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Not-for-Profit Corporations: It May be Time for You to Transition!

Not-for-Profit Corporations: It May be Time for You to Transition!

By:

Mann Lawyers

Posted May 10, 2017

If you are a federal not-for-profit corporation that was incorporated under the Canada Corporations Act, Part II (the “CCA Part II”) and you have not yet transitioned to the new federal not-for-profit legislation – the Canada Not-for-profit Corporations Act, S.C. 2009, c. 23 (the “NFP Act”) – it is now time to do so.

Corporations Canada has set a final deadline of July 31, 2017 for all existing federal not-for-profit corporations to transition to the NFP Act. It is important to remember that the NFP Act does not automatically apply to existing corporations. Therefore, if you are a not-for-profit corporation that incorporated prior to October 17, 2011 and you do not possess a Certificate of Continuance it means that you have yet to “continue” to the new legislation and must do so.

If a not-for-profit corporation does not transition by the deadline, the unfortunate result is that the corporation will be dissolved and will no longer exist as a legal entity. If the corporation is also a registered charity, this may lead to its registered status being revoked.

So what does your not-for-profit corporation have to do to transition? The letters patent of the corporation will have to be replaced by articles of continuance, an initial registered office and first board of directors form filled out and a name search report submitted. Once all documentation is submitted and approved by Corporations Canada, a Certificate of Continuance will be issued to the corporation. Further, the by-law requirements are different under the NFP Act, so it will be necessary for each corporation to review its by-laws and amend them accordingly. New by-laws compliant with the NFP Act and approved by members of the corporation can either be submitted with the continuance documents or filed with Corporations Canada within 12 months of member approval.

If your not-for-profit corporation has not yet transitioned, keep in mind that the corporation must receive its Certificate of Continuance on or before July 31, 2017. For this reason, it is important to start this process early and not wait until the last minute.

The foregoing is meant to be a summary of the requirements to continue under the NFP Act. If you have any questions, please contact us and we will be happy to assist.

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