11.D Getting CFC charitable status or equivalent back

[Vladimir Drkulec]

This is for a discussion of getting CFC charitable status or its equivalent back.

[Patricia Gamliel]

It is important that this status is reinstated as it allows not only for more donations but also access to various organizations government’s funded programs.

[Fred McKim]

It is important that this status is reinstated as it allows not only for more donations but also access to various organizations government’s funded programs.

It is important to remember that we did not have our status revoked, for "bad" behaviour, but we were ruled not to fit the description of a charity. As a lawyer, Patricia, you might be in a unique position to review the case. You could begin with Les Bunning who worked on it at the time.

I suspect we would have more luck trying to fit in as a recognized Sporting Association.

[Vladimir Drkulec]

I believe there are many programs at the federal level that are also open to non-profits. A number of years ago the question of Olympic Committee recognition of the CFC came up again when they went through their NFP process. At the time, I was quite jubilant that we once again made the cut after quite a bit of back and forth with the COC and their committee deciding the matter. This opened a door to what is now called Sport Tourism Canada. Once this door was open the painful process of trying to get communities to run CYCC and Canadian Open and other tournaments disappeared. It takes some effort to cultivate relationships with communities that we meet at the Sport Tourism Canada expos. Efforts sometimes take years to bear fruit. They do bear fruit and we have a dance card that is filling up through 2024.

My belief is that we should strive for the designation from the Federal government as a national sporting organization. We have that from the Olympic Committee and in a few instances where the government has stated requirements for one program or another they have pointed to that recognition as a requirement in order to get an exemption to hold certain events in Canada or travel to world events despite COVID restrictions. I have talked to people in Parliament and their staffs this year and over the years and they have been open to chess getting more recognition. The thing that is holding us back is that we need effective people to make these contacts and initiate the process. There is no point in getting charitable status if we do not make use of that status once we get it. My personal calculation is that we should be raising $50,000 per year in order to justify pursuing this because the costs will be $5,000 per year. If we collect $10,001 per year every once in a while through this (and typically anything you collect will often be spent on some program) it is not worth it to pursue it. The actual donations were much less than that typically. The leadership of the CFC at the time of the removal of charitable status made a calculation that the cost of pursuing charitable status exceeded all the donations that the CFC had collected up to then.

We are limited to the bandwidth and the abilities of the people who are CFC volunteers and Bob Gillanders. The Sport Tourism Canada contacts are the low hanging fruit. The money flows not to the CFC except perhaps indirectly but it does flow to the chess organizers who thus make big tournaments happen. I am focused on making more of those contacts and seeing more tournaments organized with their help.

[Pierre Dénommée]

You are widely underestimating the changes to the CFC Act of Incorporation and bylaws that would be required to get any Federal funding. Compliance with the Official Language Act is a routine requirement. Compliance with the Canadian Anti-Dopîng rules, meaning drug tests for our players (mostly high level players). Mandatory Appeal Policy enabling the Board of Directors decisions to be challenged by binding arbitration to the Sport Dispute Resolution Centre of Canada; off course, the decision cannot be challenged on its merit, but on failure to abide by the Act of Incorporation, the bylaws or the policies of the CFC. We must have a high performance program, a program for players with disabilities and so on.

The exact conditions are no longer public and are only sent to qualified applicants. When they were public, some conditions were discriminatory against chess.

Furthermore, the Conservatives did declare war on Charity when they were in power. Only Charities ideologically compatible with the Conservatives should be allowed: no more ecological charities, save the planet or save the whales charities. This is something to remember before placing your X on Election Day. The Conservatives ordered Federal employees to shut down as many Charities as possible, without making any accusations. All the provincial sports Federation in Quebec had their charity number revoked and it is clear at the reading of this policy that Ottawa has no intention of giving back the Charitable status to provincial level organization https://www.canada.ca/en/revenue-agency/services/charities-giving/charities/registering-charitable-qualified-donee-status/applying-other-qualified-donee-status/applying-registered-canadian-amateur-athletic-association.html. The main problem is the wording of the Law: "Canadian amateur athletic association". If they had used "sport association", then, chess is a sport, but it is certainly not athletic. There is a nice page for sport as a registered charity here https://www.canada.ca/en/revenue-agency/services/charities-giving/charities/policies-guidance/policy-statement-027-sports-charitable-registration.html#toc19 .

We apply here https://www.canada.ca/en/revenue-agency/services/charities-giving/charities/registering-charitable-qualified-donee-status/apply-become-registered-charity.html .


It is a complicated process in which a misplaced coma could ruin our application.

[Christopher Field]

It is important to remember that we did not have our status revoked, for "bad" behaviour, but we were ruled not to fit the description of a charity. As a lawyer, Patricia, you might be in a unique position to review the case. You could begin with Les Bunning who worked on it at the time.

I suspect we would have more luck trying to fit in as a recognized Sporting Association.

It looks as if it's unlikely that we can re-establish charitable status, as it won't be easy to make the CFC fit the definition of a charity.
For Sporting Association, I think this depends on whether the definition of 'sporting' used involves athletic activity.

[Patricia Gamliel]

It is important to remember that we did not have our status revoked, for "bad" behaviour, but we were ruled not to fit the description of a charity. As a lawyer, Patricia, you might be in a unique position to review the case. You could begin with Les Bunning who worked on it at the time.

I suspect we would have more luck trying to fit in as a recognized Sporting Association.





If you forward me the file, I’ll look into it. I am in the midst of preparing an application for an org. I believe the CFC might fit in a different «*box*» but I need to see the documents.

[David Gordon]

Why is chess a charity?

[Patricia Gamliel]

Chess is not a charity but a Chess association might be granted a Charity status based on criteria such as its exclusive promotion of amateur chess in Canada nation-wide, its overseeing of structure of local clubs, regional, provincial chess bodies, its delivery of training program that brings players to national and international levels through various qualifying competitions. Also, managing a national team to participate at international competitions, stage and sanction competitions and act as a Canadian representative of an international federation controlling chess.
A charity status allow for better and wider fundraising activities.

[Paul Leblanc]

I would also like to note that the "Chess Foundation of Canada" is not a separate entity from the CFC. It is merely the investment arm of the CFC and holds funds in trust to support the CFC.
It lost its tax deductible status along with the CFC about ten years ago.

[Christopher Field]

I would also like to note that the "Chess Foundation of Canada" is not a separate entity from the CFC. It is merely the investment arm of the CFC and holds funds in trust to support the CFC.
It lost its tax deductible status along with the CFC about ten years ago.

I wonder if it might be possible to obtain charitable status for the Foundation.
It would have to be set up as a separate entity.

[Vladimir Drkulec]

I wonder if it might be possible to obtain charitable status for the Foundation.
It would have to be set up as a separate entity.


As the financial arm of the CFC, it would be much harder than getting the CFC to become a charity. The CFC would no longer be in control of the funds which consist of the Pugi fund and the proceeds of the sale of life memberships. Trying to do so would require a two thirds majority of the voting members and probably similar majorities of life members and regular members and possibly even junior members and honorary members. The effect of doing this would be to substantially dispose of all of our assets which triggers certain consequences under the NFP act and likely under our constitution. It would also be likely in this COVID environment remove our safety net and would likely make it harder to find people willing to serve as members of the board because the board members are responsible even two years after they leave the board for the CFC in the event of bankruptcy.

[Richard Bérubé]

Chess is not a charity but a Chess association might be granted a Charity status based on criteria such as its exclusive promotion of amateur chess in Canada nation-wide, its overseeing of structure of local clubs, regional, provincial chess bodies, its delivery of training program that brings players to national and international levels through various qualifying competitions. Also, managing a national team to participate at international competitions, stage and sanction competitions and act as a Canadian representative of an international federation controlling chess.
A charity status allow for better and wider fundraising activities.

Patricia, there is little chance that a national body like the CFC who do not comply with the «*official language act*» be recognized as a charity or something like. The CFC only operates in english and this last since its foundation. The promotion you are talking about happen only in english.

[Richard Bérubé]

Patricia, There is little chance that a national federation get a charitable status or something like if it do not comply with the Language official act. It’s the same for any national program coming from the Federal government. The promotion you are talking about operates only in english.

[Vladimir Drkulec]

If being a charity was such a wonderful thing, the CFC would have done more to keep that status back when the option was still on the table. I think some are over estimating the difficulty and hurdles present to become a charity. Others are over-estimating the benefits of becoming a charity in the absence of an effective fundraising campaign.

If we were able to raise $50,000 per year or more year over year then it would be worth the extra overhead and red tape to be a charity which would be about $5000 per year for an audit every year, the last time I checked.

We do fall short on providing bilingual services but I doubt that is a precondition for charitable status based on other charities that I am aware of. We do not discriminate against players from Quebec. Perhaps we need to do a better job of publicizing what we do.

[Pierre Dénommée]

Chess is not a charity but a Chess association might be granted a Charity status based on criteria such as its exclusive promotion of amateur chess in Canada nation-wide, its overseeing of structure of local clubs, regional, provincial chess bodies, its delivery of training program that brings players to national and international levels through various qualifying competitions. Also, managing a national team to participate at international competitions, stage and sanction competitions and act as a Canadian representative of an international federation controlling chess.
A charity status allow for better and wider fundraising activities.

Those criteria applies to Canadian amateur athletic associations, but it is far from obvious that chess is athletic.

As a former CFC Treasurer, I can say that discrimination against mind sports is rampant in the Federal Grant system. I did strongly protest to the Minister about the condition, now well hidden from public eyes, stating that chess, droughts, bridge, scrabble and similar activities are unworthy of Federal Funding. The Minister did refuse to remove this blatant discrimination. In 2021, the conditions for getting Federal Grants are sent only to qualified applicants, which mean that they are hidden from the general public, presumably to hide the continuing discrimination,

[Pierre Dénommée]

If being a charity was such a wonderful thing, the CFC would have done more to keep that status back when the option was still on the table. I think some are over estimating the difficulty and hurdles present to become a charity. Others are over-estimating the benefits of becoming a charity in the absence of an effective fundraising campaign.

If we were able to raise $50,000 per year or more year over year then it would be worth the extra overhead and red tape to be a charity which would be about $5000 per year for an audit every year, the last time I checked.

We do fall short on providing bilingual services but I doubt that is a precondition for charitable status based on other charities that I am aware of. We do not discriminate against players from quebec. Perhaps we need to do a better job of publicizing what we do.

I agree. Many outsiders believe that a Charitable Status is marvellous, but those who have practical experience being a director of a Registered Charity often disagree.


The main obligations of a registered charity are to:

devote its resources (funds, personnel, and property) to its charitable purposes and activities (not everything the CFC does is Charitable)

file its annual Form T3010, Registered Charity Information Return, within six months of its fiscal year-end

meet its annual spending requirement (disbursement quota) (minimum amount to spend, per year, for the attainment of our Charitable goals)

keep adequate books and records in Canada, and make them available for review by the Canada Revenue Agency on request (audit fees)

make sure that official donation receipts are complete and accurate when issued (issuing a single bad receipt could lead to serious problems)

control and direct the use of all its resources (funds, personnel, and property)

maintain its status as a legal entity

Also, a registered charity should inform the Charities Directorate of any changes to the charity's mode of operation or legal structure. Examples include a change in address, directors, legal or operating name, purposes, activities, or governing documents.

For more information on the obligations of a registered charity, see Checklists for charities. If a registered charity does not meet its obligations, it may be subject to a penalty and may have its registered status revoked.


There is a lot of administrative overhead and audit fees that require that the Charity collect a significant amount of money to offset the extra costs.

The advantages of a Registered Charities are well known, the drawback are more secret, but are very real and could impact the CFC.

[Egidijus Zeromskis]

Chess can be charitable if sold properly. Chess institute of Canada was registered as the charitable organization several years ago.

Though I don’t know any national sport organizations with the charitable status.

In principle the organization shall prove that it does not spend donated monies “for bonuses” to get them periodically.

[Pierre Dénommée]

Chess can be charitable if sold properly. Chess institute of Canada was registered as the charitable organization several years ago.

Though I don’t know any national sport organizations with the charitable status.

In principle the organization shall prove that it does not spend donated monies “for bonuses” to get them periodically.

Yesterday cannot be compared with today. The rules have changed, if not on paper, in interpretation. Many Registered Charities have lost their status. The Federal employees in charge have changed the way things are done.

[Vladimir Drkulec]

Chess can be charitable if sold properly. Chess institute of Canada was registered as the charitable organization several years ago.

Though I don’t know any national sport organizations with the charitable status.

In principle the organization shall prove that it does not spend donated monies “for bonuses” to get them periodically.

Most national sports organizations that are athletic, recognized by the Canadian Olympic Committee and funded by Sport Canada don't need to be charities because they can issue receipts for donations which opens the door for corporate donations and sponsorships.

[Egidijus Zeromskis]

Most national sports organizations that are athletic, recognized by the Canadian Olympic Committee and funded by Sport Canada don't need to be charities because they can issue receipts for donations which opens the door for corporate donations and sponsorships.


Are you saying that the Sport Canada funding opens them the donation door?

[Vladimir Drkulec]

Are you saying that the Sport Canada funding opens them the donation door?

No. The designation by Revenue Canada is what opens the door to tax deductible donations.

We have had some donations over the years despite not being able to provide donation receipts. I am not up on the latest rules for donations but the write-off is not that significant. I believe it is on the order of 17 percent or at least was a few years ago.

[Pierre Dénommée]

No. The designation by Revenue Canada is what opens the door to tax deductible donations.

We have had some donations over the years despite not being able to provide donation receipts. I am not up on the latest rules for donations but the write-off is not that significant. I believe it is on the order of 17 percent or at least was a few years ago.

Any non-profit and even for profit can receive donations without tax donation receipts. In Quebec, a for profit used clothings store posted a sing indicating that they accept donations. In order to save their reputation, they have teamed with legitimate charities. Some persons were gullible and fail to realize that they were giving to a for profit corporation.