What is ONCA?
As of October 19, 2021, the Not-for-Profit Corporations Act, 2010, SO 2010, c 15 (“ONCA”) has been in force in Ontario, governing not-for-profit and charitable corporations in Ontario, and replacing the Corporations Act, R.S.O. 1990, c. C. 38.
ONCA has provided existing not-for-profits in Ontario with a three-year transition period to make necessary changes to their governing documents. That means that the deadline to comply for corporations is October 18, 2024 to be in conformity with the new legislative requirements.
Does it affect my organization?
Ontario not-for-profit corporations that were previously governed by the Corporations Act are automatically now subject to ONCA. Importantly, this change in legislation does not affect Federal not-for-profit organizations governed by the Canada Not for Profit Corporations Act (CNCA) that are operating in Ontario.
What happens if the compliance deadline is missed?
If the compliance deadline is missed, the new rules in ONCA will be “deemed” to update the existing organizational documents of organizations. In other words, a new set of rules will govern your organization. This “deemed compliance” could have unexpected consequences, such as changing the membership and board structure of your organization in ways that are not anticipated or desirable.
How do I comply?
Contact your legal advisors and begin the process of reviewing your existing corporation’s letters patent, supplementary letters patent, by-laws, special resolutions and internal policies. An update to your letters patent should be filed as “Articles of Amendment” under ONCA and a new set of corporate by-laws should be drafted, approved and filed.
In our experience, ONCA compliance reviews can take months to complete. Input is required from your organization’s stakeholders, and the final product must be approved by the board and membership. If you think your organization may be affected, we suggest taking action as soon as possible to ensure that updates are completed in advance of the October 18 deadline later this year.