Not-for-Profits must update records for ONCA compliance

Since the Ontario Not-for-Profit Corporations Act (“ONCA”) was proclaimed in force in October 2021, I have had many non-profit organizations and charities contact me to bring their letters patent and by-laws into compliance with ONCA. Generally speaking, non-share capital corporations that were incorporated under the Corporations Act (Ontario) have until October 18, 2024 to complete these updates.

On many of my engagements with these organizations, I’ve discovered that the information required to be kept current pursuant to the Corporations Information Act (Ontario) (“CIA”) was out of date. It is important for the directors and officers of these organizations to understand their obligations to update the required information, which includes details of the directors, officers and registered office address.

In addition to the annual return that must be filed to confirm any changes that have been made since the date of the last return or notice of change, the CIA requires that the organization updates its records within 15 days of any change to the information of a director, officer or the registered office address. This includes changes to a director or officer’s name and position held within the organization. Additionally, the organization must ensure that its records include the current mailing address of each director and officer.

Access to updated information

Further, the CIA also requires that the organization provide its members, directors, officers or creditors with paper or electronic access to the up-to-date information of its directors and officers as set out in the returns and notices upon request. They also have a right to inspect the organization’s returns and notices and obtain a copy of the information contained therein, including the names and addresses of the directors and officers, during normal business hours.

In order to ensure compliance with the CIA, these organizations should establish a system to regularly update the information of its directors and officers. This system should include procedures for promptly notifying the organization of any changes to a director or officer’s information and a process for verifying and updating the information in the organization’s records.

There are penalties in place for failure to comply with the CIA. While in practice I have not seen them levied, these penalties can be substantial. A corporation that contravenes the CIA is liable to a maximum fine of $25,000, and where a corporation is guilty of an offence, each director or officer may also be fined a maximum of $2,000.

By maintaining accurate and up-to-date records, these organizations and their directors and officers can ensure that they are in compliance with the CIA and can avoid any potential legal consequences associated with non-compliance. Additionally, having transparent and accessible information regarding the leadership of the organization can help build trust and accountability with members and stakeholders.

If you or your organization require assistance navigating ONCA or bringing your corporate records up to date, please contact me.

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