| There are 2 types of corporations: | | | | appropriate provincial or federal regulators. If approved |
| 1. Public corporation: | | | | a charter is granted. A Charter or Articles of |
| A public corporation is a legal entity that has a distinct | | | | Incorporation is a contract that exists between the |
| personality for tax and legal status. It generally is | | | | legal jurisdiction, the incorporators and their |
| started by its original shareholders who provide the | | | | shareholders. |
| start-up cash or assets in exchange for their shares. | | | | The following information is required to set up a |
| The corporation may eventually be owned by a large | | | | corporation:a. Name of corporation.b. Location of its |
| number of shareholders. | | | | Head Office.c. Purpose.d. Authorized capital, classes of |
| The share holders invest in the corporation have | | | | shares holding the capital, number of shares of each |
| certain rights:a. Voting right.b. The right to elect | | | | class and their issue price.e. Any restrictions to the sale |
| directors.c. The right to receive dividends.d. The right to | | | | of shares or classes of shares.f. Description of shares, |
| buy and sell the corporation stocks.e. The right to | | | | attributes, designation, preferences, rights and |
| examine the corporation book.f. The right to share any | | | | conditions.g. List of incorporators, including addresses |
| surplus on the wind-up of the corporation. | | | | and number of shares held and price paid for shares.h. |
| The shareholders' liability is only limited to the total sum | | | | List of first directors, including addresses.i. Any |
| of the investment, except in case of fraud and wrong | | | | additional information required by law. |
| doing. | | | | To set the company in motion, the Board of Directors |
| 2. Private corporation: | | | | must present and choose the corporation by-laws at |
| Operated similar to public corporation except the | | | | their first meeting. |
| shares of the corporation are owned by very limited | | | | All corporations are governed by corporation by-laws |
| number of shareholders. | | | | which is chosen at the corporation's first meeting. |
| How to set up a corporation: | | | | By-Laws are the code of regulations and instructions |
| Setting up a corporation requires the application for a | | | | for operation, duties and obligation of the corporation |
| Charter or Articles of Incorporation to be filed with the | | | | and its officers. |