Understanding the Ontario Not-for-Profit Corporations Act

The Ontario Not-For-Profit Corporations Act (ONCA) is a piece of legislation designed to provide regulatory structure to the actions and operations of non-profit organizations. This is an important piece of legislature due to the wide variety of non-profit organizations operating in Ontario and their importance to the province’s economy and society.

The ONCA was enacted in 2010 and provides several key provisions to non-profit organizations. First, it outlines the legal setup process that organizations must go through to acquire their non-profit corporate designation. This includes a description of filing and record-keeping requirements as well as information about the limited number of board members that can serve as well as their responsibilities. Additionally, ONCA defines how members should participate in the decision-making process and how disputes should be settled within the organizations.

The ONCA also outlines how non-profit organizations can use their donations, funds and generally operate. It provides rules concerning financial reporting, the distribution of funds and the use of donated property. The act also outlines the governance structure for non-profit organizations, including a listing of board member criteria, how directors should be appointed, and delegation of power to board members to conduct operations on behalf of the organization.

By setting out clear requirements and standards for non-profit organizations, ONCA provides a legal framework in which these organizations can operate. This allows the organizations to better serve their members, donors and constituencies while they also protect the rights of their members and contribute to the greater economic and social welfare of Ontario. It also provides assurance to organizations that their activities are in compliance with all applicable provincial laws.

One of the primary benefits of the transition to ONCA is the reduction of legal costs. Under ONCA, organizations are subject to a streamlined process for incorporating and registering, which eliminates the need to hire legal counsel and other costly services. ONCA also simplifies the process for filing documents and updating corporate structures, which can save the corporation time and money in transitioning from the OCA to ONCA. Additionally, ONCA provides clear guidance on corporate governance rules and regulations, which can greatly reduce potential legal liabilities.

The first step in transitioning to the Ontario Not-For-Profit Corporations Act is to undertake a complete review of your current corporate structure. This review should include an analysis of all legal documents, such as articles of incorporation and by-laws. Going forward, the corporation must review and update, as necessary, its current corporate structures to ensure that it is compliant with the new law.

After the review is complete, the corporation should ensure that its by-law is compliant with the new law. Generally, this requires a revision of the current by-law and a complete review of current policies and procedures. In addition, the board of directors need to ensure that all directors and officers understand their roles and responsibilities under the new law.

The next step is to file the documents required for registration. This includes completing the application for registration and filing the articles of incorporation, bylaws, and other documents that are required to incorporate the corporation under the ONCA. If necessary, the board of directors can also file an amendment to the articles of incorporation to change the name of the corporation or expand the scope of activities beyond what is outlined in the current articles.

With support from capable advisors, transitioning from the Ontario Corporations Act to the Ontario Not-For-Profit Corporations Act need not be a complex, time-consuming process.

prō ˈbônō Advisory Group is a results-based enterprise providing low and no-cost

strategic support and advisory services to charitable and non-profit organizations.