Ontario and Nevada counsel for European clients.

Where CETA Stands

The Comprehensive Economic and Trade Agreement between Canada and the European Union was signed on 30 October 2016 and has been applied provisionally since 21 September 2017The consolidated text is published by Global Affairs Canada. Provisional application under Article 30.7 covers the parts of the agreement within the Union's own competence, which is nearly all of it. Either side may end provisional application by written notice, effective the first day of the second month after the notice.. It is a mixed agreement under European law, which means that full entry into force needs the approval of every member state as well as the European Parliament. Seventeen of the twenty-seven have ratified. Ten have not, among them France, Italy, Poland, Belgium, and Ireland, and there is no date by which they must. The agreement has therefore spent nearly a decade in a condition its drafters treated as temporary, and nothing suggests that this will change soon.

What is switched off matters less than a European client might fear. The tariff schedules, the rules of origin, the customs and regulatory cooperation chapters, the services and temporary entry commitments, government procurement, intellectual property, and the geographical indications all apply now. What does not apply is the part of the investment chapter that protects an investor against the host state, including the fair and equitable treatment and expropriation standards, and the Investment Court System that would hear claims under itOf Chapter 8, only the establishment, national treatment, most-favoured-nation, senior management, and transfer provisions apply, and only as they concern foreign direct investment. Section D, apart from the transfers article, and Section F are suspended. On 5 March 2026 the CETA Joint Committee adopted an interpretation narrowing the fair and equitable treatment and indirect expropriation standards and a decision creating an expedited procedure for smaller claims by individuals and small businesses, both prepared for the day the investment court is in force.. Until the remaining ratifications arrive, a European investor's protection in Canada is what Canadian law gives every investor, which is the courts and the Investment Canada Act, and, for investors from the eight member states whose bilateral investment treaties with Canada predate CETA, those treaties, which stay in force until CETA replaces them.

Goods, Origin, and the Sectors Held Back

For goods the agreement did most of its work on the first day. Canada removed customs duties on 98.4 per cent of its tariff lines for goods originating in the European Union when provisional application began, and the phase-outs that followed, including the 6.1 per cent duty on passenger vehicles, are completeThe remaining lines were phased out over three to seven years from 2017, bringing the duty-free share to 98.8 per cent. The European Union removed duties on 98 per cent of its lines at the outset. Duties survive on dairy, poultry, and eggs, which Canada manages by production quota and tariff-rate quota and which CETA opened only to the extent of a cheese quota.. CETA works from a presumption that an originating good is duty-free unless it is listed, which simplifies the exercise for a first-time exporter. The catch is origin. Duty-free treatment attaches to goods that originate in the European Union under the product-specific rules in the origin protocol, not to goods that merely ship from there, so a German machine assembled from components made elsewhere has to be run through the rule for its tariff heading before anyone prices the shipment on the assumption of zero duty. The exporter certifies origin by a declaration on the invoice or another commercial document, and must be registered in the Union's exporter system for consignments above 6,000 euros, and the Canadian importer, which is often the European group's own subsidiary, carries the compliance risk on this side.

The sectors Canada held back are the ones the European side most often asks about. Dairy, poultry, and eggs stay behind their quotas. Canadian measures on cultural industries are exempted from the subsidies, investment, services, domestic regulation, and procurement chapters, though not from the agreement as a whole, and tariffs on cultural goods come off like any others. Telecommunications carriers with facilities in Canada remain subject to foreign ownership limits that CETA preserves in its annexesTelecommunications Act, S.C. 1993, c. 38, s. 16. A facilities-based carrier must be Canadian-owned and controlled unless it earns less than ten per cent of Canadian telecommunications revenues, in which case it may be wholly foreign-owned. For the rest, non-Canadians may hold at most 20 per cent of the carrier's voting shares and a third of its holding company's, a cumulative 46.7 per cent, and 80 per cent of the board must be Canadian.. Financial services, air transport, and a list of provincial measures scheduled in the annexes have reservations of their own. None of this is a reason to stay out, but the annexes for the sector should be read before the business plan assumes national treatment.

Services, People, and Public Contracts

Services are covered on a negative-list basis. Every service sector is open to European suppliers on national treatment and market access terms unless it is reserved in the annexes. Existing measures listed in Annex I cannot be made more restrictive, and any later liberalization is locked in, while the sectors reserved in Annex II remain open to new or tighter measures. The chapter on temporary entry is the one European clients use most. Senior personnel and specialists transferred within a company can be moved to the Canadian subsidiary for up to three years, graduate trainees and investors for a year, and contractual service suppliers and independent professionals for up to twelve months to perform a contract, in each case on a work permit that requires no labour market impact assessment, and business visitors can come for up to ninety days in any six months without oneCETA Chapter 10 and Annexes 10-A to 10-F. The Canadian permits are issued under the International Mobility Program, exempt from the labour market impact assessment that most foreign workers require. Spouses of intra-corporate transferees are covered. The categories for American and Mexican nationals under the North American agreement are separate.. Mutual recognition of professional qualifications was left to the professions to negotiate, and only the architects have completed an agreement, in effect since December 2025.

Government procurement is the chapter that changed Canadian practice the most. CETA opened contracts at every level of government, provinces, municipalities, school boards, hospitals, universities, and most Crown corporations included, to European suppliers above thresholds that for 2026 and 2027 stand at 239,200 Canadian dollars for federal goods and services contracts, about 368,000 dollars for provincial and municipal ones, and 9.2 million dollars for constructionThe thresholds are set in Special Drawing Rights, 130,000 SDR for federal entities, 200,000 SDR for provincial and municipal entities, and 5,000,000 SDR for construction, and converted into Canadian dollars every two years. Crown corporations and the other entities listed in Annex 19-3 have higher thresholds of 355,000 or 400,000 SDR for goods and services, about 653,000 and 736,000 Canadian dollars for 2026 and 2027. Contracts below the thresholds are not covered by the agreement, though the entity's own procurement rules usually require open competition anyway. Excluded categories include health care services, shipbuilding, and, in several provinces, energy procurement, and transit vehicle purchases in Ontario and Quebec carry a Canadian-content requirement.. Federal tenders are published on a single access point and provincial ones on each province's portal. A supplier that believes a covered federal award broke the rules has a short window, usually ten working days from the day it learned of the problem, to complain to the Canadian International Trade Tribunal, and provincial and municipal entities run their own bid dispute processes. The firm's guide to bidding on government contracts in Canada covers the process from qualification to challenge.

Switzerland Is Outside CETA

Switzerland is not a member of the European Union and is not a party to CETA. Its trade with Canada runs under the Canada-EFTA Free Trade Agreement, signed at Davos in January 2008 and in force since 1 July 2009, which removes duties on industrial goods, fish, and some processed agricultural products but has no services, investment, procurement, or temporary entry chaptersThe agreement is between Canada and Iceland, Liechtenstein, Norway, and Switzerland, with a bilateral agricultural agreement between Canada and each of them. Exploratory talks on updating it have not produced a new text. Under the Investment Canada Act a Swiss investor is a WTO investor rather than a trade agreement investor, so the lower review threshold applies.. A Swiss manufacturer therefore ships to Canada duty-free, as before, but a Swiss engineering firm sending staff to a Canadian project uses the ordinary immigration categories, and a Swiss bidder on an Ontario municipal contract has no treaty right to be considered, though most tenders are open to it in practice.

The route to CETA's benefits runs through a European entity. A Swiss group's German or Dutch subsidiary is an enterprise of the European Union for the services and investment chapters if it carries on substantial business activities there, and goods it produces in the Union qualify for CETA tariff treatment if they meet the origin rules, whoever owns the company. A company registered in the Union only to borrow the treaty does not qualify, because the investment chapter's definitions require substantial business activities there. On the disputes side, Switzerland and Canada have no treaty on judgments. An Ontario judgment is recognized in Switzerland under the Private International Law Act, which asks whether the Ontario court had jurisdiction by Swiss standards, whether the judgment is final, and whether the defendant was properly summoned and heard, and a money judgment is then enforced through the debt enforcement officesSwiss Private International Law Act, articles 25 to 27. The Lugano Convention does not apply to Canadian judgments. The Ontario court's jurisdiction is recognized where the defendant was domiciled in Ontario, agreed to its courts, or defended on the merits without reservation, and recognition is refused only for a manifest breach of Swiss public policy, improper summons, a denial of the right to be heard, or a conflicting Swiss judgment.. A Swiss judgment comes to Ontario by the common-law action described in Chapter Three.

Subsidiary, Branch, and Governance

A European company can operate in Ontario through a Canadian subsidiary or directly as a branch. The subsidiary is the usual choice, because it contains liability, it is what Canadian customers and lenders expect to contract with, and it keeps the Investment Canada Act and tax filings clean. It can be incorporated under Ontario's Business Corporations Act, which no longer requires any director to be resident in Canada, so the European parent can staff the board from home, or under the federal Canada Business Corporations Act, which still requires a quarter of the directors to be resident Canadians and offers a name protected across the country in exchangeOntario removed its resident director requirement in July 2021. Canada Business Corporations Act, R.S.C. 1985, c. C-44, s. 105(3): at least 25 per cent of the directors must be resident Canadians, or one director where there are fewer than four. A federal corporation must still file an initial return in Ontario within sixty days of starting business here.. A European company that prefers to operate as a branch needs an extra-provincial licence before it carries on business in Ontario, and it then exposes the whole company, rather than a Canadian subsidiary, to Ontario claims and to Canadian branch taxExtra-Provincial Corporations Act, R.S.O. 1990, c. E.27, ss. 4 and 19. A corporation incorporated outside Canada needs a licence before carrying on business in Ontario and must appoint an agent for service in the province..

A private Ontario or federal subsidiary keeps a register of the individuals who ultimately own or control a quarter or more of it, though a wholly owned subsidiary of a listed parent is exempt. An Ontario corporation keeps that register at its records office for regulators and law enforcement to inspect, and a federal corporation files it with Corporations Canada, where part of it is public. Where the Canadian entity will have more than one shareholder, whether a local partner, a manager with equity, or a joint venture counterparty, a unanimous shareholders' agreement under Ontario law does the work that the articles of association and a shareholders' pact do in Europe, and a European parent should not assume that the group's standard form will survive translation. What those agreements need to say is set out in the firm's guide to shareholders' agreements in Ontario.

The Investment Canada Act

Every acquisition of control of a Canadian business by a non-Canadian, and every new Canadian business a non-Canadian establishes, is either notifiable or reviewable under the Investment Canada Act. Notification is a filing, made before or within thirty days after closing, that gives basic information, needs no approval, and starts the forty-five-day period in which a national security review can be ordered. Review for net benefit to Canada applies, for a business outside the cultural sector, only above a threshold, and for an investor ultimately controlled in a member state of the European Union, which the Act treats as a trade agreement investor, the 2026 threshold for a direct acquisition is an enterprise value of 2.179 billion Canadian dollarsInvestment Canada Act, R.S.C. 1985, c. 28 (1st Supp.), Part IV. The 2026 thresholds are 2.179 billion dollars in enterprise value for trade agreement investors, 1.452 billion for other WTO investors, and 578 million in asset value for state-owned investors. Cultural businesses are reviewable above 5 million dollars in assets. All but the cultural threshold adjust each January.. Swiss investors fall under the general WTO threshold of 1.452 billion, and investors that are owned or influenced by a state under a much lower one measured by asset value. Most European acquisitions in Ontario are therefore notifiable rather than reviewable, and the filing is routine.

The national security review is the exception with no threshold. The federal cabinet can order a review of any investment by a non-Canadian, of any size and in any sector, including a minority stake, where the investment could be injurious to national security. The published guidance singles out critical minerals and their supply chains, sensitive technologies, critical infrastructure, and businesses that hold large amounts of personal data, and it says that the investor's ties to a foreign state will be weighed. An investor from the European Union or Switzerland is not the usual subject of such a review, but an acquisition in one of those sectors should be planned with the timeline in mind, because the review can run for months and can end in an order to divest. Sector rules apply on top of the Act. Broadcasting and telecommunications carriers have foreign ownership limits under their own federal statutes, banks and insurers have ownership and approval rules of their own, and CETA preserves all of them.

Tax, in Outline

Tax is for the tax advisers, but an outline helps a European board make sense of their advice. A Canadian subsidiary in Ontario pays corporate income tax at a combined federal and provincial general rate of 26.5 per cent. Dividends, interest on related-party debt, royalties, and management fees paid to the European parent attract a Canadian withholding tax of 25 per cent under domestic law, which Canada's tax treaties with Switzerland and with the member states reduce, in the case of dividends to a parent holding a substantial stake usually to 5 per centIncome Tax Act, R.S.C. 1985, c. 1 (5th Supp.), Part XIII. Canada has income tax treaties in force with Switzerland and with each member state of the European Union. Interest paid to an arm's-length lender is generally exempt from withholding under domestic law. Treaty rates vary and should be confirmed for the payment in question.. Interest paid to a related European lender is deductible only within a debt-to-equity limit and an earnings-based ceiling on net interest expense, and dealings between the subsidiary and the group are priced at arm's length with contemporaneous documentation. A branch pays the same income tax on its Canadian profits plus a branch tax that stands in for dividend withholding. Sales are subject to the harmonized sales tax at 13 per cent in Ontario, and a European supplier selling into Canada may need to register for it before it has any presence here. Whether a European company that sends staff or signs contracts in Canada has a permanent establishment, and with it a Canadian tax liability without a subsidiary, is a question for the treaty and for the advisers before the first contract is signed.

The Nevada Practice

Many European clients need a United States presence as well, and some ask for it in the same conversation. Denis Grigoras has been licensed in Nevada since 2008, and the firm maintains a Nevada advisory practice delivered remotely, covering entity formation and governance under chapters 78 and 86 of the Nevada Revised Statutes, reincorporations into Nevada, asset-protection structuring, and the enforcement of Ontario judgments against Nevada assets. Nevada is a common choice for a holding or operating company because of its corporate law and its lack of a state corporate income tax, and a European group can pair a Nevada entity with an Ontario one under a single set of instructions. Litigation in Nevada courts is handled with Nevada litigation counsel. The practice is described on the Nevada page, and the firm's work for American clients on the United States page.

Litigating in Ontario, for a Civil-Law Client

Commercial claims in Ontario are heard by the Superior Court of Justice, a single trial court whose judges are appointed by the federal government and sit alone. In Toronto, insolvencies and complex commercial matters go to the Commercial List, a roster of judges with the experience and the scheduling to hear an urgent motion within days, which is the closest Ontario comes to a European commercial court, though it is an arrangement within the Superior Court rather than a separate tribunal. Appeals lie to the Court of Appeal for Ontario. The judge does not investigate. The parties gather and present the evidence, examine each other's witnesses, and argue the law, and the judge decides on what they have put forward, in written reasons that an appellate court disturbs on the facts only for palpable and overriding error. Proceedings are in English, and in French where a party requires itCourts of Justice Act, R.S.O. 1990, c. C.43, ss. 125 and 126. A party who speaks French may require that the proceeding be conducted as a bilingual proceeding, before a judge who speaks both languages, with documents filed in either..

Discovery is the feature that surprises European clients most. Each party must list every document relevant to any matter in issue that is or has been in its possession, control, or power, in a sworn affidavit, and produce the ones that are not privileged, whether or not the other side asked for them. That includes internal e-mail, board minutes, and drafts, and it includes the documents that hurt. Each party then examines a representative of the other under oath for up to seven hours, and the transcript can be read in at trial. A European company that has never had to hand its files to an opponent should understand this before the claim is issued, and should also understand that the obligation binds the Canadian party equally, which is often the pointRules of Civil Procedure, rr. 30.02, 30.03, 31.03, 31.05.1, and 31.11. Rule 30.1 is the deemed undertaking, under which evidence obtained on discovery may be used only in the proceeding in which it was obtained, unless the court orders otherwise, so a Canadian opponent cannot take what it learns into a European proceeding without leave.. At trial, witnesses give their evidence and are then cross-examined by opposing counsel, and the cross-examination is where most trials are decided. Written expert reports are exchanged on a schedule before trial rather than commissioned by the court.

The costs rules and the calendar are the other things to plan around. The losing party pays a portion of the winner's legal fees, in most cases somewhere between a third and two thirds of what was actually spent, on top of its own, and a formal offer to settle that the other side fails to beat changes the costs consequences from the date of the offer, in the offering party's favour. A plaintiff that is ordinarily resident outside Ontario can be ordered at the outset to post security for the defendant's costs, a rule a Swiss client will recognize, since Swiss courts impose the same on foreign claimantsRules of Civil Procedure, rr. 49.10, 56.01(1)(a), and 57.01. Security for costs is discretionary and is usually set in stages as the action proceeds. A foreign plaintiff with sufficient assets in Ontario, or an obviously strong claim, may avoid it. Under r. 49.10 a plaintiff who does as well or better than its own offer recovers substantial indemnity costs from the date of the offer, and a defendant whose offer the plaintiff fails to beat recovers its own costs from that date.. Juries are all but unknown in commercial cases, damages are compensatory, and punitive damages are exceptional. Ontario's basic limitation period is two years from the day the claim was discovered, which is short by European standards and which the court cannot extendLimitations Act, 2002, S.O. 2002, c. 24, Sched. B, ss. 4, 5, and 15. Parties to a business agreement may vary or exclude the basic period by contract (s. 22(5)).. In Toronto an ordinary action goes to mandatory mediation within 180 days of the first defence, though Commercial List actions are exempt, summary judgment is a genuine route to a decision on the merits where the record permits, and a trial date commonly arrives one to three years after the case is set down.

Service and evidence across the Atlantic take longer than the rest. Canada, Switzerland, and every member state of the Union are parties to the Hague Service Convention, but Germany, Switzerland, and several others have objected to service by post, so an Ontario claim against a defendant there goes through the central authority in the defendant's country with a translation, and two to four months should be allowed for itRules of Civil Procedure, rr. 17.05 and 18.01. A defendant served outside Canada and the United States has sixty days to deliver a defence. Where the receiving state has not objected to Article 10 of the Convention, service by registered post or through a local process server is also available and is much faster.. Evidence is the harder problem. Canada is not a party to the Hague Evidence Convention, so an Ontario litigant who needs testimony or documents from a witness in Europe asks the Superior Court to issue a letter of request, which travels through diplomatic channels and is executed by the foreign court under its own rules. In Switzerland the formal route is the only one, because Swiss law makes it an offence to take evidence on Swiss soil for a foreign proceeding without authorization, and a Canadian lawyer who interviews a Swiss witness informally for use in court can put the evidence and the client's position at risk. In the other direction, a European court that needs evidence from Ontario sends a letter of request that the Superior Court enforces under the Evidence Acts, after trimming it to Ontario standards.

Judgments in Both Directions

Nothing in the Brussels regime, the Lugano Convention, or the 2019 Hague Judgments Convention reaches Canada. The Hague Convention has been in force for the European Union since 1 September 2023 and for the United Kingdom since 1 July 2025, but Canada has not signed it, and the registration statutes Ontario does have extend only to the other common-law provinces and territories, not Quebec, and, under a separate Act, to the United KingdomReciprocal Enforcement of Judgments Act, R.S.O. 1990, c. R.5; Reciprocal Enforcement of Judgments (U.K.) Act, R.S.O. 1990, c. R.6, which gives effect to the 1984 Canada-United Kingdom convention and lets a United Kingdom money judgment be registered in the Superior Court within six years. No member state of the Union, and not Switzerland, has such an arrangement with Ontario.. A judgment from Germany, France, the Netherlands, Italy, Switzerland, or anywhere else in Europe is therefore enforced in Ontario by an action on the judgment in the Superior Court, in which the judgment is treated as a debt. The Ontario court does not retry the case and does not ask whether the European court got it right. It asks whether that court had jurisdiction in the Canadian sense, whether the judgment is final in the court that gave it, and whether any of a short list of defences appliesBeals v. Saldanha, 2003 SCC 72. The real and substantial connection test governs the recognition of judgments from every country, and the defences of fraud, natural justice, and public policy are construed narrowly. Chevron Corp. v. Yaiguaje, 2015 SCC 42, confirmed that the Ontario court needs no connection of its own to the dispute and that the debtor's assets need not be in Ontario for the action to proceed..

Jurisdiction is measured by the real and substantial connection between the European court and either the defendant or the subject matter, or by the defendant's own conduct, and a Canadian defendant who was domiciled in the country, agreed to its courts in the contract, or defended on the merits will not be heard to say otherwise. Finality means final in the court that pronounced the judgment, and where an appeal is pending in Europe the Ontario court will usually wait. The defences are fraud that could not have been raised in the European court, a denial of natural justice measured by Canadian standards, and public policy, and none of them is an invitation to reargue the case. A judgment for a sum in euros or francs is converted into Canadian dollars under the Courts of Justice Act, and post-judgment interest runs at the European rate rather than the Ontario oneCourts of Justice Act, ss. 121 and 129(3); Currency Act, R.S.C. 1985, c. C-52, s. 12. Since Pro Swing Inc. v. Elta Golf Inc., 2006 SCC 52, a non-money judgment such as an injunction can also be enforced, with more caution about whether its terms are clear enough to obey in Ontario.. The Ontario action must be started within two years of the European judgment becoming final, meaning after the ordinary appeals are exhausted or the time for them has run, and the point is missed more often than any otherIndependence Plaza 1 Associates, L.L.C. v. Figliolini, 2017 ONCA 44; Sunlight General Capital LLC v. Effisolar Energy Corporation, 2023 ONCA 133. The two-year period under the Limitations Act, 2002 applies to an action on a foreign judgment and runs from the day the judgment became final, including the disposition of any appeal.. Most recognition actions are decided on a summary judgment motion on affidavit evidence with a certified copy of the judgment, and the Ontario judgment that results is enforced by writ of seizure and sale, garnishment, and examination of the debtor under oath. It does not travel automatically to the other provinces, so where the debtor's assets sit in more than one province the European judgment is sued on in each of them. The procedure is set out at length in the firm's guide to enforcing a foreign judgment in Ontario.

In the other direction, an Ontario judgment is enforced in each European state under that state's national law, since no treaty covers it there either. The questions that recur are whether the Ontario court had jurisdiction by the standards of the recognizing state, whether the defendant was properly served and had a chance to be heard, whether the judgment is final, and whether public policy is offended, and some states, Germany among them, ask in addition whether their own judgments would be enforced in Ontario, which they would. The practical lesson is to litigate in Ontario with the European enforcement in mind. A defendant served through the Hague channel rather than informally, an exclusive jurisdiction clause in the contract, a judgment after a defended hearing rather than by default, and a clear money sum with the interest rate stated all shorten the exequatur proceeding, and the firm prepares the Ontario record with the destination in view.

International Arbitration

For a European company contracting with a Canadian one, arbitration solves the enforcement problem that judgments leave open. Canada, Switzerland, and every member state of the Union are parties to the New York Convention, so an award made in Toronto is enforceable in Zurich, Frankfurt, or Paris, and an award made there is enforceable in Ontario, on the Convention's grounds alone and without the national recognition rules that a judgment must satisfy. Ontario applies the Convention and the UNCITRAL Model Law through the International Commercial Arbitration Act, 2017. A European award is recognized on application to the Superior Court with the award and the arbitration agreement, the court may refuse only on the listed grounds, the merits are not reviewed, and the application can be brought for ten years after the awardInternational Commercial Arbitration Act, 2017, S.O. 2017, c. 2, Sched. 5, s. 10. Compare Yugraneft Corp. v. Rexx Management Corp., 2010 SCC 19, which applied Alberta's two-year period to a foreign award before Ontario legislated ten years. The grounds for refusal under article 36 of the Model Law and Article V of the Convention are an invalid agreement, lack of proper notice, an award that goes beyond the submission, a tribunal or procedure that departed from the agreement, an award set aside at the seat, non-arbitrable subject matter, and public policy..

The seat is negotiable and both directions work. Toronto is a neutral seat with Model Law courts that intervene only where the Law permits, set aside awards only on the article 34 grounds and only within three months, and grant interim measures in aid of arbitrations seated here and abroad. A European seat under the ICC, Swiss, DIS, VIAC, or LCIA rules is equally workable from the Ontario side, since the Ontario court will grant interim relief in aid of a foreign-seated arbitration and will enforce the award when it comesModel Law, articles 17J and 34, as scheduled to the International Commercial Arbitration Act, 2017. An arbitration seated in Switzerland is governed by Chapter 12 of the Swiss Private International Law Act, and a Swiss award can be challenged only before the Federal Supreme Court, on narrow grounds.. What matters more than the seat is a clause drafted with enforcement in mind, with institutional rules that fit the size of the likely dispute, a sole arbitrator for smaller matters, an express choice of governing law and language, and a carve-out for court injunctions where assets may need to be frozen quickly. The firm's arbitration practice, including the drafting of the clause, the conduct of the case, and the court proceedings around the award, is described on the Arbitration page.

Cross-Border Contracts

A supply, distribution, agency, or licensing agreement between a European and a Canadian business raises a short list of drafting questions that decide how a dispute will go. Governing law comes first. The United Nations Convention on Contracts for the International Sale of Goods applies automatically to a sale of goods between parties in Canada and in most European states, including Germany, France, Italy, the Netherlands, and Switzerland, unless the contract excludes it, and a clause that simply chooses "the laws of Ontario" does not exclude it, because the Convention is part of Ontario lawInternational Sale of Goods Act, R.S.O. 1990, c. I.10. Ireland, Malta, and the United Kingdom are not parties to the Convention. Parties who want Ontario's domestic Sale of Goods Act, or a European civil code, to govern instead must say so expressly.. Delivery terms should name the Incoterms edition, and the clause should say who is the importer of record and who bears duties and any surtax, since a term that allocates "taxes" may not reach them, and a tariff change is not a force majeure event merely because performance became more expensive. Currency and the place of payment should be stated. If the Canadian side will hold stock or pay on credit, the European seller protects itself with a security interest registered under Ontario's Personal Property Security Act, which is the Canadian answer to retention of title and works differently from itA retention of title clause in a European form is treated in Ontario as a security interest, which must be registered to have priority over other creditors and a trustee in bankruptcy. The purchase-money priority is preserved by notice to prior secured creditors and timely registration..

Two Canadian particulars catch European drafters. An interest rate expressed at a monthly or daily rate must also state the annual equivalent, or the creditor recovers only five per cent a year under the federal Interest Act. And a contractual limitation period shorter than Ontario's two years is enforceable between businesses only on the statutory conditions. If the Canadian counterparty is in Quebec, or the goods will be sold there, the contract and the labelling face the Charter of the French Language, and the firm brings in Quebec counsel for that. Personal data flowing from the European group to the Canadian subsidiary benefits from the European Commission's adequacy decision for Canada's federal privacy statute, which the Commission confirmed in January 2024, so the standard contractual clauses needed for a transfer to a United States recipient outside the EU-U.S. Data Privacy Framework are not needed for data covered by that statutePersonal Information Protection and Electronic Documents Act, S.C. 2000, c. 5. The adequacy decision covers recipients subject to that Act, which includes commercial organizations in Ontario. Data held by public bodies, and employee data in provincially regulated businesses, falls outside it.. On the dispute clause, the firm drafts from the enforcement end backwards, asking first where the Canadian party's assets are and what that jurisdiction will enforce, and then choosing court or arbitration, seat, and rules to fit.