Topics: What's New from the Charities Directorate of CRA, Canadian Charity Law, New corporate non-profit acts
Over the last 6 weeks Corporations Canada of Industry Canada has sent out an estimated 16,000 notices to approximately 6000 Canadian Federal non-profit corporations that are still under the Canada Corporations Act (CCA). Industry Canada sends notices to the corporation and to each director. They also publish the names of the corporations online.
Industry Canada in the past has generally estimated that there were 17,000 CCA Federal corporations. Actually on their database there were over 25,000 CCA corporations but many of them are assumed to be dormant as they have not filed in many years. The 8000 dormant corporations are the ones that Industry Canada is targeting first. Most of the 6000 corporations that received notices of pending dissolution so far would be in that dormant category.
Of the 17,000 approximately 11,500 have moved over to the CNCA. There are probably others in the pipeline. Apparently Industry Canada called a large number of corporations this summer and about 10% we waiting to be dissolved.
Industry Canada has endeavored to remove registered charities for now from the list of corporations receiving the notices of pending dissolution. However, as the names on their database and the CRA database may not be consistent and Industry Canada does not have business numbers for the older corporations, we can expect that some registered charities that may not be up to date in their filings may receive notices of pending dissolution. It is particularly problematic for a registered charity to be dissolved as they will at some point also lose their charity status as CRA takes the position that a corporation that does not exist cannot be a registered charity.
With the corporations still under the CCA, Industry Canada will only send out notices by Canada Post if they have a valid address. In the past Industry Canada has mailed notices to a corporation and the mail was returned to Industry Canada then Industry Canada makes a note that the address is not valid. Industry Canada will not mail to an invalid address.
If you would like to see the list of CCA corporations that have been sent notices of pending dissolution then see the Industry Canada monthly transactions and find "Notice of Decision to Dissolve (Failure to Transition) (NFP)"
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Mark Blumberg is a partner at the law firm of Blumberg Segal LLP in Toronto and works almost exclusively in the areas of non-profit and charity law.