Ontario Election 2022: What you need to know before you donate or advertise during an election

April 5, 2022

This article is part of a series extensively covering the 2022 Ontario general election. It provides voters and business leaders a 360 degree view of all the rules and regulations affecting the campaign and voting, as well as insights into news and other developments this election season. It is intended as general guidance only.

To view the rest of our coverage, please visit Ontario Election 2022.

The Ontario provincial election will be taking place on June 2^nd, 2022. If you choose to take part, either as an individual or an organization, then there may be rules and restrictions that apply to you under the Election Finances Act (the “Act”).^[1]

This election will be the first to run under the amendments introduced by Bill 254, the Protecting Ontario Elections Act, 2021,^[2] which made amendments to, among other things, the donation limits and third-party advertising.

Contribution limits

Contributions to political entities (parties, candidates, riding associations, leadership contestants, and candidates for nomination) may only be made by:

individuals normally resident in Ontario using their own funds; or
a deceased person’s estate, as long as the estate is deemed to be one person.^[3]

This means that corporations, trade unions, registered charities, unincorporated associations, groups, and any source outside Ontario are not permitted to make contributions to political entities.^[4]

Eligible contributors may make monetary or non-monetary contributions, as long as the contribution is of their own funds and within the contribution limits. This means that individuals are prohibited from making indirect contributions, such as funds or property given to them by another person or by a corporation for the purpose of making a donation.^[5] Individuals are also not permitted to make cash contributions in excess of $25.

If you are contributing over $200 to a political entity, then you should be mindful that your name and contribution amount(s) will be published by Elections Ontario on the Elections Ontario website. Individuals can make anonymous contributions of up to $25. If an anonymous contribution above $25 is made and the contributor cannot be identified, those funds cannot be used and must be paid to Elections Ontario.^[6]

How much can you contribute per year?

In 2022, eligible individuals can contribute a maximum of $3,325 per calendar year (i.e., January 1^st to December 31^st, 2022 – the “contribution period”), including all campaign periods in that year, to each of the following categories:

to each political party registered in Ontario (e.g., a donor may donate $3,325 to each of the Liberal Party, Progressive Conservative Party, New Democratic Party, Green Party, etc.);
in total to all the registered associations and registered nomination contestants of each registered party (e.g., a donor may donate a total of $3,325 split up among three nomination contestants for the Progressive Conservative Party in three different ridings, and an additional $3,325 among three Liberal Party candidates in those same (or different) ridings, and so on);
in total to all registered candidates of each registered party;
in total to all registered candidates not endorsed by a registered party (i.e. independent candidates); and
to any one registered leadership contestant in a particular party leadership contest.^[7]

Political entities may only borrow funds from a financial institution in Ontario or a registered political party or constituency association in Ontario. In other words, individuals cannot provide loans to political entities in the form of monetary or non-monetary contributions.

What about donated goods and services?

Eligible individuals are also allowed to make non-monetary contributions, such as providing property or services without charge or for less than their commercial value.^[8] The contribution amount is the equivalent of the fair market value of the good or service contributed. If the good or service is provided for a price that is less than the fair market value, the difference between the price and fair market value is considered to be a contribution.^[9]

An exception to this is where the goods or services are produced by voluntary labour.

If the total commercial value of an individual’s contribution is $100 or less, then the individual has the option for this to not be considered a contribution.

As discussed, non-monetary contributions count toward an individual’s annual contribution limit.

Can I donate cryptocurrency?

Yes. Donations may be made by cryptocurrency, including Bitcoin. Such donations are considered monetary contributions.^[10]

What if I attend or sponsor a partisan event?

You, your employer, or your employees may consider getting involved in the upcoming election by showing your support for particular candidates or political parties at fundraising events. Doing so is subject to limitations and disclosure requirements under the Act.

Revenue raised by political entities from any fundraising events will be counted as a contribution. The contribution amount will be the difference between the amount paid to attend the event and the direct costs incurred when the contributor attends, e.g. meals, complimentary liquor, taxes, and tips.^[11] Direct costs do not include costs that are related to advertising, room rent, equipment, etc.

Furthermore, any amounts paid to a political entity in exchange for advertising or promotional opportunities are considered contributions.^[12] It follows that only individuals who are residing in Ontario may pay such amounts.

Third parties

Corporations and interest groups (collectively, “third parties”) may want to show their support for certain political parties or candidates by organizing political events or producing campaign-related advertising. They may also want to provide their views on certain provincial policies or legislative initiatives.

Under the Act, a third party is “a person or entity, other than a registered candidate, registered constituency association, or registered party.”^[13] The Act does not apply to advertising by the government, including the Government of Ontario, the Government of Canada, or the government of any other province, territory, or municipality.

In broad terms, there are two distinct features of an individual’s or group’s activities that determine whether or not those activities are captured by the Act and require that individual or group to register as a third party: (1) the time period in which that activity takes place; and (2) the nature of the activity.

When?

The “election period” commenced on Wednesday, May 4, 2022. The election period ends on polling day.

What?

When third parties engage in “political advertising”, that third party will have to register under the Act, subject to certain caveats and conditions. Political advertising is defined in the Act as:

advertising in any broadcast, print, electronic or other medium with the purpose of promoting or opposing any registered party or its leader or the election of a registered candidate and includes advertising that takes a position on an issue that can reasonably be regarded as closely associated with a registered party or its leader or a registered candidate and “political advertisement” has a corresponding meaning, but for greater certainty does not include:

the transmission to the public of an editorial, a debate, a speech, an interview, a column, a letter, a commentary or news,
the distribution of a book, or the promotion of the sale of a book, for no less than its commercial value, if the book was planned to be made available to the public regardless of whether there was to be an election,
communication in any form directly by a person, group, corporation or trade union to their members, employees or shareholders, as the case may be,
the transmission by an individual, on a non-commercial basis on the Internet, of his or her personal political views, or
the making of telephone calls to electors only to encourage them to vote.

If you are taking part in any of these political advertising activities, you may need to register as a third party under the Act, as described below.

Who?

A person, corporation, or group must register with Elections Ontario as a third party immediately after spending $500 or more on political advertising that takes place during an election period. In addition, a person, corporation, or group must also register with Elections Ontario if they spend $500 or more in the twelve months preceding a fixed-date general election. This means that if the current election proceeds on June 2^nd, 2022 as a fixed-date general election, then any person or group spending over $500 in aggregate on political advertising after May 4, 2021 and before the commencement of the election period must register with Elections Ontario. However, if a non-fixed date election is called, a person or group is only able register on the day the writs are issued.

In order to register, third parties must complete an application process which involves:

appointing a Chief Financial Officer before registering with Elections Ontario;
appointing an auditor if the third party intends to spend, or as soon as it has spent, $5,000 or more on political advertising; and
submitting an application form.^[14]

Can I donate to third parties?

Even if you are not organizing events or producing advertising, you may still choose to engage in the election by making contributions to third parties to support their regulated activities. Unlike political contributions, individuals, businesses, and other organizations are permitted to make contributions to third parties, and are not subject to any monetary or non-monetary limit on the amount of their contribution. A third party must not accept anonymous contributions.^[15]

Each contributor’s name and address must be reported in the third party’s Political Advertising Final Report for donations over $100,^[16] and their names and amounts will be published on the Elections Ontario website.^[17]

The bottom line

Participating in an election campaign is a crucial form of civic engagement. Still, individuals as well as private entities and those who work for them should be cognizant of the potential limits on their own involvement.

If you or others in your organization will engage in the political process in the 2022 Ontario election, take the time to ensure that your internal policies and procedures comply with the rules outlined above.

This article is part of our 2022 Ontario provincial election series. You can access related content here.

Have questions about working with government and government agencies? Our Public Sector experts at McCarthy Tétrault LLP can help. Please contact Awanish Sinha, Hartley Lefton, Amanda D. Iarusso, or Jacob Klugsberg, if you have any questions or for assistance.

[1] Election Finances Act, R.S.O. 1990, c. E.7.

[2] Protecting Ontario Elections Act, 2021, S.O. 2021, c. 5 (although some provisions have been subsequently repealed).

[3] Elections Ontario, CFO Handbook for Political Parties (January 2022) at p. 32.

[4] CFO Handbook for Political Parties, ibid at p. 32.

[5] Election Finances Act, supra at s. 19(1).

[6] Election Finances Act, supra at s. 17(2).

[7] Election Finances Act, supra at s. 18(1.4).

[8] Election Finances Act, supra at s. 22(3).

[9] Election Finances Act, supra at s. 21(3).

[10] CFO Handbook for Political Parties, supra at p. 36.

[11] CFO Handbook for Political Parties, supra at p. 73.

[12] Election Finances Act, supra s. 23(4).