Is your non-profit ready for the new federal and Ontario not-for-profit acts?

Federally-incorporated not-for-profit associations and organizations need to check their bylaws to make sure they conform to the new Not-For-Profit Corporations Act and re-file their governing documents. The good news is there’s time if you get started now. The bad news is this is not optional. Failure to file what are called Articles of Continuance will result in your organization ceasing to exist on October 17, 2014.

For Ontario-incorporated organizations, there is similar new legislation, but it is coming on more quickly, by January 1st, 2013. Fortunately, Ontario organizations are not under threat of extinction; the new Act will be deemed to override any provisions in existing bylaws that are not consistent. That doesn’t mean assuming governing bylaws are fine because they may not be; Ontario non-profits would also benefit from conducting a bylaw review and making changes as needed to comply with the new laws. Some pointers on how to proceed are outlined below.

While the long-promised Ontario transition guide has still not materialized, the federal government has provided the Act and Regulations and a Transition Guide here:

Act available here: http://www.canlii.org/en/ca/laws/stat/sc-2009-c-23/latest/sc-2009-c-23.html
Regulations available at: http://gazette.gc.ca/rp-pr/p1/2011/2011-02-26/html/reg7-eng.html
New forms and guidance from Corporations Canada: http://www.ic.gc.ca/eic/site/cd-dgc.nsf/eng/h_cs03925.html

A special workshop on how to review bylaws and bring them into compliance hosted by the Canadian Society of Association Executives covered the changes in the Act in detail, pointing out where to look for discrepancies in bylaws, but also outlined an excellent, thorough process that any organization would benefit from.

Michael Anderson, CSAE’s Executive Director, presented the process CSAE is going through as a model. The process, he said, will:
– Require a strong and dedicated effort
– Involve experienced volunteers and senior staff
– Take longer than expected
– Use agendas carefully crafted to keep the work moving forward
– Quickly capture changes to ensure accuracy
– Review proposed changes at each meeting to ensure consensus
– Regularly brief legal counsel, who are clear about their role as advisors, not leaders of the process.

spreadsheet for not-for-profit bylaw evaluation
Michael Anderson showed this sample of a spreadsheet the CSAE is using to methodically evaluate and modify their bylaws.

The CSAE is being very methodical, using a spreadsheet to evaluate their bylaws clause by clause.

All federally incorporated not-for-profits are encouraged to get started as soon as possible because most  will need their members to approve bylaw changes and there is usually but one opportunity a year for that, at the AGM, so members will need one meeting (2013) to discuss proposed bylaw changes, and then another (2014) to approve a final version, in good time for filing of Articles of Continuance by October 17, 2014.

Sure this is all pretty daunting, but “hope is not a strategy.” Being pro-active is, and a thorough bylaw review can be a healthy and rewarding experience for any organization.

 

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