Doing Business in Québec: Key Legal Considerations

Over 80% of Québec’s population speaks French as a first language. This is reflected in the province’s language laws, including the Charter of the French language, which establish French as the only official language of Québec, require businesses to communicate with their employees and customers in French and impose numerous other French-language requirements affecting, amongst others, signage and commercial publicity, as well as contracts between private parties and documents related thereto.

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Québec is the second most unionized province in Canada, and the laws governing employment relationships present many distinct features, including significant employment protection measures for employees after two years of uninterrupted service. Employees who are terminated after meeting this threshold may file a complaint, which may ultimately lead to their reinstatement if they were dismissed without a just and sufficient cause.

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To attract and encourage investment in certain key industries, the Québec government has established several programs offering refundable tax credits that may be available to foreign businesses investing in the province.

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Non-Canadians who acquire control of an existing Canadian business or who wish to establish a new unrelated Canadian business are subject to notification and, if certain size thresholds are met, approval requirements. Also, significant transactions may be subject to scrutiny under Canada’s antitrust regulations. Businesses in certain regulated industries (such as financial services and telecommunications) are also subject to foreign ownership restrictions.

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Recent legislation requires that most entities registered to do business in Québec disclose and maintain specific identifying information regarding their directors, officers, shareholders, and their ultimate beneficial owners with the Québec Enterprise Registrar.

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Immigration law in Québec is characterized by its unique legal framework, supported by an agreement between the government of Québec and the government of Canada. This allows Québec to exercise considerable autonomy in economic immigration matters, particularly with respect to the selection of foreign nationals wishing to settle in Québec, either permanently or temporarily.

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Unlike the other provinces in Canada, which are common law jurisdictions, Québec is a civil law jurisdiction in which most relationships between private entities and individuals are governed by the Civil Code of Québec. As such, the Civil Code governs all matters of private law, including contracts, property rights and obligations, commercial matters, and civil rights and obligations.

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Court pleadings filed in English by legal persons, such as corporations and other business entities, must include a French translation prepared by a licensed translator, at the legal person’s expense.

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Québec has taken the lead among North American jurisdictions and has recently enacted legislation requiring businesses to follow strict measures when handling personal information, similar to those set out in the EU General Data Protection Regulation (GDPR).

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A significant part of the land area in Québec is composed of lands reserved for Indigenous Nations or in respect of which these Nations have rights. As a result, many large-scale energy, resource, or industrial projects in Québec encroach upon such lands and are required to consider the rights of these Nations from the very start of these projects, including by consulting or partnering with local communities and involving their leadership in the decision-making process.

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When purchasing any category of real property, it is essential to be well versed in the legal and regulatory aspects that govern property and financing transactions. Québec has its own set of rules and regulations that differ from those in the rest of Canada and the United States, making it crucial to understand and comply with these requirements.

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With nearly 781 franchise brands in operation, Québec provides fertile ground for the development of franchise networks. Given the absence of franchise-specific legislation in the province, as well as the distinct obligations relating to pre-contractual disclosure and the duties of good faith and collaboration, franchisors must adapt their business systems and contractual documentation to Québec’s legal requirements to avoid potential pitfalls.

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Businesses wishing to bid on public contracts in Québec must register with the appropriate governmental authority and comply with applicable regulations.

The Province has stringent environmental protection laws that impose impact assessment, review, and authorization requirements on activities that result in the discharge of contaminants or otherwise affect the environment.

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Industry-specific legislation imposes stringent requirements on entities engaged in mining activities, including obligations to restore land affected by such activities in accordance with a rehabilitation plan that must be pre-approved by the relevant governmental authorities, and to provide financial guarantees to secure those obligations.

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The Commission des transports du Québec (CTQ) plays a crucial role in regulating this sector, issuing permits, and ensuring compliance by transport operators. Moreover, carriers from the United States and Mexico wishing to operate heavy vehicles in Québec must register with the CTQ’s Register of Owners and Operators of Heavy Vehicles.

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Québec is known for its well-structured regulatory framework, established by government authorities to ensure sustainable development, consumer protection, and economic stability. Investors and entrepreneurs must approach these regulations strategically to align with local requirements and maximize opportunities. Collaborating with legal experts who are well-versed in Québec’s specific legislative landscape is essential to ensure compliance and success.

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