What is the difference between a corporation's articles and its bylaws in Ontario?
Articles of incorporation are the constitutional document of an Ontario corporation. They are filed with the government when the corporation is formed and set out fundamental details: the corporation's name, the number of directors, the authorized share structure, any restrictions on share transfers, and any restrictions on the business the corporation may carry on. Changes to the articles require a special shareholder resolution and a government filing (articles of amendment).
Bylaws are the internal rules that govern how the corporation operates on a day-to-day basis. They typically cover things like how directors are elected, how meetings are called and conducted, borrowing powers, and how officers are appointed. Unlike articles, bylaws are not filed with the government. Directors can adopt or amend bylaws, but shareholders must confirm bylaw amendments at the next annual meeting.
Think of the articles as the constitution and the bylaws as the operating rules. Both documents live in the corporate minute book and both are important, but they serve different functions and are amended through different processes. Keeping both current and consistent with each other is part of good corporate housekeeping.
Key takeaways
- Articles are the constitutional document, filed with and regulated by the government.
- Bylaws are internal operating rules, not filed with the government.
- Articles require a shareholder special resolution to amend; bylaws can be changed by directors.
- Both documents belong in the corporate minute book.