The Ontario government has asked for comments on regulations affecting the new Ontario Not-For-Profit Corporations (ONCA).  The deadline is today.

ONCA consultation:  Proposed regulations to support proclamation of the Not-for-Profit Corporations Act, 2010   (also here is a PDF of the proposed regulations)

As we’ve noted before if ONCA does not come in to force us or it is extended then it will die this year. So it is good to see that finally the government is disclosing a consultation copy of certain proposed regulations under ONCA.  This means that there is a greater likelihood that the Ontario government wishes and will bring ONCA into force.   That is the good news!

Warning at the rest of this note is going to be negative and you may just skip it if COVID-19 is getting you down.

The ONCA was passed in 2010 and supposed to be brought into force in 2013.  It has been a mess that transcends the McGuinty government, the Wynn government and the Ford government.   It is a truly “bi-partisan” mess.    It will provide textbook examples for academics of how not to bring in new legislation and probably one day an investigative reporter will work out what a New Zealand company was doing with the IT and how much where the cost overruns.

Some points:

  1. There is still no word as to when the ONCA will be coming into effect!  Perhaps it will be January 1, 2021, perhaps it’ll never come into effect or perhaps it’ll come into effect in July 2021 or January 2022.
  2. During the pandemic, the government put up the ONCA regulations as part of a large package of documents.  They gave people a two week period to provide comments which ends today.  I just happened to notice this “consultation“ on Saturday.  Yes, it could look like this was being pushed through under the table.  I spoke to another lawyer who has been involved with ONCA for longer than myself and he could not even find this document until the weekend. A courtesy email to some of the individuals or groups who were involved in this matter over the last 10+ years wouldn’t have taken more than 10 minutes but I guess that was too much to ask for.
  3. These regulations affect about 30,000 to 40,000 Ontario corporations under the OCA. Unfortunately, I can’t be more specific as to how many corporations it affects because the government refuses to release that information on which groups are active vs dissolved and after years of fighting them to provide such basic information and only obtaining a list of names, I’ve given up.
  4. The government has insisted quite strenuously on a number of occasions that if there were be any updates on the ONCA they would put them up on this page.  Needless to say there was no update on the page relating to this consultation and the content has not been updated since December 31, 2019.    Because they insisted so strenuously that updates would appear there but I’m hoping someone will create a TickTock video on that.
  5. Yes I have some concerns with the regulations but I’m not gonna waste my time putting in a submission as the Ontario government doesn’t really care and the last time I put in the submission dealing with the PGT and compensation of directors of charities (and I think many groups put in submissions) the multi-page consultation draft did not change by one word.  So it’ll be interesting to see what happens to these regulations but this does appear to be a consultation for ticking a box to say that they had a “consultation”.
  6. By the way if you like the regulations that’s great. Just keep in mind they’re just regulations so a future government can change them quite easily. Also if you don’t like the regulations take a little comfort in knowing that a future government can change them quite easily!  ONCA should have been brought in in 2013 and let’s get going.
  7. As an aside, my main concern with ONCA still remains that it imposes a complete extra layer of regulation on “Charities“ that are also registered Charities with CRA and I feel that that is quite unnecessary.  If you were a federal corporation under the CNCA you do not need to obtain for example permission of PGT to change your objects.

A reminder that with ONCA not yet in force that you should almost never set up an Ontario corporation.  As well another reminder is that if you want to avoid all of this ONCA uncertainty in many cases you’re better off to move from the Ontario Corporations Act (OCA) to the Canada Not-for-profit Corporations Act (“CNCA”) under federal jurisdiction.