On March 29, 2021, certain sections of the Red Tape Reduction Implementation Act, 2020 amending the Companies Act were proclaimed into force. As of June 1, 2021, the remaining sections of the Red Tape Reduction Implementation Act, 2020, that amend the Companies Act have been proclaimed into force.
The selection of a legal structure for a social enterprise should be informed by vision, mission, business strategy, and other management considerations. Choosing a structure that does not support these factors can be detrimental to an organization, so it is essential to seek expert legal advice before incorporating or selecting a legal structure for a social enterprise. However, sometimes, business models can adapt over time, unforeseen circumstances can arise, and change can become necessary.
For those wishing to embark on social enterprise, there is a lot to consider. There is no designated legal structure for a social enterprise and the structural options and set up costs for all entities vary from province to province. Since there are multiple incorporating statutes in Alberta, and since tax status is governed federally, it is confusing for enterprising charities and nonprofits to understand the restrictions surrounding their ability to earn revenues or generate profits.