Does my Ontario corporation have to hold an annual shareholders' meeting every year?

Yes. Under the Ontario Business Corporations Act, a corporation must hold an annual meeting of shareholders not later than eighteen months after incorporation and then not more than fifteen months after the last annual meeting. At the annual meeting, shareholders typically elect directors, appoint the auditor (or pass a resolution not to appoint one for smaller corporations), and receive the financial statements.

For private corporations with relatively few shareholders, it is very common for shareholders to sign a written resolution in lieu of actually holding a meeting. This is permitted under the Act and achieves the same legal result as a formal meeting, provided the resolution is signed by all shareholders entitled to vote. The written resolution should cover all business that would have been conducted at the meeting.

Whether you hold a meeting or use a written resolution, the documentation should be kept in the corporate minute book. Failing to hold annual meetings or document them properly can cause problems during due diligence if you sell the business, raise financing, or face a shareholder dispute. Keeping annual resolutions current takes little time and prevents larger headaches later.