Industry committee  Since we haven't seen the motion, we are assuming it creates a new paragraph (a.1)--

Industry committee  --that says “its objects”.

Industry committee  Okay, 7.(1)(a.1). The idea behind paragraph (f) and the statement of purpose is to allow the corporations to spell out what it is they're going to do. Unfortunately, there are legal problems with the word “object”, which is why we did not make the statement of objects. There is a concept floating around in corporate law of ultra vires, which has been around for well over a hundred years.

Industry committee  As I said, the problem has to do with common law and the concept of ultra vires, which is if a corporation operates outside of its stated objects, the activity is considered illegal and the corporation can be dissolved. One of the things that is done through the Canada Corporations Act is that there is a very strong list of powers.

Industry committee  For over 90 years not-for-profits have been given a choice of going either federal or provincial. We would now radically change the system that's been operating in this country. Even if we grandfathered in those that are currently under our act and allowed them to stay federal, it would prevent new not-for-profits, it would take away their choice on whether they want to go federal or provincial.

Industry committee  In all cases, when a corporation makes a decision on whether they are going to go federal or provincial, whether it's a share corporation or non-share corporation, there are a lot of different factors any corporation is going to consider. It's not just a matter of which has the simpler form to file.

Industry committee  That would be the basic issue. A fair number of companies would operate in only one province. They may have a national element, but they may not actually be conducting business anywhere except in one province. They would be precluded from going under the federal legislation.

Industry committee  You do the first part. I don't mind doing the second part.

Industry committee  The fundamental problem right now would be that we have all kinds of corporations that are only operating in one province. Under this bill they would be ineligible to continue under the new act. They cannot continue under any provincial act because no provincial act allows continuance.

Industry committee  Correct.

Industry committee  Correct. I have to admit that we got into drawing a lot of timelines on a blackboard trying to deal with the 36 months you're counting as a period different from the 36 months running off an annual meeting, for which you are soliciting. There is a gap between those two periods.

Industry committee  The changes have all been made in what would be called the chapeau of (5.1). The rest of the definition is identical to what it was. It turns out there's a really technical reason that it actually can't be done as a definition because of one of those time periods in the regulations.

Industry committee  Once you become soliciting, you're soliciting three out from this annual meeting, because we've always worked on the principle of three. The regulation will essentially be the third annual meeting following after the day you became....

Industry committee  Yes.

Industry committee  The amendment motion is written with an (a) and a (b) part. This is only done because of the way we have drafted or amended the definition of “soliciting corporation”. It has to be moved out of the actual definitions and listed separately. What I will comment on is the (b) part of the motion, which is the substance.