The Companies Creditors Arrangement Act ( R.S.C., 1985, c. C-36 ) (CCAA) allows a plan of compromise between debtor and creditors to resolve the financial problems of a distressed company. The CCAA may only be applied where claims against the debtor company exceed $5 million. In short, the CCAA provides the insolvent company protection from the actions of creditors and allows the insolvent company to continue operations while a plan of arrangement is constructed.
To date, CCAA information is scattered across the country in various court offices, without any centralized recording. At the outset of a recent study, Industry Canada estimated 175 cases exist; the study located 219 cases under the act. There may be more that the study did not find.
Currently no requirements exist for debtor corporations in CCAA proceedings to report data or to publicly disclose it in a consistent way. Financial information and pension deficit information need to be reported in a consistent and accurate format. This is particularily important regarding pensions, as unfunded pension liabilities have impelled many recent CCAA filings.
A proposed amendment to the Bankruptcy and Insolvency Act, may force the Office of the Superintendent of Bankruptcy to collect uniform data into a cross-country database.