Which Canadian provinces still require licence and permit bonds, who must post them, statutory amounts, and where bonds were dropped for other protection.
Education only / verify at source / not legal advice. This guide explains Canadian licence and permit bonds using the statutes, regulations and regulator pages of Quebec, Ontario, British Columbia, Alberta, Manitoba, Saskatchewan, Yukon and the federal government. Global Guarantors publishes industry education. We aren't a surety, broker, insurer or law firm, and we don't publish premiums. The current law, your regulator's instructions and your own lawyer's advice control.
Start here: Surety 101: three parties, one written promise · Surety glossary · Surety vs insurance + indemnity
In Canada, many businesses cannot get or renew a licence until they give the regulator security. The security is a pool of money the regulator or the province can draw on if the licensee harms the people the licence is meant to protect, such as a contractor's clients or a collection agency's creditors. A licence bond, also called a permit bond or licence security, is the most common form. A surety company promises to pay up to a fixed sum if the licensee breaks the conditions in the bond.
There is no single national rule. Each province decides which trades and businesses must post security, how much and in what form. Some have moved away from bonds: they now rely on compensation funds, guarantee plans, financial-responsibility tests or other tools. This guide works through the regimes we could check in primary sources, gives the dollar amount only where a statute or regulation states it, and notes where a bond was removed and when.
For the wider family of licence, permit, court and public-official bonds, start with our commercial surety hub.
A licence bond is a promise by the licensee and a surety, made to the regulator or the Crown, that the licensee will follow the licensing law. If the licensee doesn't, and someone the law protects suffers a loss, the bond pays up to its fixed amount (the penal sum). After paying, the surety looks to the licensee to reimburse it.
The protected loss differs by regime. Quebec's regulation is a good example of how tightly it can be drawn. Section 25 says the contractor's security is there "to compensate clients who sustain a loss following non-performance or performance of construction work if the loss results directly from instalments paid, failure to carry out construction work or faulty work or defects discovered in the year following completion of the work." The same section sets out what it does not cover: "The security does not cover the claims of persons who took part in the construction work, damages resulting from delays in construction work, damages for moral injury or punitive damages."
Other regimes protect different people:
The amount is a ceiling, not an estimate of losses. A $10,000 bond pays no more than $10,000 in total, however many claims arrive. That is why several regimes also keep a separate compensation fund or let the regulator demand more security.
Canadian law and regulator pages use several names for the same idea: "security", "guarantee bond", "penal bond", "surety bond" and, in French, cautionnement. Quebec's regulation also speaks of a "surety insurance policy", which reflects how surety is licensed as a class of insurance in Canada. Whatever the label, the questions are the same: who must post it, for how much, payable to whom, and who can claim.
| Role | Who it is on a licence bond | Examples from the sources |
|---|---|---|
| Principal | The licensee or applicant | RBQ-licensed contractor; bailiff; collection agency; electrical or gas contractor; customs broker |
| Obligee | The regulator or the Crown named in the bond | Régie du bâtiment du Québec; "British Columbia Safety Authority" (Technical Safety BC); Technical Safety Authority of Saskatchewan; the Director under Alberta consumer law; the Alberta Motor Vehicle Industry Council "as represented by the Chief Executive Officer of AMVIC"; "Her Majesty the Queen in right of the Province of Manitoba"; the Crown in right of Ontario; the Government of the Yukon |
| Surety | An insurer licensed to write surety in the province | "an insurer licensed under the Insurance Act to write surety and fidelity insurance" (Ontario); "an assurance or bonding company authorized to carry on business in Manitoba"; a surety "licensed to carry on business in Saskatchewan and to be acceptable to the ministry" |
| Beneficiaries | The people the law protects | Clients, consumers, creditors who used a collection agency, owners of the property where the contractor worked |
The obligee is usually the regulator, not the customer. A customer who has lost money normally claims through the regulator's process, or with a judgment, rather than suing on the bond directly. The bond wording and the regulation say how.
Most regimes accept more than one form of security. A surety bond does not tie up the licensee's cash or bank credit, which is one reason bonds are common. Some regulators require a bond and nothing else.
Quebec has one of the broadest licence-bond requirements in the country. The Building Act lets the RBQ require security from contractors. Section 84 says: "The Board may, by regulation, require security from any contractor for the purpose of compensating the contractor's clients who sustain a loss as a result of a failure to carry out or the carrying out of construction work."
The rules are in the Regulation respecting the professional qualification of contractors and owner-builders (CQLR c. B-1.1, r. 9):
Claims are paid on proof of liability. Section 33 makes the surety solidarily liable with the contractor, and claims are evidenced by a final judgment or a settlement agreement. The Building Act also sets up a compensation fund. Under section 86 it can pay "in excess of the security but only where the security is insufficient".
Ontario shows both sides of the trend.
Bailiffs. The Bailiffs Act says: "No person shall act as a bailiff or an assistant bailiff unless bonded in the prescribed amount and form" (s. 14(1)). R.R.O. 1990, Reg. 53 sets the amounts:
The prescribed forms are a personal bond (Form 1), a bond of an insurer licensed to write surety and fidelity insurance (Form 2), and a bond of another guarantor (Form 3).
The bond can be forfeited if the bailiff is convicted of certain offences committed in the course of the work, or if a judgment is entered for money paid for services not performed, or based on fraud, conversion, assault, libel or trespass (s. 15(1)). Once forfeited, "the amount of the bond becomes due and owing as a debt due to the Crown in right of Ontario" (s. 15(2)). The proceeds can then go to judgment creditors.
Collection agencies. Ontario used to require every applicant for registration as a collection agency to be bonded. That ended on January 1, 2018. O. Reg. 460/17 revoked sections 2 to 12 of R.R.O. 1990, Reg. 74, which held the bond rules, substituted a new section 12 on registrant experience, and came into force on "the later of the day it is filed and January 1, 2018." The current regulation shows "2.-11. Revoked: O. Reg. 460/17, s. 2."
Some of the bonding framework remains in the statute:
One caution. An Ontario form information sheet dated 2022 still describes a $5,000 bond for collection agency registration. We rely on the regulation as published on e-Laws, which no longer contains a bond requirement. If you see the older wording, ask the registrar which rule it applies.
Debt collectors and debt repayment agents. British Columbia's Debt Collection and Repayment Regulation (B.C. Reg. 295/2004) sets the security by formula. Under section 12(2), it "must be the greater of (a) $10 000, and (b) the lesser of (i) 10% of the gross amount received or collected by the licensee for the preceding calendar year … less the fees or commissions applicable …, rounded up to the nearest $1 000, and (ii) $50 000." In plain terms, the security is at least $10,000. Above that it scales with the money handled, but the formula alone does not take it past $50,000.
Other rules in section 12:
Consumer Protection BC is the regulator and the obligee. The same security rule applies to licensed bailiffs, because the regulation designates bailiffs alongside collection agents and debt repayment agents (s. 1.1).
Electrical and gas contractors. Technical Safety BC says: "We require a $10,000 surety bond prior to issuing or renewing an electrical or gas contractor licence." If a contractor neglects or refuses to fix non-compliances it is responsible for, the provincial safety manager may call the bond. The surety then hires a licensed contractor to correct the work, up to $10,000. The bond must name "British Columbia Safety Authority" as obligee. The $10,000 figure is set by the regulator, not by statute (source 12 below, checked November 2, 2026). The Safety Standards General Regulation requires "the bond required by the provincial safety manager" and lets the surety rectify work "up to the maximum amount of the bond" (B.C. Reg. 105/2004, ss. 6(b) and 11), but prints no dollar amount.
Our bond wordings library has field cards for the BC, Saskatchewan and Yukon electrical and gas contractor bonds and for provincial driver-training school bonds. Each card links to the official source.
Alberta takes a different approach. Several consumer-licensing regulations require security, but they leave the form and amount to the Director:
The General Licensing and Security Regulation (Alta. Reg. 187/1999) sets common rules for these securities:
For automotive businesses, the Alberta Motor Vehicle Industry Council (AMVIC) sets the amounts in its Licensing Policy (Version 10, approved June 15, 2026; source 17 below, checked November 2, 2026): wholesale business licence $50,000; consignment business licence $300,000. These figures are set by the regulator, not by statute. The Registrar may also impose security on any licensee. AMVIC accepts an irrevocable standby letter of credit, a surety bond or cash, and keeps the security for at least three years after the licence ends. These are policy amounts, which can change without an amendment to the regulation. AMVIC's own General Surety Bond form names the obligee as the Alberta Motor Vehicle Industry Council "as represented by the Chief Executive Officer of AMVIC" (source 28).
Manitoba's Consumer Protection Regulation (M.R. 227/2006) requires bonds for two licence types:
The regulation lets the province accept collateral security bonds instead (ss. 26(2), 27(2)). Neither section states a dollar amount, and the province's published collection-agent bond form leaves the amount blank. The obligee on that form is "Her Majesty the Queen in right of the Province of Manitoba". A claim must be made within two years after the principal's licence or business ends.
Saskatchewan. The Electrical Licensing Regulations set the guarantee bond for a contractor's licence at "(a) subject to clause (b), $10,000; or (b) $30,000, if the principal under the guarantee bond has had a claim against or paid under a guarantee bond" (s. 10(1)). The surety must be "licensed to carry on business in Saskatchewan and to be acceptable to the ministry" (s. 11).
The Gas Licensing Regulations use the same structure: "a guarantee bond in the penal sum of $10,000", or $30,000 if there has been a claim against the bond or it was cancelled for cause. On its bond pages, the Technical Safety Authority of Saskatchewan (TSASK) names itself as obligee and lists what an electronic bond must show.
The higher amount after a claim is unusual in Canada. A contractor whose bond has paid out costs more to re-bond, and it also needs more surety capacity.
Yukon. Under the Electrical Protection Regulation, 1992, "The bond required of an applicant for a contractor's licence by subsection 14(2) of the Act must be in the amount of $1,000 forfeitable to the Government of the Yukon as security for the contractor's compliance with the Act and these regulations" (s. 4(3)). The licence term is one year (s. 4(8)).
Federal licences can carry security too. The Customs Brokers Licensing Regulations say: "Before a licence is issued or renewed, the applicant must give security in accordance with the requirements of the Financial Security (Electronic Means) Regulations and in the amount of $50,000" (SOR/86-1067, s. 10, as amended by SOR/2024-41). The $50,000 amount is not new: the version in force from March 22, 2006 to October 20, 2024 set the same figure as a deposit with the chief officer of customs. The reference to electronic security reflects the Canada Border Services Agency's move to electronic financial security. Importers' release security is a separate instrument. See our guide to customs surety, CARM and the importer's security.
Canadian regulators use a few other tools alongside, or instead of, licence bonds:
In practice a fund pools risk across all licensees, while a bond ties a fixed sum to one licensee. A bond can be exhausted by a single bad actor, and a fund depends on the contributions and rules behind it. Arizona is a US example of a state that runs a recovery fund alongside its contractor licence bonds.
"Statutory" marks an amount printed in a statute or regulation. "Set by the regulator, not by statute" means the law leaves the amount to the regulator, and the figure comes from the regulator's own page or policy. Check the source before relying on any row.
| Jurisdiction and regime (source) | Who must post | Amount and obligee |
|---|---|---|
| Quebec, RBQ contractor licence security (Building Act s. 84; CQLR c. B-1.1, r. 9, ss. 25–37) | Licensed contractors, except those holding only the new-home guarantee-plan subclasses | $40,000 general; $20,000 specialized only (statutory). Obligee: Régie du bâtiment du Québec |
| Ontario, bailiff bond (Bailiffs Act s. 14; R.R.O. 1990, Reg. 53, s. 3) | Bailiffs and assistant bailiffs | $5,000 (corporation, owner or partner); $1,000 (other bailiffs, assistants) (statutory). Obligee: Crown in right of Ontario |
| Ontario, collection agency bond (former Reg. 74 bond rules, revoked by O. Reg. 460/17) | No one since January 1, 2018 | Not applicable |
| British Columbia, debt collection and repayment security (B.C. Reg. 295/2004, s. 12) | Licensed collection agents, debt repayment agents and bailiffs | Greater of $10,000 and the lesser of 10% of net collections and $50,000 (statutory). Obligee: the director (Consumer Protection BC) |
| British Columbia, electrical and gas contractor bond (B.C. Reg. 105/2004, ss. 6 and 10–11; Technical Safety BC) | Electrical and gas contractors | $10,000, set by the regulator, not by statute (checked November 2, 2026). Obligee: British Columbia Safety Authority |
| Alberta, consumer licence security (Alta. Regs. 194/1999 s. 8, 185/1999 s. 5, 187/1999) | Collection and debt repayment agencies; prepaid contractors; other consumer licences | Set by the Director. Obligee: the Director |
| Alberta, automotive business security (Alta. Reg. 192/1999, s. 4(2); AMVIC Licensing Policy) | Wholesale and consignment licensees, and others the Registrar requires | $50,000 wholesale; $300,000 consignment, set by the regulator, not by statute (checked November 2, 2026). Obligee: AMVIC, as represented by its Chief Executive Officer (AMVIC bond form) |
| Manitoba, vendor and collection agent bonds (M.R. 227/2006, ss. 26–27) | Direct-sale vendors; collection agents | Not stated in the regulation. Obligee: the Crown in right of Manitoba |
| Saskatchewan, electrical and gas contractor guarantee bond (Electrical Licensing Regs s. 10; Gas Licensing Regs) | Electrical and gas contractors | $10,000; $30,000 after a claim (statutory). Obligee: Technical Safety Authority of Saskatchewan |
| Yukon, electrical contractor bond (O.I.C. 1992/017, s. 4(3)) | Electrical contractors | $1,000 (statutory). Obligee: Government of the Yukon |
| Federal, customs broker security (SOR/86-1067, s. 10) | Licensed customs brokers | $50,000 (statutory). Obligee not named in s. 10; the CBSA administers it |
US contrast. In the United States, licence bonds are set state by state, and often city by city, under statutes that name a specific dollar amount for each licence type. Contractor licence bonds are the largest group, and some states use recovery funds instead of, or alongside, bonds. In the Canadian regimes covered here, more of the amounts are left to the regulator, and some provinces rely on guarantee plans or compensation funds as well as, or instead of, bonds. Compare state rules in our guide to contractor license bonds by state.
A licence bond doesn't simply end when the licence does. Most regimes keep it open for claims for a set period.
| Jurisdiction | Cancellation notice | Claim window or tail |
|---|---|---|
| Quebec (RBQ) | At least 60 days' written notice to the RBQ | 3 years from the cause of action, for contracts or work while the security was in force |
| Alberta (consumer licences) | 3 calendar months' notice to operator and Director | Declaration of forfeit while in force or within 2 years after; later if a notice of liability was sent |
| British Columbia (debt collection) | Not stated in s. 12 | No claim more than 2 years after the default; security returned 2 years after the licence ends |
| Ontario (bailiffs) | Per the bond form | Claims within 2 years of forfeiture or cancellation (Bailiffs Act s. 16) |
| Manitoba (collection agents) | Two calendar months' written notice to the Director (bond form) | Notice of claim within 2 years after the licence or business ends |
| AMVIC (Alberta) | Per the bond | Security held at least 3 years after the licence ends |
When a bond pays, the surety will look to the licensee and any indemnitors to repay it. Our guide to surety claims basics explains how a surety investigates, pays or denies a claim, and what reimbursement follows.
General education, not legal advice. Use it as a list of questions for your regulator, lawyer and surety professional.
Before you apply for the licence
Once bonded
If you are a customer
What is a licence bond in Canada? A surety bond, or other security, that a business gives a regulator before it can be licensed. It guarantees the business will follow the licensing law. If it doesn't and people the law protects suffer a loss, the regulator or Crown can recover from the surety up to the bond amount.
Which provinces still require contractor licence bonds? Of the regimes we checked, Quebec requires licence security from RBQ-licensed contractors. British Columbia, Saskatchewan and Yukon require bonds from electrical contractors, and British Columbia and Saskatchewan also require them from gas contractors. Other provinces may have their own trade requirements; check your regulator.
How much is the RBQ licence bond in Quebec? $40,000 for a general contractor subclass and $20,000 if the contractor holds only specialized subclasses, under section 27 of the regulation. Contractors whose licence covers only the new-home guarantee-plan subclasses post no licence security.
Do Ontario collection agencies still need a bond? No. The bond requirement in R.R.O. 1990, Reg. 74 was revoked by O. Reg. 460/17, effective January 1, 2018. The statute still allows a bond requirement to be made by regulation, and a bond can be filed in lieu of a freeze order.
Can I use a letter of credit or cash instead of a bond? Often, but not always. Quebec, British Columbia's debt-collection regime, Alberta and AMVIC accept letters of credit or cash. Technical Safety BC and TSASK publish surety bond requirements only.
Does a licence bond protect the business that buys it? No. It protects customers, clients, creditors or the Crown. If the surety pays a claim, the licensee must usually repay the surety.
Retrieved or confirmed November 2, 2026 (PT).
