British Columbian businesses have operated against a backdrop of heightened economic and regulatory uncertainty in 2026. Trade friction with the United States has increased tariff exposure and raised practical questions about supply chains, contractual risk allocation and public-company disclosure. In response to this uncertainty, the Federal and provincial governments have pursued measures to reduce interprovincial trade barriers, diversify market access and accelerate major projects.

The year has also brought several legal and regulatory developments relevant to commercial activity in the Province. These include British Columbia’s new commercial liens regime, amendments affecting consumer contracts and forthcoming prompt payment legislation, as well as Federal developments in foreign investment review and securities regulation.

Tariffs and Commercial Drafting

Tariff exposure arises at various points in the cross-border supply chain and is affecting the operation of existing commercial agreements.

In August 2026, the US imposed additional 50% tariffs on a broad range of Canadian goods. The new tariffs operate as a surcharge on top of any ordinary customs duties and other applicable charges. Canada responded the following month with counter-tariffs of 15%, 25% and 50% on approximately CAD27.6 billion of imports from the US, including on steel, agricultural equipment, pulp and paper and electronics. These measures followed the first joint review of the Canada-US-Mexico Agreement (“CUSMA”) on 1 July 2026. The US declined to extend CUSMA in its current form for a further 16-year period. CUSMA nevertheless remains in force, but will now be subject to annual joint review unless the parties agree to an extension.

British Columbia’s forestry sector has been directly affected. For much of 2026, the combination of anti-dumping and countervailing duties and a separate 10% tariff that the US imposed under Section 232 of the Trade Expansion Act of 1962 left most Canadian softwood lumber producers facing an effective US duty burden of roughly 35%.

The broader tariff landscape has also changed repeatedly over a relatively short period. In the US, tariffs have been imposed under several different statutes, including the Tariff Act of 1930 and the Trade Act of 1974, and the available exemptions differ depending on the measure. Canada has responded to some of those tariffs with counter-tariffs of its own.

This uncertainty has implications for contracts that extend beyond the tariff payable on any particular shipment. A long-term supply or fixed-price agreement may have been negotiated on an assumption about landed cost that no longer holds when performance becomes due. For such agreements, the relevant contractual issues include the allocation of the additional cost and whether the agreement permits an adjustment to the commercial terms.

In new agreements, tariff risk may be addressed expressly through provisions dealing with duties, pricing and changes in law. Depending on the transaction, parties may allocate responsibility for new duties, permit price adjustments when tariff costs change materially or create a right to renegotiate where the economics of the arrangement shift. CUSMA treatment is not uniform across the current US tariff regimes, and the contractual position may depend on how the goods are classified, sourced and documented.

Existing agreements present a different problem. Businesses affected by new tariffs must work within the allocation of risk already embedded in the contract, particularly its pricing, force majeure, change-in-law and termination provisions. Where those provisions do not clearly allocate the risk, the parties may need to determine whether the existing pricing or change-in-law language permits an adjustment, or whether an amendment or renegotiation is required. That issue may be especially relevant in longer-term or fixed-price arrangements, where tariffs imposed after execution can alter the landed cost of performance.

Internal Trade Liberalisation

The deterioration in Canada-US trade relations has resulted in a renewed effort to reduce barriers within Canada. At the Federal level, the One Canadian Economy Act created a framework under which goods and services that satisfy provincial or territorial requirements may be treated as satisfying comparable Federal requirements, while also improving recognition of occupational credentials across jurisdictions. British Columbia has expressly linked its internal trade initiatives to diversifying market access and reducing reliance on the US market.

In British Columbia, the move towards mutual recognition has been formalised through both intergovernmental agreement and provincial legislation. In November 2025, the government of British Columbia helped bring together all provincial and territorial governments and the Federal government to approve the Canadian Mutual Recognition Agreement on the Sale of Goods. British Columbia followed in February 2026 with the Trade Recognition Act, which made its recognition framework permanent, while parallel work has continued on services and labour mobility, including a 30-day service standard for labour mobility applications.

The mutual recognition measures are intended to reduce duplicative testing, certification and approval requirements when goods move between participating jurisdictions. A product that can already be lawfully sold in one province may no longer require a separate round of testing, certification or approval before being sold elsewhere in Canada.

These reforms do not eliminate provincial differences, but they can make interprovincial expansion less burdensome for British Columbia companies. At a time when trade with the US has become more uncertain, access to other Canadian markets has assumed greater commercial significance.

Tariff Risk Disclosure

Tariff developments may give rise to disclosure obligations for public companies where they are material to the issuer. Tariffs may affect an issuer directly, where it imports or exports goods subject to additional duties, or indirectly through higher input costs, constrained access to materials, changes in customer demand and disruption to suppliers or distribution channels.

While Canadian securities legislation does not prescribe a tariff-specific disclosure regime, the existing continuous disclosure framework nevertheless requires reporting issuers to consider whether tariff developments require disclosure under existing materiality standards. Management’s discussion and analysis must address known trends, demands, commitments, events and uncertainties that are reasonably likely to affect the issuer’s business. It should also discuss important risks that have affected the financial statements, or are reasonably likely to affect them in the future, and explain material effects on financial condition, performance and cash flows. Depending on their significance, tariffs may also require disclosure in an annual information form, prospectus or other offering document.

National Policy 51-201 also recognises that an external political or economic development may warrant issuer-specific disclosure where its effect on the issuer is material and uncharacteristic of the effect generally experienced by others in the same industry. Tariff exposure should therefore be assessed by reference to the particular issuer’s operations, supply chain and contractual arrangements, rather than solely by reference to the effect of tariffs on its industry generally.

Mitigation measures also require careful treatment. Where an issuer relies on mitigation measures, its disclosure may address matters such as pricing measures, supply-chain changes, inventory management and contractual pass-through rights. Disclosure should address material limitations on those measures. Assertions about the expected effectiveness of mitigation strategies may constitute forward-looking information and should be accompanied by the material assumptions and risk factors on which they are based.

For issuers with meaningful exposure, tariff risk may warrant distinct treatment rather than being subsumed within a generic geopolitical risk factor.

British Columbia’s New Commercial Liens Regime

The Commercial Liens Act came into force on 30 June 2025, replacing five separate lien statutes and specified common law possessory liens with a unified statutory framework for commercial liens arising from services provided in respect of goods. The Builders Lien Act and the Forestry Service Providers Protection Act continue to operate separately.

The Commercial Liens Act also materially changes the role of possession in the commercial lien regime. A lien arises when the services are first provided and may be perfected either by possession or by registration in the Personal Property Registry, including in respect of non-serial-numbered goods. This departs from the former regime, under which many lien rights depended on continued possession and registration was more limited. Enforcement is now integrated with the Personal Property Security Act, including its notice and sale procedures.

Because a commercial lien may be perfected by registration, a service provider need not retain possession of the goods in order to perfect the lien. Registered commercial liens may also be relevant to lien searches and priority analysis undertaken by lenders and other secured parties where financed assets are subject to services.

Consumer Contract Reform in British Columbia

British Columbia has materially revised its consumer protection framework through amendments to the Business Practices and Consumer Protection Act. The first tranche of Bill 4 – Business Practices and Consumer Protection Amendment Act, 2025 – amendments came into force on 31 March 2025, prohibiting contractual terms that require mandatory arbitration, waive participation in class proceedings or restrict consumer reviews. A further tranche took effect on 1 August 2026, adding more prescriptive requirements governing contract disclosure, subscription renewals and unilateral amendments to consumer agreements.

The subscription amendments are directed principally at recurring consumer arrangements. Suppliers are now required to provide prescribed notice in advance of certain renewals and contractual changes, with corresponding cancellation rights where those requirements are not satisfied. The legislation also limits the circumstances in which a supplier may unilaterally amend an agreement to increase the consumer’s obligations or reduce its own.

The British Columbia Court of Appeal has already addressed the temporal application of the new arbitration prohibition. In Vandenbosch v Rogers Communications Canada Inc., 2026 BCCA 102, the Court held that the amendments operate retrospectively, but not retroactively. The prohibition may therefore apply to an arbitration clause in a contract entered into before 31 March 2025 where the dispute arose after that date, but does not disturb rights arising from disputes that had already crystallised when the amendments came into force.

British Columbia’s Incoming Prompt Payment Regime

British Columbia has enacted a new prompt payment regime for the construction sector, although it is not yet in force. The Construction Prompt Payment Act will take effect by regulation once the supporting framework is in place.

Once in force, the Construction Prompt Payment Act will impose statutory payment timelines on construction projects. Owners will generally have 28 days after receiving a proper invoice to pay, with payment then moving down the contractual chain on shorter timelines. Payment disputes may be referred to adjudication, with the adjudicator’s determination binding unless later displaced by a final decision of a court, arbitrator or agreement of the parties. The regime is mandatory and parties will not be able to contract out of it.

The legislation will also amend the Builders Lien Act. Among other changes, the holdback period will be reduced from 55 to 46 days and the separate lien against holdback funds established by the courts will be abolished. For owners, contractors and subcontractors, the new regime will shift payment administration away from purely contractual timelines towards statutory deadlines and expedited dispute resolution, making it a significant change for construction and infrastructure projects in British Columbia.

Foreign Investment Review and Economic Security

Foreign investment review has become a more significant execution issue for acquisitions of Canadian businesses, including those in British Columbia. On 5 March 2025, the Federal government updated its national security review guidelines under the Investment Canada Act to add economic security expressly to the assessment. The Federal government may now consider, among other factors, the size of the Canadian business, its place in the innovation ecosystem and the effect of the investment on Canadian supply chains.

The Federal government’s annual report on the Investment Canada Act, published on 16 February 2026, shows the increased scrutiny in practice. During the 2024–25 fiscal year, 30 investments were subject to extended national security review, up from 26 in the previous year, and the average extended review lasted 155 days. Nine investments were withdrawn and six were permitted to proceed subject to undertakings.

Extended national security reviews during the 2024–25 fiscal year involved investments in sectors including mining, pharmaceuticals, financial services, aviation and data processing. Bill C-34, which received Royal Assent on 22 March 2024, has already expanded ministerial powers during national security reviews, but not all of its amendments are yet operative. As of October 2026, the proposed mandatory pre-closing filing requirement for investments in prescribed sensitive sectors remained to be brought into force through further regulatory action.

Proposed Changes to Take-Over Bid, Issuer Bid and Early Warning Rules

On 14 May 2026, the Canadian Securities Administrators published proposed amendments to Canada’s issuer bid, take-over bid and early warning reporting regimes. The proposal, if adopted, would amend National Instrument 62-104 Take-Over Bids and Issuer Bids, National Instrument 62-103 The Early Warning System and Related Take-Over Bid and Insider Reporting Issues and National Instrument 51-102 Continuous Disclosure Obligations, together with related policy guidance. The proposals respond to recurring issues in market practice, including selective issuer repurchases, the use of equity-equivalent derivatives and uncertainty around certain early warning triggers.

Under the current issuer bid regime, an issuer that wishes to repurchase securities privately from selected securityholders generally has no equivalent to the private agreement exemption available for take-over bids and must therefore seek discretionary relief. Proposed Section 4.6.1 of National Instrument 62-104 would change that by permitting selective repurchases of up to 5% of a class over a 12-month period, subject to prescribed conditions. The proposal would therefore move a category of transaction that currently depends on case-by-case relief into the rules themselves.

Separate amendments would address disclosure of economic exposure and the operation of the early warning regime. In formal take-over bids and certain proxy solicitations, prescribed disclosure would extend to equity-equivalent derivatives and other arrangements that alter a party’s economic exposure to an issuer. The proposals would also deem persons who begin acting jointly or in concert to have acquired one another’s securities for early warning purposes, potentially triggering a filing where their aggregate holdings exceed 10%. If adopted, this approach would differ from the British Columbia Securities Commission’s decision in Re NorthWest Copper Corp., 2023 BCSECCOM 602, where the Commission held that the formation of a joint actor relationship, without a subsequent acquisition of securities, did not itself trigger an early warning report