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100% Confidential & Federally Regulated under the BIA.

Official OSB Resources, Directives & BIA Statutory Guides

🛡️ Federal Regulatory Notice

Insolvency in Canada is regulated federally under the Bankruptcy and Insolvency Act (BIA) and administered by the Office of the Superintendent of Bankruptcy (OSB)—a branch of Innovation, Science and Economic Development Canada (ISED). All formal debt relief procedures (Consumer Proposals and Personal Bankruptcies) must be conducted by an OSB-registered Licensed Insolvency Trustee (LIT).

Navigating insolvency requires clear, unvarnished legal facts. This guide compiles key OSB Directives, BIA statutory provisions, and official government standards to help Canadian consumers understand their legal rights, statutory protections, and trustee responsibilities.

Federal Regulatory Authority & Statutory Standards

Official OSB Resources & BIA Legal Guides

Plain-language breakdowns of official directives from the Office of the Superintendent of Bankruptcy (OSB) and federal standards under the Bankruptcy and Insolvency Act (BIA).

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Interactive BIA Calculators & Statutory Utilities

Test your financial scenario against current OSB thresholds before speaking with a trustee:

OSB Surplus Income Estimator → Consumer Proposal Savings Calculator → BIA Garnishment Limits Checker →

The Role of the Office of the Superintendent of Bankruptcy (OSB)

In Canada, debt relief through Consumer Proposals or Personal Bankruptcy is regulated at the federal level. The Office of the Superintendent of Bankruptcy (OSB)—a federal directorate of Innovation, Science and Economic Development Canada—oversees the entire insolvency system.

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Trustee Licensing & Regulation

The OSB licenses and supervises all Licensed Insolvency Trustees (LITs) in Canada. LITs are the only debt professionals legally authorized to administer BIA proceedings.

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Annual Financial Standards

The Superintendent issues binding administrative Directives, including annual net income standards that dictate mandatory monthly surplus income payments in bankruptcy.

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Consumer Rights Protection

The OSB maintains a public registry of all estate filings, sets strict statutory fee tariffs, and enforces debtor protection rules across all provinces and territories.

Key OSB Directives & Annual Financial Thresholds

The OSB issues regulatory directives under Section 5(4)(c) of the BIA to ensure consistent, fair application of insolvency law across Canada. Below are the primary directives governing consumer filings:

Directive No. 11R2

Surplus Income Standards & Monthly Thresholds

Section 68 of the BIA requires bankrupt individuals with higher household income to contribute surplus payments into their estate for creditors. The OSB calculates these limits based on Statistics Canada Low Income Cut-offs (LICO).

Family Unit Size Monthly Net Income Threshold Impact if Over Limit by $200+
1 Person $2,716 / mo Pay 50% of surplus income
2 People $3,381 / mo Pay 50% of surplus income
3 People $4,157 / mo Pay 50% of surplus income
4 People $5,047 / mo Extends 1st bankruptcy from 9 to 21 months
5 People $5,724 / mo Extends 1st bankruptcy from 9 to 21 months
6 People $6,456 / mo Extends 2nd bankruptcy from 24 to 36 months
7+ People $7,188 / mo Extends 2nd bankruptcy from 24 to 36 months
Calculate Your Household's Surplus Income →
Directive No. 1R6

Mandatory Insolvency Counselling

Requires every individual filing a proposal or bankruptcy to complete two mandatory, structured financial counselling sessions. Topics cover personal budgeting, credit bureau rebuilding, and money management.

OSB Tariff Rules

Federally Regulated Trustee Fees

Trustee fees are controlled by federal tariff rules (BIA Rules 128-132). Fees are taken directly out of your agreed monthly proposal or bankruptcy payment—meaning you pay $0 upfront out-of-pocket.

Directive No. 6R

Financial Assessment & Rehabilitation

Mandates that LITs conduct a thorough assessment of a debtor’s income, living expenses, assets, and liabilities before filing to recommend the best BIA solution.

Key Provisions under the Bankruptcy and Insolvency Act (BIA)

The BIA is designed to balance debtor rehabilitation with fair creditor distribution. Below are the core statutory protections granted to Canadian filers:

BIA Section 69

The Statutory Stay of Proceedings

The moment a Consumer Proposal or Bankruptcy is registered with the OSB, an automatic legal injunction takes effect. This legally forbids commercial creditors and the CRA from taking further legal action, sending collection letters, freezing bank accounts, or garnishing wages.

Check Garnishment Protections →
BIA Division II

Consumer Proposal Framework

Enables insolvent individuals owing up to $250,000 (excluding principal mortgage) to negotiate a legally binding settlement offer to repay a portion of their debt over up to 5 years at 0% interest, while keeping 100% of their assets.

Guide to Filing a Consumer Proposal →
BIA Section 178

Non-Dischargeable Debts

Defines specific obligations that survive bankruptcy or proposal completion, including court fines, child/spousal support arrears, debts resulting from fraud, and government student loans under 7 years old.

Bankruptcy Discharge Timelines & Rules →
BIA Section 67

Provincial Asset Exemption Rules

Protects essential personal property (clothing, household goods, tools of trade, primary vehicle, and home equity) from liquidation under provincial execution statutes.

View All 13 Provincial & Territorial Exemptions →

OSB Consumer Advisory: Unregulated Debt Consultants

The Office of the Superintendent of Bankruptcy regularly issues public advisories regarding unregulated private debt consultants who charge high upfront fees for informal settlement plans:

Regulatory Standard Licensed Insolvency Trustee (LIT) Unregulated Debt Consultant
Federal Government License Issued & Supervised by OSB None (Unregulated)
BIA Statutory Protection Immediate Legal Stay No Legal Protection
Fee Structure Federally Regulated Tariff High Upfront Retainer Fees
Binding on All Creditors Yes (Majority Vote Binds 100%) No (Creditors Can Refuse)

Frequently Asked Questions

The Office of the Superintendent of Bankruptcy (OSB) is the federal regulator operating under Innovation, Science and Economic Development Canada. The OSB licenses and supervises Licensed Insolvency Trustees (LITs), enforces BIA regulations, and sets annual Surplus Income thresholds.

Directive No. 11R2 is the official OSB directive establishing annual net income standards for Canadian bankruptcies based on household size. Earnings above these thresholds require 50% surplus payments and extend a first-time bankruptcy from 9 to 21 months.

The OSB maintains a public registry of all filings, sets statutory trustee fee tariffs to prevent consumer overcharging, regulates mandatory financial counselling standards, and investigates complaints against unlicensed debt settlement firms.

Mandatory Insolvency Counseling Sessions

Required federal credit counseling stages under the Bankruptcy and Insolvency Act

Session 1

Financial Management

Timeline: Between 10 and 30 days post-filing
Core Objective & Statutory Focus

Focuses on practical money management, budgeting templates, understanding personal spending habits, warning signs of debt stress, and proper credit usage to establish long-term financial stability.

Session 2

Cause Identification & Relapse Prevention

Timeline: Day 60 to 210 post-filing (min. 30 days after Session 1)
Core Objective & Statutory Focus

Reviews progress on the financial budget, identifies non-budgetary causes of debt (such as job loss, illness, or family changes), sets long-term goals, and provides actionable resources for credit rebuilding.

Important Note: Both counseling sessions are mandatory requirements of your bankruptcy or consumer proposal. Completing them successfully is necessary to obtain your discharge.

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