Recent changes introduced in Budget 2012, which have made it tougher for foreign charities to obtain qualified donee status, have resulted in a removal of all organizations that were once on the Canada Revenue Agency's list of foreign charities. Prior to the rule change, a foreign charity had to demonstrate that it had received a gift from her Majesty in right of Canada and that it would meet the requirements to qualify as a registered charity in Canada. Now, to be a qualified donee, a foreign charity must demonstrate that it has received a gift from her Majesty in right of Canada and that it is doing one (or more) of the following:
- carrying on relief activities in response to a disaster;
- providing urgent humanitarian aid; or
- carrying on activities in the national interest of Canada.
The rule change thus drastically reduces the number of foreign charities that could potentially qualify for qualified donee status. However, one could argue that the Budget 2012 changes are making little difference in practice since very few foreign charities were on the list prior to the rule change (examples include the Woodrow Wilson International Center for Scholars and the William J. Clinton Foundation) given the requirement that the Canadian government must have made a gift to the foreign charity.
This new development comes in the midst of charges from various critics that the Harper government has an agenda against certain types of charities, including charities with political and international activities. For interesting commentary on the topic, you can check out the Globe and Mail's recent article on the "delisting" of foreign charities here: http://www.theglobeandmail.com/report-on-business/industry-news/the-law-page/canada-revenue-agency-delists-foreign-charities/article20104693/.
The current list (or non-list, as the case may be) of foreign charities with qualified donee status can be found here: http://www.cra-arc.gc.ca/chrts-gvng/qlfd-dns/qd-lstngs/gftsfrmhrmjsty-lst-eng.html.
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