Step 1 - Review your letters patent and by-laws

The first step is to review the corporation’s letters patent, supplementary letters patent (if any) and the by-laws. Copies are available from Corporations Canada if you are not able to locate them.

Under the old Act, not-for-profit corporations were required to include a lot of detail in their by-laws, such as procedures for members meetings, the manner of electing or appointing directors, procedures for directors’ meetings, and the procedures for making, amending or repealing by-laws.

The NFP Act doesn’t require this level of detail in the articles or by-laws since many of the rules are contained in the Act. A number of these rules are default rules. The corporation can override these default rules in its articles or by-laws if the rules do not suit its needs. However, there are a few rules that cannot be overridden by the articles or the by-laws. They apply to all corporations.

Refer to Annex A when reviewing your corporation’s letters patent and by-laws. It highlights the main rules usually included in these documents which would no longer be needed since the NFP Act provides the rules. What is currently set out in the letters patent or by-laws may even be inconsistent with the rules under the NFP Act.

During your review, you may wish to note any provisions, other than those set out in Annex A, which are important to your corporation and that you want to keep. You can choose to include them as articles or by-laws under the NFP Act, the focus of the next two steps.

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