Privacy and cybersecurity
Starting a Business in Quebec: Why You Should Integrate Compliance with the Act Respecting the Protection of Personal Information in the Private Sector from the Outset
Creating a business in Quebec is much more than choosing a name and filing articles of incorporation. It involves a series of structuring steps: choosing the legal form, applying for registration, filing articles of incorporation, adopting by-laws, appointing directors, opening the minute book, etc.
This means laying the groundwork for a legal and operational structure that complies with the current legislation. Too often, privacy requirements are perceived as an administrative task to be dealt with later. However, incorporation offers a strategic window to integrate the documents and mechanisms required by the Act respecting the protection of personal information in the private sector (hereinafter “Private Sector Act”).
Founding Documents and Initial Obligations
Once registered, the business must produce or update certain documents essential to its governance, depending on its legal form:
- Initial declaration to the REQ
- Articles of incorporation
- By-laws
- Register of directors and shareholders
- Minute book
- Mandatory annual meeting
- Annual update with the REQ
- Declaration regarding the ultimate beneficiaries
- Designation of a person in charge of the protection of personal information (for all businesses covered by the Private Sector Act)
The creation of these documents and the establishment of a formal governance framework offer a key opportunity to integrate the Private Sector Act’s compliance requirements, including your privacy policy, internal data governance agreements, processing records and incident management process.
This approach offers three concrete advantages:
- Cost reduction: avoid emergency compliance costs when carrying out certain commercial projects or in the event of a confidentiality incident.
- Time savings: structure the right tools and processes from the outset.
- Valuation, reputation and trust: demonstrate rigour and reliability to your employees, partners, clients and investors through integrated compliance.
The Private Sector Act: A Complementary Requirement to Governance
The Private Sector Act imposes the following obligations on all businesses to which it applies:
- Designate a person in charge of the protection of personal information whose contact information must be public.
- Deploy incident response processes.
- Maintain a register of confidentiality incidents.
- Clearly define everyone’s roles and responsibilities regarding the protection of personal information.
- Implement a privacy policy.
- Implement and provide an employee awareness and training program.
- Provide for a contractual framework for data transfers to third parties.
- Conduct privacy impact assessments (PIAs) for certain processes.
- Implement processus and tools enabling individuals to assert their rights.
- Implement security measures proportionate with the sensitivity, volume and use of personal information.
These obligations are naturally integrated into the overall governance framework. Their adoption from the outset ensures a preventive, consistent and efficient approach aligned with current regulatory expectations.
Annual Reviews: Maintaining an Up-to-Date Framework
Like other corporate obligations, compliance with the Private Sector Act is part of a continuous improvement cycle. Requirements evolve based on the organization’s activities—whether it’s a merger or acquisition during the year, a change in service providers, the use of new technological tools, or the collaboration with partners using artificial intelligence or hosting data outside Quebec or Canada.
In this context, the regular updating of internal policies, protection mechanisms, staff training and incident response plan testing is not a one-time exercise. It is a structured process, to be re-evaluated periodically, that is fully integrated into the organization’s annual governance—just like updating the minute book or the annual declaration to the REQ.
Summary
The integration of the Private Sector Act’s compliance requirements at the inception of a business aligns with sound governance practices. It ensures consistency between the organizational structure, internal responsibilities and legal obligations. In parallel with the articles of incorporation and by-laws, these compliance mechanisms form an essential foundation for risk management, transparency and stakeholder trust.
In need of a guiding hand, an evaluation of your internal practices or an effective due diligence review to establish where you stand regarding your legal obligations?
Our Privacy and Cybersecurity team can assist you.
