Canadian court orders shareholder buyout pending GAC determination of ownership & control

17 July 2026

The Ontario Superior Court has held that a court-ordered share buyout should not take place until Global Affairs Canada (GAC), Canada's sanctions regulator, decides whether the selling shareholder is controlled by RESO – a Russian company listed under the Special Economic Measures (Russia) Regulations – CLR Invest Ltd v Kondratiev, 2026 ONSC 3832.

CLR, a Maltese investment company, holds 14.5% of UCT, an Ontario medical technology company. After a shareholder dispute, CLR asked the court to order UCT to buy out its shares under Ontario corporate law and to fix the price. CLR made an oppression application, asking the court to increase the buyout price. The Court rejected the application and ordered the buyout on ordinary fair value terms.

Both parties had asked GAC to rule on whether CLR is “controlled” by RESO (CLR denies that it is) and on whether a “no prohibition” letter confirming lack of control was appropriate. If GAC were to find that CLR is controlled by RESO, it would be caught by Russia sanctions (per s2.1(2) of the Special Economic Measures Act (SEMA)) and transfer/ payment of monies to CLR for the shares would breach sanctions.  The Court said there was evidence that CLR might be controlled by RESO but left this issue for determination by GAC so no payment of monies/share transfer can occur until the GAC determination.

Our Canada pages have further information on the Special Economic Measures Act, The Special Economic Measures (Russia) Regulations, the role of GAC, and all Canada sanctions-related judgments.