Sébastien Vézina Partner, Lawyer

Profile

Partner

Sébastien Vézina is a partner in the firm’s Business Law group.

Sébastien’s expertise lies in his exemplary ability to negotiate complex commercial agreements, in accordance with the highest standards of the legal industry. Recognized by the clients for his strong interpersonal skills, keen business sense and availability, he always adapts his strategic and legal advice to the business reality of the companies and organizations he works with.

Sébastien’s desire to develop a comprehensive and diversified practice has led him to represent companies in a variety of industries.

Over the years, he has refined his practice and developed a particular interest in negotiating commercial agreements with companies in the mining and renewable energy sources, financial services and sports and entertainment industries.

Generally, Sébastien’s practice in these different industries includes public and private mergers and acquisitions, public and private financing, private sector investments and company buyouts, in particular cross-border transactions between Canada and the United States and international transactions, and the negotiation of various commercial agreements. He holds degrees in both civil law and common law.

Sébastien also represents boards of directors and independent committees of boards of directors and sits on the board of a number of private corporations. In addition, he is involved in charitable, community and sports organizations and associations.

He is recommended by legal directories identifying leaders in Canada, such as the Canadian Legal Lexpert Directory since 2014, Chambers Canada since 2020 and The Best Lawyers in Canada since 2021.

Transaction Law

Sébastien represents a number of corporations along with various private equity funds and institutional investment firms in Canada and the United States.

He acts as legal counsel and special advisor to corporate, institutional, private and governmental sector clients, representing them in their private and public business transactions, both nationally and internationally. His approach and legal skills are invaluable in the negotiation, structuring and implementation of acquisitions, divestitures, mergers, consortiums, corporate financing (including cross-border financing), refinancing, syndication, debt restructuring, corporate reorganization and arrangement plans.

Sébastien has extensive experience in managing large-scale projects that require a large workforce and an interdisciplinary approach involving various industries and multiple jurisdictions.

Securities | Mining, Natural Resources and Renewable Energy Sources

Sébastien practises in securities law with a focus on mining and natural resource corporations. He provides advice on business consortiums, hostile takeover bids and proxy contests, corporate, partnership and revenue-based financings, including metal production and royalty sales transactions, as well as on issues related to infrastructure, transportation, energy and social acceptability. He is involved at every stage of the mining cycle, from exploration and project development to extraction and mine closures.

He has acquired solid experience with local and foreign investors as part of the Plan Nord aimed at the economic development of northern Quebec. He advises boards of directors and special committees on securities law compliance, corporate governance and related-party transactions. In addition, he is the corporate secretary for a number of public companies.

Sports and Entertainment

Sébastien’s sports and entertainment law practice focuses on sports franchise investments and acquisitions, sports facility management, commercial transactions, team-related transactions, intellectual property protection and enforcement of the applicable laws in this matter, the staging and operation of live sports and other events, public and media affairs and other types of professional sports-related projects.

He provides business and regulatory advice to sports teams, players, agents, owners, senior managers, sponsors, agencies, event promoters, team members, athletes and emerging digital businesses of all kinds. Over the years, he has gained experience in the development and financing of sports properties and commercial sports projects, as well as in corporate transactions and mergers and acquisitions involving Canadian and American sports leagues and clubs.

In addition, Sébastien is particularly interested in sports talent. He negotiates and drafts contracts entered into with key sports managers and contracts for other sports personnel, as well as contracts promoting his clients’ talents (including on-air talent and, in particular, former athletes, sports journalists and sports managers). He also helps his clients gain visibility, promote themselves and participate in conferences.

Finally, Sébastien is able to provide advice to sports organisations and associations that are subject to investigations pertaining to behavior or resulting from whistleblower complaints. He is also able to conduct investigations and prepare independent investigation reports into all forms of alleged misconduct, and issue recommendations.

Representative mandates

Transactional Law

  • Representation of Aspen Skiing Company, LLC and KSL Capital Partners LLC in connection with the acquisition of Intrawest Resorts Holdings, LLC, an operator of ski resorts and recreational centres
  • Representation of an established private equity firm in the United States in connection with the acquisition of Pretium Holding, LLC, a manufacturer of rigid packaging products, and the secured debt financing related to the acquisition
  • Representation of Globe Specialty Metals Inc. for the completion of the acquisition of certain assets of Bécancour Silicon Inc. and the revolving credit facility

Securities | Mining, Natural Resources and Renewable Energy Sources

  • Representation of Stornoway Diamond Corporation in connection with the preparation and negotiation of financing agreements with the Quebec Government under which Stornoway has participated in the construction and maintenance costs of a highway extension
  • Representation of Hecla Mining Company in connection with an arrangement plan with Aurizon Mining Ltd. under which Hecla has acquired all issued and outstanding shares of Aurizon
  • Representation of a consortium led by Magris Resources inc. in connection with the completion and financing of the acquisition of Niobec Inc., a subsidiary of IAMGOLD Corporation and one of the three major producers of niobium in the world
  • Representation of Sodemex Développement s.e.c. in connection with the acquisition of an interest in a portfolio of mining royalties
  • Representation of Canadian Royalties Inc. with respect to its commercial and corporate activities, including the preparation of its impact and benefits agreement as well as its prospectus offering of more than $212 million
  • Representation of Geomega Resources inc. in a series of equity and debt financing related to the development of its rare earth elements/niobium Montviel project
  • Representation of Oceanic Iron Ore Corp. in connection with various financings and commercial agreements for the purpose of developing its iron ore deposit of the Ungava Bay in Nunavik
  • Representation of institutional venture capital funds in Quebec, such as Société de développement de la Baie-James and Fonds régional de solidarité FTQ

Sports

Professional Hockey

  • Representation of Marc Bergevin in connection with his appointment as Executive Vice President and General Manager of the Montreal Canadiens hockey club
  • Representation of sports coaches in connection with their nomination as head coach or assistant coach of professional hockey clubs, such as Guy Boucher, Jacques Martin and Martin Raymond
  • Representation of a group led by the Molson brothers in connection with the acquisition of the Montreal Canadiens hockey club
  • Representation of hockey promoters in connection with the acquisition of a potential National Hockey League (NHL) hockey club
  • Representation of Pat Brisson and JP Barry, two leading hockey player agents, in connection with the acquisition of IMG’s hockey players’ representation business and the negotiation of a strategic partnership arrangement with Creative Artists Agency (CAA)
  • Representation of Luc Robitaille, President of the Los Angeles Kings hockey club, in connection with speaking engagements
  • Representation of Los Angeles Kings Hockey Club, L.P. and AEG Facilities Canada ULC in connection with their respective registration with the Registry of Lobbyists

Junior Hockey and M18 AAA

  • Representation of the Quebec Major Junior Hockey League in connection with updating its legal structure and governance, including creating and organizing a new entity under the Canada Not-for-profit Corporations Act, reviewing its governance structure and drafting its new constitution and regulations
  • Representation of the Ligue de développement du hockey M18 AAA du Québec in connection with updating its legal structure and governance, reviewing its governance structure and updating its constitution and regulations
  • Representation of Benoît Robert and his partners in the sale of American Hockey Group, LLC (AHG), the operating company of the Omaha Lancers hockey club of the United States Hockey League (USHL), pursuant to which all of the membership interests of AHG were sold to Crossbar Down, LLC, a Nebraska company
  • Representation of Daniel Brière in connection with the acquisition of an interest in the capital of the Blainville-Boisbriand Armada hockey club, a member of the Quebec Major Junior Hockey League
  • Representation of a lender in connection with a corporate loan granted to the Val-d’Or Foreurs hockey club, a member of the Quebec Major Junior Hockey League
  • Representation of a group of investors comprised on sportscasters and current and ex-NHLers for a contemplated acquisition and relocation of a Quebec Major Junior Hockey League hockey club
  • Representation of the Quebec Major Junior Hockey League as an independent arbitrator

Other Sports

  • Representation of a group of investors in connection with the acquisition of the Montreal Alouettes football club of the Canadian Football League (CFL)
  • Representation of Groupe Yvon Michel Inc. (GYM) in connection with permitting procedures and exhibitions of boxing events in multifunctional arenas and casinos
  • Representation of Groupe Yvon Michel Inc. (GYM) in connection with a series of promotional agreements with Top Rank, Inc. and Matchroom Boxing Limited, boxing promotion companies affiliated with the American sports television channel ESPN and the online streaming service DAZN, in order to co-promote multiple fights

Brand, Publicity and Sponsorship

  • Representation of track and field and Olympian athlete Bruny Surin in connection with endorsement engagements, management of trademark portfolio and sponsorship representation arrangements
  • Representation of track and field and Olympian athlete Bruny Surin in connection with a lawsuit against Puma North America Inc. and Puma Canada Inc. for illegal use of trademarks and brand image
  • Representation of diver and Olympian athlete Jennifer Abel in connection with her endorsement engagements and sponsorship representation arrangements
  • Representation of a leading sponsor of the Canadian Football League (CFL) in connection with the negotiation of a sponsorship agreement
  • Representation of the sports agency Spring Management Inc. in connection with its business and strategic matters

Entertainment

  • Representation of the ad hoc committee of first lien lenders to Cirque du Soleil in connection with the acquisition of Cirque du Soleil pursuant to a credit bid under the Companies’ Creditors Arrangement Act for $1.2 billion
  • Representation of the independent kids’ content company DHX Media Ltd. in connection with its corporate fundraising activities
  • Representation of 01 Studio Inc. in the negotiation of an equity financing and license and distribution agreement for a video game in China and in the Asia-Pacific region with Skymoons Technology Inc. and its affiliates
  • Representation of luxury goods online retailer Attalah Group Inc. (doing business under the name SSense) in connection with services regarding a work production and licensing arrangements
  • Representation of Les Productions O’Gleman Diaz inc. in connection with the broadcasting, publishing and licensing of its flagship TV program, magazines and books entitled « Cuisine futée, parents pressés »
  • Representation of contemporary visual artist Michel de Broin in connection with a legal claim for copyrights infringement
  • Representation of a renowned speaker in connection with the protection of public image, reputation, privacy and defamation recourse

Distinctions

  • The Best Lawyers in Canada in the field of Mergers and Acquisitions Law, 2021
  • Chambers Canada in the field of Energy and Natural Resources: Mining, since 2020
  • Lexpert Special Edition – Canada’s Leading Energy Lawyers as a leading lawyer in energy law, 2017
  • The Canadian Legal LEXPERT® Directory in the field of mining law, since 2014
Best Lawyers 2022 Lexpert 2022 Chambers 2022 Chambers 2023

Education

  • LL.B., University of Western Ontario, 1997
  • LL.B., Université Laval, 1996

Boards and Professional Affiliations

  • Member of the Board of Directors of the Montréal Fashion + Design Festival
  • Member of the Sports Lawyers Association
  • Member of the Prospectors & Developers Association of Canada
  • Member of the Quebec Mineral Exploration Association
  • Corporate Secretary for the de Gaspé Beaubien Foundation
  • Member of the Executive Committee of the Yvon Michel Foundation
  • Member of the 2022 Memorial Cup Site Selection Committee
  • Bruny Surin Foundation
  1. $8 million awarded to a quadriplegic hockey player: the Court of Appeal confirms the Superior Court's decision

    Last May 2, the Court of Appeal granted a motion to dismiss an appeal against a significant decision in the area of civil liability in the context of the practice of a sport.1 Decision at trial2 The facts in the case date back to October 3, 2010. A few seconds after the start of a hockey game between two junior teams, the plaintiff, Andrew Zaccardo, was violently body checked from behind by the defendant Ludovic Gauvreau-Beaupré, a player on the opposing team. Zaccardo, who became quadriplegic as a result of the incident, brought an action in damages against Gauvreau-Beaupré and his insurer, Chartis, claiming $8 million in damages. We commented this decision in a previous publication.3 At trial, Justice Daniel W. Payette noted that a hockey rink is not [translation] "a law-free zone".4 The Court found that by body checking Zaccardo from behind, Gauvreau-Beaupré had breached the basic rules of care, thereby committing a fault within the meaning of the civil law. In addition, the Superior Court pointed out that while it is true that hockey involves certain inherent risks, Zaccardo could not reasonably have expected to become quadriplegic as a result of an illegal body check. Gauvreau-Beaupré and Chartis, his insurer, were therefore ordered to indemnify Zaccardo for $8 million, which amount had been the subject of an agreement between the parties. Court of Appeal's decision In a short decision, the Court of Appeal dismissed the appeal by Chartis and Gauvreau-Beaupré against the decision at trial, noting that it had no reasonable chance of success, since the trial judge had carefully assessed the evidence in reaching his decision. Moreover, the Court dismissed the argument by Chartis that Gauvreau-Beaupré had committed an intentional fault when he made the body check from behind, stating that [translation] "where the insured is accused of committing an intentional fault, the intention must relate not only to the act committed, but also to the results of that act".5 At trial, Chartis had, moreover, waived the right to invoke this exclusion. Ultimately, the Court of Appeal upheld the award against the insurer to pay the total amount of $8 million in compensation for the injuries suffered by Zaccardo. This amount is certainly one of the highest ever granted by a Canadian court in such a context. Chartis Insurance Company of Canada c. Zaccardo, 2016 QCCA 787 ["decision of the Court of Appeal"]. Zaccardo c. Chartis Insurance Company of Canada, 2016 QCCS 398. Need to Kwow publication, march 2016. Supra note 2, at paragraph 10. Paragraph 5 of the decision of the Court of Appeal.

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  2. Judge blows whistle to put a stop to checks from behind: $8,000,000 awarded to a quadriplegic hockey player

    On February 1, 2016, the Superior Court of Québec rendered a significant decision in the area of civil liability in the context of the practice of a sport1. The judgment was widely reported in the media due, on the one hand, to the importance of the amount granted by the judge (8 million dollars) and, on the other hand, because it is closely related to the practice of the national sport of Canadians. Will this judgment, through which a junior hockey player who became quadriplegic after receiving a check from behind has been allowed such an important amount as compensation, change the rules of the game? The facts The plaintiff, Andrew Zaccardo (hereinafter, “Zaccardo”), who was 16 years old at the time of the events, was a junior amateur hockey player. On October 3, 2010, his life took a turn for the worse when he received a check from behind from another player, defendant Ludovic Gauvreau-Beaupré (hereinafter, “Gauvreau-Beaupré”), who violently hit him from behind. Zaccardo became quadriplegic. The video clip, filed as evidence at the trial, shows a sequence resembling those routinely seen by hockey fans in sports information bulletins (at 0:15 to 0:30 more specifically). Zaccardo instituted civil proceedings against Gauvreau-Beaupré, his insurer, as well as Hockey Québec and Hockey Canada, claiming damages, particularly for the costs and expenses related to the care required by his physical condition for the remainder of his life. Prior to the hearing, Zaccardo discontinued his action against Hockey Québec and Hockey Canada. The hearing showed that for many years both entities had systematically discouraged and condemned checking from behind. At the time of the hearing, the parties agreed to an admission as to the quantum of damages for an amount of 8 million dollars. Mr. Justice Daniel W. Payette came to the conclusion that Gauvreau-Beaupré had committed a fault and found him liable for the damages suffered by Zaccardo. The Judgment At the outset, Justice Payette stated that players participating in hockey games are subject to the law as any other citizens: [TRANSLATION] “an ice rink is not a law-free zone”2. Justice Payette reviewed the relevant case law, both from Quebec and the common law provinces and concluded that strictly speaking, “sports liability” does not exist as a separate area of liability: players are subject to the usual rules governing civil liability and are thus required to act like [TRANSLATION] “reasonable players placed in the same circumstances”. The judge also confirmed that the practice of hockey involves inherent risks which a player accepts by participating in a game, but that by doing so, he is not however deemed to accept unreasonable risks which he is not aware of. Accordingly, the violent check suffered by Zaccardo did not constitute a risk which he should have foreseen when participating in the game. Moreover, the judge noted that a breach of the rules of the game, whether sanctioned by a penalty or not during the game, will not always constitute a fault within the meaning of civil law. Therefore, the court ordered Gauvreau-Beaupré and his insurer to pay to Zaccardo the admitted amount of 8 million dollars. It must be noted that at the beginning of the hearing, Gauvreau-Beaupré’s insurer informed the court that it was not alleging the intentional fault of the insured and, accordingly, the judgment does not deal with this issue. In the circumstances, the court also ordered the insurer to indemnify Zaccardo for the damages he suffered. The surgical precision with which the judge dissected the sequence of the check shows that he no doubt has experience of the practice of hockey and leads one to believe that this may have influenced the conclusions of the judgment. In addition, the legal reasoning put forward confirms that the efforts made by Hockey Québec and Hockey Canada to promote the safe practice of hockey are still encouraged. Echoes beyond the legal sphere In addition to being the highest amount ever granted to a victim of an injury in such a context, at least in Canada according to our verifications, this judgment already echoes beyond legal circles. For the time being, it is difficult to determine the scope that this decision will have and whether it will impact sports in general. Indeed, despite the magnitude of the amount granted to Zaccardo which, again, had not been contested, the judge noted that each case is dealt with on its own merits and only involves the application of general civil liability principles. In that sense, each situation is to be considered according to its own set of facts. In an era where class actions are instituted by former professional athletes who suffered concussions3 and following numerous other cases of violent actions with serious consequences4this decision may have an impact on the prevailing culture of hockey, which is more than ever called upon to change. Lastly, it must be noted that on March 2 2016, Gauvreau-Beaupré and his insurer appealed the decision5. The conclusions reached by the judge regarding liability will therefore be reviewed in the following 18 to 24 months. Conclusion The judgment in favour of young Zaccardo and the impressive monetary compensation he was granted attest to the numerous efforts made during the last few years to raise players’ awareness to the risk of serious harm associated to the practice of contact sports. The often critical attitude of Justice Payette toward the aggressor also demonstrates that this awareness had at least already entered the mind of the judge. Despite the fact that all the calls for prudence, by-laws and increased sanctions have not succeeded in actualizing the culture of hockey6, it is to be hoped that the whistle blown by Justice Payette will accelerate the changes. Zaccardo v. Chartis Insurance Company of Canada, 2016 QCCS 398, appeal pending: 500-09-025937-160 and 500-09-025938-168. Paragraph 10 of the judgment. For illustration purposes, a group of over 100 former players of the National Hockey League filed an application to be authorized to institute a class action against the NHL for damages suffered as a result of repeated shocks received to the head while they played as professionals: http://www.cbc.ca/sports/hockey/nhl/grand-ledyard-nhl-lawsuit-1.3432273. Also see: http://www.nhlconcussionlitigation.com For example we may think about the action of Todd Bertuzzi against Steve Moore, following which Moore was unable to continue his professional hockey career: https://www.youtube.com/watch?v=Fz9RE9RGrVY. The hockey stick hit given by Marty McSorely to Donald Brashear constitutes another example: https://www.youtube.com/watch?v=eTOfsoJAij4 500-09-025937-160 and 500-09-025938-168. Only a few days ago, another young hockey player from the Montreal region suffered an injury to the neck following a check from behind by another player. However, the young man has been “luckier” than young Zaccardo since his spinal cord was not damaged: http://montrealgazette.com/news/local-news/local-midget-hockey-player-suffers-broken-neck-after-illegal-hit

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  3. Canadian Securities Administrators announce amendments to venture issuer requirements

    The Canadian Securities Administrators (“CSA”) have announced that, on several fronts, they are implementing amendments to the disclosure requirements for venture issuers, including those listed on the TSX Venture Exchange. These amendments primarily address continuous disclosure and governance obligations, while also implementing changes to disclosure obligations for prospectuses and information circulars. These amendments include: The introduction of an option to use Quarterly Highlights to provide MD&A Restrictions on Audit Committee composition and exceptions thereto A staggered threshold for the disclosure of the perquisites of NEOs and directors The modification of the deadline for executive compensation disclosure Harmonization of significance levels for Business Acquisition Reports WHAT YOU NEED TO KNOW ENTRY INTO FORCE The primary amendments will be in effect as of June 30, 2015. Exception: Quarterly Highlights disclosure will apply in respect of financial years beginning July 1, 2015 onward. (See below). Exception: Audit composition requirements will apply in respect of financial years beginning January 1, 2016 onward. (See below). 1. OPTION TO USE QUARTERLY HIGHLIGHTS: APPLICABLE FOR FINANCIAL YEARS BEGINNING JULY 1, 2015 ONWARD National Instrument 51-102 Continuous Disclosure Obligations (NI 51-102) was amended so that all venture issuers will have the option of providing a quarterly highlights disclosure (“Quarterly Highlights”) in order to meet the requirement to provide interim MD&A, instead of complying with Form 51-102F1. Quarterly Highlights consist in a brief discussion of the company’s operations, liquidity and capital resources and also cover topics such as major operating milestones, known trends, risks or demands, and any significant changes since the last disclosure. Although simplified, a number of formalities must be followed in order to properly comply with the Interim MD&A obligations by providing Quarterly Highlights. 2. AUDIT COMMITTEE COMPOSITION: APPLICABLE FOR FINANCIAL YEARS BEGINNING JANUARY 1, 2016 ONWARD National Instrument 52-110 Audit Committees will require that venture issuers have an Audit Committee consisting of at least three members, the majority of whom cannot be executive officers, employees or control persons of the issuer or an affiliate (the “Composition Requirement”). This will not impose much change to issuers listed on the TSX Venture Exchange, as the TSX Venture Exchange Corporate Finance Manual already provides similar requirements for those issuers. However, the new regulation has provided two exceptions to the Composition Requirement : First, should an Audit Committee member become a control person of the issuer or an affiliate thereof for reasons outside the member’s reasonable control, the Composition Requirement will not apply for a specified period of time. Second, the CSA has provided that if a vacancy on the audit committee is caused by death, incapacity or resignation, the Subsection 3 will not apply for a specified period of time. 3. STAGGERED THRESHOLD FOR PERQUISITE DISCLOSURE The instrument also amends the requirements for perquisite disclosure with the introduction of Form 51-102F6V Statement of Executive Compensation -- Venture Issuers. The amendments will require the disclosure of perquisites of a certain value, calculated on staggered thresholds based on the named executive officer (“NEO”) or director’s annual salary: Perquisites above $15,000 will have to be disclosed if the NEO or director’s salary is $150,000 or less. Perquisites representing over 10% of a NEO or director’s salary between $150,000 and $500,000 will also have to be disclosed. Perquisites of over $50,000 will have to be disclosed for NEO or director salaries of over $500,000. 4. DEADLINE FOR FILING EXECUTIVE COMPENSATION DISCLOSURE The CSA has further amended NI 51-102 by including a deadline for filing executive compensation disclosure on Form 51-102F6V, which will have to be submitted no later than 180 days after the end of a venture issuer’s most recently completed financial year. 5. SIGNIFICANCE LEVEL FOR BUSINESS ACQUISITION REPORTS (BARS) Under current regulations, all issuers, including venture issuers, must file a Business Acquisition Report for all “significant” acquisitions. A significant acquisition is established as being one that exceeds 40% on the asset or investment test under Part 8 of NI 51-102. Under the amendment, this threshold will be raised to 100% for venture issuers. The current filing deadline of 75 days from the acquisition will continue to apply.

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  4. Forum on Mining Royalties – Consultation document

    Here is an overview prepared by Lavery of the highlights of the consultation document (in French) released last Thursday by the Quebec government in connection with the forum on mining royalties to be held on March 15, 2013. OVERVIEW OF THE CONSULTATION DOCUMENT ENTITLED:“LE RÉGIME D’IMPÔT MINIER DU QUÉBEC” March 8, 2013 We have reviewed the consultation document entitled “Le régime d’impôt minier du Québec – mars 2013” posted on the Internet on March 8, 2013, in anticipation of the forum regarding mining royalties scheduled for March 15, 2013.This memo is not intended to be a detailed review of all items raised in the consultation document but rather a summary of the salient information contained therein. This memo reproduces the titles of the relevant sections of the consultation document.MESSAGE FROM THE MINISTERSIn 2011, half of the mining companies operating in Quebec did not pay mining royalties. The regime currently in place did not allow the community to benefit from the mining activities of public non-renewable resources despite the high prices of commodities around the world.INTRODUCTIONThe document is divided into five sections:  Overview of the mining industry in Quebec; Overview of the mining tax regimes; Analysis of the mining tax regime applicable in Quebec; Quantitative analysis of the taxes levied on the mining companies together with tax subsidies for the mining industry; and Feedback requested from the mining industry. The review undertaken by the government is governed by two principles:a) Any mining company that operates a mine in Quebec should pay a minimum mining royalty to the government in lieu of financial compensation for the exploitation of mineral resources owned by the community; andb) When the profits of the mining companies increase the Quebecers in general shall be entitled to benefit from a larger portion of these profits.The mining industry players are invited to provide comments in order to feed the reflection and discussion.1. THE MINING INDUSTRY IN QUEBEC1.1 Mineral development processSection 1.1 provides an overview of the mining industry in Quebec, mostly information you are already aware of.1.2 Mineral productionSection 1.2 of the document provides comparative data in respect of mineral production with other jurisdictions in Canada.1.3 Comparative market data of mineral production in Quebec and other jurisdictionsSection 1.3 of the document provides comparative data in respect of mineral production with foreign jurisdictions.1.4 Mining investmentsMining investments that occurred in Quebec amounted to $4.8 billion in 2012, of which 14% (i.e. $696 million) were incurred for mining exploration and development costs. These investments were made mostly in the regions of Abitibi-Témiscamingue, Côte-Nord and Nord-du-Québec. The mining investments for 2013 are forecasted at $4.1 billion.1.5 Labour matters in the mining sectorSection 1.5 provides market data on labour force in the Quebec mining industry.1.6 Economical EnvironmentThe demand for iron ore shall maintain the price of this commodity. In recent years, the prices of iron ore resulted in the development of significant mining projects in Quebec. In upcoming years, the world demand shall continue to grow but at a slower pace than the growth of the offer. The consultation document refers to an analysis of KPMG, November 2012. Based on a consensus of 13 financial institutions, on a short term basis, the price of iron ore shall be around US $130 per ton. Graphs 3 and 4 of this section set forth market data on iron ore.2. MINING TAX REGIMES2.1 Features of the types of mining tax regimesThe most common royalty regimes are the following:a) Royalties based on specific units (by volume or weight)This regime is generally suitable for bulk raw materials, materials of low value or requiring little processing, such as surface mineral substances, sand, gravel, stone, etc. It ensures stable revenues for the government, has the advantage of being transparent and requires audits of limited scope to verify the accuracy of the amounts reported. It would not be applicable in the case of metallic minerals, especially because the latter cannot be sold on the market before having undergone a treatment to extract the marketable substance.b) Ad valorem royalties based on the gross value of productionThis regime provides the government with stable revenues since the mining companies pay royalties regardless of their level of profitability. It is fairly simple to administer, but the application of a single rate limits the incentive to invest in processing activities. This is why many countries and states modulate the rate depending on the level of treatment or define the base on which royalties are levied by taking into account certain costs incurred by mining companies. However, this type of regime is less efficient in terms of economic allocation. It nevertheless remains the most common royalty regime.c) Royalties or taxes based on mining profitsThis regime is based on the computation of a mining income to which are deducted operating costs and allowances, in order to establish the value of the resource at the extraction stage. It generates an unstable income stream for the government as royalties or taxes paid by mining companies may be low or nonexistent during the first years of operation. However, this regime is very efficient in terms of economic allocation and it adjusts to prevailing market conditions. On the other hand, a low level of transparency is associated to this regime. It is typically more complex to implement and monitor, which requires an effective administration by the tax authorities.d) Royalties or taxes based on resource rentThis regime usually taxes a portion of income that exceeds a given return on investment threshold. It allows for a better distribution of income from the exploitation of the resource and has a very high level of efficiency in terms of economic allocation. Its implementation is complex and requires the development of underlying tax concepts with respect to the notion of rent.e) Hybrid regimes combining ad valorem royalties and royalties or taxes based on profits or rentHybrid regimes usually combine minimum royalties and royalties or taxes based on profits or rent. The goal is to limit the risk that the government ends up receiving no revenue if a given mining company never becomes profitable. Hybrid regimes have the advantages and disadvantages of the regimes that compose them.Table 4 at page 16 illustrates the performance of the different regimes with respect to the main governmental goals.2.2 Overview of mining tax regimes outside of QuebecTable 5 at page 17 presents an overview of the mining tax regimes of the other Canadian provinces and some foreign countries.3. MINING TAX REGIME IN QUEBECMining profits are currently taxed at a rate of 16% in Quebec. The regime applies a mine-bymine approach, meaning that a loss in respect to a given mine cannot reduce earnings from another mine.The mining profits are calculated from the gross value of the annual production of a mine, to which are subtracted some expenses and allowances (including for depreciation, postproduction development, processing, exploration and pre-production development).Table 6 at page 19 summarizes how the current mining tax regime works in Quebec.4. MINING ROYALTIES AND OTHER TAXES4.1 Evolution of mining royaltiesTable 7 at page 23 sums up the financial results of mining companies from 2000 to 2011.During this period, mining companies have reported a total gross value of production of $43.7 billion. The gross value was relatively constant for the years 2000 to 2005, but has experienced a gradual increase from 2006. From 2006 to 2011, the gross value of the annual production has more than doubled, from $3.1 billion to $7.3 billion.The industry profits have skyrocketed, particularly those of the four main producers. Between 2006 and 2011, with a gross margin of over 40%, the concept of excess profits has made its way. It is the responsibility of the government to ensure that Quebecers obtain their fair share.4.2 Imperfect regimeAlthough mining royalties have increased, half of mining companies did not pay any in 2011. These companies did not have mining profits, either because they were not profitable or because they were at the beginning of commercial operation and they claimed deductions and allowances that had the effect of reducing their mining profits to nil. Indeed, to acknowledge the investments made by the mining companies, the current mining tax regime allows them to recover a portion of their investments before subjecting them to the payment of royalties.Mining companies that paid mining tax in 2011 accounted for 81% of the gross value of annual production. These companies paid the government the equivalent of 5.9% of the gross value of production.4.3 Taxes levied on the mining companies and tax subsidies for the mining industryIn addition to the mining tax, mining companies are also subject to corporate income tax and must contribute to the Health Services Fund. However, the tax on capital was abolished in 2010.The refundable tax credit for resources is a direct assistance mechanism to support mineral exploration. The basic rate is currently 15%. As of January 1, 2014, the rate will be reduced to 10%.The flow-through share regime aims to promote the financing of mining companies. It provides for a basic deduction of 100% of the cost of flow-through shares in the calculation of the investor’s taxable income. An extra 25% deduction is granted if the expenses are incurred in Quebec by a non-operating company. An additional 25% deduction is allocated if the exploration is conducted from the surface, which gives a total possible deduction of 150% of the amount invested.4.4 Taxes levied by governmentsIn total, taxable income of mining companies is taxed at a rate of 38.6%.5. FEED-BACK REQUESTED FROM THE MINING INDUSTRY5.1 Fundamental principlesThe basic principle that will guide the government in the revision of the mining tax regime is clear: since the mineral resource belongs to the community and has a value, all companies exploiting a mine in Quebec will have to pay a royalty on the extracted resource.In parallel, the government's decision with respect to mining taxation policy will have to take into account the following objectives:5.1.1 Adequate sharing of the resource rentThe new mining regime will have to ensure a better sharing of the resource rent between Quebecers and mining companies.When the price of commodities is very high so that the profits of mining companies increase beyond a certain threshold, the government has to collect a portion of the excess profits. Mining companies argue, rightly, that the periods of high profits are offset by periods when prices are down or during which they make major investments. The new regime will therefore have to maintain a balance between the taxation of excess profits and maintaining the attractiveness of Quebec to investors.5.1.2 Optimal tax baseThe tax base of the new regime will have to provide sufficient revenues from the exploitation of the collective resource. It should encourage the influx of additional capital for exploration and development of mining projects in order to eventually create a multiplier effect. As market prices will not always be high and the existence of excess profits is not guaranteed, the chosen tax base will have to be self-sufficient for periods when there will be no excess profits.5.1.3 Efficiency of the tax system from an economical point of viewa) Stability of revenuesThe new royalty regime must generate a stable income stream for the government. However, royalties based on profits or resource rent offer less stability than the other regimes.b) FairnessThe concept of fairness will have to play at two levels in the new mining regime:a) Mining companies that generate the same amount of resource rent should be subject to the same tax rate;b) Mining companies should each pay royalties or taxes in proportion of their operating results, regardless of the level of resource rent.c) Transparency and stabilityThe new regime should allow mining companies to accurately predict the long-term tax liability associated to their activities.The new mining regime should also be transparent to Quebecers. In this regard, the new regime could be inspired from the new disclosure rules that will be introduced soon in the United States as well as the Extractive Industries Transparency Initiative to which many countries participate.d) Administrative efficiencyThe administration of the new regime should be simple for both mining companies and the government. However, this should not be at the expense of economic efficiency.On the other hand, administrative efficiency should not lead to an exploitation of the resource that is not beneficial for Quebecers as a whole, including the payment of mining royalties.e) CompetitivenessThe new system should enable companies operating in Quebec to be competitive. Many of them are also active in other parts of the world. They must remain competitive in Quebec to maintain their operations here and attract investments from their parent companies.Although Quebec has recently tightened some requirements regarding mining tax, the tax burden of mining companies is lower in Quebec than in many other countries.Many governments around the world have reformed their mining tax regimes or are considering doing the same. During the year 2010-2011 alone, at least 25 countries and states in the world have increased or announced plans to increase their mining royalties or taxes, including Australia, Peru, Tanzania, India, China, Zimbabwe, Chile, Congo, Mongolia, the Philippines, Poland and the United States.On the basis of these principles and issues, the government of Quebec considers it important to establish a constructive dialogue with the mining industry.5.2 Contemplated alternativesThe government of Quebec wants to improve the sharing of the wealth generated by the exploitation of mineral resources in the province. To do this, different options are contemplated.Choosing a hybrid regime seems more appropriate in order to combine the advantages of each regime, namely (1) guaranteed minimum revenues and (2) an appropriate sharing of the resource rent.5.2.1 Guaranteed minimum revenues: ad valorem royaltiesTo achieve the goal of guaranteed minimum revenues for the government, the ad valorem royalties constitute the best regime. It involves applying a given rate to the gross value of the annual production of mining companies. The royalties could be varied, for example, by adjusting the rate for value added products or by defining the tax base in order to avoid penalizing processing activities.The royalties could be considered as a minimum amount that must pay any company that operates a mine in Quebec and thus ensure a revenue stream to the government at any time. Once this regime is established, it should be relatively simple to administer.The ad valorem royalties could, according to the chosen approach, be deducted in the calculation of the second component of the regime.5.2.2 Appropriate sharing of the resource rentTo ensure that mining companies pay more royalties when their profitability is high, several approaches can be considered.a) Regime based on the profit marginThis regime would have the same tax base as the current one. However, the applicable rate would progressively increase once a certain level of profitability is reached. The profitability of a mining company would be determined by its profit margin.This approach would progressively increase the amount of royalties paid by mining companies. It has a high degree of economic and tax efficiency and allows an optimal sharing of the resource rent. Under this approach, a mining company would be required to pay royalties corresponding to the highest of the ad valorem royalties and the mining tax calculated on the annual profits.b) Regime based on resource rentHere, the royalties would be based on resource rent, that is to say the profits that are beyond a threshold of acceptable return on investment based on risk.This regime would have the advantage of maximizing governmental revenues when there are excess profits. It is very effective in terms of economic allocation and fairness. However, it must include clear definitions and a well-structured methodology in order to facilitate its administration.The royalties would be applied only beyond the expected return on investment. In order to guarantee a return on investment to a mining company, the profits of its activities would be tax free up to the annual deductions representing the expected return on its investment, amortized over its lifetime.If a mining company has excess profits once the ad valorem royalties are subtracted, a tax at the rate of 30% would be applied to these excess profits.The proposed formula is independent of the financing structure, allowing mining companies discretion in this regard.List of graphsGraph 1 Evolution of mining investmentGraph 2 Labour in the mining sector allocated by administrative regions in 2011Graph 3 Price of iron ore (years 2000-2013)Graph 4 World supply and demand for iron oreGraph 5 Price of gold (years 2000-2013)Graph 6 World demand for goldList of tablesTable 1 Quebec’s mineral production (2011-2012)Table 2 Value of Canadian mineral production (2012)Table 3 World production of gold and iron ore and that of Quebec and the main producing countries (2011)Table 4 Qualitative evaluation of the performance of the different types of royalties and taxes as measured against the key tax objectives of the governmentTable 5 Mining tax regimes applicable outside of QuebecTable 6 Illustration of the current mining tax systemTable 7 Data on operators (years 2000 to 2011)Table 8 Number of companies, mining tax and total gross value of mineral production (2011)Table 9 Taxes levied on mining companiesTable 10 Combined effective rate of corporate income taxes and mining tax (2013)

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  1. Mining: Lexpert Recognizes Three Partners as Leading Lawyers in Canada

    On October 5, 2022, Lexpert recognized the expertise of three of our partners in its 2022 Lexpert Special Edition: Mining. Josianne Beaudry, René Branchaud and Sébastien Vézina now rank among Canada’s leaders in the area of Mining. Josianne Beaudry is a partner and leader of the Business law group at Lavery. Her practice is primarily focused on securities law. She advises financial sector participants on the application of regulations relating to securities and corporate governance. René Branchaud practises in the fields of securities, mergers and acquisitions, as well as corporate law. With more than thirty years’ experience, he advises companies on matters such as incorporation and organization, the drafting of shareholder agreements, private placements, public issues, going public, dispositions, and takeovers. Sébastien Vézina is a partner in the firm’s Business Law group. Over the years, he has refined his practice and developed a particular interest in negotiating commercial agreements with companies in the mining and renewable energy sources, financial services and sports and entertainment industries. Generally, Sébastien's practice in these different industries includes public and private mergers and acquisitions, public and private financing, private sector investments and company buyouts, in particular cross-border transactions between Canada and the United States and international transactions, and the negotiation of various commercial agreements.

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  2. Lavery's expertise recognized by Chambers Canada 2023

    Lavery has been recognized in the following fields as a leader in the 2023 edition of the Chambers Canada guide: Corporate/Commercial (Québec Band 1, Highly Regarded) Employment and Labour (Québec Band 2) Energy and Natural Resources: Mining (Nationwide, Band 4) Intellectual Property (Nationwide, Band 4) Our professionals demonstrate once again they are leaders in Chambers Canada guide 2023. René Branchaud, Nicolas Gagnon, Marie-Hélène Jolicoeur, Guy Lavoie and Sébastien Vézina have been recognized as leaders in their respective areas of practice in the 2023 edition of the Chambers Canada guide. Areas of expertise in which they are recognized: René Branchaud: Energy and Natural Resources: Mining (Nationwide, Band 5) Nicolas Gagnon : Construction (Nationwide, Band 4) Marie-Hélène Jolicoeur : Labour and Employment Law (Québec, Up and Coming) Guy Lavoie: Labour and Employment Law (Québec, Band 2) Sébastien Vézina: Energy and Natural Resources: Mining (Nationwide, Band 5) The lawyers and law firms profiled in Chambers Canada are selected following through a rigorous process of research and interviews with a broad spectrum of lawyers and their clients. The final selection is based on clearly defined criteria such as the quality of client service, legal expertise, and commercial astuteness.

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  3. The Best Lawyers in Canada 2023 recognize 67 lawyers of Lavery

    Lavery is pleased to announce that 67 of its lawyers have been recognized as leaders in their respective fields of expertise by The Best Lawyers in Canada 2023. The following lawyers also received the Lawyer of the Year award in the 2023 edition of The Best Lawyers in Canada: René Branchaud : Natural Resources Law Chantal Desjardins : Intellectual Property Law Bernard Larocque : Legal Malpractice Law Patrick A. Molinari : Health Care Law   Consult the complete list of Lavery's lawyers and their fields of expertise: Josianne Beaudry : Mergers and Acquisitions Law / Mining Law Laurence Bich-Carrière : Class Action Litigation / Corporate and Commercial Litigation / Product Liability Law Dominic Boivert : Insurance Law (Ones To Watch) Luc R. Borduas : Corporate Law / Mergers and Acquisitions Law Daniel Bouchard : Environmental Law Laurence Bourgeois-Hatto : Workers' Compensation Law René Branchaud : Mining Law / Natural Resources Law / Securities Law Étienne Brassard : Equipment Finance Law / Mergers and Acquisitions Law / Real Estate Law Jules Brière : Aboriginal Law / Indigenous Practice / Administrative and Public Law / Health Care Law Myriam Brixi : Class Action Litigation Benoit Brouillette : Labour and Employment Law Richard Burgos : Mergers and Acquisitions Law / Corporate Law Marie-Claude Cantin : Insurance Law / Construction Law Brittany Carson : Labour and Employment Law Eugene Czolij : Corporate and Commercial Litigation France Camille De Mers : Mergers and Acquisitions Law (Ones To Watch) Chantal Desjardins : Intellectual Property Law Jean-Sébastien Desroches : Corporate Law / Mergers and Acquisitions Law Raymond Doray : Privacy and Data Security Law / Administrative and Public Law / Defamation and Media Law Christian Dumoulin : Mergers and Acquisitions Law Alain Y. Dussault : Intellectual Property Law Isabelle Duval : Family Law Chloé Fauchon : Municipal Law (Ones To Watch) Philippe Frère : Administrative and Public Law Simon Gagné : Labour and Employment Law Nicolas Gagnon : Construction Law Richard Gaudreault : Labour and Employment Law Danielle Gauthier : Labour and Employment Law Julie Gauvreau : Intellectual Property Law Michel Gélinas : Labour and Employment Law Caroline Harnois : Family Law / Family Law Mediation / Trusts and Estates Marie-Josée Hétu : Labour and Employment Law Alain Heyne : Banking and Finance Law Édith Jacques : Energy Law / Corporate Law Pierre Marc Johnson, Ad. E.  : International Arbitration Marie-Hélène Jolicoeur : Labour and Employment Law Isabelle Jomphe : Intellectual Property Law Guillaume Laberge : Administrative and Public Law Jonathan Lacoste-Jobin : Insurance Law Awatif Lakhdar : Family Law Bernard Larocque : Professional Malpractice Law / Class Action Litigation / Insurance Law / Legal Malpractice Law Myriam Lavallée : Labour and Employment Law Guy Lavoie : Labour and Employment Law / Workers' Compensation Law Jean Legault : Banking and Finance Law / Insolvency and Financial Restructuring Law Carl Lessard : Workers' Compensation Law / Labour and Employment Law Josiane L'Heureux : Labour and Employment Law Despina Mandilaras : Construction Law / Corporate and Commercial Litigation (Ones To Watch) Hugh Mansfield : Intellectual Property Law Zeïneb Mellouli : Labour and Employment Law Patrick A. Molinari : Health Care Law André Paquette : Mergers and Acquisitions Law Luc Pariseau : Tax Law Ariane Pasquier : Labour and Employment Law Jacques Paul-Hus : Mergers and Acquisitions Law Hubert Pepin : Labour and Employment Law Martin Pichette : Insurance Law / Professional Malpractice Law Élisabeth Pinard : Family Law François Renaud : Banking and Finance Law / Structured Finance Law Judith Rochette : Insurance Law / Professional Malpractice Law Ian Rose FCIArb : Director and Officer Liability Practice / Insurance Law Chantal Saint-Onge : Corporate and Commercial Litigation (Ones To Watch) Éric Thibaudeau : Workers' Compensation Law André Vautour : Corporate Governance Practice / Corporate Law / Information Technology Law / Intellectual Property Law / Technology Law Bruno Verdon : Corporate and Commercial Litigation Sébastien Vézina : Mergers and Acquisitions Law Yanick Vlasak : Corporate and Commercial Litigation Jonathan Warin : Insolvency and Financial Restructuring Law These recognitions are further demonstration of the expertise and quality of legal services that characterize Lavery’s professionals.

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  4. Lavery represents ImmunoPrecise Antibodies as it acquires BioStrand

    On March 29, 2022, ImmunoPrecise Antibodies Ltd (IPA) announced that it acquired BioStrand BV, BioKey BV, and BioClue BV (together, “BioStrand”), a group of Belgian entities pioneers in the field of bioinformatics and biotechnology. With this €20 million acquisition, IPA will be able to leverage BioStrand’s revolutionary AI-powered methodology to accelerate the development of therapeutic antibody solutions. In addition to creating synergies with its subsidiaries, IPA expects to develop new markets with this revolutionary technology and strengthen its position as a world leader in biotherapeutics. Lavery was privileged to support IPA in this cross-border transaction by providing specialized expertise in cybersecurity, intellectual property, securities and mergers and acquisitions. The Lavery team was led by Selena Lu (transactional) and included Eric Lavallée (technology and intellectual property), Serge Shahinian (intellectual property), Sébastien Vézina (securities), Catherine Méthot (transactional), Jean-Paul Timothée (securities and transactional), Siddhartha Borissov-Beausoleil (transactional), Mylène Vallières (securities) and Marie-Claude Côté (securities). ImmunoPrecise Antibodies Ltd. is a biotherapeutic, innovation-powered company that supports its business partners in their quest to discover and develop novel antibodies against a broad range of target classes and diseases.

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