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In October 2021, the Not-for-Profit Corporations Act, 2010 (“ONCA”) came into force. Not-for-profit corporations incorporated in Ontario will have a three-year transition period to make changes to their governing documents to comply with the ONCA. Our ONCA Fast Facts series explores what is new and different in the ONCA. This week we talk about incorporation as of right.
To create a not-for-profit corporation in Ontario, articles of incorporation must be obtained in accordance with Part II Incorporation of the ONCA. The ONCA provides for incorporation as of right, which means that a certificate of incorporation will be issued upon the government’s receipt from one or more eligible individuals or bodies corporate of Articles of Incorporation, together with other required information and fees. Incorporation as of right is different than the previous process where incorporation was subject to government discretion. The same applies for corporations intending to apply for charitable registration. Public Guardian and Trustee approval is no longer required as part of the incorporation process but will still be needed for amendments to Articles by registered charities, and charitable objects will still be required.
The Articles of Incorporation may be filed through the Ontario Business Registry and must contain certain prescribed information including, for example, the purposes of the corporation, and, where applicable, classes of members and number range of Directors. The name of the corporation must also comply with the rules for corporate naming as set out in section 11 of the ONCA.
Incorporation as of right will only apply to new not-for-profit corporations. For existing corporations that were previously incorporated under the Corporations Act (Ontario), Letters Patent will become the Articles of the corporation and filings under the ONCA are not required to make this change. Note that if the corporate by-laws include any matters that the ONCA requires to be stated in the Articles, consider with your legal advisors whether restated and/or amended Articles should be obtained at this time.
For more information on the ONCA continue to follow our ONCA Fast Facts series.