Corporate Lawyer for Medical Doctors in Ontario: Professional Corporations, Clinics & Business Agreements

Practising medicine in Ontario can involve much more than providing clinical care. Physicians may incorporate professional corporations, own or operate clinics, work with associates, employ administrative staff, enter management arrangements, negotiate commercial leases, acquire other practices, and eventually sell or transition their businesses.

Those arrangements create corporate and commercial legal issues that need to work alongside a physician’s professional obligations.

I’m Raz Toor, the founder of Falcon Law PC. We regularly advise Ontario physicians and medical-clinic operators on professional corporations, clinic structures, commercial contracts, associate arrangements, leases, healthcare business transactions and related corporate matters.

For physicians, good corporate legal planning is not simply about creating a corporation. The goal is to make sure the corporation, contracts, clinic structure and business relationships actually work together.

What Does a Corporate Lawyer Do for a Physician?

Depending on the physician’s practice, corporate legal work can include:

• forming a medicine professional corporation;
• preparing and maintaining corporate records;
• changing shareholders or corporate structures;
• reviewing clinic ownership arrangements;
• drafting shareholder agreements;
• drafting associate and locum agreements;
• reviewing independent-contractor arrangements;
• negotiating management agreements;
• reviewing medical director agreements;
• negotiating commercial leases;
• buying or selling a medical practice;
• reviewing equipment and service agreements;
• planning for retirement or succession; and
• providing ongoing corporate and commercial advice as the practice grows.

The appropriate structure depends heavily on whether the physician is practising alone, sharing expenses with other doctors, operating a clinic, entering into business with other physicians, or working within a clinic owned by somebody else.

Medicine Professional Corporations in Ontario

Many Ontario physicians practise through a medicine professional corporation.

This is not the same as setting up an ordinary Ontario business corporation.

The corporation must comply with Ontario professional-corporation legislation and the requirements of the College of Physicians and Surgeons of Ontario.

CPSO requires incorporated medical practices to obtain a Certificate of Authorization before practising medicine through the corporation.

The incorporation process therefore generally involves:

• selecting a compliant corporate name;
• preparing appropriate articles of incorporation;
• establishing the permitted share structure;
• incorporating under the Ontario Business Corporations Act;
• preparing the corporate minute book;
• issuing shares;
• appointing directors and officers; and
• applying to CPSO for the Certificate of Authorization.

The Corporate Name Is Restricted

Ontario physicians do not have complete flexibility when naming a medicine professional corporation.

CPSO currently requires the name to contain the surname of a physician shareholder as it appears on the College register. Given names or initials may also be included.

The name must also contain:

“Medicine Professional Corporation”

or the permitted French equivalent.

CPSO specifically cautions physicians to make sure the corporation’s articles, particularly the corporate name, satisfy its requirements before filing the incorporation.

Who Can Own a Medicine Professional Corporation?

Ownership of an Ontario medicine professional corporation is more restricted than ownership of an ordinary corporation.

Voting ownership must remain with qualifying physicians.

Certain family members of a physician shareholder may be permitted to hold non-voting shares. CPSO currently recognizes qualifying family relationships including spouses, common-law spouses, children, step-children, parents and step-parents, subject to the applicable statutory rules.

These rules need to be reflected in the articles, share issuances and corporate records.

The fact that a person can legally hold a particular class of shares does not necessarily mean issuing those shares makes sense from a tax perspective. I generally recommend that physicians coordinate the proposed share structure with their accountant before shares are issued to family members.

Can a Holding Company Own the Professional Corporation?

This is an important limitation for physicians.

CPSO currently states that a holding company cannot own shares in an Ontario medicine professional corporation.

That differs from corporate structures available in some ordinary businesses.

A physician may still have other corporations involved in their broader business affairs, depending on the circumstances, but those structures need to respect the ownership restrictions applicable to the medicine professional corporation.

For example, a separate corporation may sometimes be considered for legitimate non-clinical business activities, assets or clinic-management functions. That does not mean the separate corporation can simply own the physician’s professional corporation.

A Professional Corporation Does Not Eliminate Professional Liability

Another common misconception is that incorporation shields a physician from liability for their own professional negligence.

It does not.

Practising through a professional corporation does not remove the physician’s personal responsibility for professional services.

The corporation may still provide useful separation for certain ordinary business obligations, but physicians should not treat incorporation as a substitute for appropriate professional liability protection.

Corporate Law and Tax Planning Need to Be Coordinated

Tax planning is often one of the reasons a physician considers incorporation.

The legal and tax work should therefore be coordinated.

The lawyer can establish the corporation, share structure and corporate documents. The accountant or tax adviser should advise on matters such as:

• whether incorporation makes financial sense;
• salary versus dividends;
• retaining funds within the corporation;
• family shareholdings;
• tax on split income;
• investment income;
• corporate tax filings;
• retirement planning; and
• the tax consequences of a future sale or reorganization.

I generally prefer to determine the intended tax structure before finalizing the corporation rather than asking the accountant to work around an unnecessarily restrictive share structure afterward.

What Happens When Several Physicians Own a Practice Together?

A group practice creates a different set of issues.

It is not enough simply to put several physicians into the same corporation or clinic and agree informally that everyone will share expenses.

The parties should determine who owns what.

That may include ownership of:

• the professional corporation;
• the clinic operating company;
• medical equipment;
• leasehold improvements;
• the clinic brand;
• the website and telephone numbers;
• administrative infrastructure;
• the EMR licence;
• other intellectual property; and
• other business assets.

The structure should also determine what happens when a physician eventually retires, becomes disabled, dies or wants to leave.

Shareholder Agreements for Physicians

Where multiple physicians own a corporation together, a shareholder agreement can become one of the most important documents in the practice.

It can address:

• ownership percentages;
• voting rights;
• management responsibilities;
• compensation;
• capital contributions;
• expense sharing;
• admission of new physicians;
• share transfers;
• retirement;
• disability;
• death;
• buy-sell mechanisms;
• valuation;
• deadlock resolution;
• restrictive covenants;
• dispute procedures; and
• the eventual sale of the practice.

These provisions are much easier to negotiate while the physicians have a good relationship than after someone announces that they want to leave.

Cost-Sharing Arrangements Between Physicians

Not every group of physicians needs to jointly own a professional corporation.

Some doctors maintain separate professional corporations but share clinic expenses.

A cost-sharing agreement may deal with:

• rent;
• administrative staff;
• equipment;
• software;
• supplies;
• utilities;
• insurance;
• reception services;
• billing support;
• EMR systems;
• maintenance;
• common areas; and
• other overhead expenses.

The agreement should explain how expenses are calculated and what happens when a physician joins or leaves the arrangement.

Associate Physician Agreements

Many medical clinics operate with associate physicians who do not own the clinic.

The associate agreement should reflect the actual relationship rather than simply using a generic independent-contractor template.

Issues can include:

• services to be provided;
• clinic hours;
• billing arrangements;
• overhead deductions;
• administrative support;
• professional independence;
• EMR access;
• patient records;
• privacy obligations;
• vacation and coverage;
• insurance;
• termination;
• patient notification;
• post-termination record access; and
• non-solicitation or other restrictive provisions where appropriate.

The agreement should also be consistent with the physician’s professional obligations. A commercial contract cannot override a physician’s responsibility to exercise independent professional judgment.

Patient Records Need to Be Addressed in the Contract

Patient records deserve particular attention in physician business arrangements.

CPSO currently requires physicians to have a written agreement establishing custodianship and clear accountabilities for medical records where physicians practise in a setting with multiple contributors to the record system or where they do not own the practice or EMR licence.

Those agreements should address matters including:

• custody and control of the records;
• privacy and security;
• storage;
• retention;
• destruction;
• patient access;
• physician access;
• what happens when a physician leaves; and
• enduring access where records are required for professional or legal purposes.

This is why I would not leave patient-record provisions to a one-line clause stating that “all charts belong to the clinic.”

Management Companies and Clinic Structures

Some physician practices separate professional medical services from the non-clinical operation of the clinic.

For example, a separate management corporation may provide or control:

• clinic premises;
• administrative staff;
• equipment;
• IT systems;
• marketing;
• reception;
• billing support;
• supplies; and
• other non-clinical business services.

Where a management company is involved, the agreement needs to distinguish legitimate business-management functions from clinical decision-making.

A clinic owner, investor or management company should not be given contractual authority that improperly interferes with a physician’s independent medical judgment or professional obligations.

Medical Director Agreements

Medical director arrangements can arise in clinics involving physicians, nurses, nurse practitioners, medical aesthetics, multidisciplinary care or other clinical services.

The title “medical director” is not itself enough to establish what that person is actually responsible for.

The agreement should define the physician’s role.

Depending on the clinic, issues may include:

• clinical oversight responsibilities;
• availability;
• protocol development;
• medical directives;
• chart review;
• quality assurance;
• staff education;
• reporting;
• professional independence;
• insurance;
• compensation;
• termination; and
• limits on the physician’s responsibility for matters they do not supervise or control.

The documentation should reflect what the physician will actually do rather than using the medical director title as a general solution to every regulatory issue.

Commercial Leases for Medical Clinics

The lease can be one of the largest and longest contractual commitments made by a physician-owned clinic.

Medical premises can also have requirements that an ordinary office lease does not adequately address.

When reviewing a medical-clinic lease, I would consider matters such as:

• permitted medical use;
• zoning;
• exclusive-use rights;
• lease term and renewal options;
• base and additional rent;
• personal guarantees;
• assignment rights;
• change-of-control provisions;
• signage;
• parking;
• accessibility;
• build-out requirements;
• landlord and tenant work;
• HVAC and electrical requirements;
• bio-medical waste;
• insurance;
• restoration obligations;
• relocation clauses; and
• what happens to the lease when the practice is eventually sold.

You can learn more about our Ontario commercial lease legal services.

Buying or Selling a Medical Practice

Physicians who buy or sell established practices face additional corporate and healthcare issues.

A transaction may involve:

• an asset purchase;
• a share purchase;
• professional goodwill;
• medical equipment;
• commercial leases;
• employees;
• associate physicians;
• clinic contracts;
• EMR arrangements;
• patient-record custodianship;
• privacy obligations;
• transition assistance;
• restrictive covenants;
• financing;
• security registrations; and
• closing adjustments.

For a detailed discussion, see our guide to buying or selling a medical practice in Ontario.

Physicians Buying Into an Existing Clinic

A physician who is offered an ownership interest in an established clinic should conduct legal due diligence before paying for shares or goodwill.

I would want to understand:

• which corporation is actually being purchased;
• who currently owns the clinic assets;
• what shares are outstanding;
• whether the minute book is complete;
• what liabilities exist;
• what the lease requires;
• how overhead is calculated;
• how profits are distributed;
• whether shareholder loans exist;
• how new physicians are admitted;
• how ownership can eventually be sold;
• what happens if there is a disagreement; and
• how the purchase price was determined.

Becoming a “partner” in a clinic can mean very different things legally. The documents should make clear exactly what the physician is acquiring.

Employment Agreements for Clinic Staff

Physician-owned practices also operate as employers.

Administrative staff may include:

• receptionists;
• medical office assistants;
• clinic managers;
• billing personnel;
• administrative assistants; and
• other support personnel.

Written employment agreements can help address:

• duties;
• compensation;
• hours;
• benefits;
• confidentiality;
• privacy;
• access to patient information;
• workplace policies;
• termination; and
• return of clinic property and systems access.

Independent Contractors Need More Than a Label

Some clinics use independent contractors for administrative, clinical or other services.

Calling someone an “independent contractor” in the agreement does not necessarily determine their legal status.

The actual relationship matters.

The structure should therefore be reviewed with reference to how the parties will actually work together, including control, integration into the clinic, financial arrangements and the individual’s professional obligations where they are regulated.

Contracts With Technology and Service Providers

Modern medical practices increasingly depend on third-party technology.

Contracts may involve:

• EMR providers;
• online booking platforms;
• billing services;
• virtual-care platforms;
• AI-enabled tools;
• cloud storage;
• communications systems;
• medical equipment providers;
• marketing agencies; and
• other vendors with access to sensitive information.

Physicians remain responsible for meeting their professional and privacy obligations even where commercial service providers are involved.

The contract should therefore be reviewed not only for price and termination rights but also for privacy, data access, security, confidentiality, service continuity and what happens to information when the relationship ends.

Planning for Retirement or Exit

Physicians should ideally think about their eventual exit before they are ready to retire.

A practice transition can involve:

• selling the practice;
• selling shares;
• bringing in a younger physician;
• redeeming another physician’s shares;
• transitioning patients;
• dealing with medical records;
• ending a lease;
• assigning a lease;
• terminating or transferring employees;
• dealing with equipment;
• closing the corporation;
• maintaining access to records; and
• working with the accountant on the tax consequences.

Advance planning can materially improve the physician’s options.

What We Have Been Working On With Ontario Healthcare Practices in 2026

Our healthcare corporate work in 2026 has involved a range of issues that illustrate how closely physicians’ professional and business arrangements overlap.

In one matter, we have been advising on the structure and launch of a physician-led Ontario clinic, including the legal relationships with associate healthcare professionals, the clinic’s business structure and related commercial arrangements.

In another matter, we reviewed and negotiated substantial lease documentation for a new medical clinic. The lease dealt with issues that were specific to the proposed healthcare use, including permitted physician and primary-care services, construction obligations, insurance, bio-medical waste, building systems and the long-term operation of the clinic from the premises.

We have also advised healthcare businesses on medical director arrangements, clinical-versus-administrative responsibilities, independent-contractor structures, clinic acquisitions and the corporate agreements needed to operate healthcare businesses alongside regulated professionals.

These files reinforce the same point: the corporation itself is only one part of the legal structure. The shareholders, lease, professionals, employees, records, management arrangements and commercial contracts all need to fit together.

The examples above have been anonymized and certain details have been generalized to protect client confidentiality.

When Should a Physician Speak With a Corporate Lawyer?

I would generally recommend obtaining legal advice before:

• incorporating a medical practice;
• adding or removing shareholders;
• entering a group practice;
• buying into a clinic;
• opening a new clinic;
• signing a long-term commercial lease;
• bringing in associate physicians;
• creating a management-company structure;
• entering a medical director arrangement;
• buying or selling a medical practice;
• bringing in an investor or business partner;
• making significant changes to compensation arrangements;
• restructuring an existing practice; or
• planning retirement or succession.

Legal advice tends to be more useful before the commercial structure has already been agreed upon.

Corporate Counsel for Physicians and Medical Practices

Falcon Law PC assists Ontario physicians and medical-clinic operators with corporate and commercial matters throughout the life of the practice.

Our work includes professional corporations, corporate records, shareholder arrangements, associate agreements, healthcare management structures, medical director agreements, commercial leases, practice purchases and sales, employment agreements, contractor agreements and ongoing commercial contracts.

For broader corporate structuring and ongoing business matters, see our legal services for entrepreneurs and business owners.

For physicians considering an acquisition or sale, our business purchase and sale practice also covers the broader transactional work involved in acquiring or selling an operating business.

The objective is not merely to prepare documents. It is to create a legal structure that allows the physician’s business arrangements to function while respecting the regulatory responsibilities that continue to apply to the practice of medicine.

This article is intended for general informational purposes only and does not constitute legal, medical-regulatory, tax, accounting, privacy or employment advice. The appropriate structure depends on the physician, professional corporation, clinic arrangement, contracts and individual circumstances.