Canada

Canada will shut down the rail operator whose tanker train blew up in a Quebec town last month, killing 47 people, because the firm does not have enough insurance to pay clean-up costs and other damages, a government regulator said on Tuesday, Reuters reported. The Canadian Transportation Agency said it would suspend the operating license of Montreal, Maine and Atlantic Railway (MMA) and its Canadian subsidiary from Aug.

The Canadian subsidiary of Montreal, Maine & Atlantic Railway, whose train ravaged Lac-Mégantic, got the creditor protection it was seeking, but the Quebec Superior Court judge who granted its request had some harsh words for the railway’s directors, The Globe and Mail reported. Justice Martin Castonguay granted the stay of proceedings against the railway company on Thursday to “avoid judicial anarchy.” However, the judge initially excluded the directors of Montreal Maine & Atlantic Canada from the court’s protection.

The U.S.-based company whose train derailed in Lac-Mégantic, Que., last month announced Wednesday that it has filed for bankruptcy protection in both Canada and the United States, The Globe and Mail reported. Montreal, Maine & Atlantic Railway issued a statement Wednesday afternoon saying it has filed for Chapter 11 bankruptcy protection in the U.S. Bankruptcy Court in Maine. The Canadian division of the company also filed a petition under the Companies’ Creditors Arrangement Act with the Superior Court of Quebec in Montreal, according to the statement.

Syncapse, the social media marketing management company that had hoped to provide enterprise-level solutions for companies such as Coca-Cola and Johnson & Johnson on Facebook, has filed for Chapter 15 bankruptcy protection in U.S. federal court, Business Insider reported. Syncapse was one of Facebook's "preferred marketing developers," a company that qualifies to serve ads into, and gather analytics from, the social network. The move suggests that the economics of social media marketing, absent being acquired by a bigger company, are more difficult than they may appear.

Rona Inc, Canada's biggest home-improvement retailer and distributor, will close stores, cut jobs and reduce costs in the second phase of a restructuring plan designed to return it to profitability, the company said on Thursday. Rona said it plans to close 11 unprofitable stores; reduce administrative, marketing, merchandising and distribution costs; and cut a further 125 administrative jobs.

Canada's biggest securities regulator accused Ernst & Young LLP of failing to properly audit the financial statements of Zungui Haixi Corp. ahead of the Chinese shoe maker completing a 39.8 million Canadian dollar ($38.1 million) initial public offering in 2009 and listing its shares on the junior Canadian TSX Venture Exchange. The allegations come after the Ontario Securities Commission in December alleged the big accounting firm failed to adequately audit the financial statements of Sino-Forest Corp. between 2007 and 2010.

Amid skyrocketing professional fees, the United States and the United Kingdom have figured out that the self-regulated industry of salvaging distressed companies is in desperate need of rescue. Not so in Canada, the Financial Post reported in a commentary. Consider the four-and-a-half-year winding down of Nortel Networks Corp.

GM Canada faces billions of dollars worth of liabilities later this decade, most of which will come due as vehicle production declines in Oshawa, The Globe and Mail reported. Pension costs are scheduled to soar, interest-free loans from governments will hit their repayment date and payments on a note issued to finance health care costs start kicking in as production commitments the company made to the federal and Ontario governments in 2009 expire.

The patient is doing better but is still in intensive care: That’s the Bank of Canada’s latest assessment of risks to the Canadian financial system amid a prolonged period of fragility for the global economy, The Globe and Mail reported. Risks to the Canadian financial system “have decreased somewhat” in the past six months, the Bank of Canada said in a report issued Thursday, the first release from the bank under the watch of new governor Stephen Poloz. The bank cited an easing of short-term risks in the U.S.

Canadians keep getting new credit cards. And, despite all the worries about record-high household debt, they keep paying them off, The Wall Street Journal Real Time Canada blog reported. Overall consumer credit, excluding mortgages, has grown robustly in the years since 2009, but delinquency and default rates have remained at low levels, according to credit-card data released Thursday by credit rater Equifax and Moody's Analytics.