Wednesday, July 18, 2012

NEW RULES FOR NOT-FOR-PROFIT CORPS


There are new rules for Canada Not-for-profit Corporations. If you are working, volunteering or serving on a board of directors for a federally incorporated Not-For-Profit, you might want to pay attention.

The new Canada Not-for-profit Corporations Act (NFP Act) establishes a new set of rules for federally incorporated not-for-profit corporations in Canada.

 These new rules replace Part II of the Canada Corporations Act (old Act), the law that has governed federal corporations for nearly a century. The rules under the NFP Act are modern, flexible and more suited to the needs of the not-for-profit sector.

The NFP Act does not automatically apply to existing corporations.

Instead, every existing federally incorporated not-for-profit corporation will have to take action to make the transition to the NFP Act. Until that transition is made, the rules under the old Act still apply.

The corporation must replace its letters patent, supplementary letters patent (if any) and by-laws with new charter documents by submitting articles of continuance to obtain a Certificate of Continuance and creating and filing new by-laws. The articles and by-laws

The federal government has issued a helpful guide that provides valuable information about the transition, particularly for chariest.

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