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SNL1994 CHAPTER E-1.1 ECONOMIC DIVERSIFICATION AND GROWTH ENTERPRISES ACT Amended: 1998 c18; 2001 c44; 2009 cR-15.01 s116 CHAPTER E-1.1 AN ACT TO PROMOTE ECONOMIC (Assented to December 16, 1994)
ECONOMIC DIVERSIFICATION AND GROWTH ENTERPRISE CORPORATION
PROVISIONS RESPECTING TAXATION
START-UP INCENTIVES
ACCESS TO
APPOINTMENT OF FACILITATOR
GENERAL
COMMENCEMENT Be it enacted by the Lieutenant-Governor and House of Assembly in Legislative Session convened, as follows: Short title
1.
This Act may be cited as the Economic Diversification and Growth Enterprises Act
. Interpretation
2.
(1) In this Act
(a)
"EDGE Corporation" means an Economic Diversification and Growth Enterprise Corporation which has been approved by the Lieutenant-Governor in Council for the purpose of obtaining the investment and business development incentives provided by this Act;
(b)
"corporation" includes a cooperative society registered under the Co-operative Societies Act;
(b.1)
"minister" means the minister appointed under the Executive Council Act
to administer this Act;
(b.2)
"north-east Avalon" means the towns of Bauline, Conception Bay South, Flatrock, Logy Bay-Middle Cove-Outer Cove, Paradise, Petty Harbour, Portugal Cove-St. Philip's, Pouch Cove and Torbay incorporated or continued under the Municipalities Act, 1999
, the City of Mount Pearl incorporated under the City of Mount Pearl Act
and the City of St. John's incorporated under the City of St. John's Act
; and
(c)
"resident of the province" means a resident as defined in the Elections Act, 1991.
(2)
The incentives that an EDGE Corporation is eligible to obtain under this Act are in addition to other incentives for which the EDGE Corporation may be eligible under other assistance programs established to encourage business development in the province.
(3)
Notwithstanding subsections 3(1) and (2), where a corporation that seeks to be designated as an EDGE Corporation is already carrying on business in the province and is proposing to establish a new business or undertaking or to expand its existing business or undertaking, only the new business or undertaking or the expanded portion of its existing business or undertaking qualifies for the investment and business development incentives provided by this Act. ECONOMIC DIVERSIFICATION AND GROWTH ENTERPRISE CORPORATION Qualifications for designation
3.
(1) A corporation that seeks to be designated as an EDGE Corporation shall demonstrate to the satisfaction of the Lieutenant-Governor in Council that in establishing a new business or undertaking, or in expanding an existing business or undertaking, in the province there is a potential
(a)
capital investment of at least $300,000; or
(b)
incremental sales of at least $500,000; and
(c)
for the creation and maintenance of at least 10 permanent jobs in the province.
(2)
In addition to the requirements for designation as an EDGE Corporation contained in subsection (1), a corporation shall be engaged in or propose to engage in
(a)
business activities or undertakings which offer the opportunity for long-term sustainable jobs and growth;
(b)
business activities or undertakings that, in the absence of the incentives provided under this Act, would not
(i)
be undertaken or pursued in this province in preference to another location, or
(ii)
be undertaken or pursued in the province at the time when it is proposed to do so; and
(c)
business activities or undertakings that have a substantial net economic benefit to the province.
(3)
Notwithstanding subsections (1) and (2), a corporation shall not be designated as an EDGE Corporation where the investment and business development incentives that the corporation would be eligible for if designated would provide the corporation with a direct competitive advantage over other businesses or undertakings already established in the province.
(4)
Notwithstanding subsections (1) and (2) a corporation shall not be designated as an EDGE Corporation where the business activities or undertakings it proposes to engage in are business activities or undertakings that are the subject of an agreement to which the government of the province or the government of Canada or both governments are a party the purpose of which is to compel the business activities or undertakings to be established or undertaken within the province outside the ambit of this Act. Application for designation
4.
(1) A corporation that wishes to obtain the investment and business development incentives provided by this Act shall apply to the minister to be designated by the Lieutenant-Governor in Council as an Economic Diversification and Growth Enterprise Corporation.
(2)
A corporation that is designated as an EDGE Corporation by the Lieutenant-Governor in Council under section 7 shall be entitled to the investment and business development incentives provided by this Act. Business plan
5.
Where a corporation makes an application to be designated as an EDGE Corporation, it shall provide a business plan covering all aspects of a corporations proposed operations.
Evaluation of application
6.
(1) Applications for designation as an EDGE Corporation shall be evaluated by a board appointed by the Lieutenant-Governor in Council and composed of public and private sector representatives who shall make recommendations with respect to the applications to the Lieutenant-Governor in Council through the minister.
(2)
Where the board requests it, an applicant for designation as an EDGE Corporation shall provide the other information, in addition to that required under section 5, that the board may require to enable it to conduct a proper evaluation of the application.
(3)
All proprietary and commercial information provided by an applicant for designation as an EDGE Corporation in conjunction with its application or as a result of a request under subsection (2) shall be kept confidential. Designation of corporation
7.
(1) Where the Lieutenant-Governor in Council, after consideration of the recommendation of the evaluation board, accepts an application, the applicant shall be designated an EDGE Corporation.
(2)
An application for designation as an EDGE Corporation shall be evaluated under section 6 and the designation either granted or refused by the Lieutenant-Governor in Council under this section within 30 days of the day on which the evaluation board is satisfied that it has all the information it considers necessary to properly evaluate the application under section 6.
(3)
The minister, on behalf of the province, and the EDGE Corporation shall enter into a contract for the period stated in the contract in which the province shall guarantee the EDGE Corporation the benefits provided under this Act and the EDGE Corporation shall bind itself to implement the business proposal as described in the contract.
(4)
The minister shall give notice in the House of Assembly that a contract has been entered into between the province and an EDGE Corporation, and the notice shall be given within 15 days after the signing of the contract or, where the House of Assembly is not then sitting, within the first 15 days of the next sitting.
(5)
The terms of the contract shall not be included in the notice given under subsection (4) and the notice shall not include information of a proprietary and commercial nature related to the corporation and its activities or undertakings. Report
8.
(1) An EDGE Corporation shall report annually to the minister on progress made in implementing its business proposal as contained in the contract entered into with the province.
(2)
The annual report shall include a report prepared by the external auditors of the corporation stating whether, in the opinion of the auditors, the corporation is complying with the terms and conditions of the contract entered into with the province.
(3)
Where the minister believes, after reviewing the report of an EDGE Corporation, or where the minister believes on the basis of other information, that the EDGE Corporation is failing to comply with the terms of the contract entered into with the province, the minister may direct representatives of the government to review the records and accounts of the corporation with a view to confirming whether or not the corporation is complying with the terms of its contract with the province.
(4)
An EDGE Corporation shall give the representatives of the government referred to in subsection (3) access to its financial statements, records and accounts and shall provide whatever other assistance they may require.
(5)
Where the minister believes, after reviewing the report of the EDGE Corporation or the report of the representatives of the government referred to in subsection (3), that the corporation is failing to comply with the terms of the contract entered into with the government, the minister may make recommendations to the Lieutenant-Governor in Council with respect to the continuation, amendment or cancellation of the contract.
(6)
The Lieutenant-Governor in Council may revoke a corporations EDGE designation and cancel the contract with the corporation. 1994 cE-1.1 s8;1998 c18 s2; 2001 c44 s6 PROVISIONS RESPECTING TAXATION Remission and reimbursement of tax 9. (1) A corporation that has been designated as an EDGE Corporation qualifies for a remission of tax and the Lieutenant-Governor in Council shall, by order under section 19 of the Financial Administration Act , remit all of the tax payable by the corporation under (a) the Income Tax Act, 2000; or
(b)
Parts IV and VIII of the Revenue Administration Act.
(2)
An order for a remission of tax shall provide
(a)
that all the tax paid by the EDGE Corporation shall be remitted for a period of
(i)
10 years, where the corporation's proposed business, undertaking or activity is on the north-east Avalon, and
(ii)
15 years, where the corporation's proposed business, undertaking or activity is in a part of the province other than the north-east Avalon, beginning on the date set out in the order; and
(b)
that the remission of the tax payable shall be reduced by 20% each year for a period of 5 years beginning on the expiry of the 10 or 15 year period, whichever is applicable, referred to in paragraph (a).
(3)
A corporation that has been designated as an EDGE corporation qualifies for a reimbursement by the province of 50% of tax payable by the corporation to the Crown in right of
(a)
for a period of 10 years, where the corporation's proposed business, undertaking or activity is on the north-east Avalon; or
(b)
for a period of 15 years, where the corporation's proposed business, undertaking or activity is in a part of the province other than the north-east Avalon.
(4)
The reimbursement of tax payable provided for in subsection (3) shall be reduced by 20% each year for a period of 5 years beginning on the expiry of the 10 or 15 year period, whichever is applicable.
(5)
Notwithstanding subsections (1), (2), (3) and (4), the remission of tax and the reimbursement of tax that an EDGE Corporation qualifies for applies only in respect of the tax that is reasonably and directly attributable to a new business or undertaking of the corporation carried on or established in the province or an expansion of its existing business or undertaking in the province.
(6)
This section applies only to a corporation that applies for and is designated as an EDGE corporation after
(7)
Section 9 as it read before the coming into force of this section continues to apply with respect to a corporation that applied for or was designated as an EDGE corporation before
2001 c44 s7; 2009 cR-15.01 s116 Qualification to receive benefits
9.1
(1) Notwithstanding the other provisions of this Act respecting the qualification of an EDGE corporation to receive benefits under this Act, a corporation does not qualify for the benefits that may be conferred by this Act if it does not achieve and maintain the eligibility criteria set out in section 3.
(2)
The Lieutenant-Governor in Council, upon advice from the minister, may in extenuating circumstances where the EDGE Corporation has met the criteria set out in section 3, but on a temporary basis is not able to maintain them, provide for the continuation of EDGE benefits where it is considered to be in the public interest.
(3)
This section applies only to a corporation that applies for and is designated as an EDGE corporation after
Municipal tax remission
10.
(1) A municipality may grant a remission of all the business tax or property tax or both the business tax and the property tax payable by an EDGE Corporation which establishes a business or undertaking, or expands an existing business or undertaking within its municipal boundaries.
(2)
A municipality that intends to grant a remission of all the business tax or property tax or both the business tax and the property tax payable to it by an EDGE Corporation shall, by resolution of its council, adopt a policy stating that intention and shall notify the minister of its adoption of that policy.
(3)
A municipality that adopts a policy respecting the remission of all the business tax or property tax or both the business tax and the property tax payable to it by an EDGE Corporation is bound by that policy until formally revoked and notice of the revocation is given to the minister.
(4)
Notwithstanding a decision of a municipality to revoke its policy of granting a remission of tax payable by an EDGE Corporation, the municipality is bound to grant the remission in the amounts and for the periods provided for by subsection (7) to every EDGE Corporation that enters into a contract with the province prior to the receipt of the notice of revocation by the minister.
(5)
Where a municipality adopts a policy to grant a remission of taxes the policy binds the municipality to grant a remission of the business tax or property tax or both the business tax and the property tax as provided by subsection (7) to an EDGE Corporation that establishes a new business or undertaking, or expands an existing business or undertaking, within its municipal boundaries.
(6)
Where a municipality agrees to remit all of the business or property tax or both the business tax and the property tax payable by an EDGE Corporation to the municipality, the municipality is not bound by
(a)
subsection 135(2) of the Municipalities Act;
(b)
subsection 158(2) of the City of
(c)
subsection 157(2) of the City of
(d)
section 262 of the City of St. John's Act,
whichever is the Act that applies to the municipality.
(7)
The remission of tax under this section shall be
(a)
for a period of
(i)
10 years, where the corporation's business, undertaking or activity is on the north-east Avalon, and
(ii)
15 years, where the corporation's business, undertaking or activity is in a part of the province other than the north-east Avalon, beginning on the date set out in the order referred to in section 9; and
(b)
reduced by 20% each year for a period of 5 years beginning on the expiry of the 10 or 15 year period, referred to in paragraph (a), whichever is applicable.
(8)
Where, before the coming into force of subsection (7) as it now reads, a municipality, that is located in a part of the province other than the north-east Avalon, adopted a resolution to grant a remission of all the business tax or the property tax or both of the taxes payable by an EDGE corporation which establishes a business or undertaking, or expands an existing business or undertaking within its municipal boundaries, the municipality is not bound by subsection (7) as it now reads, but the municipality may adopt a resolution to provide the benefits referred to in subsection (7). Contract to include remission order
11.
The terms of an order for the remission of tax under section 9 or 10 shall form part of the contract between an EDGE Corporation and the province entered into under subsection 7(2). Rep. by 2001 c44 s9
12.
[Rep. by 2001 c44 s9] Rep. by 1998 c18 s3
13.
[Rep. by 1998 c18 s3] Lease of Crown land
14.
(1) Where serviced land that an EDGE Corporation may require to implement the contract between it and the province is not available, or cannot be obtained at a reasonable cost, unserviced Crown land that the corporation may require to implement the contract shall be leased to the corporation by the government.
(2)
Crown land leased to an EDGE Corporation under subsection (1) shall be leased for a term of 50 years, or for a shorter period if one is requested by the corporation, for the sum of $1.
(3)
An EDGE Corporation that obtains a lease of Crown land under this section has the right to purchase the land for the sum of $1 on the expiry of the contract with the province provided the corporation has complied with all of the terms of the contract.
(4)
In this section "Crown land" means Crown land as defined in the Lands Act.
(5)
Where there is a conflict between the Lands Act
and this section, this section prevails. Facilitator
15.
(1) An EDGE Corporation may apply to the minister for the appointment of a person to expedite the processing of an application or to assist the EDGE Corporation in obtaining permits, licences, options for use of Crown assets and other authorizations that the EDGE Corporation is required to obtain in connection with its business or undertaking.
(2)
Where the minister receives an application under subsection (1), the minister may appoint a person, either from within or outside the government to assist the EDGE corporation as a facilitator.
(3)
All departments of the government of the province, agencies of the government, and municipal authorities shall provide a facilitator with all the assistance necessary for the facilitator to fulfil his or her responsibilities with respect to the EDGE Corporation.
(4)
A facilitator shall use his or her best offices with departments and agencies of the government of
1994 cE-1.1 s15;1998 c18 s4; 2001 c44 s10 Regulations
16.
The Lieutenant-Governor in Council may make regulations generally to give effect to the purpose of this Act. Corporation's rights unaffected
17.
The right of a corporation to be designated as an EDGE Corporation is not affected by a proposal made to the government with respect to the establishment or expansion of a business or undertaking in the province between
Commencement
18.
This Act comes into force on a day to be proclaimed by the Lieutenant-Governor in Council.
(In force - Dec. 23/94) ©Earl G. Tucker, Queen's Printer |