Legal Challenges and Options for Boards of Religious Institutes in Transition
Esential Charity Law Update
Anti-Terrorism/Money Laundering Update
Sep 2019 Charity & NFP Law Update
On September 9, 2019, President Donald Trump signed Executive Order 13886 (“EO 13886”), amending Executive Order 13224 (“EO 13224”), which had been signed by President George W. Bush on September 25, 2001 in the wake of the 9/11 attacks in the United States (“US”). Of note, EO 13886 allows the Secretary of the Treasury to prohibit or impose restrictions on the opening and maintenance in the US of correspondent accounts or payable-through accounts of any foreign financial institution that is determined to have knowingly conducted or facilitated a significant transaction on behalf of any person whose property and interests in property are blocked pursuant to EO 13886.
As such, foreign financial institutions with correspondent bank relationships in the US may need to implement additional due diligence mechanisms in order to prevent their property and interests in property in the US from being blocked. This will add to the issue of “de-risking”, when financial institutions decide to terminate, rather than manage, accounts or transactions perceived as higher risk, resulting in reduced availability of traditional financial channels for charities and not-for-profits with operations in conflict and remote areas.
As was discussed in the June 2019 Charity & NFP Law Update, promoting financial access for charities and not-for-profits is an important policy objective in order to further their humanitarian and developmental efforts. The secondary sanctioning regime in the US as a result of EO 13886, however, may push financial institutions and their affiliates towards more de-risking by denying services to humanitarian organizations, and thereby hindering their efforts of providing aid and other peacebuilding activities. As well, given the breadth of EO 13886, Canadian charities and not-for-profits working with US counterparts will need to be diligent to make sure that they are not caught by the expanded scope of the US regime, especially in light of the ever burgeoning information sharing regime between countries.
New Model Crowdfunding Legislation from the Uniform Law Conference of Canada
Sep 2019 Charity & NFP Law Update
The Uniform Law Conference of Canada (the “ULCC”), a conference that brings together appointees from all the governments of Canada, academics, members of the bench and bar, as well as representatives from law reform commissions or similar bodies, for the purpose of promoting uniformity of legislation among the provinces, has released a Consultation Paper with regard to a proposed Uniform Informal Public Appeals and Crowdfunding Act (the “Proposed Uniform Act”).
The Proposed Uniform Act revises the Uniform Informal Public Appeals Act, which was released by the ULCC in 2011 and was recommended for adoption in all provinces and territories. For information on the Uniform Informal Public Appeals Act, which was adopted in Saskatchewan and implemented in the Internet crowdfunding campaign involving the Humboldt Broncos incident in 2018, see the October 2018 Charity and NFP Law Update.
The ULCC is seeking feedback from interested persons and organizations with regard to the Proposed Uniform Act until January 15, 2020.