For those of you who have had the pleasure of volunteering with a Not-for-Profit organization this year, or for those who are thinking about volunteering in the future, there are some key issues to report on.
The top priority for Federally incorporated not-for-profits is the transition to the Canada Not-for-profit Corporations Act (the “CNCA”). It is hard to believe that the Canada Not-for-profit Corporations Act (the “CNCA”) came into force more than two years ago. That means that for not-for-profits who have yet to comply there is only ten months left to successfully transition to the CNCA.
The deadline to file the Articles of Continuance is October 17, 2014. If the Articles of Continuance are not filed by this deadline, the corporation will be dissolved.
If you have not started this process, you should take immediate steps to:
- Review the current letters patent and existing by-laws;
- Draft the Articles of Continuance;
- Create a new set of by-laws that comply with the CNCA or revise the current set;
- Have the members of the Corporation approve both the Articles of Continuance and new by-laws, by special resolution, at a members meeting; and
- Submit the Articles of Continuance and by-laws to Corporations Canada to receive your Certificate of Continuance.
Please keep in mind that the Articles of Continuance and by-laws must be approved by special resolution. This can easily be accomplished at your annual general meeting but if that is not possible, special steps will need to be taken to ensure that the Corporation has the approval of the members to submit the necessary documents for Continuance.
Ontario’s Not-for-Profit Corporations Act, 2010
Board members for not-for-profits registered in Ontario remain in a wait-and-see period. As some of you may recall, the new Ontario Not-for-Profit Corporations Act, 2010 (the “ONCA”) has been scheduled to come into force at several different dates over the past two years, but each time there have been postponements to its implementation, the most recent date being January 1, 2014.
This past summer, amendments to more than 80 statutes, including the ONCA, were introduced in the provincial legislature. As a result, the January 1, 2014 day was postponed as it was anticipated that these amendments would be debated throughout the fall of 2013 and spring of 2014.
If the results of these debates result in the amendment of the ONCA, it is anticipated that the new date to come into force would be no earlier than six months after the passage of the statute. This means that we can expect the ONCA to come into force no earlier than late summer 2014. Once the new law comes into force, Ontario not-for-profits, like their federal counterparts, will have three years to transition to the new legislation. However, unlike the Federal legislation which dissolves not-for-profits who don’t comply within three years, Ontario not-for-profits will be deemed to have complied even if they have not taken the necessary steps themselves within the allotted time period.
As always, we will keep a keen eye on the Ministry of Consumer Services and will inform you of any updates provided.