What you need to know about the new Ontario Not-for-Profit Corporations Act
After over 10 years, the Ontario Not-for-Profit Corporations Act (ONCA) will be proclaimed into force on October 19, 2021. Non-profits will have three years to review, update, and file governing documents (articles & letters patent) with the Ontario government.
When new regulations come into effect, it can often be overwhelming to understand all the details. Here’s a snapshot of what you need to know to get started with ONCA:
What is ONCA and how does it impact you?
ONCA is replacing the Ontario Corporations Act (OCA) and it’s the enabling legal framework that sets out how non-profit corporations are created, governed, and dissolved.
If your non-profit is incorporated under provincial law, you may be required to make changes to your articles and bylaws to comply with the new regulation by October 18, 2024.
This Act does not apply to non-profits incorporated federally under the Canada Not-for-Profit Corporations Act or another law outside of Ontario.
What is changing?
As the voice for the non-profit sector in Ontario, the Ontario Non-Profit Network (ONN) has partnered with the Community Legal Education Ontario (CLEO) to provide free guidance and resources for the non-profit sector. Their website, Nonprofit Law, includes detailed information on what is changing under the ONCA to help you better understand the future law and prepare for the transition.
Changes to bylaws
When ONCA comes into effect it will impact an organization’s bylaws, specifically:
- When organizational bylaws take effect
- How bylaws are confirmed
- The statutory minimum number of directors required on your board and how to change the number of directors required for your organization
- The requirements for the roles and titles of officers on the board
- Quorum requirements for the board
- Provisions for electronic meetings*
For a more detail overview of the changes housing providers can expect, check out our The Ontario Not-for-Profit Corporations Act: Preparing your organization for change blog post.
*Note: extension of virtual meeting provisions to September 30, 2022
The government of Ontario has recently announced the extension of virtual meeting provisions to September 30, 2022. With the extension, organizations currently governed under certain legislation may continue to hold meetings, including Annual General Meetings, virtually for the next year. The extension applies to organizations governed under the Ontario Business Corporations Act, Ontario Corporations Act, Ontario Co-operative Corporations Act and the Ontario Condomimium Act and, after October 19, the Ontario Not-for-Profit Corporations Act.
See our previous blog post on virtual AGMs for more.
New and changed governance requirements
The recent rollout of regulations for the ONCA (O.Reg 395/21, O. Reg 396/21, and O. Reg 394/21) has clarified specifics on some of the changes for non-profits including:
- Changing the requirement to provide financial statements to members 5 days in advance of Annual General Meetings, as opposed to 21 days under older legislation.
- New design requirements for nonprofits that use proxy forms for voting.
- Updated information, including an email address, required for non-profits’ register of directors, officers and members.
- A list of documents and decisions that non-profits need to keep in writing, such as the revocation of a proxy, notice of resignation for an auditor or director, and information on dissent of a member to a resolution.
Launch of a new Ontario Business Registry
In addition to ONCA coming into force, a new online business registry is also launching on October 19. For not-for-profit corporations, this new system will offer simplified incorporation and maintenance services. With 90+ services available 24/7 and year-round, the registry is intended to make it easier and less time-consuming to register and maintain businesses and nonprofits, comply with government filing requirements, and access to government products and services online. Review the Ontario government’s fact sheet for more information.
4 things you can do today to prepare:
More resources and information on what is changing under the ONCA and what you can do to prepare will be shared with members in the coming months. In the meantime, here’s what you can start doing today:
- Register for the new Ontario Business Registry. Make sure you register to ensure your organization’s information is up-to-date in the new system, learn more about this service and receive your log-in credentials.
- Find out if the ONCA applies to you. You can start by looking up your organization’s legal business name under the Ontario Business Registry’s search function. If your organization is listed, it was incorporated in Ontario. If you’re not sure whether the ONCA applies to your organization, get legal advice.
- Ensure your articles of incorporation or letters patent comply with the ONCA. More information on updating your articles of incorporation (also known as letters patent) and submitting them on the new Ontario Business Registry is available here.
- Update your bylaws. Although it isn’t required, at the end of the three year transition period, any bylaws that haven’t been updated to comply with the new regulations become invalid and will be replaced by the rules under ONCA. Replacing your bylaws now helps you understand which bylaws are valid and ensures you don’t have any bylaws in place in 2024 that no longer apply. Note: registered charities must file updated bylaws with the Canada Revenue Agency within the three year period, not doing so could impact their charitable status.
Looking for help with bylaws?
Check out our new Model bylaws and Guide, a set of comprehensive and customizable documents to help you amend bylaws based on the requirements of the Ontario Not-for-Profit Corporations Act (OCA) and the Housing Services Act (HSA). This set of resources includes information on what sections of the bylaws will change once ONCA comes into effect and will help ease housing providers into the new requirements. It also includes a primer on the legal procedures to change your bylaws.
Note: ONCA has been written so that if its provisions or regulations are in conflict of other legal requirements for the organization, the other legal requirements prevail. If you believe you may be facing a conflict of your legal requirements, seek legal counsel to advise you on the best course of action for your organization.
Do you have questions about governance?
Check out our comprehensive Governance essentials resources for best governance practices tailored specifically to non-profit and housing legislation in Ontario! If you are looking for a more guided learning experience, stay tuned for the next cycle of our online Governance Essentials course.
ONPHA will be working in the coming months to deliver additional information and resources to members about the transition to the ONCA. Have a specific inquiry? Contact us at member.support@onpha.org – we are always happy to hear from you, and to help!
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