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OCC Member Bulletin: Not-for-Profit Corporations Act

Monday, May 02, 2011

The Ontario government has introduced amendments to the Corporations Act, 1907 – last updated in 1953 – through the Not-for-Profit Corporations Act, 2010.

Upon proclamation the Act will:

  • Simplify the incorporation process for not-for-profit organizations
  • Give more rights to employees and corporations, including better protection of directors and officers from personal liability

The Act is projected to come into effect in late 2012. All not-for-profit organizations currently incorporated under the Ontario Corporations Act will be required to take a number of steps as a result of the new legislation:

  • Restate their articles so that the company’s documents are clearly in compliance with the Act.
  • Amend their letters patent, supplementary letters patent and by-laws to conform with the Act.

A full description of the changes is available here (pages 6-7).

The OCC previously commented on the new legislation in a formal submission.  The OCC identified the proposed “as of right” system as a potential issue, due to uncertainty about what would happen to the review and renewal process, which protects corporations’ names from misuse.

The Ministry of Consumer Services responded to the OCC’s concerns, noting that there will continue to be a review process carried out by the Ministry to ensure corporations comply with name rules, preventing organizations from having corporate names that would be deceptively similar.

For more information, please contact Steven Isidori, Policy Intern at or 416-482-5222 ext 247.


The Not-for-Profit Corporations Act will provide the modern legal framework for approximately 46,000 not-for-profit corporations. Ontario’s Not-for-Profit sector employees approximately 16% of all employees in the province.

The Act will facilitate a modernization of the existing incorporation process through introducing a new incorporation “as of right” system. The new system will facilitate a faster, more efficient process that will allow incorporation to happen within one week versus the old process of six weeks or more.

The Act will strengthen Member rights by providing new courses of action for employees when dissenting from company changes, and corporations when changing their purpose.

In addition, Directors and Officers will be better protected from personal liability under the New Act through the principle of Indemnity, which allows their corporation to pay their personal liable damages directly or through reimbursement.

Detailed information can be found on pages 3-4 of this document.

Official Ministry of Consumer Services resources on the Not-for-Profit Act are available here or at 1-877-665-0662.

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