The Parliament of Canada has exclusive jurisdiction to regulate matters relating to bankruptcy and insolvency, by virtue of s.91 of the Constitution Act, 1867. It has passed some statutes as a result, i.e., The Bankruptcy and Insolvency Act (“BIA”) and the Winding-Up and Restructuring Act (which essentially applies only to financial institutions under federal jurisdiction). In applying these statutes, provincial law has important consequences. Section 67(1)(b) of the BIA provides that “any property that as against the bankrupt is exempt from execution or seizure under any laws applicable in the province within which the property is situated and within which the bankrupt resides” is not divisible among their creditors. Provincial legislation under the property and civil rights power of the Constitution Act, 1867 regulates the resolution of financial difficulties that occur before the onset of insolvency.

( Source wikipedia )