F-3.2.1 - Act to establish the Fonds de solidarité des travailleurs et des travailleuses du Québec (FTQ)

Updated to 1 November 2024

This document has official status.

chapter F-3.2.1

Act to establish the Fonds de solidarité des travailleurs et des travailleuses du Québec (FTQ)

The Minister of Finance is responsible for the administration of this Act. Order in Council 1689-2022 dated 26 October 2022, (2022) 154 G.O. 2 (French), 6581.

1983, c. 58; 2024, c. 11, s. 31.

WHEREAS the Fédération des travailleurs et travailleuses du Québec has proposed the establishment of an investment fund for the objectives, mainly, of promoting job maintenance and job creation, stimulating the economy and training workers in economic matters;

Whereas, to achieve those objectives, an appeal will be made to the solidarity of the working men and women of Québec;

Whereas it is expedient to accede to the request of the Fédération des travailleurs et travailleuses du Québec;

Whereas the establishment of such a fund requires the enactment of special legislation regarding both its organization and the protection of the investors concerned;

THE PARLIAMENT OF QUÉBEC ENACTS AS FOLLOWS:

1983, c. 58, pream.; 2024, c. 11, s. 32.

DIVISION I ARTICLES

§ 1 . — Constitution and head office

1999, c. 40, s. 139.

1. A joint-stock company is hereby constituted under the name “Fonds de solidarité des travailleurs du Québec (F.T.Q.)”. It continues its existence under the name “Fonds de solidarité des travailleurs et des travailleuses du Québec (FTQ)”, hereinafter called the “Fund”.

1983, c. 58, s. 1; 1999, c. 40, s. 139; 2024, c. 11, s. 33.

2. Notwithstanding section 125 of the Companies Act (chapter C-38), the provisions of that Act which are applicable to companies constituted by the filing of articles apply to the Fund, with the necessary modifications, where they are not inconsistent with this Act, except the second paragraph of section 46, subsection 1 of section 53, section 54, sections 123.9 to 123.11, 123.21 to 123.27, 123.55, 123.72, 123.82, 123.91 to 123.93, 123.95, 123.96, 123.98 to 123.100, the second paragraph of section 123.114 and sections 123.115 to 123.139.

The Fund is deemed to have been constituted by the filing of articles on 23 June 1983.

The articles may be amended, but no filing of articles may result in the amendment of any provision of this Act.

1983, c. 58, s. 2; 1993, c. 48, s. 421; 1999, c. 40, s. 139.

3. The head office of the Fund is established in the territory of Ville de Montréal.

1983, c. 58, s. 3; 2000, c. 56, s. 219.

§ 2 . — Management

4. The affairs of the Fund are managed by a board of directors consisting of

(1)  seven persons appointed by the Conseil général of the Fédération des travailleurs et travailleuses du Québec;

(2)  eleven persons, elected by the general meeting of holders of class “A” shares, of whom

(a)  seven qualify as independent persons and their candidacy is recommended to the board by the governance and ethics committee;

(b)  four are elected from among the candidates selected following an invitation for applications;

(3)  (subparagraph repealed);

(4)  the president and chief executive officer of the Fund, for the duration of his term of office.

The members of the board of directors, other than the president and chief executive officer of the Fund, may not hold office for more than 12 years. However, this time limit does not apply to the president or secretary general of the Fédération des travailleurs et travailleuses du Québec.

1983, c. 58, s. 4; 1993, c. 47, s. 1; 2007, c. 12, s. 10; 2015, c. 8, s. 321.

4.1. Persons qualify as independent persons if, in the opinion of the board of directors, they have no direct or indirect relation or interest, for example of a financial, commercial, professional or philanthropic nature, that might compromise their judgment as regards the interests of the Fund.

A person is deemed not to be independent if that person

(1)  is, or was in the three years prior to being elected or appointed,

(a)  an employee or officer of the Fund or one of its subsidiaries, except if the person is an officer solely because the person is a member of the Fund’s or subsidiary’s board of directors; or

(b)  an employee, officer or director of the Fédération des travailleurs et travailleuses du Québec or of a union or other body that, under its articles, is affiliated with it; or

(2)  has an immediate family member who is an officer of the Fund or of an employer referred to in subparagraph 1.

The board shall adopt a policy to determine whether a person in a situation submitted to it qualifies as an independent person.

“Officer” and “subsidiary” have the meanings assigned to them by the Securities Act (chapter V-1.1). In addition, a person’s immediate family members are the person’s spouse, father, mother or parent, child, brother, sister, father-in-law, mother-in-law, son-in-law, daughter-in-law, brother-in-law or sister-in-law, or any other person who shares that person’s dwelling, except an employee of that person.

2015, c. 8, s. 322; 2016, c. 7, s. 182; 2022, c. 22, s. 234.

4.2. The members of the board of directors shall elect, from those among them who qualify as independent persons, the chair of the board.

2015, c. 8, s. 322.

5. If a vacancy occurs among the members of the board of directors contemplated in subparagraph 1 of the first paragraph of section 4, the Conseil général of the Fédération des travailleurs et travailleuses du Québec may appoint a person for the unexpired portion of the term.

1983, c. 58, s. 5; 2015, c. 8, s. 323.

6. (Repealed).

1983, c. 58, s. 6; 2002, c. 45, s. 513; 2015, c. 8, s. 324.

6.1. The board of directors shall set up a governance and ethics committee and a human resources committee.

These committees are composed exclusively of board members. They are chaired by a member who qualifies as an independent person, and may only deliberate and make decisions in the presence of a majority of independent members.

The chair of the board shall see to the proper operation of the committees.

2015, c. 8, s. 325.

6.2. The functions of the governance and ethics committee include

(1)  for the election of board members by the general meeting of holders of class “A” shares:

(a)  ensuring that the board represents a diversity of expertise and experience;

(b)  examining candidates’ past experience;

(c)  recommending to the board, for the purposes of subparagraph a of subparagraph 2 of the first paragraph of section 4, the candidacy of persons who, in light of the committee’s examination, qualify as independent persons; and

(d)  determining the conditions governing the invitation for applications under subparagraph b of subparagraph 2 of the first paragraph of section 4, as well as the applicant eligibility criteria;

(2)  developing a policy to determine whether a person in a situation submitted to the board qualifies as an independent person; and

(3)  giving the board its assessment as to whether a person, in light of the committee’s examination, qualifies as an independent person, except in the case of board members whose candidacy the committee has recommended.

2015, c. 8, s. 325.

6.3. The functions of the human resources committee include

(1)  developing and proposing to the board an expertise and experience profile for the appointment of the president and chief executive officer; and

(2)  developing and proposing criteria for evaluating the performance of the president and chief executive officer, and making recommendations to the board as regards his terms of employment, including remuneration.

2015, c. 8, s. 325.

6.4. The president and chief executive officer is appointed by the board members mentioned in subparagraphs 1 and 2 of section 4.

The term of office of the president and chief executive officer may not exceed five years. A person appointed to that office may be reappointed each time the appointing members consider such reappointment to be appropriate in light of the president and chief executive officer’s performance evaluation.

The president and chief executive officer may not be an employee, officer or director of the Fédération des travailleurs et travailleuses du Québec or of a union or other body that, under its articles, is affiliated with it.

2015, c. 8, s. 325.

§ 3 . — Share capital

7. Subject to section 15.1, the Fund is authorized to issue class “A” shares without par value, giving the rights provided for in section 123.40 of the Compagnies Act (chapter C-38), the right to elect 11 directors and the right of redemption provided for in sections 10 and 11.

The Fund is also authorized, subject to section 15.1, to issue class “A” fractional shares without par value, giving proportionately the same rights as class “A” shares, except the voting rights attached to such shares.

The Fund may, by articles of amendment,

(1)  create one or more series of class “A” shares that include, in addition to the rights set out in the first paragraph, either the right to be exchanged for shares of another series or any other characteristic not inconsistent with this Act;

(2)  convert in whole or in part the class “A” shares held by the shareholders or certain shareholders into one or more series of shares created under subparagraph 1, on terms and conditions which may, where expedient and with the authorization of the Minister of Finance, depart from subsections 6 and 7 of section 48 or from section 49 of the Companies Act (chapter C-38).

The directors may also, by articles of amendment according to sections 123.101 and 123.103 of the Companies Act, create any other class of shares which does not give the right to vote at meetings of the shareholders. The articles of amendment determine the other rights, privileges, conditions and restrictions attached to the shares of each class.

1983, c. 58, s. 7; 1989, c. 78, s. 1; 1997, c. 62, s. 1; 2015, c. 8, s. 326.

8. Subject to section 123.56 of the Companies Act (chapter C-38), only a person of full age may acquire or hold class “A” shares or fractional shares. No holder of class “A” shares or fractional shares may alienate them and no such shares or fractional shares may be purchased by agreement by the Fund, except with the authorization of the board of directors or a committee composed of persons designated by it for that purpose.

The Fund may purchase class “A” shares or fractional shares by agreement only where and so far as provided by a policy adopted by the board of directors and approved by the Minister of Finance and only at a price not in excess of the price of redemption fixed in accordance with the second or third paragraph of section 11.

1983, c. 58, s. 8; 1986, c. 69, s. 1; 1989, c. 78, s. 2; 1993, c. 47, s. 2; 2024, c. 11, s. 34.

9. Notwithstanding section 8, class “A” shares or fractional shares may be transferred to a trustee within the scope of a registered retirement savings plan under which the shareholder or the spouse of the shareholder is the beneficiary. The beneficiary of the plan is deemed, however, to keep the voting rights attached to the shares thus transferred. For the purposes of the second paragraph of section 8 and section 10, the spouse is deemed to be the person who acquired the transferred share or fractional share from the Fund.

Subject to section 9.1, the trustee is, however, subject to section 8 in respect of any transfer to a person other than the beneficiary of the plan.

1983, c. 58, s. 9; 1989, c. 78, s. 3; 2001, c. 51, s. 11.

9.1. Notwithstanding section 8, class “A”, share or fractional share, held within the scope of a registered retirement savings plan under which the shareholder or the spouse or former spouse of the shareholder is the beneficiary, may be transferred to a trustee within the scope of another registered retirement savings plan or a registered retirement income fund under which the shareholder or the spouse or former spouse of the shareholder is the beneficiary. The beneficiary of that other plan or of that fund is deemed, however, to keep the voting rights attached to the share thus transferred. For the purposes of the second paragraph of section 8 and section 10, the spouse or former spouse is deemed to be the person who acquired the transferred share or fractional share from the Fund.

Subject to the first paragraph and section 9.2, the trustee is, however, subject to section 8 in respect of any transfer to a person other than the beneficiary of that other plan or of that fund.

2001, c. 51, s. 12; 2021, c. 15, s. 61.

9.2. Notwithstanding section 8, class “A” share or fractional share, held within the scope of a registered retirement income fund under which the shareholder or the spouse or former spouse of the shareholder is the beneficiary, may be transferred to a trustee within the scope of another registered retirement income fund or registered retirement savings plan, as the case may be, under which the shareholder or the spouse or former spouse of the shareholder is the beneficiary. The beneficiary of that other fund or plan is deemed, however, to keep the voting rights attached to the share thus transferred. For the purposes of the second paragraph of section 8 and section 10, the spouse or former spouse is deemed to be the person who acquired the transferred share or fractional share from the Fund.

Subject to the first paragraph, the trustee is, however, subject to section 8 in respect of any transfer to a person other than the beneficiary of that other fund or plan.

2001, c. 51, s. 12; 2021, c. 15, s. 61.

10. A class “A” share or fractional share is redeemable by the Fund only in the following cases:

(1)  at the request of a person who has reached 45 years of age and has availed himself of his right to early retirement or retirement or who has reached 65 years of age, if the person acquired the share or fractional share from the Fund at least

(a)  two years prior to the request, where the acquisition occurred before 1 June 2024,

(b)  three years prior to the request, where the acquisition occurred after 31 May 2024 and before 1 June 2025,

(c)  four years prior to the request, where the acquisition occurred after 31 May 2025 and before 1 June 2026, or

(d)  five years prior to the request, where the acquisition occurred after 31 May 2026;

(2)  at the request of a shareholder, who did not acquire the share or fractional share from the Fund, if the person who acquired it from the Fund has reached 65 years of age or, if deceased, would have reached that age had he lived, provided that, in either case, the share or fractional share was issued by the Fund at least

(a)  two years prior to the date of redemption, where the share or fractional share was issued before 1 June 2024,

(b)  three years prior to the date of redemption, where the share or fractional share was issued after 31 May 2024 and before 1 June 2025,

(c)  four years prior to the date of redemption, where the share or fractional share was issued after 31 May 2025 and before 1 June 2026, or

(d)  five years prior to the date of redemption, where the share or fractional share was issued after 31 May 2026;

(3)  at the request of the person on whom the share or fractional share has devolved by succession;

(3.1)  at the request of the person who is a beneficiary under a registered retirement savings plan within the scope of which the share or fractional share has been transferred to the plan’s trustee by an individual who was the person’s spouse at the time of the transfer, if the individual is deceased;

(4)  at the request of the person who acquired the share or fractional share from the Fund, if he applies to it therefor in writing within 60 days of subscribing the share or fractional share or, in the case provided for in section 26, within 60 days of the first deduction from his salary or wages;

(5)  at the request of the person who acquired the share or fractional share from the Fund, if he is declared, in the manner prescribed by the Fund, to be suffering from a severe and prolonged physical or mental disability which prevents him from working.

1983, c. 58, s. 10; 1989, c. 5, s. 6; 1989, c. 78, s. 4; 1997, c. 14, s. 6; 2011, c. 6, s. 91; 2021, c. 15, s. 62; 2024, c. 11, s. 35.

10.0.1. For the purposes of paragraph 1 of section 10, a person is considered to have availed himself of his right to early retirement or retirement if, at the time of the request for redemption referred to in that paragraph,

(1)  the person has reached 45 years of age and is taking or will, within three months after the day of the request, be taking an early retirement under a registered pension plan and his estimated work income for the 12 months following the beginning of the early retirement does not exceed 25% of the Maximum Pensionable Earnings established for the year of the request under the Act respecting the Québec Pension Plan (chapter R-9);

(2)  the person has reached 60 years of age and receives or will, within three months after the day of the request, receive a retirement pension under the Act respecting the Québec Pension Plan or under a similar plan within the meaning of that Act;

(3)  the person has reached 50 years of age and has stopped working or has entered into an agreement with the person’s employer to reduce regular working time by 20% or more until retirement;

(4)  the person has reached 55 years of age and receives or will, within three months after the day of the request, receive a life annuity under a pension plan, an annuity under a registered retirement savings plan or a deferred profit sharing plan or a payment under a registered retirement income fund, unless the annuity or payment is received because of the death of his spouse;

(5)  the person has reached 45 years of age, is an annuitant under a registered retirement savings plan or a registered retirement income fund and did not hold any remunerated employment or carry on any business in the 730 days preceding the day of the request, and the person who is his spouse at the time, other than a person who has not reached 60 years of age and who has entered into an agreement with his employer to reduce his regular working time by 20% or more until retirement, meets the conditions set out in any of paragraphs 1 to 4; or

(6)  the person meets the conditions set out in a resolution adopted by the board of directors of the Fund and approved by the Minister of Finance.

For the purposes of subparagraph 3 of the first paragraph, a person is deemed to have stopped working where the person’s estimated work income for the 12 months following the day of the request for redemption referred to in that paragraph does not exceed 25% of the Maximum Pensionable Earnings established for the year of the request under the Act respecting the Québec Pension Plan.

2011, c. 6, s. 92; 2015, c. 21, s. 36.

10.0.2. If a request for redemption is made under paragraph 1 of section 10 by a person who has not reached 60 years of age and the request is based on the grounds that the person has entered into an agreement with his employer to reduce his regular working time by 20% or more until retirement, the amount to be redeemed may not exceed, for a year, the lesser of

(1)  the salary reduction incurred by the person for the year; and

(2)  the quotient obtained by dividing the balance of the person’s share or fractional share account at the time of his first request for redemption based on those grounds by the number of years, not exceeding 11, that the agreement is to cover.

2011, c. 6, s. 92.

10.1. For the purposes of paragraph 5 of section 10, a disability is severe only if by reason thereof the person is incapable regularly of pursuing any substantially gainful occupation.

However, in the case of a person 60 years of age or over, a disability is severe if by reason thereof the person is incapable regularly of carrying on the substantially gainful occupation he holds at the time he ceases to work owing to his disability.

A disability is prolonged only if it is likely to result in death or to be of indefinite duration.

1989, c. 5, s. 7; 1997, c. 14, s. 7.

11. Subject to the second paragraph of section 123.54 of the Companies Act (chapter C-38), the Fund is bound to redeem any class “A” share or fractional share at the request of a person contemplated in paragraph 1, 2, 3 or 5 of section 10.

The price of redemption of the shares and fractional shares shall be fixed twice a year at dates six months apart, by the board of directors, on the basis of the value of the Fund as established by experts under the responsibility of a firm of chartered accountants according to generally accepted accounting principles and adjusted, if necessary, to reflect the fair value of investments in enterprises the Fund controls, in joint ventures and in enterprises on which it has significant influence or in which it holds variable interests.

The board of directors may also fix the price of redemption contemplated in the second paragraph at any other time in the year, on the basis of an internal valuation that, in each case, is presented in an accounting expert’s report confirming continued adherence to the principles and methods used to value the Fund and referred to in the second paragraph.

The Fund may, however, accept the offer of a shareholder to receive the last price of redemption so fixed rather than the subsequent one. The redemption contemplated in the first paragraph shall be made within a reasonable time after the date on which the request therefor is made.

However, in the case provided for in paragraph 4 of section 10, the Fund is bound to redeem the share or fractional share at the price at which it was acquired from the Fund and to pay the price thereof not later than 30 days after the date of receipt of the request.

1983, c. 58, s. 11; 1989, c. 5, s. 8; 1989, c. 78, s. 5; 1993, c. 47, s. 3; 1997, c. 14, s. 8; 2009, c. 13, s. 3.

11.1. A request for purchase by agreement made under section 8, a request for transfer made under section 9.1 or 9.2 and a request for redemption made under section 10 must be filed with the Fund in the form prescribed by the Fund and accompanied by the information and documents required by the Fund.

2011, c. 6, s. 93; 2021, c. 15, s. 63.

12. Each shareholder is entitled to receive written confirmation of the number of shares or fractional shares he holds and of the amount paid thereon.

The confirmation is provided to the shareholder free of charge once yearly under the form and modalities prescribed by the Fund.

Where a mode of confirmation other than a share certificate is prescribed, the document sent to the shareholder serves as a certificate issued under section 53 of the Companies Act (chapter C-38).

Moreover, the Fund, at the request of a shareholder of fractional shares, must exchange the fractional share certificates or the documents serving as such for certificates or documents serving as such representing corresponding whole shares.

1983, c. 58, s. 12; 1989, c. 78, s. 6; 2021, c. 15, s. 64.

DIVISION II INVESTMENTS

§ 1 . — Functions and interpretation

2015, c. 8, s. 327.

13. The main functions of the Fund are

(1)  to encourage retirement savings among Québec workers by, in particular, issuing shares, so that they can have a decent retirement;

(2)  to invest development capital and venture capital in eligible Québec enterprises and provide them with support services to deal with the issues with which they are confronted, in order to create, maintain and protect jobs and better prepare Québec workers and enterprises for the future;

(3)  to promote the training of workers on the economy, retirement, climate change and other matters of importance to Québec’s economy and thereby enable workers to increase their influence on the economic development of Québec and of their enterprise; and

(4)  to create value by stimulating the Québec economy by making strategic investments that will be of benefit to Québec workers and enterprises.

1983, c. 58, s. 13; 1997, c. 62, s. 2; 2007, c. 12, s. 11; 2024, c. 11, s. 36.

14. For the purposes of this Act, an enterprise is a partnership, a legal person or a social trust pursuing economic objects; investment includes any financial assistance granted to an enterprise in the form of a loan, security, guarantee, purchase of capital stock of any other form.

1983, c. 58, s. 14; 1983, c. 54, s. 114; 1999, c. 40, s. 139; 2007, c. 12, s. 12; 2017, c. 1, s. 49; 2024, c. 11, s. 37.

14.1. For the purposes of this Act, “eligible Québec enterprise” means an enterprise in active operation in Québec that

(1)  is Québec-owned; or

(2)  has a main decision-making centre that is operated in Québec.

1983, c. 54, s. 114; 1989, c. 78, s. 7; 1997, c. 62, s. 3; 2005, c. 1, s. 8; 2005, c. 38, s. 34; 2007, c. 12, s. 13; 2012, c. 8, s. 30; 2024, c. 11, s. 38.

§ 2 . — Prior approval of investments

2015, c. 8, s. 328.

14.2. Each investment must be approved in advance by the board of directors after being favourably recommended by the investment committee charged with examining it.

However, to the extent it determines, the board may delegate the power to approve an investment to such a committee or, in cases it considers exceptional or urgent, to a committee composed of officers of the Fund or to the president and chief executive officer.

2015, c. 8, s. 328.

14.3. The board of directors must set up at least one investment committee.

If it sets up more than one investment committee, the board must specify the economic sector in which the investments each committee is responsible for are to be made, and one committee must have jurisdiction over investments not covered by the other committees.

2015, c. 8, s. 328.

14.4. An investment committee may be composed of persons who are not members of the board of directors. It must be chaired by one of its members who qualifies as an independent person, and may only deliberate and make decisions in the presence of a majority of independent persons.

2015, c. 8, s. 328.

§ 3 . — Investments

2015, c. 8, s. 328.

15. The Fund may make investments with or without a guarantee or security.

However, for a fiscal year, the Fund’s eligible investments must represent, on the average, at least 65% of its average net assets for the preceding fiscal year.

For the purposes of this section and section 15.1, the following rules apply:

(1)  the Fund’s average net assets for a fiscal year must be determined by adding its net assets at the beginning of that year, its net assets at the end of that year and its net assets at the beginning of the preceding fiscal year, then dividing the sum so obtained by 3;

(2)  the net assets do not include the movable or immovable property used by the Fund to carry on its operations; and

(3)  the average eligible investments for a fiscal year must be determined by the formula

[(A + B + C + CA – 1 + CA – 2 + D)/3] + E.

In the formula in subparagraph 3 of the third paragraph,

(1)  A is the Fund’s eligible investments at the beginning of the fiscal year, excluding those described in subparagraph b of subparagraphs 1 to 3 of the first paragraph of section 15.0.3 that were disinvested before that time;

(2)  B is the Fund’s eligible investments at the end of the fiscal year, excluding those described in subparagraph b of subparagraphs 1 to 3 of the first paragraph of section 15.0.3 that were disinvested before that time;

(3)  C is the amount by which an amount that is the total of the eligible investments already made by the Fund that were disinvested in the fiscal year, exceeds an amount equal to 2% of the Fund’s average net assets for the preceding fiscal year;

(4)  CA – 1 is the amount determined under subparagraph 3 for the preceding fiscal year;

(4.1)  CA – 2 is the amount determined under subparagraph 3 for the second preceding fiscal year;

(4.2)  D is the Fund’s eligible investments at the beginning of the preceding fiscal year, excluding those described in subparagraph b of subparagraphs 1 to 3 of the first paragraph of section 15.0.3 that were disinvested before that time; and

(5)  E is the amount designated by the Fund for the fiscal year, which amount may not exceed the lesser of $500,000,000 and the amount determined for the fiscal year by the formula

(FA − 1 − GA − 2) + {(FA − 2 − GA − 3) − [EA − 1 − (FA − 3 − GA − 4)]}.

In the formula in subparagraph 5 of the fourth paragraph,

(1)  EA − 1 is the amount designated by the Fund under subparagraph 5 of the fourth paragraph for the preceding fiscal year or, in the absence of such a designation, an amount equal to zero;

(2)  FA − 1 is the amount of the Fund’s average eligible investments for the preceding fiscal year, which amount is determined as if the formula in subparagraph 3 of the third paragraph were read without reference to “+ E”;

(3)  FA − 2 is the amount of the Fund’s average eligible investments for the second preceding fiscal year, which amount is determined as if the formula in subparagraph 3 of the third paragraph were read without reference to “+ E”;

(4)  FA − 3 is the amount of the Fund’s average eligible investments for the third preceding fiscal year, which amount is determined as if the formula in subparagraph 3 of the third paragraph were read without reference to “+ E”;

(5)  GA – 2 is 65% of the Fund’s average net assets for the second preceding fiscal year;

(6)  GA – 3 is 65% of the Fund’s average net assets for the third preceding fiscal year;

(7)  GA – 4 is 65% of the Fund’s average net assets for the fourth preceding fiscal year; and

(8)  where the result of a subtraction is less than zero, it is deemed to be equal to zero.

1983, c. 58, s. 15; 1989, c. 78, s. 8; 1992, c. 57, s. 585; 1997, c. 62, s. 4; 2004, c. 21, s. 34; 2005, c. 23, s. 28; 2005, c. 38, s. 35; 2006, c. 36, s. 15; 2007, c. 12, s. 14; 2011, c. 6, s. 94; 2012, c. 8, s. 31; 2013, c. 10, s. 8; 2015, c. 21, s. 37; 2017, c. 1, s. 50; 2019, c. 14, s. 42; 2020, c. 16, s. 12; 2021, c. 36, s. 35; 2023, c. 19, s. 7; 2024, c. 11, s. 39.

15.0.0.1. (Repealed).

2012, c. 8, s. 32; 2013, c. 10, s. 9; 2024, c. 11, s. 40.

15.0.1. (Repealed).

2005, c. 38, s. 36; 2006, c. 36, s. 16; 2007, c. 12, s. 15; 2012, c. 8, s. 33; 2013, c. 10, s. 10; 2024, c. 11, s. 40.

15.0.2. (Repealed).

2005, c. 38, s. 36; 2006, c. 36, s. 17; 2017, c. 1, s. 51; 2024, c. 11, s. 40.

15.0.3. For the purposes of section 15, the following investments are eligible investments:

(1)  investments that belong to the class of Québec enterprises, which includes

(a)  investments entailing, subject to section 15.0.5, no security or hypothec, made after 31 May 2024 in accordance with a comprehensive investment policy adopted by the board of directors of the Fund and approved by the Minister of Finance, each of which is

i.  an investment made by the Fund in an eligible Québec enterprise,

ii.  an investment made by the Fund otherwise than as first purchaser for the acquisition of securities issued by an eligible Québec enterprise, or

iii.  a new investment or a reinvestment made by the Fund in an enterprise it held in its portfolio at the end of 31 May 2024, where the initial investment is included in this class, and

(b)  investments of the Fund at the end of 31 May 2024, each of which is

i.  an investment described in any of subparagraphs 1, 2 and 4 to 6 of the sixth paragraph of section 15, as it read in its application to the Fund’s fiscal year ended on that date (in this section referred to as the “former version”), including an investment deemed to have been made by the Fund and described in any of those subparagraphs because of the eighth paragraph of that section, in the same version, or

ii.  an investment described in the seventh paragraph of section 15, in its former version, including an investment deemed to have been made by the Fund and described in that paragraph because of the eighth paragraph of that section, in the same version;

(2)  investments that belong to the class of Québec investment funds, which includes

(a)  investments entailing no security or hypothec and made after 31 May 2024 in accordance with the comprehensive investment policy, each of which is

i.  an investment made by the Fund in an investment fund managed in Québec, with the expectation that the fund directly or indirectly invest an amount in eligible Québec enterprises that is at least equal to the sums received from the Fund, or

ii.  a new investment or a reinvestment made by the Fund in a limited partnership or a fund it held in its portfolio at the end of 31 May 2024, where the initial investment is included in this class, and

(b)  investments of the Fund at the end of 31 May 2024, each of which is

i.  an investment described in any of subparagraphs 8, 9, 12, 13 and 15 to 17 of the sixth paragraph of section 15, in its former version, including an investment deemed to have been made by the Fund and described in any of those subparagraphs because of the ninth paragraph of that section, in the same version, or

ii.  an investment described in subparagraph 14 of the sixth paragraph of section 15, in its former version, including an investment deemed to have been made by the Fund and described in that subparagraph because of the eighth paragraph of that section, in the same version; and

(3)  investments that belong to the class of other interventions for the benefit of Québec, which includes

(a)  investments entailing no security or hypothec and made after 31 May 2024 in accordance with the comprehensive investment policy, each of which is

i.  an investment made by the Fund, or any of its wholly-controlled subsidiaries, in the real estate sector in relation to a new or substantially renovated income-producing immovable situated in Québec, provided that the investment generates societal benefits for Québec in accordance with the rules set out in that respect in the comprehensive investment policy, or

ii.  an investment that is made by the Fund in an investment fund managed outside Québec and that is an investment described in the third paragraph, up to the amount invested by that fund in eligible Québec enterprises, where this section applies to a fiscal year of the Fund that is subsequent to the second fiscal year that follows the fiscal year in which that investment was made, and

(b)  investments of the Fund at the end of 31 May 2024, each of which is

i.  an investment described in subparagraph 3 of the sixth paragraph of section 15, in its former version, including an investment deemed to have been made by the Fund and described in that subparagraph because of the eighth paragraph of that section, in the same version, except an investment not permitted under the thirteenth paragraph of that section, in the same version, or

ii.  an investment described in subparagraph 7 of the sixth paragraph of section 15, in its former version, including an investment deemed to have been made by the Fund and described in that subparagraph because of the eighth paragraph of that section, in the same version.

For the purposes of subparagraph ii of subparagraph a of subparagraph 1 of the first paragraph of this section and the third paragraph of section 15.0.4, a dealer acting as an intermediary or firm underwriter is not considered to be a first purchaser of securities.

The investment to which subparagraph ii of subparagraph a of subparagraph 3 of the first paragraph refers is either an investment that the Fund has agreed to make, at any time in a fiscal year that begins after 31 May 2024, with an investment fund managed outside Québec and for which the Fund has committed but not yet disbursed sums at the end of that fiscal year, on the condition that such an investment be taken into account to determine whether the Fund complies with the requirement of the second paragraph of section 15 for that fiscal year, or, where that condition is not met, each of the sums subsequently disbursed by the Fund because of that investment.

2024, c. 11, s. 41.

15.0.4. An investment that was agreed to by the Fund at any time after 31 May 2024, for which it has committed but not yet disbursed sums at the end of a fiscal year and that would have been an eligible investment within the meaning of section 15.0.3 if it had been made by the Fund at that time is deemed, for the purposes of that section, to have been made by the Fund at that time.

In addition, an investment made by the Fund, at any time after 31 May 2024, in an entity that is not an enterprise within the meaning of section 14 and that is either a partnership (other than a partnership that is an investment fund) or a legal person, for the purpose of investing in a particular enterprise, is deemed, for the purposes of subparagraph i or iii of subparagraph a of subparagraph 1 of the first paragraph of section 15.0.3, to be an investment made at that time by the Fund in the particular enterprise.

Similarly, an investment made, at any time after 31 May 2024, by an entity that is neither an enterprise within the meaning of section 14 nor an investment fund otherwise than as first purchaser for the acquisition of securities issued by an enterprise is deemed, for the purposes of subparagraph ii of subparagraph a of subparagraph 1 of the first paragraph of section 15.0.3, to have been made, at that time, by the Fund in proportion to its share in the entity, if one of the main reasons for which the Fund holds an interest in the entity is to enable the financing of such an acquisition.

2024, c. 11, s. 41.

15.0.5. For the purpose of including an investment made after 31 May 2024 in a class provided for in section 15.0.3, the following rules apply:

(1)  the mere fact that such an investment entails a security does not prevent it from being included in the class provided for in subparagraph 1 of the first paragraph of that section to the extent that it is part of a financing package, in which Fonds de transfert d’entreprise du Québec, s.e.c. participates, for the succession of an enterprise;

(2)  where such an investment is made in an enterprise that is an investment fund, it may only be included in the class provided for in subparagraph 2 of the first paragraph of that section; and

(3)  where such an investment is made in the real estate sector in relation to a new or substantially renovated income-producing immovable situated in Québec, it may only be included in the class provided for in subparagraph 3 of the first paragraph of that section.

2024, c. 11, s. 41.

15.0.6. In respect of investments included in the class provided for in subparagraph 2 of the first paragraph of section 15.0.3, the following rules apply:

(1)  such investments are deemed to be increased by 50% if they are investments made in Fonds de transfert d’entreprise du Québec, s.e.c.;

(2)  where such investments are taken into account for the purposes of the second paragraph of section 15 for a fiscal year of the Fund that ends before 1 January 2027, they are, up to 5% of the Fund’s net assets at the end of the preceding fiscal year, deemed to be increased by 50% if they are investments made by the Fund after 21 April 2005 and before 1 June 2026 in a local venture capital fund established and managed in Québec or in a local fund recognized by the Minister of Finance, with the expectation that that fund invest an amount at least equal to 150% of the aggregate of the sums received from the Fund, from Fondaction, le Fonds de développement de la Confédération des syndicats nationaux pour la coopération et l’emploi and from Capital régional et coopératif Desjardins in Québec enterprises whose assets are less than $100,000,000 or whose net equity is less than $50,000,000; and

(3)  the investments are deemed to be increased by 25% if they are investments made in Fonds de solidarité FTQ Pôles Logistiques, S.E.C., but the aggregate of those investments may not, before the increase, exceed $100,000,000 for the purposes of the second paragraph of section 15 for a fiscal year of the Fund.

For the purposes of the first paragraph, the Fund’s net assets must be determined by taking into account subparagraph 2 of the third paragraph of section 15. In addition, the assets or net equity of an enterprise are the assets or net equity shown in its financial statements for its fiscal year ended before the time at which the investment is made, minus the write-up surplus of its property and the incorporeal assets. In the case of an enterprise which has not completed its first fiscal year, a chartered accountant must confirm in writing to the Fund that the assets or net equity, as the case may be, of the enterprise are, immediately before the investment, under the limits provided for in subparagraph 2 of the first paragraph.

2024, c. 11, s. 41.

15.0.7. Any investment of the Fund at the end of 31 May 2024 included in the class provided for in subparagraph 3 of the first paragraph of section 15.0.3 that is an investment described in subparagraph 1 or 2 of the first paragraph of section 15.0.1, as it read in its application before being repealed, must, for any fiscal year of the Fund beginning after that date, be limited to the same extent as it would have been if section 15.0.1 had continued to apply in its respect.

2024, c. 11, s. 41.

15.0.8. For the purpose of applying section 15.0.3 to a fiscal year of the Fund, the following restrictions apply:

(1)  the aggregate of all investments each of which is an investment that is included in the class provided for in subparagraph 1 of the first paragraph of section 15.0.3 and that is an investment in a large enterprise within the meaning of section 15.0.9 may not exceed 30% of the Fund’s average net assets for the preceding fiscal year;

(2)  the aggregate of all investments each of which is an investment included in the class provided for in subparagraph 3 of the first paragraph of section 15.0.3 may not exceed 10% of the Fund’s average net assets for the preceding fiscal year; and

(3)  the aggregate of all investments each of which is one of the following investments may not exceed 12% of the Fund’s net assets at the end of the preceding fiscal year:

(a)  an investment that is deemed to have been made by the Fund and that is included in the class provided for in subparagraph 1 of the first paragraph of section 15.0.3 because of the first paragraph of section 15.0.4 or an investment that is, at the end of 31 May 2024, deemed to have been made by the Fund and that is included in that class as an investment described in subparagraph i or ii of subparagraph b of that subparagraph 1,

(b)  an investment that is deemed to have been made by the Fund in Fonds Valorisation Bois, s.e.c. and that is included in the class provided for in subparagraph 2 of the first paragraph of section 15.0.3 because of the first paragraph of section 15.0.4 or an investment that is, at the end of 31 May 2024, deemed to have been made by the Fund and that is included in that class as an investment described in subparagraph ii of subparagraph b of that subparagraph 2, or

(c)  an investment that is deemed to have been made by the Fund and that is included in the class provided for in subparagraph 3 of the first paragraph of section 15.0.3 because of the first paragraph of section 15.0.4 or an investment that is, at the end of 31 May 2024, deemed to have been made by the Fund and that is included in that class as an investment described in subparagraph i or ii of subparagraph b of that subparagraph 3.

For the purposes of the first paragraph, the following rules apply:

(1)  the Fund’s net assets and average net assets must be determined by taking into account the rules set out in the third paragraph of section 15;

(2)  no investment described in subparagraph b of subparagraphs 1 to 3 of the first paragraph of section 15.0.3 that was disinvested may be taken into account to determine an aggregate described in subparagraph 1 or 2 of the first paragraph; and

(3)  no investment that is, at the end of 31 May 2024, deemed to have been made by the Fund may be taken into account to determine the aggregate described in subparagraph 3 of the first paragraph, in the case where the investment has been made.

2024, c. 11, s. 41.

15.0.9. For the purposes of subparagraph 1 of the first paragraph of section 15.0.8, the following investments are investments in a large enterprise:

(1)  an investment made, at any time, in an enterprise whose assets are greater than $200,000,000 and whose net equity is greater than $100,000,000 at that time; and

(2)  an investment made, at any time, otherwise than as first purchaser for the acquisition of securities issued by an enterprise whose assets are greater than $200,000,000 and whose net equity is greater than $100,000,000 at that time.

For the purposes of the first paragraph, the assets and net equity of an enterprise at any time are those shown in its financial statements at that time, minus the write-up surplus of its property and the incorporeal assets.

2024, c. 11, s. 41.

15.1. If, for a particular fiscal year, the Fund fails to comply with the requirement of the second paragraph of section 15, the Fund may not issue class “A” shares or fractional shares in the following fiscal year for a total consideration exceeding the amount determined as follows:

(1)  75% of the total consideration paid for class “A” shares or fractional shares issued in the preceding fiscal year, excluding the total consideration paid for class “A” shares or fractional shares acquired and paid by payroll deduction in accordance with Division IV or acquired under a subscription agreement entered into with an employer in favour of the employer’s employees, if the percentage of the Fund’s average eligible investments for the particular fiscal year relative to the Fund’s average net assets for the preceding fiscal year is equal to or greater than 55% and less than 65%;

(2)  50% of the consideration if the percentage of the Fund’s average eligible investments for the particular fiscal year relative to the Fund’s average net assets for the preceding fiscal year is equal to or greater than 45% and less than 55%; or

(3)  25% of the consideration if the percentage of the Fund’s average eligible investments for the particular fiscal year relative to the Fund’s average net assets for the preceding fiscal year is equal to or greater than 35% and less than 45%.

The Fund may not issue any class “A” shares or fractional shares in the fiscal year following the particular fiscal year if the percentage of the Fund’s average eligible investments for the particular fiscal year relative to the Fund’s average net assets for the preceding fiscal year is less than 35%.

Class “A” shares and fractional shares acquired and paid by payroll deduction in accordance with the provisions of Division IV or acquired under a subscription agreement entered into with an employer in favour of the employer’s employees are excluded from the application of this section.

1989, c. 78, s. 9; 2007, c. 12, s. 16; 2011, c. 6, s. 95; 2017, c. 1, s. 52; 2024, c. 11, s. 42.

16. The Fund shall make no investment in an enterprise that would then make the total amount of its investment in the enterprise greater than 5% of the assets of the fund as established on the basis of the latest expert evaluation contemplated in the second paragraph of section 11.

The percentage may be increased to 10% where the investment

(1)  enables the Fund to acquire securities in an eligible Québec enterprise whose assets are greater than $200,000,000 and whose net equity is greater than $100,000,000 at the time of the acquisition; or

(2)  is made after 20 March 2012 by the Fund in a financial institution that is registered with the Autorité des marchés financiers or the Office of the Superintendent of Financial Institutions established by the Office of the Superintendent of Financial Institutions Act (R.S.C. 1985, c. 18 (3rd Suppl.)) and that is part of a financial group recognized by the Minister of Finance.

However, in the case of an investment described in subparagraph 1 of the second paragraph and made in an enterprise referred to in that subparagraph 1, the Fund cannot, directly or indirectly, acquire or hold shares that include more than 30% of the voting rights attached to the shares of the enterprise and that can be exercised in any circumstances. Where, at the time of the investment, the Fund already holds, directly or indirectly, shares that include more than 30% of the voting rights attached to the shares of the enterprise and that can be exercised in any circumstances, it shall have a period of five years from the date of the investment to cause its interest in the capital stock of the enterprise to include 30% or less of the voting rights attached to the shares of the enterprise and that can be exercised in any circumstances.

These restrictions do not apply, however, where the Fund invests in the following securities:

(1)  securities guaranteed by the government of Québec or of Canada or of any Canadian province or territory;

(2)  securities the payment of which is guaranteed in capital and interest by the transfer of a grant from the Gouvernement du Québec, payable out of the appropriations to be voted each year for such purposes by the Parliament;

(3)  bills of exchange accepted or certified by a bank or an authorized foreign bank listed in Schedule I, II or III to the Bank Act (S.C. 1991, c. 46), or a financial institution registered with the Autorité des marchés financiers.

An enterprise that holds securities enabling it, under all circumstances, to elect a majority of the directors of another enterprise is deemed to form, together with the latter, one and the same enterprise for the purposes of this section.

For the purposes of subparagraph 1 of the second paragraph, the assets and net equity of an eligible Québec enterprise at the time of the acquisition of its securities are those shown in its financial statements at that time, minus the write-up surplus of its property and the incorporeal assets.

1983, c. 58, s. 16; 1989, c. 78, s. 10; 2002, c. 45, s. 514; 2002, c. 70, s. 186; 2004, c. 37, s. 91; 2005, c. 38, s. 37; 2007, c. 12, s. 17; 2013, c. 10, s. 11; 2024, c. 11, s. 43.

17. Where the Fund makes an investment in the form of a security or guarantee, it must establish and maintain, for the duration of the security or guarantee, a reserve equivalent to not less than 50% of the amount of the security or guarantee.

The Fund may invest the money deposited in the reserve under this section in the manner provided in the rules relating to investments presumed sound prescribed by the Civil Code .

1983, c. 58, s. 17; 1999, c. 40, s. 139.

DIVISION II.1 LOANS

1989, c. 78, s. 11.

17.1. The Fund shall not contract any loan that would make the current total capital of its total debt greater than 100% of the total consideration paid for its class “A” shares and fractional shares.

For the purposes of this section, the expression “total debt” means the amount obtained by applying the following equation:

x = the debt of the Fund + y1 [debt of any particular subsidiary of the Fund + y2 (debt of any particular subsidiary of the particular subsidiary of the Fund)]

where

x = the total debt of the Fund; and

y1 = the percentage of voting shares held, directly or indirectly, by the Fund out of the capital stock of the particular subsidiary of the Fund; and

y2 = the percentage of voting shares held, directly or indirectly, by the particular subsidiary of the Fund out of the capital stock of the particular subsidiary of the particular subsidiary of the Fund.

Furthermore, the debt of a subsidiary does not include the principal of a loan granted to the subsidiary by the parent legal person, either directly or by subscription of any debt security.

This equation applies, with the necessary modifications, to any subsidiary of a subsidiary, in descending line.

1989, c. 78, s. 11; 1999, c. 40, s. 139.

DIVISION III CONFLICT OF INTEREST

18. Any director or officer having an interest in an economic activity causing his personal interest to conflict with that of the Fund shall, under pain of forfeiture of office, disclose his interest. In addition, a director must abstain from voting on any decision involving the activity in which he has an interest.

The director or officer is deemed to have an interest in any economic activity in which a member of his immediate family has an interest.

1983, c. 58, s. 18; 2015, c. 8, s. 329.

19. In no case may the Fund make an investment in favour of one of its officers or directors or of a member of his immediate family, nor of any of its major shareholders.

1983, c. 58, s. 19; 2006, c. 50, s. 132, s. 133; 2015, c. 8, s. 330.

20. The Fund may not invest in an enterprise in which a director referred to in any of subparagraphs 1, 2 and 4 of the first paragraph of section 4 or a senior executive other than a director has a major or controlling interest.

1983, c. 58, s. 20; 2006, c. 50, s. 133; 2007, c. 12, s. 18.

21. A person is considered to be a major shareholder in the Fund if he directly or indirectly holds more than 10% of the issued and paid-up capital stock.

A person is considered to have a major interest in an enterprise if he holds more than 10% of the stocks or shares of the enterprise.

A person is deemed to control an enterprise if he holds securities enabling him under all circumstances to elect a majority of its directors.

1983, c. 58, s. 21; 2007, c. 12, s. 19.

22. Any contract in contravention of section 19 or 20 may be cancelled within one year of the date of the contract.

The senior executives of the Fund who carried out the financial transaction or consented thereto are jointly and severally liable for the losses to the Fund resulting from the transaction.

1983, c. 58, s. 22.

23. No contract made in contravention of section 19 or 20 may be cancelled and the second paragraph of section 22 does not apply if the contravention results from the opening of a succession or a gift and if the beneficiary renounces the property concerned or disposes of it with dispatch.

1983, c. 58, s. 23.

DIVISION IV PURCHASE OF CLASS “A” SHARES OR FRACTIONAL SHARES BY PAYROLL DEDUCTIONS

1989, c. 78, s. 12.

24. A person may request his employer to deduct the amount he determines from his salary or wages, for the period he specifies, to pay for the class “A” shares or fractional shares he has decided to purchase from the Fund.

The employer shall, within a reasonable time, make the deduction from the salary or wages of the person requesting it if 50 of his employees, or 20% of them if that is fewer, avail themselves of this section.

1983, c. 58, s. 24; 1989, c. 78, s. 13.

25. An employee whose salary is subject to a deduction under this division may, at any time, notify the employer of his decision to cease purchasing shares of the Fund by a deduction from his salary or wages.

The employer shall comply with the employee’s decision with reasonable dispatch.

1983, c. 58, s. 25.

26. An employee availing himself of section 25 may demand redemption of the shares he has subscribed provided he applies to the Fund in writing within 60 days of the payday when the first deduction was made from his salary or wages under this division.

1983, c. 58, s. 26.

27. An employer shall remit to the Fund or the trustee designated by the latter the amounts deducted under this division not later than the fifteenth day of the month following that in which he made the deduction. The remittance must be accompanied with a statement specifying the amount deducted from the salary or wages of each employee and the latter’s name, address, date of birth and social insurance number.

Copy of the statement is also forwarded, where applicable, to the certified association.

The amounts deducted under this division remain due to the employee as salary until they are remitted by the employer to the Fund or to the trustee designated by it.

1983, c. 58, s. 27; 1989, c. 78, s. 14; 1993, c. 47, s. 4.

28. An employee on behalf of whom sums have been remitted under section 27 is deemed to have subscribed for as many of the Fund’s class “A” shares and fractional shares as the amounts deducted from his salary permit him to purchase.

1983, c. 58, s. 28; 1989, c. 78, s. 15.

29. An employer required to make a deduction under this division shall at the request of the Fund transmit a notice once yearly to each employee concerned who receives remuneration advising him where he may examine the half-yearly financial statements of the Fund.

The form, tenor and mode of transmission of the notice are prescribed by the Autorité des marchés financiers.

1983, c. 58, s. 29; 2002, c. 45, s. 515; 2004, c. 37, s. 90.

DIVISION V MISCELLANEOUS AND FINAL PROVISIONS

30. In addition to the other statutory duties it may have regarding the Fund, the Autorité des marchés financiers is responsible for inspecting once yearly the internal affairs and the activities of the Fund to see that this Act is complied with.

For the inspection, the Authority has the powers vested in it by Chapters I and II of Title IX of the Securities Act (chapter V-1.1).

The Authority shall make a report of each inspection to the Minister of Finance and shall include therein any other information or document the Minister determines.

1983, c. 58, s. 30; 1989, c. 78, s. 16; 2002, c. 45, s. 516; 2004, c. 37, s. 90.

31. Sections 123.77 to 123.79 of the Companies Act (chapter C-38) apply only in the case of the directors contemplated in subparagraph 2 of the first paragraph of section 4.

1983, c. 58, s. 31; 1986, c. 69, s. 2.

32. A shareholder may, on payment of the costs prescribed by the Fund, obtain copy of the articles and by-laws of the Fund.

1983, c. 58, s. 32; 2011, c. 6, s. 96; 2021, c. 15, s. 65.

33. (This section ceased to have effect on 23 June 1988).

1983, c. 58, s. 33; U. K., 1982, c. 11, Sch. B, Part I, s. 33.

34. (Omitted).

1983, c. 58, s. 34.

REPEAL SCHEDULE

In accordance with section 17 of the Act respecting the consolidation of the statutes and regulations (chapter R-3), chapter 58 of the statutes of 1983, in force on 1 July 1983, is repealed, except section 34, effective from the coming into force of chapter F-3.2.1 of the Revised Statutes.