With only a small percentage of Ontario non-profits having finished dealing with the ONCA process, there are many Ontario non-profits (both charities and non-charities) that will have an uphill battle to deal with the changes over the next few months.

Existing non-profit corporations incorporated under Part III of the Corporations Act (Ontario), which is the vast majority of Ontario non-profits, have a 3-year transition period during which to bring their constating documents (i.e. letters patent, by-laws, etc.) into conformity with the new ONCA.  The 3-year transition period will end on October 19, 2024.  Unfortunately, there are only about nine months left to make the changes to bring the Ontario non-profit into compliance with ONCA, or another alternative would be to move to the Canada Not-for-profit Corporations Act (the “CNCA”), which is a modern act and preferable for some organizations.  For registered charities especially, this transition is generally going to be much more complicated.  

 

What are the takeaways?

  1. For most organizations, it makes sense to retain a lawyer who is familiar with non-profit corporate law and if you are a charity, then charity law as well.
  2. Very few organizations in Ontario that are under ONCA have made the changes necessary to bring them into alignment with the requirements of ONCA.
  3. The Ontario non-profit and charity sector is really important.  You can see Blumbergs’ Snapshot of the Ontario Charity Sector 2021.  Just the registered charity part of such sector has expenditures of $118 billion, including spending $67.2 billion on salaries and compensation.   Not every charity in Ontario is an Ontario non-profit corporation (some are Federal or trusts or unincorporated associations), but most are Ontario non-profit corporations, and any disruption or problems in the governance of these organizations can be costly.
  4. For those who are interested, we have a course you can buy on ONCA.Ontario not-for-profit corporations and dealing with ONCA, but now may be too late for just watching courses. Obtaining legal advice to move more quickly through the process is important.
  5. As we have discussed in a recent article, the timelines may be quite tight for some groups: “Ontario Not-for-Profit Corporations Act (“ONCA”) – only a little more than one year for groups to make changes and for some this may not be enough time“.
  6. Non-profits and charities have a lot on their plate.  Raising funds, running programs, dealing with so many stakeholders.  Presumably, some are procrastinating. But it may be very difficult next year to get the assistance that is needed, and for registered charities, especially the CRA Client Assistance has already slowed down, so typically, waiting times for object reviews are now six months.  This may get even worse.
  7. We feel bad for volunteers working with non-profits in Ontario.  There is so little support for them.   Many of the non-profits and charities, including some large organizations, are spending hundreds of hours trying to do the transition themselves.  We have been approached by many groups who have prepared documents and expended a lot of time, and are asking us to quickly review those documents, and unfortunately, they did not understand what was needed and all the rules around these changes, so the effort was a complete waste of their time.  Very unfortunate.   This is a once-in-a-120-year change!  Get legal advice from a lawyer knowledgeable about non-profit corporate law, and if you are a charity, then a lawyer who is also knowledgeable about charity law.

If you wish to retain our law firm to deal with ONCA changes you can contact us now.