The Ministry of Government and Consumer Services announced that the Ontario Not-for-Profit Corporations Act, 2010 (ONCA) came into force on October 19, 2021. As of October 19, 2021, not-for profit corporations incorporated in Ontario have a three-year transition period to make necessary changes to their government documents to comply with ONCA. At the same time, the Ontario government launched a new Ontario Business Registry to replace outdated technology and provide Ontarians with better access to government services. Ontario not-for-profit corporations can receive more information by signing up to the Ontario Business Registry .
ONCA automatically applies to all Ontario not-for-profit corporations and charities governed by Part III of the Ontario Corporations Act (OCA). It doesn’t apply to not-for-profit corporations incorporated federally under the Canada Not-for-Profit Corporations Act (CNCA).
After the three-year transition period, any provisions in letters patent/supplementary letters patent, by-laws or special resolutions that are inconsistent with ONCA will be deemed to be amended to comply with the ONCA. If your organization is contemplating major changes to its membership or board structures, consider starting the review process now and consult with your members or other relevant stakeholders regarding the proposed changes. Now is a good time to review letters patent and supplementary letters patent, as well as by-laws, for any potential amendment requirements.
ONCA changes include:
- Requirements for directors and officers to report conflicts of interest;
- New distinction between public benefit corporations and other not-for-profit corporations;
- More flexibility for corporations to allow for reviewing financial records (i.e., a “review engagement”) rather than an audit;
- Providing members greater access to financial records.
The OCA will continue to apply for five years for share-capital social clubs. During that time, the club must choose one of the three following options for continuance, which must be approved by special resolution of each class of shareholders by a separate vote:
- As a corporation without share capital under ONCA
- As a for-profit corporation under the Ontario Business Corporations Act
- As a cooperative corporation under the Ontario Co-operative Corporations Act
If you have any questions about how the ONCA might impact your organization or want to learn more about how the Charities and Not-for-Profit team can assist you and your business, please reach out to your Grant Thornton advisor.