2018-May-25
Status of Ontario Not-for-Profit Corporations Act and Interim Changes
This update on the law governing not-for-profit corporations is relevant to all GBA member associations that are incorporated entities under Ontario law.
After a series of delays, the Government of Ontario has announced that the new Not-for-profit Corporations Act (passed way back in 2010) is scheduled to be proclaimed in force in January 2020. Not-for-profit corporations will have 3 years after the date of proclamation to come into compliance with the new Act. Meanwhile, the Ontario Corporations Act remains the legislation that applies to not-for-profit corporations incorporated in Ontario.
It is recommended that Ontario not-for-profit corporations wait until the Act is proclaimed before making any associated changes to their by-laws, because the regulations under the new Act have not been published yet, and they will contain important details on the requirements.
Interim Changes
As an interim step, some helpful changes were passed as part of the Cutting Unnecessary Red Tape Act, 2017 and are now proclaimed in force.
- Organizations can hold annual general meetings online or by telephone, unless your by-laws provide otherwise.
- Notices of members’ meetings may be sent online. (Minimum of 10 days’ notice.)
- An organization may waive an audit of financial statements if it has less than $100,000 in revenue in a financial year and 80% of members vote at a meeting (or give unananimous written consent) to waive the requirement.
- The duties and standard of care of the directors and officers are clearly set out. No provision in a contract, instrument of incorporation, by-law or resolution can relieve a director or officer from these duties, or from liability for breach of the Act or regulations.
- Directors are not required to be members of the organization, so if you want to elect an outside director, you can.
- Members may remove a director by a majority vote at a members’ meeting called for that purpose (instead of by a 2/3 majority as required before).