Does it matter whether I incorporate under Ontario or federal law for my share structure?

Both the Ontario Business Corporations Act and the Canada Business Corporations Act are modern statutes with similar approaches to share structure, so for most private companies the choice between them has limited practical impact on how you design your shares. Both permit unlimited authorized shares, multiple classes with customized rights, no-par-value shares, and the same basic tools for corporate finance.

The main differences relate to the corporation's operating scope and administrative requirements. A federal CBCA corporation can be incorporated once and carry on business under that same name anywhere in Canada, but it still must register as an extra-provincial corporation in each province -- including Ontario -- where it actually carries on business, just as an Ontario OBCA corporation must register in each province outside Ontario where it operates. For a business that intends to operate nationally from the start, a CBCA incorporation can simplify inter-provincial operations.

Conversely, for a business that operates only in Ontario, an OBCA corporation is straightforward to maintain with the Ontario government and may have slightly lower ongoing compliance costs.

There are also differences in the director residency rules (historically the CBCA required a majority of Canadian-resident directors; that has been reduced, and the CBCA still generally requires that at least 25% of a federal corporation's directors be resident Canadians (or at least one director if the board has fewer than four)) and in certain technical share rules. A corporate lawyer can help you choose the right incorporating jurisdiction for your specific circumstances, and can advise on any share structure implications of that choice.