Charitable Fund-raising Regulation

Link to law: http://www.qp.alberta.ca/1266.cfm?page=2000_108.cfm&leg_type=Regs&isbncln=9780779782949&display=html
Published: 2014

AR 108/2000 CHARITABLE FUND-RAISING REGULATION (Consolidated up to 196/2014)
ALBERTA REGULATION 108/2000
Charitable Fund‑raising Act
CHARITABLE FUND‑RAISING REGULATION
Table of Contents
                1      Interpretation
Calculation of Gross Contributions
                2      Gross contributions
Requirements Relating to Soliciting Contributions
                3      References to solicitation
                4      Providing information during solicitation
                5      Records to be maintained
                7      Financial information return
                8      Trust requirements
Registration and Licensing Requirements
                9      Registration of charitable organizations
              10      Licensing of fund-raising business Security
              11      Meaning of claim
              12      Declaring security forfeit
              13      Valid unpaid claims
              14      Application by claimant
              15      Notice to fund-raising business
              16      Admission but no payment
              17      No reply by fund-raising business
              18      Minister’s jurisdiction when fund-raising business disputes claim
              19      Arbitration when fund-raising business disputes claim
              20      Failure to comply by fund-raising business
              21      Failure to comply by claimant
              22      Decision provided to Minister
              23      Appeal of arbitrator’s award
              24      Claim becoming valid under arbitrator’s award
              25      Claimant obtaining judgment
              26      Proceeds of security
              27      Remainder of security proceeds
              28      Return of cash security
              29      Extinguishment of late claims
Donor Fund-raisers
              30      Donor fund-raiser information
Transitional Provisions, Repeals, Expiry and Coming into Force
              31      Existing bonds
              32      Claims before June 1, 2000
              33      Repeal
              34      Expiry
              35      Coming into force
Interpretation
1(1)  In this Regulation,
                               (a)    “Act” means the Charitable Fund‑raising Act;
                              (b)    “claim” means a claim described in section 11;
                               (c)    “claimant” means a person who has a claim.
(2)  In this Regulation,
                               (a)    a reference to a solicitation made by a charitable organization means a solicitation made by the charitable organization or its employees or volunteers;
                              (b)    a reference to a solicitation made on behalf of a charitable organization means a solicitation made by a fund‑raising business on behalf of the charitable organization;
                               (c)    a reference to a solicitation made by a fund‑raising business means a solicitation made by a fund‑raising business or the employees or volunteers of the fund‑raising business.
Calculation of Gross Contributions
Gross contributions
2(1)  For the purposes of the Act and this Regulation, the gross contributions of a charitable organization in respect of a financial year are calculated by adding the following contributions that it receives from persons in Alberta during that financial year as a result of solicitations:
                               (a)    all cash received and the total dollar amount of cheques received that have cleared, including bequests, loose collections and amounts received from other charitable organizations;
                              (b)    the value, as determined by the charitable organization, of all goods and services received, including all real or personal property whether or not it is subject to conditions or a trust;
                               (c)    the cash surrender value of life insurance policies and the amount of premiums that a donor pays directly to the insurance company on behalf of the charitable organization;
                              (d)    grants and payments received from a government or government agency.
(2)  If a charitable organization gives a receipt for the purposes of the Income Tax Act (Canada) in respect of a contribution, the amount to be included in gross contributions under this section in respect of the contribution is the amount specified in the receipt.
(3)  Gross contributions do not include
                               (a)    a pledge of a contribution unless the contribution is received by the charitable organization, or
                              (b)    contributions received as a result of solicitations to which the Act does not apply.
(4)  For the purposes of section 9(1)(b) of the Act, the calculation of gross contributions of a charitable organization does not include grants and payments received from a government or government agency.
(5)  When gross contributions are being calculated under section 12(3) or (4) of the Act in respect of solicitations made only to individuals, the gross contributions include only those contributions received from individuals within the meaning of that term under section 12 of the Act.
(6)  This section does not apply to gross contributions referred to in section 30(2) of the Act.
AR 108/2000 s2;251/2001
Requirements Relating to Soliciting Contributions
References to solicitation
3   A reference to a solicitation in sections 4 to 7 of this Regulation is to a solicitation to which Part 1 of the Act applies.
Providing information during solicitation
4(1)  For the purposes of section 6 of the Act, a person who makes a solicitation must provide the person who is being solicited with the following information:
                               (a)    the name of the charitable organization making the solicitation or on whose behalf the solicitation is being made;
                              (b)    the charitable purpose for which contributions will be used;
                               (c)    the charitable organization’s estimate of the costs of making the solicitations and the activities directly related to making the solicitations and the charitable organization’s estimate of the contributions that it will receive as a result of the solicitations;
                              (d)    the address of the charitable organization and, if incorporated, the charitable organization’s place of incorporation;
                               (e)    the name and telephone number of a contact person in the charitable organization to whom the person being solicited may direct any inquiries;
                               (f)    if the charitable organization uses a fund‑raising business to make solicitations on its behalf or to manage or be responsible for solicitations made by or on behalf of the charitable organization,
                                        (i)    the operating name and full legal name of the fund‑raising business, and
                                      (ii)    how the remuneration of the fund‑raising business is determined.
(2)  The estimates referred to in subsection (1)(c) must be provided one after the other with no intervening information in between.
(3)  The information referred to in subsection (1) must be provided orally or in writing.
Records to be maintained
5(1)  For the purposes of section 7(c) of the Act, every charitable organization that makes solicitations must maintain
                               (a)    original or true copies of its financial information return required under section 8 of the Act for the financial year in which the solicitations were made;
                              (b)    reasonable samples of publications or other information provided to persons solicited and any telephone scripts used to make the solicitations;
                               (c)    copies of all receipts given under section 10 of the Act in respect of the solicitations;
                              (d)    if a fund‑raising business was used to make solicitations on behalf of the charitable organization or if a fund‑raising business managed or was responsible for the solicitations, a true copy of the fund‑raising agreement between the charitable organization and the fund‑raising business and any amendments to the agreement;
                               (e)    if money received as a result of the solicitations is deposited into an account in a financial institution under section 11 of the Act, records of all transactions in the account and a record of the names of the signing officers of the charitable organization authorized to deal with the account.
(2)  For the purposes of section 7(c) of the Act, every fund‑raising business that makes solicitations must maintain
                               (a)    reasonable samples of publications or other information provided to persons solicited and any telephone scripts used to make the solicitations;
                              (b)    copies of all receipts given under section 10 of the Act in respect of the solicitations;
                               (c)    a true copy of the fund‑raising agreement and any amendments to the agreement between the fund‑raising business and the charitable organization for which the fund‑raising business was making the solicitations;
                              (d)    records of any expenses of the fund‑raising business paid by the charitable organization for which the fund‑raising business was making the solicitations;
                               (e)    records of the deposits of monetary contributions made by the fund‑raising business or the fund‑raising business’s employees under section 11 of the Act.
(3)  The information and records referred to in subsections (1) and (2) must be maintained for 3 years from their creation.
(4)  An audited financial statement prepared under this section or any predecessor of this section must be maintained for 3 years from the date of its creation.
AR 108/2000 s5;60/2009;196/2014
6   Repealed AR 196/2014 s3.
Financial information return
7(1)  For the purposes of section 8 of the Act, a charitable organization must prepare a financial information return for a financial year if solicitations were made by or on behalf of the charitable organization during the financial year.
(2)  A financial information return prepared by a charitable organization for a financial year must be prepared in accordance with generally accepted accounting principles and contain the following:
                               (a)    all expenses incurred for the purposes of soliciting contributions;
                              (b)    the gross contributions received;
                               (c)    a summary of the disposition of gross contributions received;
                              (d)    a separate description of each disposition of contributions that is equal to or exceeds 10% of the gross contributions received;
                               (e)    the total amount paid as remuneration to employees of the charitable organization whose principal duties involve fund‑raising;
                               (f)    if a fund‑raising business was used to make the solicitations on behalf of the charitable organization or if a fund‑raising business managed or was responsible for the solicitations, the amount paid as remuneration to the fund‑raising business, including any expenses or fees paid by the charitable organization on behalf of the fund-raising business or as reimbursements to the fund‑raising business.
(3)  A financial information return of a charitable organization must be signed by at least 2 directors who state that they believe the information contained in the return is true.
(4)  If the charitable organization does not have 2 or more directors, its financial information return must be signed by the person under whose direction the solicitations were made and the person must
                               (a)    set out in the return the name, residence, occupation and address for service of the person, the person’s position in the charitable organization and a full description of the person’s responsibilities with respect to the solicitations and any contributions received, and
                              (b)    state that the person believes the information contained in the return is true.
AR 108/2000 s7;57/2004;196/2014
Trust requirements
8   Every fund‑raising business and every employee of a fund‑raising business who receives contributions on behalf of a charitable organization
                               (a)    holds the contributions in trust for the charitable organization under section 11 of the Act, and
                              (b)    is liable and accountable to the charitable organization for the contributions.
Registration and Licensing Requirements
Registration of charitable organizations
9(1)  A charitable organization that wishes to be registered or to have its registration renewed must provide
                               (a)    the information described in subsection (3) on a form established by the Minister, and
                              (b)    a fee of $60.
(2)  Repealed AR 182/2005 s2.
(3)  A charitable organization must provide
                               (a)    its name and address and place of incorporation and incorporation number, if any,
                              (b)    the names and addresses of any chapters or branches that will be making solicitations under the authority of the registration applied for,
                               (c)    the objectives or purposes of the charitable organization,
                              (d)    the dates when its financial year begins and ends,
                               (e)    the names and addresses of its officers and directors, and
                               (f)    information required by the Minister to determine if the registration is to be refused under section 15 of the Act.
(4)  A registration or renewal of registration expires at the end of a time period established by the Minister.
(5)  The time period under subsection (4) may not exceed 12 months.
AR 108/2000 s9;108/2004;182/2005
Licensing of fund‑raising business
10(1)  A fund‑raising business that wishes to be licensed or to have its licence renewed must provide
                               (a)    the information described in subsection (2) on a form established by the Minister,
                              (b)    a bond or other security in a form approved by the Minister, and
                               (c)    a fee of $130.
(2)  A fund‑raising business must provide
                               (a)    its operating name, full legal name and address and place of incorporation and incorporation number, if any,
                              (b)    the address of its registered office in Alberta,
                               (c)    the names, addresses and titles of its officers and directors, and
                              (d)    information required by the Minister to determine if the licence is to be refused under section 23 of the Act.
(3)  A licence or renewal of a licence expires at the end of the time period established by the Minister.
(4)  The time period under subsection (3) may not exceed 12 months.
Security
Meaning of claim
11(1)  A person has a claim against a fund‑raising business if the person suffers financial loss because
                               (a)    the fund‑raising business fails to perform obligations imposed in respect of the provisions or requirements of the Act or this Regulation or the terms or conditions of a fund‑raising agreement,
                              (b)    of the fund‑raising business’s misrepresentation, fraud, breach of trust, theft, conversion, negligence or default in respect of any solicitation or handling of contributions, or
                               (c)    the fund‑raising business fails to comply with a condition of the fund‑raising business’s security.
(2)  A person does not have a claim against a fund‑raising business unless, while the fund‑raising business’s security was in force,
                               (a)    the person had a business relationship with the fund‑raising business,
                              (b)    the person had, in the course of the fund‑raising business’s business, entered into a fund‑raising agreement,
                               (c)    the person paid money to or deposited money with the fund‑raising business, or
                              (d)    the fund‑raising business did or omitted to do something that led or contributed to the person’s financial loss referred to in subsection (1).
Declaring security forfeit
12(1)  When a claim against a fund‑raising business becomes a valid unpaid claim, the Minister may declare the fund‑raising business’s security to be forfeit and require the surety under the security to pay to the Minister the principal amount of the security.
(2)  A surety who receives a declaration under subsection (1) while the security is in force or within 2 years after the security ceases to be in force must pay the principal amount of the security to the Minister within 30 days of receiving the declaration.
(3)  Where the validity of a claim against a fund‑raising business may not be determined within the 2‑year period referred to in subsection (2), the Minister must send a notice of liability relating to the claim to the surety under the fund‑raising business’s security.
(4)  A surety who receives a notice under subsection (3) must, if a claim referred to in subsection (3) is found to be a valid unpaid claim, pay the principal amount of the security to the Minister within 30 days of receiving a declaration under subsection (1), notwithstanding that the 2‑year period referred to in subsection (2) has expired.
Valid unpaid claims
13   A claim becomes a valid unpaid claim
                               (a)    if the claimant makes an application under section 14, the claimant has not obtained a judgment against the fund‑raising business in respect of the claim and section 16, 17, 18, 20 or 24 applies, or
                              (b)    if the claimant makes an application under section 25, the claimant has obtained a judgment against the fund‑raising business in respect of the claim and section 25(3) applies.
Application by claimant
14(1)  A claimant who purports to have a claim against a fund‑raising business may apply to the Minister for a payment from the proceeds of the fund‑raising business’s security.
(2)  A claimant may not make an application under subsection (1) in respect of a fund‑raising business if the claimant has commenced a court action against the fund‑raising business that is based on the grounds that gave rise to the claim unless the court action has been discontinued.
(3)  A claimant who is making an application under subsection (1) must submit a statutory declaration that contains
                               (a)    particulars of the basis of the claim,
                              (b)    the amount of the claim,
                               (c)    a statement that the claimant has never commenced an action in a court against the fund‑raising business that is based on the grounds that gave rise to the claim or, if the claimant commenced such an action, a statement that the action was discontinued,
                              (d)    as an exhibit, a copy of any contract that is relevant to the claim that is in the possession of the claimant, and
                               (e)    any documents proving loss as requested by the Minister.
Notice to fund‑raising business
15   When a claimant submits a statutory declaration that meets the requirements of section 14 and any other information required by the Minister and the Minister is satisfied that, if the particulars provided by the claimant are correct, the claimant has a claim against a fund‑raising business, the Minister must send to the fund‑raising business
                               (a)    a copy of the claimant’s statutory declaration, and
                              (b)    a notice requiring the fund‑raising business to inform the Minister within 30 days after the date of the notice whether the fund‑raising business admits or denies the claim.
Admission but no payment
16   If the fund‑raising business that receives the Minister’s notice under section 15 admits to the claim within the 30‑day period referred to in section 15, but does not pay the claim within 15 days after the Minister receives the fund‑raising business’s admission, the claim becomes a valid unpaid claim for the purposes of this Regulation.
No reply by fund‑raising business
17   If a fund‑raising business that receives the Minister’s notice under section 15 fails to reply to the Minister within the 30‑day period referred to in section 15 and does not pay the claim within the 30‑day period, the claim becomes a valid unpaid claim for the purposes of this Regulation.
Minister’s jurisdiction when fund‑raising business disputes claim
18(1)  The Minister is responsible for determining if a claim is valid when a fund‑raising business that receives the Minister’s notice under section 15 denies the claim within the 30‑day period referred to in section 15 and the amount of the claim does not exceed $1000.
(2)  The Minister may take whatever steps the Minister considers appropriate to determine if the claim is valid and require the claimant and the fund‑raising business to provide additional information.
(3)  After taking those steps, the Minister may
                               (a)    dismiss the claim, or
                              (b)    declare the claim to be valid, establish the amount of the claim to which the claimant is entitled and notify the fund‑raising business of the declaration.
(4)  If the amount established in the declaration remains unpaid for 30 days after the declaration is made, the claim in the amount established by the Minister becomes a valid unpaid claim for the purposes of this Regulation.
Arbitration when fund‑raising business disputes claim
19(1)  Subject to sections 20 and 21, arbitration must be used to decide a claim if the fund‑raising business that receives the Minister’s notice under section 15 denies the claim within the 30‑day period referred to in section 15 and the amount of the claim exceeds $1000.
(2)  Subsection (1) applies despite any agreement between the fund‑raising business and claimant to have the claim determined in a different manner.
(3)  The arbitration is governed by the Arbitration Act and the arbitration rules established by the Minister.
(4)  Section 3 of the Arbitration Act does not apply to an arbitration  under this Regulation.
(5)  The Minister must provide the fund‑raising business and claimant with a list of 3 candidates to be arbitrator, and each candidate must be
                               (a)    a member of the Alberta Arbitration and Mediation Society, or
                              (b)    a person who is not a member of the Society but is approved by the Minister.
(6)  The fund‑raising business and the claimant must each nominate an arbitrator from the list provided by the Minister.
(7)  If the fund‑raising business and the claimant nominate the same candidate, that candidate is the arbitrator for the arbitration and if the fund‑raising business and claimant nominate different candidates, the candidate that was not nominated is the arbitrator for the arbitration.
Failure to comply by fund‑raising business
20(1)  If the fund‑raising business fails to comply with the Arbitration Act or the Minister’s rules and the non‑compliance is, in the arbitrator’s opinion, significant, the arbitrator must notify the Minister in writing of the non‑compliance.
(2)  If the Minister receives a notice under subsection (1), the arbitration ends and the claim becomes a valid unpaid claim for the purposes of this Regulation.
Failure to comply by claimant
21(1)  If the claimant fails to comply with the Arbitration Act or the Minister’s rules and the non‑compliance is, in the arbitrator’s opinion, significant, the arbitrator must notify the Minister in writing of the non‑compliance.
(2)  If the Minister receives a notice under subsection (1), the arbitration ends and the claim is dismissed.
Decision provided to Minister
22   When the arbitrator completes the arbitration, the arbitrator must provide the Minister with a copy of the decision.
Appeal of arbitrator’s award
23   The fund‑raising business or the claimant may appeal the award of an arbitrator under this Regulation to the Court of Queen’s Bench only on a question of law in accordance with section 44(2) of the Arbitration Act.
Claim becoming valid under arbitrator’s award
24   A claim that has been submitted to arbitration becomes a valid unpaid claim for the purposes of this Regulation for the amount established by the arbitrator if
                               (a)    the arbitrator’s award is that the claimant has a valid claim in an amount established by the arbitrator,
                              (b)    the arbitrator’s award has become final by reason of lapse of time or being confirmed by the highest court to which it may be appealed, and
                               (c)    the arbitrator’s award remains unpaid 30 days after the award has become final.
Claimant obtaining judgment
25(1)  A claimant who has obtained a judgment against a fund‑raising business that is based on grounds that give rise to a claim may apply to the Minister for a payment from the proceeds of the fund‑raising business’s security.
(2)  A claimant making an application under subsection (1) must submit a statutory declaration that contains
                               (a)    particulars of the basis of the claim,
                              (b)    as an exhibit, a copy of the judgment, and
                               (c)    a statement that the judgment has become final by reason of lapse of time or of being confirmed by the highest court to which it may be appealed and has not been satisfied within 30 days after it became final.
(3)  When a claimant submits a statutory declaration that meets the requirements of subsection (2) and the Minister is satisfied that, if the particulars provided by the claimant are correct, the claimant has a claim against the fund‑raising business, the claim becomes a valid unpaid claim for the purpose of this Regulation.
Proceeds of security
26(1)  When the Minister declares a security to be forfeit under section 12 and receives the principal amount under the security from the surety, the Minister must hold the principal amount until the Minister is satisfied that no other valid unpaid claims will be received by the Minister, but in no case may the Minister hold the amount for more than 3 years after the Minister declares the security to be forfeited.
(2)  The Minister must, in accordance with subsection (1), distribute the principal amount of the security to claimants who have valid unpaid claims against the fund‑raising business.
(3)  If the principal amount of the security is insufficient to pay all of the valid unpaid claims, the Minister must pay out the money on a pro rata basis to those claimants.
(4)  If there is a dispute among persons who have valid unpaid claims concerning the amount they should receive from the principal amount of the security under subsection (2) or (3), the Minister may pay all or part of the principal amount into the Court of Queen’s Bench, and the Court may determine the amounts to be paid.
Remainder of security proceeds
27   If the whole of the principal amount is not required to pay valid unpaid claims, the Minister must pay the amount that remains,
                               (a)    in the case of a security that is not a cash security, to the surety who paid the principal to the Minister, and
                              (b)    in the case of a cash security, to the fund‑raising business who paid the principal.
Return of cash security
28   If a cash security submitted to the Minister is terminated by the fund‑raising business that submitted it and no valid unpaid claims have been received by the Minister in respect of the fund‑raising business while the security was in force or within 2 years after the security ceases to be in force, the Minister must return the security to the fund‑raising business.
Extinguishment of late claims
29   After the Minister has distributed the principal amount of a security in accordance with sections 26 and 27 or returned a cash security in accordance with section 28, the Minister must refuse to accept an application under section 14 or 25 in respect of the security, and any claim that was not submitted to the Minister in respect of the security prior to the distribution or return is extinguished for the purposes of this Regulation.
Donor Fund‑raisers
Donor fund-raiser information
30(1)  In this section,
                               (a)    “donation period” means
                                        (i)    the period during which a donor fund‑raiser makes requests in respect to a particular charitable organization or charitable purpose, or
                                      (ii)    if the requests of a donor fund‑raiser indicate that a portion of a purchase price of goods or services sold during a specified time period will be donated to a charitable organization or be used for a charitable purpose, the specified time period during which those goods or services are sold;
                              (b)    “request” means a direct or indirect request made by a donor fund‑raiser to the public to buy a good or service normally produced or provided by the donor fund‑raiser in which it is stated or implied that all or a portion of the purchase price will be donated to a charitable organization or be used for a charitable purpose.
(2)  A donor fund‑raiser is required to provide under section 33 of the Act the following information in respect of requests made during a donation period:
                               (a)    reasonable samples of advertisements, scripts or other information used or provided to the public in making the requests;
                              (b)    if the requests indicate that a percentage of the purchase price of goods or services sold will be donated to a charitable organization or be used for a charitable purpose, the gross amount of the purchase price received for the goods or services sold during the donation period;
                               (c)    if the requests indicate that a specified amount will be donated to a charitable organization or be used for a charitable purpose for each good or unit of service sold, the number of goods or units of service sold during the donation period;
                              (d)    the amount donated to the charitable organization or used for the charitable purpose identified in the requests in respect of the goods or services sold during the donation period.
(3)  The information required to be provided under subsection (2) must be identified separately.
(4)  The information and records that a donor fund‑raiser needs to comply with this section must be maintained for 3 years after the end of the donation period.
Transitional Provisions, Repeals, Expiry and Coming into Force
Existing bonds
31(1)  Despite the repeal of the Charitable Fund-raising Regulation (AR 95/95), a bond provided by a professional fund‑raiser is
                               (a)    subject to this Regulation, and
                              (b)    deemed to contain a provision that it is subject to forfeiture in accordance with the procedures in this Regulation.
(2)  If there is a conflict between
                               (a)    a provision in a bond referred to in subsection (1), and
                              (b)    this Regulation or the deemed provision in subsection (1)(b),
this Regulation or the deemed provision, as the case may be, prevails.
Claims before June 1, 2000
32(1)  In this section, “former bond provisions” means sections 11 to 13 of the Charitable Fund‑raising Regulation (AR 95/95).
(2)  Despite section 31, the former bond provisions continue to apply to claims submitted to the Government of Alberta before June 1, 2000 against a bond provided under the Charitable Fund‑raising Regulation (AR 95/95).
Repeal
33   The Charitable Fund‑raising Regulation (AR 95/95) is repealed.
Expiry
34   For the purpose of ensuring that this Regulation is reviewed for ongoing relevancy and necessity, with the option that it may be repassed in its present or an amended form following a review, this Regulation expires on June 1, 2017.
AR 108/2000 s34;57/2004;38/2007
Coming into force
35   This Regulation comes into force on June 1, 2000.
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