Like any legislation, the Bank Act contains phrases, words, and sentences that are worded to ensure a specific legal outcome. The “Definitions” section provides meaning to most of these key terms. However, definitions are also contained in other sections of the Act.
To assist readers, The 2023 Annotated Bank Act (Thomson Reuters, 2022) provides commentary on specific phrases and words, including those in the definitions section, and cross-references to other relevant sections of the Act. Additionally, the book includes case law where applicable to ensure a holistic view of the legislation and how it is applied in practice. This post will touch on some of the definitions contained within the book, beginning with “affairs” in Part I, s.2.
“Affairs” is the first definition in Part I of the Bank Act, and is explained with a paragraph of text. Included within this definition are several other terms that are later defined, including “affiliate,” “authorized foreign bank,” and the term “bank” itself. Like many definitions, the definition of “affairs” is similar to that provided in the Canada Business Corporations Act (CBCA). It has additionally been amended, first in 2001 and later in 2010, to apply to bank holding companies and federal credit unions. Essentially, the term encapsulates all interactions in the relationship between banks, authorized foreign banks, and their affiliates, shareholders, members, et cetera.
Another nuanced definition is “bank,” which refers to “a bank listed in Schedule I or II.” The schedules are then later defined in s.14(1), with Schedule I pertaining to banks that are not subsidiaries of foreign banks and Schedule II being banks that are subsidiaries of foreign banks.
Similarly, the term “branch” is defined, and this definition is divided into two parts. The first is for banks, and the second is for authorized foreign banks. While the first definition requires the bank’s head office to be maintained in the province specified in its incorporating instrument, the latter applies to an agency, principal office or any other office in Canada carrying on the business of a foreign bank. Section 2 of the Bank Act later explains that “principal office” refers to the office that a foreign bank is required to maintain specific to its order for carrying out business.
These examples illustrate the technicalities of the Bank Act. While the definitions, at first, seem straightforward, they reference terms that are defined elsewhere in the Act, and thus must be read together.
To learn more about these examples and other terms, and to review case law pertinent to their definitions, check out pages 6-34 of The 2023 Annotated Bank Act (Thomson Reuters, 2022).