Not-for-profits ~ BEWARE: Federal Privacy Laws Can Apply To Not-for-profit Corporations

• Published date: 20 April 2022
• Subject Matter: Corporate/Commercial Law, Privacy, Charities & Non-Profits , Corporate and Company Law, Contracts and Commercial Law, Privacy Protection
• Law Firm: McCague Borlack LLP
• Author: Ms Theresa Hartley and Paul Jacoby

The Personal Information Protection and Electronic Documents Act (PIPEDA) can apply to not-for-profits.¹ PIPEDA applies to organizations that collect, use or disclose personal information in the course of commercial activities.² While commercial activities may seem to be a blanket statement indicating that PIPEDA applies only to for-profit corporations, the relevant authorities suggest otherwise.

Commercial activity means any particular transaction, act or conduct or any regular course of conduct that is of a commercial character, including the selling, bartering, or leasing of donor, membership or other fundraising lists.³ This definition in itself implies that PIPEDA may apply to not-for-profits.

The case law also indicates that commercial activity can be defined in many ways and applies to not-for-profits. It specifies:

• 'Whether an organization is a non-profit business for purposes of taxation is not determinative of whether its collection, use or disclosure of personal information is carried out in the course of commercial activity.'⁴
• '[N]on-profit or charitable organizations that engage in limited commercial activities that are ancillary to their primary functions would nevertheless be subject to [PIPEDA] to the extent that those commercial transactions involve the collection use or disclosure of personal information.'⁵
• 'The primary characterization of the activity or conduct in issue is thus the dominant factor in assessing the commercial character of that activity or conduct under PIPEDA.'⁶

The above is only a sample of the many cases defining commercial activity. Given the lack of a concrete definition...