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Can I file for faillite in Canada if I’m living abroad?

September 1st, 2017

Financial troubles don’t end at borders—or even oceans. If you’re a Canadian citizen no longer living in the country, and you still have debts in Canada that you are unable to pay, you may be wondering whether or not you can file for faillite. The answer is that it depends, but the rules are actually pretty straightforward.

The simplest way to file for faillite , would be to return to Canada . Once you’ve filed your faillite papers, you’re free to leave again, but you must keep your trustee informed about where you will be living. If you prefer to remain outside the country, you may file for faillite if:

  • You’ve carried on business in Canada within the year preceding faillite.
  • You have resided for the previous 12 months in Canada.
  • OR if the majority of your property is located in Canada (property can include money held in a Canadian banking institution, real estate, things or goods, and lawsuits).

Even if you’re living in another country when you file for Canadian faillite, you will still be subject to all the rules and regulations under the Canadian Bankruptcy and Insolvency Act. Specifically, you must:

  • Make sure your trustee has up-to-date contact information for you.
  • Declare all your assets, even those held outside of Canada. Depending on the laws of the country where those assets are located, your trustee may be required to seize the assets and sell them for the benefit of your creditors.
  • Declare all of your liabilities, whether the debt is owed in Canada or not.
  • Arrange to attend your two mandatory counselling sessions and any meetings of creditors.

For more information about how Canadian faillite laws may affect you if you’re no longer living in the country, We are available to assist you and answer your questions over email, text or Skype.

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