Land Tax Act, 2006 or the predecessor Act".

(3)  The Act is amended by adding the following section:

Collection of amounts

46.1  If public land is located in territory without municipal organization, the following amounts may be collected under the Provincial Land Tax Act, 2006 as if they were taxes imposed under that Act:

1. Amounts payable as rent under a lease.

2. Amounts payable as a fee under a licence of occupation, a land use permit or any other authority granting a right to occupy the land or permitting the carrying out of an activity on the land.

Safe Drinking Water Act, 2002

29.  (1)  Subsection 124 (8) of the Safe Drinking Water Act, 2002 is amended by striking out the portion before clause (a) and substituting the following:

Notice re land in territory without municipal organization

(8)  The Director may give written notice to the Minister of Finance of the amounts specified in an order to pay costs issued under section 122 that relate to things done in connection with a drinking-water system, requesting collection of the amounts under the Provincial Land Tax Act, 2006, if,

. . . . .

(2)  Subsection 124 (9) of the Act is repealed and the following substituted:

Collection

(9)  When the Minister of Finance receives the notice under subsection (8), the amounts specified in the notice may be collected under the Provincial Land Tax Act, 2006 as if they were taxes imposed under that Act on all land owned by the person to whom the order to pay costs is directed that is located in the same territorial district as the drinking-water system to which the order relates.

(3)  Subsection 124 (10) of the Act is amended by striking out "or (8)" and substituting "or a notice under subsection (8)".

Social Housing Reform Act, 2000

30.  (1)  Subsection 130 (6) of the Social Housing Reform Act, 2000 is repealed and the following substituted:

Collection, territory without municipal organization

(6)  The amount apportioned under subsection (1) to the territory without municipal organization may be collected under the Provincial Land Tax Act, 2006 as if it was tax imposed under that Act on land in the territory.

(2)  Subsection 130 (7) of the Act is amended by striking out "this section" at the end and substituting "subsections (1) to (5)".

Statute Labour Act

31.  (1)  Subsection 35 (3) of the Statute Labour Act is amended,

(a) by striking out "as provided in the Provincial Land Tax Act" and substituting "as provided in the Provincial Land Tax Act, 2006"; and

(b) by striking out "and the Provincial Land Tax Act applies" and substituting "and the Provincial Land Tax Act, 2006 applies".

(2)  Subsection 35 (4) of the Act is amended,

(a) by striking out "Where forfeiture is annulled" at the beginning and substituting "Where the forfeiture is revoked"; and

(b) by striking out "the Provincial Land Tax Act" and substituting "the Provincial Land Tax Act, 2006".

Taxpayer Protection Act, 1999

32.  (1)  Paragraph 7 of the definition of "designated tax statute" in section 1 of the Taxpayer Protection Act, 1999 is repealed and the following substituted:

7. Provincial Land Tax Act, 2006.

(2)  Subsection 2 (4) of the Act is amended by striking out "a regulation under the Provincial Land Tax Act that increases the average tax rate under section 21 or under section 21.1 of that Act" in the portion before clause (a) and substituting "a regulation under the Provincial Land Tax Act, 2006 that increases the average tax rate under that Act".

Bill 43 - Clean Water Act, 2006

33.  (1)  This section applies only if Bill 43 (Clean Water Act, 2006), introduced on December 5, 2005, receives Royal Assent.

Same

(2)  References in this section to provisions of Bill 43 are references to those provisions as they were numbered in the first reading version of the Bill.

Same

(3)  On the later of the day this section comes into force and the day subsection 61 (3) of Bill 43 comes into force, subsection 61 (3) of Bill 43 is amended,

(a) by striking out "instructs the Land Tax Collector appointed under the Provincial Land Tax Act" and substituting "requests the Minister of Finance"; and

(b) by striking out "section 3 of the Provincial Land Tax Act" and substituting "section 2 of the Provincial Land Tax Act, 2006".

Commencement

34.  (1)  Subject to subsection (2), this Schedule comes into force on the day the Budget Measures Act, 2006 (No. 2) receives Royal Assent.

Same

(2)  Sections 1 to 33 come in to force on January 1, 2009.

SCHEDULE Z.4
RETAIL SALES TAX ACT

1.  (1)  The French version of subclause (d) (i) of the definition of "premium" in subsection 1 (1) of the Retail Sales Tax Act is amended by striking out "Loi sur l'impôt prélevé sur les employeurs relatif aux services de santé" and substituting "Loi sur l'impôt-santé des employeurs".

(2)  Subclause (e) (i) of the definition of "premium" in subsection 1 (1) of the Act is repealed and the following substituted:

(i) any amounts paid into the plan by the planholder, including amounts paid to an administrator, but not including amounts that would be included in total Ontario remuneration of the planholder under the Employer Health Tax Act when paid out of the benefits plan, less any amounts paid to the planholder by members in order to receive benefits under the plan, and

2.  Subsection 2.1 (19) of the Act is repealed and the following substituted:

Designation of benefits plan as funded or unfunded

(19)  A planholder who establishes a new benefits plan on or after the day this subsection comes into force shall, in the manner required by the Minister, designate in writing whether the benefits plan is intended to be a funded benefits plan or an unfunded benefits plan and, for the purposes of this Act, the benefits plan shall be deemed to be a funded benefits plan or an unfunded benefits plan in accordance with the designation until the planholder advises the Minister of a change to the benefits plan.

Transitional

(20)  A planholder of a benefits plan that was established before the day subsection (19) comes into force shall notify the Minister at the time and in the manner required by the Minister whether the benefits plan was established as a funded benefits plan or an unfunded benefits plan and, for the purposes of this Act, the benefits plan shall be deemed from the day the notice is received by the Minister to be a funded benefits plan or an unfunded benefits plan in accordance with the notice until the planholder advises the Minister of a change to the benefits plan.

3.  Subsection 4 (12) of the Act is repealed and the following substituted:

Offence

(12)  Every person who fails to comply with subsection (10) or (11) is guilty of an offence and on conviction is liable to a fine of not less than $1,000 and not more than $10,000 plus, if the conviction is for the offence of failing to comply with subsection (11), an amount equal to the tax imposed by this section in respect of each vehicle or each vehicle of the type of vehicle to which the conviction relates that is sold in Ontario at a retail sale before the Minister makes a determination that the vehicle or type of vehicle is a passenger vehicle or sport utility vehicle for the purposes of this section.

4.  Paragraph 47 of subsection 7 (1) of the Act is repealed and the following substituted:

47. Magazines, as defined by the Minister, but only where purchased by subscription or acquired under such circumstances as may be prescribed by the Minister.

5.  (1)  Subsection 25 (5) of the Act is amended by striking out the portion before clause (a) and substituting the following:

Extension of time

(5)  The time within which a notice of objection is to be served or an appeal is to be instituted may be extended by the Minister if application for extension is made,

. . . . .

(2)  Clause 25 (5) (b) of the Act is repealed and the following substituted:

(b) with respect to an appeal, before the expiry of the time allowed under subsection (1) for instituting the appeal.

6.  The Act is amended by adding the following section:

Application under subrule 14.05 (2), Rules of Civil Procedure

29.1  (1)  If the following conditions are satisfied, a person may make an application under subrule 14.05 (2) of the Rules of Civil Procedure to a judge of the Superior Court of Justice:

1. The application is to determine one or more issues of law that depend solely on the interpretation of,

i. this Act or the regulations, or

ii. this Act or the regulations and another Ontario statute or regulation.

2. The Minister has indicated in writing that the Minister is satisfied that it is in the public interest for the applicant to make the application.

3. The Minister and the applicant have executed a statement of agreed facts on which they both intend to rely and the applicant files the statement as part of the applicant's application record.

4. No facts remain in dispute between the Minister and the applicant that either of them believes may be relevant to the determination of any issue of law that is a subject of the application.

Application of rule 38.10, Rules of Civil Procedure

(2)  Rule 38.10 of the Rules of Civil Procedure does not apply to an application referred to in this section, except that the presiding judge may, on the hearing of the application, adjourn the application in whole or in part and with or without terms under clause 38.10 (1) (a).

Disposition of application

(3)  The court may dispose of an application that is authorized under this section by,

(a) making a declaration of law in respect of one or more issues of law forming the subject of the application;

(b) declining to make a declaration of law in respect of any of the issues of law forming the subject of the application; or

(c) dismissing the application.

Effect of declaration of law

(4)  No declaration of law made on an application under this section,

(a) shall be binding on the Minister and the applicant except in relation to the facts agreed to by them in the proceeding; or

(b) shall otherwise affect the rights of the Minister or the applicant in any appeal instituted under this Act.

No applications under subrule 14.05 (3)

(5)  No person other than the Minister may bring an application under subrule 14.05 (3) of the Rules of Civil Procedure on or after the day this section comes into force, in respect of any matter arising under this Act.

Other proceedings

(6)  On the motion of the Minister, the court shall dismiss a proceeding commenced by an application under rule 14.05 of the Rules of Civil Procedure relating to a matter under this Act or the regulations if any condition in subsection (1) has not been satisfied or the application is prohibited under subsection (5).

Commencement

7.  This Schedule comes into force on the day the Budget Measures Act, 2006 (No. 2) receives Royal Assent.

SCHEDULE Z.5
SECURITIES ACT

1.  (1)  Subsection 1 (1) of the Securities Act is amended by adding the following definitions:

"control person" means,

(a) a person or company who holds a sufficient number of the voting rights attached to all outstanding voting securities of an issuer to affect materially the control of the issuer, and, if a person or company holds more than 20 per cent of the voting rights attached to all outstanding voting securities of an issuer, the person or company is deemed, in the absence of evidence to the contrary, to hold a sufficient number of the voting rights to affect materially the control of the issuer, or

(b) each person or company in a combination of persons or companies, acting in concert by virtue of an agreement, arrangement, commitment or understanding, which holds in total a sufficient number of the voting rights attached to all outstanding voting securities of an issuer to affect materially the control of the issuer, and, if a combination of persons or companies holds more than 20 per cent of the voting rights attached to all outstanding voting securities of an issuer, the combination of persons or companies is deemed, in the absence of evidence to the contrary, to hold a sufficient number of the voting rights to affect materially the control of the issuer; ("personne qui a le contrôle")

"economic exposure" in relation to a reporting issuer means the extent to which the economic or financial interests of a person or company are aligned with the trading price of securities of the reporting issuer or the economic or financial interests of the reporting issuer; ("risque financier")

"economic interest in a security" means,

(a) a right to receive or the opportunity to participate in a reward, benefit or return from a security, or

(b) an exposure to a loss or a risk of loss in respect of a security; ("intérêt financier dans une valeur mobilière")

"related financial instrument" means an agreement, arrangement or understanding to which an insider of a reporting issuer is a party, the effect of which is to alter, directly or indirectly, the insider's,

(a) economic interest in a security of the reporting issuer, or

(b) economic exposure to the reporting issuer; ("instrument financier connexe")

(2)  The definitions of "director", "insider", "investment fund manager", "officer" and "self-regulatory organization" in subsection 1 (1) of the Act are repealed and the following substituted:

"director" means a director of a company or an individual performing a similar function or occupying a similar position for any person; ("administrateur")

"insider" means,

(a) a director or officer of a reporting issuer,

(b) a director or officer of a person or company that is itself an insider or subsidiary of a reporting issuer,

(c) a person or company that has,

(i) beneficial ownership of, or control or direction over, directly or indirectly, securities of a reporting issuer carrying more than 10 per cent of the voting rights attached to all the reporting issuer's outstanding voting securities, excluding, for the purpose of the calculation of the percentage held, any securities held by the person or company as underwriter in the course of a distribution, or

(ii) a combination of beneficial ownership of, and control or direction over, directly or indirectly, securities of a reporting issuer carrying more than 10 per cent of the voting rights attached to all the reporting issuer's outstanding voting securities, excluding, for the purpose of the calculation of the percentage held, any securities held by the person or company as underwriter in the course of a distribution,

(d) a reporting issuer that has purchased, redeemed or otherwise acquired a security of its own issue, for so long as it continues to hold that security,

(e) a person or company designated as an insider in an order made under subsection (11),

(f) a person or company that is in a class of persons or companies designated under subparagraph 40 v of subsection 143 (1); ("initié")

"investment fund manager" means a person or company that directs the business, operations or affairs of an investment fund; ("gestionnaire de fonds d'investissement")

"officer", with respect to an issuer or registrant, means,

(a) a chair or vice-chair of the board of directors, a chief executive officer, a chief operating officer, a chief financial officer, a president, a vice-president, a secretary, an assistant secretary, a treasurer, an assistant treasurer and a general manager,

(b) every individual who is designated as an officer under a by-law or similar authority of the registrant or issuer, and

(c) every individual who performs functions similar to those normally performed by an individual referred to in clause (a) or (b); (dirigeant")

"self-regulatory organization" means a person or company that is organized for the purpose of regulating the operations and the standards of practice and business conduct, in capital markets, of its members and their representatives with a view to promoting the protection of investors and the public interest; ("organisme d'autoréglementation")

(3)  Clause (c) of the definition of "distribution" in subsection 1 (1) of the Act is repealed and the following substituted:

(c) a trade in previously issued securities of an issuer from the holdings of any control person,

(4)  The definition of "reporting issuer" in subsection 1 (1) of the Act is amended by,

(a) repealing clause (b) and substituting the following:

(b) that has filed a prospectus and for which the Director has issued a receipt under this Act,

(b) repealing clause (f) and the portion of the definition after clause (f) and substituting the following:

(f) that is designated as a reporting issuer in an order made under subsection 1 (11);

(5)  The definition of "senior officer" in subsection 1 (1) of the Act is repealed.

(6)  Clause (d) of the definition of "underwriter" in subsection 1 (1) of the Act is repealed and the following substituted:

(d) a bank listed in Schedule I, II or III to the Bank Act (Canada) with respect to securities described in paragraph 1 of subsection 35 (2) or to such banking transactions as are designated by the regulations;

(7)  Subsection 1 (1.1) of the Act is amended by adding ""business combination"" before ""derivatives"".

(8)  Subsections 1 (8) and (9) of the Act are repealed.

(9)  Section 1 of the Act is amended by adding the following subsections:

Relieving orders

(10)  If the Commission is satisfied that it would not be prejudicial to the public interest, it may make an order that, for purposes of Ontario securities law, a person or company is not,

(a) an insider; or

(b) a reporting issuer.

Designation

(11)  If the Commission considers that it is in the public interest, it may make an order that, for purposes of Ontario securities law,

(a) a person or company is an insider of a reporting issuer if the person or company would reasonably be expected to have, in the ordinary course, access to material information about the business, operations, assets or revenues of the issuer; or

(b) a person or company is a reporting issuer.

Terms and conditions

(12)  An order under subsection (10) may be made subject to such terms and conditions as the Commission may impose.

Who may apply

(13)  An order under subsection (10) or (11) may be made on application by an interested person or by the Director.

Hearing

(14)  The Commission shall not make an order under subsection (10) or (11) without giving the person or company that would be subject to the order an opportunity to be heard.

2.  Subsection 53 (1) of the Act is repealed and the following substituted:

Prospectus required

(1)  No person or company shall trade in a security on his, her or its own account or on behalf of any other person or company if the trade would be a distribution of the security, unless a preliminary prospectus and a prospectus have been filed and receipts have been issued for them by the Director.

3.  Subsection 61 (2) of the Act is repealed and the following substituted:

Refusal of receipt

(2)  The Director shall not issue a receipt for a prospectus or an amendment to a prospectus if it appears to the Director that,

(a) the prospectus or any document required to be filed with it,

(i) does not comply in any substantial respect with any of the requirements of this Act or the regulations,

(ii) contains any statement, promise, estimate or forward-looking information that is misleading, false or deceptive, or

(iii) contains a misrepresentation;

(b) an unconscionable consideration has been paid or given or is intended to be paid or given for any services or promotional purposes or for the acquisition of property;

(c) the aggregate of,

(i) the proceeds from the sale of the securities under the prospectus that are to be paid into the treasury of the issuer, and

(ii) the other resources of the issuer,

is insufficient to accomplish the purpose of the issue stated in the prospectus;

(d) the issuer cannot reasonably be expected to be financially responsible in the conduct of its business because of the financial condition of,

(i) the issuer,

(ii) any of the issuer's officers, directors, promoters, or control persons, or

(iii) the investment fund manager of the issuer or any of the investment fund manager's officers, directors or control persons;

(e) the business of the issuer may not be conducted with integrity and in the best interests of the security holders of the issuer because of the past conduct of,

(i) the issuer,

(ii) any of the issuer's officers, directors, promoters, or control persons, or

(iii) the investment fund manager of the issuer or any of the investment fund manager's officers, directors or control persons;

(f) a person or company that has prepared or certified any part of the prospectus, or that is named as having prepared or certified a report or valuation used in connection with the prospectus, is not acceptable;

(g) an escrow or pooling agreement in the form that the Director considers necessary or advisable with respect to the securities has not been entered into; or

(h) adequate arrangements have not been made for the holding in trust of the proceeds payable to the issuer from the sale of the securities pending the distribution of the securities.

4.  Subsection 63 (1) of the Act is repealed and the following substituted:

Forms of prospectus

(1)  A person or company may, if permitted by the regulations, file a short form of preliminary prospectus, short form of prospectus, pro forma prospectus, preliminary simplified prospectus, simplified prospectus or pro forma simplified prospectus under section 53 or 62 in the prescribed form and any such prospectus that complies with the applicable regulations shall, for the purposes of section 56, be considered to provide sufficient disclosure of all material facts relating to the securities issued or proposed to be distributed under the prospectus.

5.  Subsections 72 (8) to (11) of the Act are repealed and the following substituted:

List of defaulting reporting issuers

(8)  The Commission may publish a list of reporting issuers who are in default of any requirement of this Act or the regulations.

6.  Sections 83 and 83.1 of the Act are repealed.

7.  Subsection 104 (1) of the Act is repealed and the following substituted:

Applications to the Commission

(1)  On application by an interested person, if the Commission considers that a person or company has not complied with, or is not complying with, a requirement under this Part or the regulations, the Commission may make an order,

(a) restraining the distribution of any document or any communication used or issued in connection with a take-over bid or issuer bid;

(b) requiring an amendment to or variation of any document or any communication used or issued in connection with a take-over bid or issuer bid and requiring the distribution of amended, varied or corrected information or documents;

(c) directing any person or company to comply with a requirement under this Part or the regulations;

(d) restraining any person or company from contravening a requirement under this Part or the regulations; and

(e) directing the directors and officers of any person or company to cause the person or company to comply with or to cease contravening a requirement under this Part or the regulations.

8.  Section 105 of the Act is repealed and the following substituted:

Applications to Court

105.  On application by an interested person, if the Superior Court of Justice is satisfied that a person or company has not complied with a requirement under this Part or the regulations, the Superior Court of Justice may make such interim or final order as the Court thinks fit, including, without limitation, an order,

(a) compensating any interested person who is a party to the application for damages suffered as a result of a contravention of a requirement of this Part or the regulations;

(b) rescinding a transaction with any interested person, including the issue of a security or an acquisition and sale of a security;

(c) requiring any person or company to dispose of any securities acquired pursuant to or in connection with a take-over bid or an issuer bid;

(d) prohibiting any person or company from exercising any or all of the voting rights attaching to any securities; or

(e) requiring the trial of an issue.

9.  Subsection 106 (2) of the Act is amended by adding "and" at the end of clause (a), by striking out "and" at the end of clause (b) and by repealing clause (c).

10.  Sections 107 and 108 of the Act are repealed and the following substituted:

Insider reporting

107.  (1)  Within 10 days of becoming an insider or within such other time period as may be prescribed, a person or company who becomes an insider of a reporting issuer, other than a mutual fund, shall file a report disclosing, in the prescribed manner and form, any direct or indirect beneficial ownership of or control or direction over securities of the reporting issuer and any interest in, or right or obligation associated with, a related financial instrument and the insider shall make such other disclosure as may be required by the regulations.

Same

(2)  Within 10 days, or within such other time period as may be prescribed, of any change in the direct or indirect beneficial ownership of, or control or direction over, securities of the reporting issuer or any interest in, or right or obligation associated with, a related financial instrument, an insider of a reporting issuer, other than a mutual fund, shall file a report disclosing, in the prescribed manner and form, such change and the insider shall make such other disclosure as may be required by the regulations.

11.  Section 116 of the Act is repealed and the following substituted:

Standard of care, investment fund managers

116.  Every investment fund manager,

(a) shall exercise the powers and discharge the duties of their office honestly, in good faith and in the best interests of the investment fund; and

(b) shall exercise the degree of care, diligence and skill that a reasonably prudent person would exercise in the circumstances.

12.  The Act is amended by adding the following section:

Additional remedies

122.1  (1)  If a person or company is convicted of an offence under this Act, the court may, in addition to any penalty, order the convicted person or company to make restitution or pay compensation in relation to the offence to an aggrieved person or company.

Notice

(2)  If a court makes an order for restitution or compensation, it shall cause a copy of the order or a notice of the content of the order to be given to the person or company to whom the restitution or compensation is ordered to be paid.

Filing

(3)  An order for restitution or compensation may be filed with a local registrar of the Superior Court of Justice and the responsibility for filing shall be on the person or company to whom the restitution or compensation is ordered to be paid.

Enforcement

(4)  An order for restitution or compensation filed under subsection (3) may be enforced as if it were an order of the court.

Postjudgment interest

(5)  Section 129 of the Courts of Justice Act applies in respect of an order for restitution or compensation filed under subsection (3) and, for that purpose, the date of filing shall be deemed to be the date of the order.

Limitation

(6)  A person or company is not entitled to participate in a proceeding in which an order may be made under this section solely on the basis that the person or company has a right of action against a defendant to the proceeding or that the person or company may be entitled to receive an amount under the order.

Civil remedies protected

(7)  A civil remedy for an act or omission is not affected by reason only that an order for restitution or compensation under this section has been made in respect of that act or omission.

13.  Clause 130 (1) (d) of the Act is repealed and the following substituted:

(d) every person or company whose consent to disclosure of information in the prospectus has been filed pursuant to a requirement of the regulations but only with respect to reports, opinions or statements that have been made by them; and

14.  (1)  The definition of "control person' in section 138.1 of the Act is repealed.

(2)  The definitions of "core document" and "failure to make timely disclosure" in section 138.1 of the Act are repealed and the following substituted:

"core document" means,

(a) a prospectus, a take-over bid circular, an issuer bid circular, a directors' circular, a notice of change or variation in respect of a take-over bid circular, issuer bid circular or directors' circular, a rights offering circular, management's discussion and analysis, an annual information form, an information circular, annual financial statements and interim financial statements of the responsible issuer, where used in relation to,

(i) a director of a responsible issuer who is not also an officer of the responsible issuer,

(ii) an influential person, other than an officer of the responsible issuer or an investment fund manager where the responsible issuer is an investment fund, or

(iii) a director or officer of an influential person who is not also an officer of the responsible issuer, other than an officer of an investment fund manager,

(b) a prospectus, a take-over bid circular, an issuer bid circular, a directors' circular, a notice of change or variation in respect of a take-over bid circular, issuer bid circular or directors' circular, a rights offering circular, management's discussion and analysis, an annual information form, an information circular, annual financial statements, interim financial statements and a material change report required by subsection 75 (2) or the regulations of the responsible issuer, where used in relation to,

(i) a responsible issuer or an officer of the responsible issuer,

(ii) an investment fund manager, where the responsible issuer is an investment fund, or

(iii) an officer of an investment fund manager, where the responsible issuer is an investment fund, or

(c) such other documents as may be prescribed by regulation for the purposes of this definition; ("document essentiel")

"failure to make timely disclosure" means a failure to disclose a material change in the manner and at the time required under this Act or the regulations; ("non-respect des obligations d'information occasionnelle")

(3)  Clause (c) of the definition of "influential person" in section 138.1 of the Act is amended by striking out "senior".

15.  Subsection 138.3 (4) of the Act is amended by adding "or the regulations" after "Act".

16.  (1)  Clause 138.4 (8) (a) of the Act is amended by adding at the end "or the regulations".

(2)  Clause 138.4 (8) (e) of the Act is repealed and following substituted:

(e) where the material change became publicly known in a manner other than the manner required under this Act or the regulations, the responsible issuer promptly disclosed the material change in the manner required under this Act or the regulations.

(3)  Subsection 138.4 (10) of the Act is amended by adding "or the regulations" after "Act" in the portion before clause (a).

(4)  Subsection 138.4 (15) of the Act is amended by adding "or the regulations" after "Act" wherever it appears.

17.  Subsections 138.5 (1) and (2) of the Act are amended by adding "or the regulations" after "Act" wherever it appears.

18.  (1)  Paragraph 9 of subsection 143 (1) of the Act is repealed and the following substituted:

9. Providing for exemptions from the requirements of section 41 in respect of dealers.

(2)  Paragraph 15 of subsection 143 (1) of the Act is repealed and the following substituted:

15. Prescribing categories or subcategories of issuers for purposes of the prospectus requirements under this Act, the regulations and the rules and classifying issuers into categories or subcategories.

(3)  Paragraph 16 of subsection 143 (1) of the Act is amended by striking out the portion before subparagraph i and substituting the following:

16. Regulating in respect of, or varying this Act to facilitate, expedite or regulate in respect of, the distribution of securities, or the issuing of receipts, including by establishing,

. . . . .

(4)  Subsection 143 (1) of the Act is amended by adding the following paragraph:

16.1 Prescribing requirements for the certification of prospectuses by persons and companies in relation to the following:

i. if the issuer is a trust, requiring individuals who perform functions for the issuer similar to those performed by a chief executive officer or chief financial officer of an issuer to certify the prospectus,

ii. if the issuer is a trust and its business or a material part of its business is conducted through a person or company other than the issuer, requiring a director and the chief executive officer and the chief financial officer of the person or company, or individuals who perform functions for the person or company similar to those performed by a chief executive officer or chief financial officer, to certify the prospectus,

iii. if the issuer is a limited partnership, requiring the general partner of the issuer and individuals who perform functions for the issuer similar to those performed by a chief executive officer or a chief financial officer of an issuer to certify the prospectus, and

iv. if the issuer is not organized as a company, trust or limited partnership, requiring persons or companies that perform functions similar to those performed by persons or companies described in subparagraph i, ii or iii or section 58 to certify the prospectus.

(5)  Subsection 143 (1) of the Act is amended by adding the following paragraph:

22.1 Respecting the preparation, form and content requirements applicable to the public dissemination of forward-looking information by reporting issuers where the dissemination is not part of a required filing.

(6)  Paragraph 28 of subsection 143 (1) of the Act is amended by,

(a) striking out the portion before subparagraph i and substituting the following:

28. Regulating take-over bids, issuer bids, insider bids, going-private transactions, business combinations, and related party transactions, including,

. . . . .

(b) adding "business combinations" after "going-private transactions" in subparagraph v.

(7)  Subsection 143 (1) of the Act is amended by adding the following paragraphs:

30.1 Regulating the disclosure or furnishing of information to the public or the Commission by insiders, including,

i. prescribing filing requirements for the reporting by insiders of their respective direct or indirect beneficial ownership of, or control or direction over, securities of a reporting issuer or changes in ownership, control or direction,

ii. prescribing requirements respecting the reporting by insiders of any interest in or right or obligation associated with a related financial instrument or changes in such interests, rights or obligations,

iii. prescribing requirements respecting the reporting by insiders of any agreement, arrangement or understanding that alters, directly or indirectly, an insider's economic interest in a security or an insider's economic exposure to a reporting issuer or changes in such agreements, arrangements or understandings.

30.2 Prescribing requirements in respect of a reporting issuer to facilitate compliance by insiders of the reporting issuer with this Act and with the rules made under paragraph 30.1.

30.3 Requiring that reports under paragraph 30.1 shall also provide information for the period of up to six months before a person or company became an insider.

(8)  Paragraph 31 of subsection 143 (1) of the Act is repealed and the following substituted:

31. Regulating investment funds and the distribution and trading of the securities of investment funds, including,

i. varying Part XV or Part XVIII by prescribing additional disclosure requirements in respect of investment funds and requiring or permitting the use of particular forms or types of additional offering or other documents in connection with the funds,

ii. prescribing permitted investment policy and investment practices for investment funds and prohibiting or restricting certain investments or investment practices for investment funds,

iii. prescribing requirements governing the custodianship of assets of investment funds,

iv. prescribing minimum initial capital requirements for investment funds making a distribution and prohibiting or restricting the reimbursement of costs in connection with the organization of a fund,

v. prescribing matters affecting investment funds that require the approval of security holders of the fund, the Commission or the Director, including, in the case of security holders, the level of approval,

vi. prescribing requirements in respect of the calculation of the net asset value of investment funds,

vii. prescribing requirements in respect of the content and use of sales literature, sales communications or advertising relating to investment funds or the securities of investment funds,

viii. designating mutual funds as private mutual funds and prescribing requirements for private mutual funds,

ix. respecting sales charges imposed by a distribution company or contractual plan service company under a contractual plan on purchasers of shares or units of an investment fund, and commissions or sales incentives to be paid to registrants in connection with the securities of an investment fund,

x. prescribing the circumstances in which a plan holder under a contractual plan has the right to withdraw from the contractual plan,

xi. prescribing procedures applicable to investment funds, registrants and any other person or company in respect of sales and redemptions of investment fund securities and payments for sales and redemptions,

xii. prescribing requirements in respect of, or in relation to, promoters, advisers or persons and companies who administer or participate in the administration of the affairs of investment funds.

(9)  Paragraph 33 of subsection 143 (1) of the Act is repealed and the following substituted:

33. Prescribing requirements relating to the qualification of a registrant to act as an adviser to an investment fund.

(10)  Subparagraph 35 iii of subsection 143 (1) of the Act is repealed and the following substituted:

iii. prescribing requirements that apply to investment funds, commodity pools or other issuers.

(11)  Paragraph 36 of subsection 143 (1) of the Act is repealed and the following substituted:

36. Varying this Act with respect to foreign issuers to facilitate distributions, compliance with requirements applicable or relating to reporting issuers and the making of take-over bids, issuer bids, insider bids, going-private transactions, business combinations and related party transactions where the foreign issuers are subject to requirements of the laws of other jurisdictions that the Commission considers are adequate in light of the purposes and principles of this Act.

(12)  Subparagraphs 40 ii and iii of subsection 143 (1) of the Act are repealed and the following substituted:

ii. designating, for purposes of subsection 88 (1), the jurisdictions whose requirements are substantially similar to the requirements of Part XIX,

iii. designating a person or company for the purpose of the definition of "market participant",

iv. designating classes of persons or companies not to be insiders for the purpose of the definition of "insider", and

v. designating classes of persons or companies for the purpose of clause (f) of the definition of "insider" in subsection 1 (1), if the persons or companies would reasonably be expected to have, in the ordinary course, access to material information about the business, operations, assets or revenue of the issuer, to be insiders.

(13)  Paragraph 46 of subsection 143 (1) of the Act is repealed and the following substituted:

46. Providing for electronic signatures for the signing of documents and prescribing the circumstances in which persons or companies shall be deemed to have signed or certified documents on an electronic or computer-based system for any purpose of this Act, the regulations or the rules.

(14)  Paragraph 49 of subsection 143 (1) of the Act is repealed and the following substituted:

49. Permitting or requiring, or varying this Act to permit or require, methods of filing or delivery, to or by the Commission, issuers, registrants, security holders or others, of documents, information, notices, books, records, things, reports, orders, authorizations or other communications required under or governed by Ontario securities law.

(15)  Paragraph 56 of subsection 143 (1) of the Act is repealed and the following substituted:

56. Prescribing, providing for exemptions from or varying any or all of the time periods in this Act or the regulations.

19.  Paragraph 4 of subsection 143.2 (2) of the Act is repealed and the following substituted:

4. A reference to the authority under which the rule is proposed or a statement that the Commission is seeking legislative amendments to provide the requisite rule-making authority.

20.  (1)  Subsections 143.10 (3) and (4) of the Act are repealed and the following substituted:

Coming into effect

(3)  If the Minister approves the agreement, memorandum of understanding or arrangement, it comes into effect on the date specified in the agreement, memorandum of understanding or arrangement or, if no date is specified, on the day it is approved.

Same

(4)  If the Minister does not approve or reject the agreement, memorandum of understanding or arrangement within 60 days after it is published in the Bulletin, it comes into effect on the date specified in the agreement, memorandum of understanding or arrangement or, if no date is specified, on the 60th day after its publication in the Bulletin.

(2)  Section 143.10 of the Act is amended by adding the following subsection:

Exception

(6)  The obligation to publish set out in subsection (1) does not apply to an agreement, memorandum of understanding or arrangement if the principal purpose of the agreement, memorandum of understanding or arrangement relates to,

(a) the provision of products or services by a party not named in subsection (1);

(b) the sharing of costs incurred by a party named in subsection (1); or

(c) the provision of services by or temporary transfer of an employee of a party named in subsection (1).

Commencement

21.  (1)  Subject to subsection (2), this Schedule comes into force on the day the Budget Measures Act, 2006 (No. 2) receives Royal Assent.

Same

(2)  Subsection 1 (8), sections 9 and 10 and subsection 18 (7) come into force on a day to be named by proclamation of the Lieutenant Governor.

SCHEDULE Z.6
SUPERANNUATION ADJUSTMENT BENEFITS REPEAL ACT, 1994

1.  The Superannuation Adjustment Benefits Repeal Act, 1994 is repealed.

Commencement

2.  (1)  Subject to subsection (2), this Schedule comes into force on the day the Budget Measures Act, 2006 (No. 2) receives Royal Assent.

Same

(2)  Section 1 comes into force on April 1, 2007.

SCHEDULE Z.7
TAX INCREMENT FINANCING ACT, 2006

Definitions

1.  In this Act,

"designated project" means a project designated under this Act; ("projet désigné")

"education tax increment" means, in respect of a tax increment finance district, the tax increment in respect of taxes for school purposes or payments in lieu of taxes for school purposes; ("surcroît d'impôts scolaires")

"eligible project" means,

(a) the construction of municipal infrastructure or amenities to assist in,

(i) the redevelopment or intensification of previously developed areas, or

(ii) the development of an urban growth centre identified in a growth plan under the Places to Grow Act, 2005,

(b) the environmental remediation of land in a previously developed area, or

(c) the construction of a municipal public transit facility; ("projet admissible")

"Minister" means the Minister of Finance or such other member of the Executive Council to whom the administration of this Act is assigned under the Executive Council Act; ("ministre")

"municipal tax increment" means, in respect of a tax increment finance district, the tax increment in respect of taxes for municipal purposes or payments in lieu of taxes for municipal purposes; ("surcroît d'impôts municipaux")

"taxes" means taxes for municipal or school purposes or payments in lieu of taxes for municipal or school purposes; ("impôts")

"tax increment" means, in respect of a tax increment finance district established for a designated project, the amount, as determined in the prescribed manner, of an increase that results from the project in the amount of taxes levied in respect of real property in the district. ("surcroît d'impôts")

Feasibility study

2.  (1)  A municipality may apply to receive funding for a proposed project from the Crown in right of Ontario that is based on the education tax increments expected to occur as a result of the project by preparing and submitting to the Minister a study examining the feasibility of the project.

Contents of feasibility study

(2)  The feasibility study must satisfy the following requirements:

1. The study contains a description of the proposed project.

2. The study identifies the proposed tax increment finance district in which tax increments are expected to occur as a result of the proposed project and contains information relating to the amount of the expected tax increments.

3. The study contains an analysis of the nature and timing of any new development that can reasonably be expected to occur in the proposed tax increment finance district in the absence of the proposed project.

4. The study identifies as the proposed financing authority for the proposed project,

i. one or more of the municipalities in which the proposed tax increment finance district is located,

ii. a local board of one of the municipalities referred to in subparagraph i,

iii. a municipal business corporation created by one or more of the municipalities referred to in subparagraph i, or

iv. an entity that satisfies the prescribed conditions.

5. The study contains such additional information as may be required by the regulations.

Limitation, proposed tax increment finance district

(3)  In determining which real property to include in a proposed tax increment finance district, a municipality shall ensure that the total amount of municipal tax increments for the municipality that the municipality expects to use in a given year to fund designated projects in the municipality does not exceed 1 per cent of the total taxes for municipal purposes that are expected to be raised for that year in respect of real property in the municipality.

Joint feasibility study

(4)  If a proposed project will be carried out in two or more municipalities or the proposed tax increment finance district is located in two or more municipalities, the municipalities may prepare and submit a joint feasibility study in accordance with this section.

Minister's action

(5)  The Minister may,

(a) refer the feasibility study to the Lieutenant Governor in Council; or

(b) refer the feasibility study back to the municipality or municipalities for further information or consideration.

Designation of proposed project

3.  (1)  After consideration of a feasibility study prepared in accordance with section 2, the Lieutenant Governor in Council may, if the Lieutenant Governor in Council considers it to be in the public interest,

(a) designate the proposed project for the purposes of being partly funded by the Crown in right of Ontario through tax increment financing if the proposed project is an eligible project;

(b) establish the tax increment finance district for the designated project;

(c) authorize the Minister to enter into a funding agreement with respect to the designated project; and

(d) specify the last year that education tax increments may be used to finance the designated project.

Same

(2)  Despite clause (1) (a), the Lieutenant Governor in Council may designate a proposed project that is not an eligible project if the Lieutenant Governor in Council believes that the project will provide a significant public benefit but will not proceed in a timely manner unless it is funded in part by the Crown in right of Ontario through tax increment financing.

Funding agreement

4.  (1)  The parties to a funding agreement authorized under clause 3 (1) (c) for a designated project shall be,

(a) the Minister;

(b) every municipality that is providing funding for the project through tax increment financing; and

(c) the financing authority appointed for the designated project, if it is not a municipality referred to in clause (b).

Required matters

(2)  A funding agreement under subsection (1) shall provide for the following:

1. Payments by the Minister in accordance with the regulations to the financing authority to partly fund the carrying out of the designated project.

2. Payments by the municipality or municipalities to partly fund the carrying out of the designated project.

3. The rights and obligations of the financing authority and the municipality or municipalities with respect to,

i. the use of the funds received from the Minister and the time and manner in which amounts are to be repaid,

ii. the carrying out of the project to which the agreement relates, and

iii. the manner in which tax increments resulting from the project will be applied and the time period during which the tax increments will be applied in that manner.

4. The requirement that the financing authority or the municipality or municipalities make periodic reports to the Minister, including progress reports on the project, financial reports and reports relating to the calculation of tax increments.

Other terms

(3)  A funding agreement shall contain such other terms and conditions as may be required by the regulations and may contain additional terms and conditions that do not conflict with this Act or the regulations.

Payments by municipality

(4)  Despite section 106 of the Municipal Act, 2001 and section 82 of the City of Toronto Act, 2006, a municipality may grant assistance to a manufacturing business or other industrial or commercial enterprise if the assistance,

(a) is for a designated project in a tax increment financing district that is the environmental remediation of land or is for the environmental remediation of land used or to be used for a designated project in a tax increment financing district;

(b) is authorized by the terms of a funding agreement; and

(c) is authorized by the regulations.

Limit on payments by the Minister

(5)  The total amount of all payments by the Minister under a funding agreement shall not exceed the estimated amount over the term of the agreement of the education tax increments for the tax increment finance district to which the funding agreement relates.

Consolidated Revenue Fund

(6)  Any monies required to be paid by the Minister under a funding agreement are a charge on and payable out of the Consolidated Revenue Fund.

Municipal Property Assessment Corporation

5.  (1)  When a proposed project is designated under this Act, the municipality that submitted the feasibility study for the project shall promptly provide to the Municipal Property Assessment Corporation information concerning the tax increment finance district established for the project, the name and address of the financing authority for the project if it is not the municipality and such other information as the Municipal Property Assessment Corporation may reasonably require to carry out its functions under this section.

Portion of the roll

(2)  The Municipal Property Assessment Corporation shall, in each year, on or before the time for returning assessment rolls to municipalities for the year under the Assessment Act, send a copy of the portion of the assessment roll for the real property in each tax increment finance district to the financing authority for the applicable designated project and to the municipality or municipalities in which the tax increment finance district is located.

Extension of time

(3)  Despite subsection (2), if, in the year in which a tax increment finance district is established, it is not practicable for the Municipal Property Assessment Corporation to send the copy of the portion of the assessment roll for real property in the district within the time required under that subsection, the Municipal Property Assessment Corporation may send the copy of the portion of the assessment roll as soon after that time as it reasonably can.

Approved form of portion of the roll

(4)  The Municipal Property Assessment Corporation shall send to the financing authority the portion of the roll described in subsection (2) in a form approved by the Minister.

Supplemental assessments, etc.

(5)  The Municipal Property Assessment Corporation shall provide information to every financing authority for a designated project about any assessments or classifications of real property in the applicable tax increment finance district that are made under section 33 or 34 of the Assessment Act.

Same

(6)  The Municipal Property Assessment Corporation shall provide the information required under subsection (5) to the financing authority at the same time that it provides the information to the municipality under the Assessment Act.

Regulations

6.  (1)  The Minister may make regulations,

(a) governing payments by the Minister under a funding agreement;

(b) prescribing the manner in which tax increments are calculated;

(c) prescribing types of information and documents to be included in a feasibility study;

(d) prescribing conditions for the purposes of subparagraph 4 iv of subsection 2 (2);

(e) prescribing additional restrictions or limits on payments by the Minister under a funding agreement or restrictions or limits on the time or manner of those payments;

(f) prescribing terms and conditions for the purposes of subsection 4 (3).

General or specific

(2)  A regulation made under this Act may be general or specific.

Commencement

7.  The Act set out in this Schedule comes into force on the day the Budget Measures Act, 2006 (No. 2) receives Royal Assent.

Short title

8.  The short title of the Act set out in this Schedule is the Tax Increment Financing Act, 2006.

SCHEDULE Z.8
TEACHERS' PENSION ACT

1.  (1)  Section 5 of the Teachers' Pension Act is amended by adding the following subsection:

Payments for long term income protection

(2)  For the purposes of subsection (1.1), no additional payments made on or after January 1, 1992 by the Minister of Education or employers who contribute under the pension plan in respect of active plan members receiving payments under a long term income protection agreement shall be included in determining the total amount of contributions payable by the Minister of Education and the employers who contribute under the plan.

(2)  Section 5 of the Act is amended by adding the following subsection:

Contributions for 2008

(8)  Despite subsection (1.1), the total amount of contributions payable in respect of 2008 by the Minister of Education and the employers who contribute under the pension plan may exceed the amount of contributions payable by or on behalf of active plan members in respect of credited service for that year. 

Commencement

2.  (1)  Subject to subsection (2), this Schedule comes into force on the day the Budget Measures Act, 2006 (No. 2) receives Royal Assent.

Same

(2)  Subsection 1 (1) shall be deemed to have come into force on January 1, 1992.

SCHEDULE Z.9
TOBACCO TAX ACT

1.  Subsection 3 (7) of the Tobacco Tax Act is repealed and the following substituted:

Offence

(7)  Every person who holds a wholesaler's permit as required under this section and contravenes any condition or restriction contained in the permit or any other requirement specified in this section is guilty of an offence and on conviction is liable to a fine of not less than $1,000 and not more than $10,000.

2.  Subsection 5 (11.1) of the Act is repealed and the following substituted:

Penalty on unregistered importer

(11.1)  Every person who operates as an importer in Ontario without holding a subsisting registration certificate under this section shall pay a penalty, when assessed therefor, equal to three times the amount of the tax that would be payable under section 2 had the tobacco imported into Ontario by the person during the period when the person did not hold the subsisting certificate been sold to a consumer liable to pay tax under this Act.

Penalty on unregistered exporter

(11.2)  Every person who operates as an exporter in Ontario without holding a subsisting registration certificate under this section shall pay a penalty, when assessed therefor, equal to the amount of the tax that would be payable under section 2 had the tobacco exported out of Ontario by the person during the period when the person did not hold the subsisting certificate been sold to a consumer liable to pay tax under this Act.

3.  Subsection 7.1 (5) of the Act is repealed and the following substituted:

Requirements

(5)  Every holder of a permit to manufacture tear tape shall, in accordance with the regulations,

(a) mark the tear tape the holder manufactures for use in Ontario; and

(b) account for and take reasonable steps to safeguard tear tape in its possession.

4.  Clause 17 (1) (a) of the Act is repealed and the following substituted:

(a) without notice or demand at the time and in the manner prescribed by the Lieutenant Governor in Council or the Minister; or

5.  (1)  Subsection 22 (11) of the Act is amended by striking out the portion before clause (a) and substituting the following:

Extension of time

(11)  The time within which a notice of objection is to be served or an appeal is to be instituted may be extended by the Minister if application for extension is made,

. . . . .

(2)  Clause 22 (11) (b) of the Act is repealed and the following substituted:

(b) with respect to an appeal, before the expiry of the time allowed under subsection (1) for instituting the appeal.

6.  The Act is amended by adding the following section:

Application under subrule 14.05 (2), Rules of Civil Procedure

22.0.1  (1)  If the following conditions are satisfied, a person may make an application under subrule 14.05 (2) of the Rules of Civil Procedure to a judge of the Superior Court of Justice:

1. The application is to determine one or more issues of law that depend solely on the interpretation of,

i. this Act or the regulations, or

ii. this Act or the regulations and another Ontario statute or regulation.

2. The Minister has indicated in writing that the Minister is satisfied that it is in the public interest for the applicant to make the application.

3. The Minister and the applicant have executed a statement of agreed facts on which they both intend to rely and the applicant files the statement as part of the applicant's application record.

4. No facts remain in dispute between the Minister and the applicant that either of them believes may be relevant to the determination of any issue of law that is a subject of the application.

Application of rule 38.10, Rules of Civil Procedure

(2)  Rule 38.10 of the Rules of Civil Procedure does not apply to an application referred to in this section, except that the presiding judge may, on the hearing of the application, adjourn the application in whole or in part and with or without terms under clause 38.10 (1) (a).

Disposition of application

(3)  The court may dispose of an application that is authorized under this section by,

(a) making a declaration of law in respect of one or more issues of law forming the subject of the application;

(b) declining to make a declaration of law in respect of any of the issues of law forming the subject of the application; or

(c) dismissing the application.

Effect of declaration of law

(4)  No declaration of law made on an application under this section,

(a) shall be binding on the Minister and the applicant except in relation to the facts agreed to by them in the proceeding; or

(b) shall otherwise affect the rights of the Minister or the applicant in any appeal instituted under this Act.

No applications under subrule 14.05 (3)

(5)  No person other than the Minister may bring an application under subrule 14.05 (3) of the Rules of Civil Procedure on or after the day this section comes into force, in respect of any matter arising under this Act.

Other proceedings

(6)  On the motion of the Minister, the court shall dismiss a proceeding commenced by an application under rule 14.05 of the Rules of Civil Procedure relating to a matter under this Act or the regulations if any condition in subsection (1) has not been satisfied or the application is prohibited under subsection (5).

Application

(7)  Subsections (1) to (6) do not apply in respect of applications to the Superior Court of Justice authorized under any other section of this Act.

7.  (1)  Clause 23 (1) (d) of the Act is repealed.

(2)  Subsection 23 (5) of the Act is repealed and the following substituted:

Copies

(5)  If a book, record or other document is examined or produced under this section, the person by whom it is examined or to whom it is produced, or any officer of the Ministry of Finance, may make or cause to be made one or more copies of it, and a document purporting to be signed by the Minister, or by a person authorized by the Minister, certifying the document to be a copy made under this subsection is admissible in evidence and has the same probative force as the original document would have had if it had been proved in the ordinary way.

8.  Subsection 29 (2.1) of the Act is repealed and the following substituted:

Forfeiture

(2.1)  All unmarked cigarettes in respect of which a person is convicted of an offence under subsection (2) shall be forfeited to Her Majesty to be disposed of in any manner determined by the Minister, to the extent the cigarettes have not been forfeited or disposed of under another provision of this Act.

9.  (1)  Subsection 31 (1) of the Act is amended by striking out "Every person who sells tobacco in Ontario" at the beginning and substituting "Every person who sells or delivers tobacco in Ontario".

(2)  Subsection 31 (2) of the Act is amended by striking out the portion before paragraph 1 and paragraphs 1 and 2 and substituting the following:

Offence

(2)  Every person who sells or delivers tobacco in Ontario for resale without holding a wholesaler's permit issued under this Act is guilty of an offence and on conviction is liable to the following:

1. If the tobacco is 10,000 or more unmarked cigarettes,

i. a fine of not less than $500 and not more than $10,000, and

ii. an additional fine of not less than three times the amount of tax that would be payable under section 2 had the cigarettes been sold to a consumer liable to pay tax under this Act.

1.1 If the tobacco is less than 10,000 unmarked cigarettes,

i. a fine of not less than $500 and not more than $10,000 and an additional fine of not less than three times the amount of tax that would be payable under section 2 had the cigarettes been sold to a consumer liable to pay tax under this Act, or

ii. imprisonment for a term of not more than two years.

2. If the tobacco is marked cigarettes,

i. on a first conviction, a fine of $8 for each 200 cigarettes, and

ii. on each subsequent conviction, a fine of $8 for each 200 cigarettes, imprisonment for a term of not more than six months or both.

. . . . .

(3)  Section 31 of the Act is amended by adding the following subsection:

Imprisonment

(2.1)  Where a person convicted of an offence under subsection (2) was found to be in possession of 10,000 or more unmarked cigarettes, the court may impose a term of imprisonment of not more than two years in addition to any fines levied under subsection (2).

10.  (1)  Paragraphs 1 and 2 of subsection 35 (2) of the Act are repealed and the following substituted:

1. If the tobacco is 10,000 or more unmarked cigarettes,

i. a fine of not less than $500 and not more than $10,000, and

ii. an additional fine of not less than three times the amount of tax that would be payable under section 2 had the cigarettes been sold to a consumer liable to pay tax under this Act.

1.1 If the tobacco is less than 10,000 unmarked cigarettes,

i. a fine of not less than $500 and not more than $10,000 and an additional fine of not less than three times the amount of tax that would be payable under section 2 had the cigarettes been sold to a consumer liable to pay tax under this Act, or

ii. imprisonment for a term of not more than two years.

2. If the tobacco is marked cigarettes,

i. on a first conviction, a fine of $8 for each 200 cigarettes, and

ii. on each subsequent conviction, a fine of $8 for each 200 cigarettes or imprisonment for a term of not more than six months or both.

(2)  Paragraphs 1 and 2 of subsection 35 (2.0.1) of the Act are repealed and the following substituted:

1. If the tobacco is unmarked cigarettes,

i. a fine of not less than $500 and not more than $10,000, and

ii. an additional fine of not less than three times the amount of tax that would be payable under section 2 had the cigarettes been sold to a consumer liable to pay tax under this Act.

2. If the tobacco is marked cigarettes,

i. on a first conviction, a fine of $8 for each 200 cigarettes, and

ii. on each subsequent conviction, a fine of $8 for each 200 cigarettes or imprisonment for a term of not more than six months or both.

(3)  Section 35 of the Act is amended by adding the following subsections:

Imprisonment

(2.0.2)  Where a person convicted of an offence under subsection (2) was found to be in possession of 10,000 or more unmarked cigarettes, the court may impose a term of imprisonment of not more than two years in addition to any fines levied under subsection (2).

Same

(2.0.3)  Where a person convicted of an offence under subsection (2.0.1) was found to be in possession of tobacco in bulk that was unmarked cigarettes, the court may impose a term of imprisonment of not more than two years in addition to any fines levied under subsection (2.0.1).

(4)  Subsection 35 (2.1) of the Act is amended by striking out "subsection (2)" and substituting "subsection (2) or (2.0.1)".

Commencement

11.  (1)  Subject to subsection (2), this Schedule comes into force on the day the Budget Measures Act, 2006 (No. 2) receives Royal Assent.

Same

(2)  Section 3 shall be deemed to have come into force on July 1, 2004.

EXPLANATORY NOTE

This Explanatory Note was written as a reader's aid to Bill 151 and does not form part of the law. Bill 151 has been enacted as Chapter 33 of the Statutes of Ontario, 2006.

SCHEDULE A
ASSESSMENT ACT

Currently, the Assessment Act governs the assessment of land for the purposes of municipal and school taxes. Amendments throughout the Act provide, in addition, for the assessment of land in non-municipal territory for the purposes of taxes levied under the Provincial Land Tax Act, 2006.

Under paragraph 6 of subsection 3 (1) of the Act, land used and occupied by a public hospital that receives provincial aid under the Public Hospitals Act is exempt from tax. The authority to provide provincial aid for children's treatment centres was recently transferred for most of the centres from the Public Hospitals Act to the Ministry of Community and Social Services Act. The enactment of paragraph 6.1 of subsection 3 (1) of the Act continues the tax-exempt status of children's treatment centres that receive provincial aid under the Ministry of Community and Social Services Act.

An exemption from taxation for land used by veterans, which is currently set out in section 325 of the Municipal Act, 2001, is enacted as the new section 6.1 of the Assessment Act.

Paragraph 5 of subsection 19.2 (1) of the Act is amended to reflect that, for the 2006, 2007 and 2008 taxation years, land is valued as of January 1, 2005 rather than as of January 1 of the preceding taxation year.

Section 40 of the Act is amended to provide that if an assessment complaint relates to the 2006 taxation year, the complaint is deemed to have been made as well for the 2007 and 2008 taxation years if the complaint is not fully disposed of before the last day for a complaint for 2007 and 2008. Similarly, complaints relating to the 2007 taxation year are deemed to have been made as well for 2008.

Technical amendments are made, including amendments replacing references in the Act to "assessor" and "assessment commissioner" with "assessment corporation".

SCHEDULE B
AUDITOR GENERAL ACT

The Auditor General Act is amended by redefining "Crown controlled corporation" to include a corporation having a majority of the members of its board of directors appointed by a Minister of the Crown and by adding a reference to agencies of the Crown in clause 12 (2) (f).

SCHEDULE C
BUSINESS REGULATION REFORM ACT, 1994

Currently, the Business Regulation Reform Act, 1994 provides for the establishment of a system of business identifiers and authorizes the Minister of Government Services to enter into agreements to integrate the system of business identifiers with any such system established by the Government of Canada.

The Schedule would add provisions to the Act to allow the sharing of the business identifiers and other business information between the Government of Canada, the Minister of Government Services and other Ministers.

SCHEDULE D
CANADIAN PUBLIC ACCOUNTABILITY BOARD ACT (ONTARIO), 2006

The purpose of the Canadian Public Accountability Board Act (Ontario), 2006 is to promote the integrity of financial reporting in Ontario's capital markets. This is accomplished through the oversight of the auditing of the financial statements of companies (reporting issuers) whose securities are publicly traded.

The Act gives the Canadian Public Accountability Board a statutory mandate to maintain a register of public accounting firms that audit reporting issuers and to provide oversight of their audits. The Board is federally incorporated for this purpose and is supported by securities regulators across Canada. It currently carries out its functions under National Instrument 52-108 of the Canadian Securities Administrators which was adopted as a rule of the Ontario Securities Commission in March, 2004. Public accounting firms subject to the Board's oversight program must allow the Board to review their audits as provided in the Board's by-laws and rules. Parties to a hearing before appeal panels of the Board will have a right of appeal to the Divisional Court or they may refer matters to final and binding arbitration.

The Act provides for the powers and duties of the Board in Ontario. The Board is accountable to the Province through three mechanisms. Firstly, the Board must submit an annual report to the Commission which must in turn review the report and report on it to the Minister. The Board's report, together with the Commission's report, must be tabled in the Assembly. Secondly, the Minister may make regulations prescribing rules that are deemed to be rules of the Board. Thirdly, the Act may be repealed by proclamation of the Lieutenant Governor on the recommendation of the Minister of Finance if the Board changes its letters patent or its by-laws in a manner that has a negative effect on the operation of the Act.

The Board has wide access to confidential information as well as, in cases of absolute necessity, to privileged information. Audit firms and reporting issuers are protected in respect of the disclosure of information. Subject to the disclosure rules in the Act, the Board may notify the Ontario Securities Commission and other appropriate regulatory authorities, law enforcement agencies or professional regulatory authorities of a breach of the law by any person or company. It may also assist foreign public company audit oversight bodies.

Members of the Board's Council of Governors, its industry members, as defined in its by-laws, the members of its board of directors and its officers, employees and agents are given protection from civil liability.

SCHEDULE E
CAPITAL INVESTMENT PLAN ACT, 1993

The re-enactment of the definition of "public body" in subsection 29 (1) of the Capital Investment Plan Act, 1993 removes the Ontario Institute for Studies in Education from the definition and clarifies that only provincially funded universities are public bodies.

SCHEDULE F
COMMUNITY SMALL BUSINESS INVESTMENT FUNDS ACT

Currently, Part III.2 of the Community Small Business Investment Funds Act permits Ontario commercialization investment funds to invest before January 1, 2009 in taxable Canadian corporations that are eligible businesses in order to be eligible for an Ontario commercialization investment fund grant under the Act. The amendments to section 18.11 of the Act permit eligible investments to be made until the end of 2010. In addition, Canadian partnerships meeting the requirements set out in section 18.11 qualify as eligible businesses.

SCHEDULE G
CORPORATIONS TAX ACT

Subclause 43 (2) (b) (iii) of the Corporations Tax Act is amended to update references to the Income Tax Act (Canada). The references to "Canadian investment income" and "foreign investment income" are replaced with a reference to "aggregate investment income", as defined in subsection 129 (4) of the Income Tax Act (Canada).

Section 43.11 of the Act currently provides for an Ontario interactive digital media tax credit to certain small corporations in respect of eligible labour and marketing expenditures. The amendments to that section,

(a) increase the tax credit rate from 20 per cent to 30 per cent for qualifying small corporations with respect to eligible expenditures incurred after March 23, 2006 and before January 1, 2010;

(b) extend the tax credit at the 20 per cent rate to corporations that exceed the current size restrictions, applicable to eligible expenditures incurred after March 23, 2006 and before January 1, 2010;

(c) extend the tax credit at the 20 per cent rate to corporations that develop certain eligible products pursuant to contractual arrangements with another corporation, applicable to eligible labour expenditures incurred after March 23, 2006 and before January 1, 2010; and

(d) clarify the extent to which the tax credit may be claimed by a corporation in respect of expenditures incurred by a qualifying predecessor corporation.

The amendment to subsection 43.13 (10) of the Act updates a cross-reference.

The re-enactment of section 50 of the Act provides that new section 135.1 of the Income Tax Act (Canada) applies for the purposes of the Act after 2005. A corporation that is an eligible member of an agricultural co-operative corporation may defer the inclusion in income of all or a portion of a payment made by the agricultural co-operative corporation in the form of a tax deferred co-operative share, pursuant to an allocation in proportion to patronage. This deferral lasts until the disposition (or deemed disposition) of the share.

The amendment to section 56.1 of the Act ensures that a corporation is unable to make a deduction in respect of a tax shelter investment if any person is liable to a penalty under subsection 237.1 (7.4) of the Income Tax Act (Canada) in respect of the tax shelter.

The amendment to section 57.4 of the Act ensures that capital gains arising on the donation after May 1, 2006 of certain publicly traded securities to qualifying charities or on the donation after that day of ecologically sensitive land under the Ecological Gifts Program will not be subject to corporate minimum tax.

Subclause 80 (11) (b) (i) of the Act is amended to allow a reassessment to be made within three years after the end of the normal reassessment period for a taxation year if the reassessment is required because the corporation has filed a loss carry-back request before the applicable filing deadline, or would be required if the request had been filed before the deadline. A consequential amendment is made to clause 80 (15) (a) of the Act.

Subsection 80 (16) of the Act is amended to allow for the reassessment of all relevant taxation years (other than taxation years preceding the taxation year to which the loss is to be applied) if a corporation has filed a loss carry-back request. Amendments to subsection 80 (16) of the Act also permit a loss carry-back request to be made in respect of listed personal property losses.

The enactment of subsection 80 (16.1) of the Act allows a corporation to file a written request to amend a return if the corporation's foreign accrual property income for a taxation year has been reduced by a deductible loss of a foreign affiliate that arose in a subsequent taxation year.

The enactment of subsection 80 (25.2) of the Act authorizes the Minister of Finance to reassess a corporation after the expiry of the normal reassessment period in order to deny a deduction in respect of certain illegal payments. Consequential amendments are made to subsections 84 (1.0.1) and 85 (1.1) to refer to reassessments under subsection 80 (25.2).

The amendments to section 91 of the Act clarify that the Minister may extend the time to commence an appeal under the Act if an application for the extension is made before the expiry of the time limit for instituting the appeal.

Currently, the Act provides a procedure whereby assessments made under the Act may be reconsidered by the Minister and subsequently appealed to the Superior Court of Justice. The enactment of section 92.1 of the Act authorizes applications to the court under subrule 14.05 (2) of the Rules of Civil Procedure for the statutory interpretation of the Act and any other relevant legislation if certain conditions are satisfied. The facts must not be in dispute and the Minister of Finance must be satisfied that the application is in the public interest. Applications for relief under subrule 14.05 (3) of the Rules of Civil Procedure with respect to the Act are prohibited.

SCHEDULE H
DEVELOPMENT CHARGES ACT, 1997

The amendments to the Development Charges Act, 1997 change the method by which the estimate for the increase in the need for the Toronto-York subway extension is calculated by basing it on the planned level of service provided in the municipality over the 10-year period immediately following the preparation of the background study, rather than the average level of service provided over the 10-year period immediately preceding the preparation of the background study. The amendments also exempt the Toronto-York subway extension from the 10 per cent municipal contribution requirement for certain services.

SCHEDULE I
EMPLOYER HEALTH TAX ACT

The amendment to the English version of subsection 10 (5) of the Employer Health Tax Act clarifies that the Minister may extend the time to commence an appeal under the Act if an application for the extension is made before the expiry of the time limit for instituting the appeal.

Currently, the Act provides a procedure whereby assessments made under the Act may be reconsidered by the Minister and subsequently appealed to the Superior Court of Justice. The enactment of section 10.1 of the Act authorizes applications to the court under subrule 14.05 (2) of the Rules of Civil Procedure for the statutory interpretation of the Act and any other relevant legislation if certain conditions are satisfied. The facts must not be in dispute and the Minister of Finance must be satisfied that the application is in the public interest. Applications for relief under subrule 14.05 (3) of the Rules of Civil Procedure with respect to the Act are prohibited.

SCHEDULE J
FINANCIAL ADMINISTRATION ACT

The enactment of section 11.4.1 of the Financial Administration Act permits the Treasury Board to authorize and direct ministries to pay interest after March 31, 2007 on late payments on such terms and conditions as the Treasury Board specifies. The interest payments must be funded out of the ministry's appropriation against which the late payment is charged. A related technical wording change is made to the definition of "ministry" in section 1 of the Act.

Paragraph 1 of section 21 of the Act currently provides authority to the Province to refinance securities that are maturing or coming due. The re-enactment of that paragraph permits the Province to also refinance securities that are purchased and cancelled by the Province before their maturity.

Section 43 of the Act currently authorizes the Minister of Finance to claim a set-off if a payee is indebted to the Crown. The amendments to that section also authorize the Minister to claim a set-off if the Crown has paid an amount which the recipient is not entitled to receive or subsequently ceases to be entitled to receive.

To date, Ontario has entered into reciprocal taxation agreements with the federal government under the authority of an order made by the Lieutenant Governor in Council. The enactment of Part V of the Act provides statutory authority for the Minister of Finance to negotiate and enter into reciprocal taxation agreements with the federal government on behalf of the province.

SCHEDULE K
FUEL TAX ACT

The enactment of subsections 4 (4.1) and 4.1 (3) of the Fuel Tax Act impose penalties on exporters and importers of fuel who are not registered under the Act equal to, in the case of an unregistered importer, 110 per cent of the amount of tax that would be payable under the Act in respect of the imported fuel and, in the case of an unregistered exporter, 100 per cent of the amount of tax that would be payable under the Act in respect of the exported fuel.

The amendment to the English version of subsection 4.6 (1) of the Act updates terminology to parallel current terminology in the Act.

The amendments to section 14 of the Act clarify that the Minister may extend the time to commence an appeal under the Act if an application for the extension is made before the expiry of the time limit for instituting the appeal.

Currently, the Act provides a procedure whereby assessments made under the Act may be reconsidered by the Minister and subsequently appealed to the Superior Court of Justice. The enactment of section 14.1 of the Act authorizes applications to the court under subrule 14.05 (2) of the Rules of Civil Procedure for the statutory interpretation of the Act and any other relevant legislation if certain conditions are satisfied. The facts must not be in dispute and the Minister of Finance must be satisfied that the application is in the public interest. Applications for relief under subrule 14.05 (3) of the Rules of Civil Procedure with respect to the Act are prohibited.

The re-enactment of subsection 18 (4) of the Act removes a reference to the seizure of books and records under the Act. As a result of previous amendments to the Act, there is no longer authority in the Act to seize books and records without a search warrant.

The enactment of subsection 21 (5.1) of the Act makes it an offence to use deceit, falsehood or another fraudulent means to obtain a refund under the Act to which the recipient is not entitled.

Currently, subsections 26 (2) and (3) of the Act provide for penalties if a dealer possesses fuel in bulk from which the dye has been removed or coloured fuel that has been mixed or combined with any other type or grade of fuel. The re-enactment of those subsections clarifies that the penalty provisions apply to the possession of fuel that is a mixture of coloured fuel and any other fuel.

SCHEDULE L
GASOLINE TAX ACT

The definition of "gasoline" in subsection 1 (1) of the Gasoline Tax Act is amended to clarify that fuel-grade ethanol is subject to the same rules under the Act as other fuels that are taxed as gasoline.

The enactment of subsections 4.1 (4.1) and 4.2 (3) of the Act imposes penalties on exporters and importers of gasoline who are not registered under the Act equal to, in the case of an unregistered importer, 110 per cent of the amount of tax that would be payable under the Act in respect of the imported gasoline and, in the case of an unregistered exporter, 100 per cent of the amount of tax that would be payable under the Act in respect of the exported gasoline. The Act is reorganized by repealing section 4.9 of the Act and enacting the same provision as subsection 4.2 (4) of the Act.

The amendments to section 14 of the Act clarify that the Minister may extend the time to commence an appeal under the Act if an application for the extension is made before the expiry of the time limit for instituting the appeal.

Currently, the Act provides a procedure whereby assessments made under the Act may be reconsidered by the Minister and subsequently appealed to the Superior Court of Justice. The enactment of section 14.1 of the Act authorizes applications to the court under subrule 14.05 (2) of the Rules of Civil Procedure for the statutory interpretation of the Act and any other relevant legislation if certain conditions are satisfied. The facts must not be in dispute and the Minister of Finance must be satisfied that the application is in the public interest. Applications for relief under subrule 14.05 (3) of the Rules of Civil Procedure with respect to the Act are prohibited.

The re-enactment of subsection 16 (5) of the Act removes a reference to the seizure of books and records under the Act. As a result of previous amendments to the Act, there is no longer authority in the Act to seize books and records without a search warrant.

The enactment of subsection 29 (2) of the Act makes it an offence to use deceit, falsehood or another fraudulent means to obtain a refund under the Act to which the recipient is not entitled.

SCHEDULE M
HIGHWAY TRAFFIC ACT

The Highway Traffic Act is amended as follows:

1. The power to prescribe fees for anything done or provided under the Act is moved from section 7 to section 5.

2. New subsection 5 (3) provides that fees prescribed or set under the Act for the issuance, renewal or validation of permits or for the issuance or renewal of licences may include a portion for the recovery of costs related to public highway infrastructure.

3. A housekeeping amendment is made to section 7, changing the obsolete reference to the Treasurer of Ontario to the Minister of Finance.

SCHEDULE N
INCOME TAX ACT

The amendments to the Income Tax Act do the following:

1. Repeal the provisions relating to the Ontario adoption expense credit that were enacted in 2005 but not proclaimed into force pending passage of the federal adoption expense credit provisions and enact revised Ontario adoption expense credit provisions that accord with the federal legislation as passed, applicable to 2005 and later taxation years.

2. Revise the wording of the Ontario foreign tax credit as a result of federal amendments and to ensure that individuals do not avoid Ontario tax by claiming the Ontario foreign tax credit with respect to non-business income before claiming the federal foreign tax credit.

3. Parallel recent enhancements to the federal dividend tax credit and introduce, effective January 1, 2006, a second, higher tax credit for eligible dividends, phased in over five years, starting at 6.5 per cent and increasing to 7.7 per cent by 2010.

4. Update the definition of "municipal tax" for the purposes of calculating the amount of property and sales tax credits.

5. Increase the income threshold for property and sales tax credits for seniors who have a cohabiting spouse or common-law partner from $22,250 to $23,090 for 2006 and later years to ensure that recent increases in the amount of Old Age Security and the federal and Ontario guaranteed income supplements will not result in any reduction in property and sales tax credits.

6. Ensure that the amount of property and sales tax credits and Ontario child care supplements are not affected by the new federal universal child care benefit which is otherwise included in income for tax purposes.

7. Make consequential amendments to update the language in the Act.

SCHEDULE O
INSURANCE ACT AND CORPORATIONS ACT

The Schedule contains amendments to the Insurance Act and related amendments to the Corporations Act that change the rules governing investments that may be made by insurers in Ontario. Broadly, the rules currently permit insurers to invest in specific, enumerated investments. The amendments in the Schedule change the investment rules to ones in which insurers have more flexibility in determining appropriate investments, subject to various restrictions. Amendments made by the Schedule include the following:

Insurance Act

New section 431.1 of the Insurance Act sets out how the new investment rules will first apply to an insurer. Once the new rules are proclaimed in force, there will be a period of four years before they apply to an insurer. During that period, the old investment rules (namely, those in force before the new investment rules are proclaimed) will continue to apply to the insurer. However, an insurer may choose to have the new investment rules apply to it at any time once they are in force and before four years have elapsed. An insurer that chooses that option must give 30 days notice before the day on which it intends to have the new rules apply. Once the new rules apply to it, an insurer may not choose to have the old rules apply.

Part XVII (Investments) of the Insurance Act is significantly amended to implement the new investment rules. The general standard, set out in remade section 434, is that an insurer incorporated and licensed in Ontario must adhere to investment and lending policies that a reasonable and prudent person would apply in respect of a portfolio of investments to avoid undue risk of loss and obtain a reasonable return. The directors of an insurer must establish those policies and review them annually.

The ability of an insurer to invest in a prudent portfolio of investments is subject to various restrictions.

Substantial investments are restricted. Broadly, substantial investments are investments that result in ownership of more than 10 per cent of the voting shares or 25 per cent of shareholder equity in an incorporated entity and more than 25 per cent of the ownership interests, however designated, in an unincorporated entity. No insurer may acquire, hold or increase a substantial investment except in accordance with certain exceptions set out in Part XVII or the regulations.

The Schedule also implements aggregate limits on types of investments.

Under new section 435.13, the Superintendent is empowered to order an insurer to dispose of an investment for specified reasons, including if the investment was made or acquired in contravention of the Act.

New Part XVII.1 (Related Party Transactions) is added to the Act. The general rule in this Part, set out in new section 437.16, is that no insurer incorporated or licensed in Ontario may enter into transactions with a related party unless permitted to do so under the Part or the regulations. The Part sets out certain permitted transactions and certain prohibited transactions between an insurer and a related party. Section 437.13 describes persons who are related parties of an insurer. The Superintendent is empowered to issue orders designating other persons as related parties to an insurer. Any such order can be appealed by the insurer or the person so designated.

New subsections 121 (5), (6) and (7) set out extensive regulation making authority relating to the new investment rules.

Corporations Act

Various amendments are made to the Corporations Act. The networking power set out in clause 141 (5) (a) of the Act is replaced. Under the existing provision, an insurer may act as agent for a financial institution. Under the new clause, an insurer may act as agent for various entities identified in the Insurance Act.

Other amendments to the Act relate to corporate governance of insurers. New rules respecting the board of directors of an insurer are set out in section 141.2. The board must be composed of no less than six members and no more than two-thirds of those members can be affiliated with an insurer. Regulations may be made under the Insurance Act specifying the circumstances in which a director will be considered affiliated with an insurer.

SCHEDULE P
LAND TRANSFER TAX ACT

The Land Transfer Tax Act imposes tax in respect of unregistered transfers of beneficial interest in land. The Act provides a deferral and cancellation of tax on transfers of beneficial interest in land between affiliated corporations if no conveyance is subsequently registered on title. The amendments to sections 2 and 3 of the Act ensure that if a subsequent conveyance evidencing the disposition is registered on title, the tax payable on registration is based on the value of the consideration of the previous disposition of the beneficial interest and not on the nominal value of the bare legal title.

Currently, the determination for the purposes of section 3 of the Act of whether corporations are affiliated is based on provisions of the Securities Act that are adopted by statutory cross-reference. The re-enactment of subsection 3 (14) and the enactment of subsection 3 (15) of the Act incorporate the relevant provisions into the Act for clarity.

The amendments to section 14 of the Act clarify that the Minister may extend the time to commence an appeal under the Act if an application for the extension is made before the expiry of the time limit for instituting the appeal.

Currently, the Act provides a procedure whereby assessments made under the Act may be reconsidered by the Minister and subsequently appealed to the Superior Court of Justice. The enactment of section 14.1 of the Act authorizes applications to the court under subrule 14.05 (2) of the Rules of Civil Procedure for the statutory interpretation of the Act and any other relevant legislation if certain conditions are satisfied. The facts must not be in dispute and the Minister of Finance must be satisfied that the application is in the public interest. Applications for relief under subrule 14.05 (3) of the Rules of Civil Procedure with respect to the Act are prohibited.

SCHEDULE Q
LIQUOR CONTROL ACT

The amendments to the Liquor Control Act increase the number of members of the Board from a maximum of seven members to a maximum of 11 members. The amendments also authorize the Board to appoint a chief executive officer to be responsible for the operation of the corporation and to carry out other duties as assigned by the Board. The Board is given broader delegation powers and its status as an agency of the Crown is clarified.

SCHEDULE R
MINING ACT

The Schedule amends the Mining Act to give authority to make regulations relating to the valuation of rough diamonds and to the collection of records relating to rough diamond production.

SCHEDULE S
MINING TAX ACT

The Mining Tax Act is amended to prohibit operators from deducting fines, penalties and illegal payments in computing the amount of mining tax payable under the Act and to extend the period for reassessing mining tax to disallow the deduction of illegal payments.

Currently, the Act provides a procedure whereby assessments made under the Act may be reconsidered by the Minister and subsequently appealed to the Superior Court of Justice. The amendment to section 10 of the Act provides that section 92.1 of the Corporations Tax Act applies for the purposes of the Mining Tax Act. This section authorizes applications to the court under subrule 14.05 (2) of the Rules of Civil Procedure for the statutory interpretation of the Act and any other relevant legislation if certain conditions are satisfied. The facts must not be in dispute and the Minister of Finance must be satisfied that the application is in the public interest. Applications for relief under subrule 14.05 (3) of the Rules of Civil Procedure with respect to the Act are prohibited.

SCHEDULE T
MINISTRY OF HEALTH AND LONG-TERM CARE ACT

The Ministry of Health and Long-Term Care Act is amended to allow the Minister to enter into agreements on behalf of the Government of Ontario to indemnify Canadian Blood Services Captive Insurance Company Limited or other persons or entities under the terms of insurance policies issued in favour of the Canadian Blood Services and other persons.

SCHEDULE U
MINISTRY OF REVENUE ACT

Currently, sections 11 and 12 of the Ministry of Revenue Act authorize the Lieutenant Governor in Council, on the recommendation of the Minister of Finance, to remit taxes, fees, penalties and overpayments of grants and refundable tax credits if the Lieutenant Governor in Council considers it in the public interest to do so. The amendments to section 11 of the Act authorize the Lieutenant Governor in Council to remit other types of debts owed to the Province if the remission is recommended by the Minister of Finance and the Lieutenant Governor in Council considers the remission to be in the public interest.

SCHEDULE V
MUNICIPAL ACT, 2001

Section 308 of the Municipal Act, 2001 provides for the establishment of tax ratios which are the ratios that the municipal tax rate for each property class is to the tax rate in the municipality for the residential property class. In certain cases, the tax ratio may be outside the allowable range prescribed by the regulations as long as the ratio is within the transition ratio prescribed by the Minister of Finance. The enactment of subsection 308 (11.1) of the Act is a technical amendment to clarify that the tax ratio established by a municipality for a property class cannot be outside the allowable range prescribed by the regulations for the property class if the transition ratio prescribed by the Minister of Finance is not outside the allowable range for the property class.

Section 325 of the Act is repealed consequential upon the enactment of section 6.1 of the Assessment Act in this Bill.

SCHEDULE W
OIL, GAS AND SALT RESOURCES ACT

Section 10.2 of the Oil, Gas and Salt Resources Act restricts the erection, location and construction of buildings and structures within 75 metres of a well or facility. Section 10.2 is revised so that the restriction will apply only to types of buildings and structures prescribed by the regulations. With respect to unlicensed wells and facilities, the restriction will apply only if the building or structure is on the same property as the well or facility.

SCHEDULE X
ONTARIO ENERGY BOARD ACT, 1998

The Schedule amends the Ontario Energy Board Act, 1998 to permit work on gas and electricity construction projects to be expedited in certain circumstances.

Section 33 of the Act currently provides that an order made by the Ontario Energy Board under section 36 or 78 of the Act is not stayed by an appeal. This section is amended to ensure that all orders made by the Board become operative on the date set out in the order, while allowing the Board to order a stay of its order on appeal and allowing the Divisional Court, on appeal, to order a stay of the Board's order or to set aside the Board's stay.

Section 98 of the Act currently allows persons entry on a proposed work site in order to conduct surveys and examinations in preparation of the work if they have leave from the Ontario Energy Board to construct a hydrocarbon line, to construct, expand or reinforce an electricity transmission line or an electricity distribution line or to make an interconnection. Section 98 is amended to also allow persons exempted from obtaining leave and persons who are required by the Board to expand or reinforce a transmission or distribution system to enter onto the land to conduct the necessary preparatory work. A further amendment gives the Board the power to issue interim orders authorizing persons to enter onto the land to conduct the necessary preparatory work while their application for leave or for an exemption is being determined or while the Board is conducting a proceeding to determine whether to require the person to expand or reinforce a transmission or distribution system.

Section 101 of the Act currently allows a person with leave to construct a work to apply to the Board for authority to construct the work on, under or over a highway, utility line or ditch. This is amended to also allow a person who is exempted from the requirement to obtain leave and a person who is required by the Board to expand or reinforce a transmission or distribution system to also apply for this authority.

SCHEDULE Y
ONTARIO INFRASTRUCTURE PROJECTS CORPORATION ACT, 2006

The Schedule amends the Ontario Infrastructure Projects Corporation Act, 2006 to allow the Corporation to carry out its objects with respect to infrastructure projects concerning public works that are assigned to it. The Corporation may also hold an interest in real or other property with respect to infrastructure projects concerning public works that are assigned to it and may carry out other activities with respect to premises, buildings and structures that are public works relating to an infrastructure project that is assigned to it.

SCHEDULE Z
ONTARIO LOTTERY AND GAMING CORPORATION ACT, 1999

The Schedule amends the Ontario Lottery and Gaming Corporation Act, 1999 to allow the Corporation to make payments out of the revenue that it receives from lottery tickets, charity casinos and slot machine facilities and from the operation of its casinos if the payment is required by an agreement relating to the distribution of a portion of the Corporation's revenues to First Nations of Ontario. The amendments also allow the Minister of Finance to make payments out of the Consolidated Revenue Fund if the payment is required by an agreement relating to the distribution of a portion of the Corporation's revenues to First Nations of Ontario. New section 14.2 of the Act requires the Minister to publish such agreements in The Ontario Gazette.

SCHEDULE Z.1
PENSION BENEFITS ACT

Section 93 of the Pension Benefits Act currently authorizes Ontario to enter into an agreement with another jurisdiction to provide for matters relating to the application of the Act and the regulations and the pension benefits legislation of the other jurisdiction to multi-jurisdictional pension plans. Subsection 93 (4) of the Act is amended to provide that any matter that may be the subject of an agreement under section 95 of the Act may also be the subject of an agreement under section 93 of the Act. The amendments also provide that an agreement with another jurisdiction under section 93 of the Act may provide for the reciprocal exchange of information between the Superintendent of Financial Services and the pension regulator of the other jurisdiction for the purpose of complying with or implementing the agreement or for the purpose of the administration of the Act or the pension benefits legislation of the other jurisdiction.

SCHEDULE Z.2
PROVINCIAL LAND TAX ACT, 2006

The Schedule replaces the current scheme of property taxation that applies to land located in territory without municipal organization. The current scheme is set out in the Provincial Land Tax Act. That Act is replaced by the Provincial Land Tax Act, 2006, set out in this Schedule, and by related amendments to the Assessment Act set out in this Bill.

Under the current scheme, the Provincial Land Tax Act governs both the assessment of land in territory without municipal organization (which is called "non-municipal territory" in the new Act) and the levying of property tax on that land. Under the new scheme, the Provincial Land Tax Act, 2006 will provide for the levying of property tax on land in non-municipal territory, but the assessment of that land will be under the Assessment Act. The current exemptions from municipal property tax that are set out in the Assessment Act will apply to land in non-municipal territory and some of the current exemptions from provincial land tax that are not provided for under the Assessment Act are specifically continued in the new Act.

The new scheme is analogous to the scheme of municipal property taxation established under the Municipal Act, 2001 and the Assessment Act. Under the new scheme, the Minister of Finance is given powers and duties under the new Act and the Assessment Act that correspond to powers and duties of municipal councils and municipal officials under the Municipal Act, 2001 and the Assessment Act. Those powers include the power to grant tax relief. The Minister may delegate administrative powers and duties under the new Act to public servants.

The new Act comes into force on January 1, 2009.

SCHEDULE Z.3
PROVINCIAL LAND TAX ACT, 2006 - CONSEQUENTIAL REPEAL AND AMENDMENTS

The provisions in this Schedule relate to the enactment of the new Provincial Land Tax Act, 2006. Section 1 of this Schedule repeals the Provincial Land Tax Act. Sections 2 to 33 make consequential amendments to other Acts.

This Schedule also amends various Acts to replace references to the assessment commissioner with references to the Municipal Property Assessment Corporation.

SCHEDULE Z.4
RETAIL SALES TAX ACT

Under the Retail Sales Tax Act, the planholder of a funded benefits plan is required to pay tax in respect of premiums paid by the planholder into the plan. An amendment to the definition of "premium" in subsection 1 (1) of the Act excludes from that definition premiums for amounts that would be included in the total Ontario remuneration of the planholder under the Employer Health Tax Act when paid out to employees. This treatment parallels the treatment of these amounts in respect of unfunded benefits plans. A technical amendment is also made to the French version of the definition.

Amendments to section 2.1 of the Act specify that planholders who establish benefits plans are required to designate whether the plans are funded or unfunded. This designation applies until the planholder advises the Minister of Finance of a change to the plan.

Subsection 4 (12) of the Act is re-enacted to remove an obsolete reference to regulations filed by the Minister of Finance.

Currently, paragraph 47 of subsection 7 (1) of the Act provides for a tax exemption on the purchase of magazines by subscription. The re-enactment of that paragraph allows a tax exemption on the purchase of magazines in other circumstances to be prescribed by regulations made by the Minister.

The amendments to section 25 of the Act clarify that the Minister may extend the time to commence an appeal under the Act if an application for the extension is made before the expiry of the time limit for instituting the appeal.

Currently, the Act provides a procedure whereby assessments made under the Act may be reconsidered by the Minister and subsequently appealed to the Superior Court of Justice. The enactment of section 29.1 of the Act authorizes applications to the court under subrule 14.05 (2) of the Rules of Civil Procedure for the statutory interpretation of the Act and any other relevant legislation if certain conditions are satisfied. The facts must not be in dispute and the Minister of Finance must be satisfied that the application is in the public interest. Applications for relief under subrule 14.05 (3) of the Rules of Civil Procedure with respect to the Act are prohibited.

SCHEDULE Z.5
SECURITIES ACT

The amendments to the Securities Act harmonize Ontario securities law with the laws of other Canadian jurisdictions. The Schedule makes several amendments to the Act dealing with prospectus requirements, insider trading and self dealing and the regulation of take-over bids and business combinations. Many of these amendments involve the granting of additional rule-making authority to the Commission or changes to its existing rule-making authorities. In addition to the previously identified areas where amendments have been made, certain other amendments have been made and are identified below. The following summarizes the changes:

Part XV of the Act (Prospectuses - Distributions)

The re-enactment of subsection 61 (2) harmonizes the grounds for refusing to issue a receipt with the securities legislation of Canadian jurisdictions. The definition of "control person" is moved from section 138.1 to subsection 1 (1) as a consequence. A consequential amendment is also made to the definition of "distribution" in subsection 1 (1).

A technical amendment is made to section 53 to reflect the fact that receipts are issued for a prospectus or an amendment to a prospectus. A technical amendment is also made to subsection 63 (1) to reference simplified forms of prospectuses. Subsection 72 (8) replaces existing subsections 72 (8) to (11) and enables the Commission to publish a list of reporting issuers that are in default of any requirement of the Act or the regulations. The Commission will no longer provide certificates respecting a reporting issuer's status with the Commission.

Various amendments are made to the Commission's rule-making authority relating to prospectuses and distributions. Paragraph 16.1 of subsection 143 (1) provides the Commission with the authority to prescribe requirements for certification of prospectuses by persons or companies where the issuer is a trust or limited partnership, or where the issuer is not a company, trust or a limited partnership. Technical amendments are also made to the Commission's rule-making authority in paragraphs 15 and 16 of subsection 143 (1).

Part XX of the Act (Take-over Bids and Issuer Bids)

The re-enactment of subsection 104 (1) makes technical amendments to harmonize the language of the subsection with other provincial securities legislation.

The re-enactment of section 105 is intended to create harmonized wording to the analogous provisions of other jurisdictions dealing with court applications in respect of take-over bids and issuer bids. In addition, the reference to Ontario Court (General Division) is changed to the Superior Court of Justice.

Amendments to paragraphs 28 and 36 of subsection 143 (1) provide the Commission with authority to regulate business combinations. The Commission has been given new authority in subsection 1 (1.1) to define the term "business combination" in a rule.

Part XXI of the Act (Insider Trading and Self-Dealing)

The amendments to section 107 will extend requirements applicable to insiders of a reporting issuer to include interests in "related financial instruments". A new definition for "related financial instruments" and the related terms "economic interest in a security" and "economic exposure" are to be added to subsection 1 (1). The repeal of clause 106 (2) (c) and section 108 are consequential to the re-enactment of section 107 and the proposed transfer of many of the requirements for insider reporting to the Commission's rules. New rule-making powers to provide the Commission with the authority to make these rules are contained in paragraphs 30.1, 30.2 and 30.3 of subsection 143 (1).

The amendments to the definition of "insider" in subsection 1 (1) are related to the re-enactment of section 107 and the revised rule-making authority. As amended, the definition will include any person or company designated by the Commission as an insider by an order under subsection 1 (11) and exclude any person or company designated not to be an insider by a Commission order under subsection 1 (10). Under subsection 1 (14), the Commission is required to hold a hearing before making such an order if one is requested by a person or company which would be subject to such an order. Subsection 1 (11) provides that the Commission's discretion to make an order designating a person or company to be an insider is limited to circumstances where the person or company has access to material information about the issuer in the ordinary course.

Technical amendments are made to the definition of "insider" to harmonize it with the language of securities legislation across Canada. Sections 83 and 83.1 are repealed as a consequence of the addition of subsections 1 (10) to (14). In addition, the definitions of "insider" and "reporting issuer" in subsection 1 (1) of the Act are amended to refer to the new subsections 1 (10) and (11).

Other Amendments

Investment Funds

The re-enactment of section 116 extends the statutory standard of care from persons or companies responsible for the management of a mutual fund to investment fund managers of investment funds. Amendments are made to paragraphs 31 and 35 of subsection 143 (1) as a consequence of the addition of the definition of "investment fund" to the Act in 2004.

Forward-Looking Information

Paragraph 22.1 of subsection 143 (1) provides the Commission with authority to make rules in connection with the preparation, form and content of forward-looking information which is publicly disseminated, but is not part of a required filing with the Commission.

Restitution Remedy

Section 122.1 provides additional remedies where there has been a conviction for an offence under the Act. The court, in addition to any penalty that it may impose, will be entitled to order that the convicted person or company make restitution or pay compensation in relation to the offence to an aggrieved person or company.

Memoranda of Understanding

The amendments to section 143.10 clarify the effective date of an agreement, memorandum of understanding or arrangement entered into by the Commission with another securities or financial regulator, self-regulatory body or organization, or jurisdiction. The amendments also provide exceptions to the requirement to publish these agreements, memoranda and arrangements.

Miscellaneous

Amendments are made to the definitions of "director", "investment fund manager", "officer" and "self-regulatory organization" in subsection 1 (1) to harmonize the language of these provisions with that of other provincial securities legislation.

The definition of "senior officer" and other references to "senior officer" in the Act are being repealed as they are no longer necessary in light of the revised definition of "officer".

Amendments are made to sections 138.1, 138.3, 138.4 and 138.5 providing civil liability for misrepresentations in disclosure materials in the secondary market to include references to the regulations.

Paragraph 9 of subsection 143 (1) is re-enacted to correct a cross reference.

Paragraph 4 of subsection 143.2 (2) is amended to clarify that the Commission in giving notice of proposed rule changes may give notice of rules that would be made in situations where it lacks rule-making authority but is seeking legislative changes to acquire the necessary authority.

SCHEDULE Z.6
SUPERANNUATION ADJUSTMENT BENEFITS REPEAL ACT, 1994

The Superannuation Adjustment Benefits Repeal Act, 1994 (the "Repeal Act") repealed the Superannuation Adjustment Benefits Act, Revised Statutes of Ontario, 1980, chapter 490, which established accounts in the Consolidated Revenue Fund to finance the indexation of pension benefits for members of certain pension plans, including the Ryerson Pension Plan. The Repeal Act provided, among other things, for a transfer of assets from the Consolidated Revenue Fund to the Ryerson Pension Plan, which was accomplished by the issue of a series of debentures the last of which matures on March 31, 2007. Accordingly, the Repeal Act is spent as of March 31, 2007 and is itself repealed as of April 1, 2007.

SCHEDULE Z.7
TAX INCREMENT FINANCING ACT, 2006

The Tax Increment Financing Act, 2006 is enacted to authorize the Province to assist in funding designated municipal projects through tax increment financing. Eligible projects include the construction of municipal infrastructure or amenities, the environmental remediation of land and the construction of municipal public transit facilities. To apply for provincial assistance, a municipality must prepare a feasibility study for submission to the Minister of Finance. If the Lieutenant Governor in Council considers it to be in the public interest, the Lieutenant Governor in Council designates the project, establishes the tax increment finance district for the project and authorizes the Minister of Finance to enter into a funding agreement for the project. The funding agreement provides for the making of payments by the Minister of Finance to fund part of the cost of the project. The amount of the provincial assistance is calculated based on the projected future increase in education tax revenues in the tax increment finance district.

SCHEDULE Z.8
TEACHERS' PENSION ACT

The enactment of subsection 5 (2) of the Teachers' Pension Act recognizes that the Province and employers who contribute under the teachers' pension plan have been making additional pension contributions since 1992 on behalf of active plan members of the teachers' pension plan who are receiving payments under a long term income protection agreement and provides that the Province and the employers will continue to do so.

The enactment of subsection 5 (8) of the Act implements the terms of an agreement to retire a going concern unfunded liability in the teachers' pension plan by permitting the Province and employers who contribute under the plan, for one year only, to increase their payments for 2008 to an amount in excess of the contributions to be made in that year by active plan members.

SCHEDULE Z.9
TOBACCO TAX ACT

The re-enactment of subsection 3 (7) of the Tobacco Tax Act and the amendments to section 31 and subsections 35 (2) and (2.0.1) of the Act add a penalty for delivering tobacco in Ontario for the purposes of resale without a wholesaler's permit, bring the offence provisions for wholesaler offences into line with comparable provisions relating to individuals and increase the fine for possession of marked cigarettes without a wholesaler's permit to $8 per carton of 200 cigarettes.

Subsection 5 (11.1) of the Act currently imposes a penalty on exporters and importers of tobacco who are not registered under the Act equal to the amount of tax that would be payable under the Act in respect of tobacco that they exported or imported, as the case may be, during the period when they were not registered. The re-enactment of subsection 5 (11.1) and the enactment of subsection 5 (11.2) of the Act increases the amount of the penalty imposed on unregistered importers to three times the amount of the tax. There is no change for unregistered exporters.

Packages of taxable cigarettes currently carry a yellow tear tape indicating that tax is payable on the purchase of the cigarettes. Subsection 7.1 (5) of the Act is re-enacted to provide that manufacturers of the yellow tear tapes are subject to regulations with respect to how they account for and safeguard the tear tapes in their possession.

The re-enactment of clause 17 (1) (a) of the Act is a technical amendment to refer to regulations that may have been made by the Lieutenant Governor in Council or by the Minister, depending on whether the person filing the return under the Act is a collector or importer or another type of registrant under the Act.

The amendments to section 22 of the Act clarify that the Minister may extend the time to commence an appeal under the Act if an application for the extension is made before the expiry of the time limit for instituting the appeal.

Currently, the Act provides a procedure whereby assessments made under the Act may be reconsidered by the Minister and subsequently appealed to the Superior Court of Justice. The enactment of section 22.0.1 of the Act authorizes applications to the court under subrule 14.05 (2) of the Rules of Civil Procedure for the statutory interpretation of the Act and any other relevant legislation if certain conditions are satisfied. The facts must not be in dispute and the Minister of Finance must be satisfied that the application is in the public interest. Applications for relief under subrule 14.05 (3) of the Rules of Civil Procedure with respect to the Act are prohibited.

Clause 23 (1) (d) of the Act was enacted before the Charter of Rights and Freedoms and authorizes the seizure of records without a search warrant. It is repealed and subsection 23 (5) is re-enacted to remove references to records seized under the authority of section 23 of the Act.

The re-enactment of subsection 29 (2.1) of the Act is a housekeeping amendment to ensure consistency in wording relating to the forfeiture and disposal of unmarked cigarettes in respect of which a person is convicted of an offence under the Act.

Subsection 35 (2.1) provides authority to forfeit tobacco seized in the commission of an offence. The amendment adds a reference to offences included in subsection 35 (2.0.1) of the Act.

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