By Melissa Ip on 30 Jul 2013 / 0 Comment
Effective July 29, 2013, businesses in British Columbia can officially become community contribution companies (or CCCs and C3s).
This new business structure is designed to give companies with neither purely nonprofit nor for-profit functions a legal environment to conduct business.? For example, similar to for-profits, CCCs would be able to issue dividend, albeit restricted, to shareholders.? Whereas similar to nonprofits, the company is free to pursue the social or environmental well-being of a community.
As far as the regulation is concerned, CCCs will be subject to an asset lock that ensures at least 60 percent of assets are used for the betterment of a community.? A CCC will also have to pay taxes and make sure they distribute no more than 40 percent of annual profit as dividends.? Every year, they will be required to produce and publish a community contribution report.
After becoming a CCC, the business must have the words ?Community Contribution Company? or the abbreviation ?CCC? as part of its name.? For example, if Social Enterprise Buzz were a CCC, the name would become ?Social Enterprise Buzz CCC? or ?Social Enterprise Buzz Community Contribution Company?.
A company can also use the incorporation number as the company?s name, but the name must end with ?B.C. Community Contribution Company Ltd.? ? for example ?123456 B.C. Community Contribution Company Ltd.?
To incorporate as a CCC, the steps differ for existing and new businesses, but the business must have at least three directors.
An existing business, whether they are a nonprofit or for-profit, would consequently become a for-profit CCC.? Should a nonprofit decide to become a CCC, their nonprofit would be dissolved.
For-profits, upon?unanimous consent of the company?s shareholders to become a CCC, would have to submit a Name Request through BC Registry Services and select the option to convert a BC company to a CCC.? This online process costs $30 and a service fee of $1.50 plus GST.? Then they would file a ?Notice of Alteration (from a BC Company to become a BC Community Contribution Company)? through BC Corporate Online, which costs $100.
For new businesses, they would similarly do a Name Request through BC Registry Services.? Again, this costs $30 and a service fee of $1.50 plus GST.? Once they name is approved, they can apply to incorporate the CCC through BC Corporate Online for $350 and a service fee of $1.50 plus GST.
?This new model will unlock new ways to generate meaningful, local employment in B.C. and generate economic wealth for our province by encouraging private investment in B.C.?s social enterprise sector,? said Minister of Finance Michael de Jong.? ?I?m excited to see the positive impacts the C3 model will have on B.C. businesses and communities.?
Detailed steps of the incorporation process for CCCs can be found on the BC Registry Services website.
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