Don’t be so quick to believe political parties can’t merge in Alberta

By Ken Boessenkool and Tyler Shandro

 It is difficult for political parties to merge in Canada because it is impossible for political parties in Canada to transfer assets to each other. This is the conclusion of numerous anti-unite-the-right activists, as well as numerous commentators. They base this on recent comments from Glen Resler, Canada’s chief electoral officer.

There is nothing in Canada’s Elections Act or the Election Finances and Contributions Disclosure Act stop parties from merging. The question is what to do with the bank accounts for a registered political party.

Here’s what Resler said: “One party could absorb the membership of the other, but the assets of the party being left will be transferred to the Crown.” And “PC and Wildrose members … could form a completely new party, but in that case, the assets of the existing parties would be forfeited.”

Resler is relying on sections 13, 35 and 38 of the Election Finances and Contributions Disclosure Act.

Let’s take the weakest argument first. Section 13 provides for exemptions to contribution limits and prohibitions. It says that transfers from a “foundation” or “trust” to a party are permitted. You are required to create a “foundation” (essentially a non-profit corporation or society) before registering a new political party and can accept up to $5,000 prior to registering your political party.

At registration, the party and the foundation become one and the same. In that sense, the “foundation” can accept more than $5,000 in assets after registration. And foundations can transfer money to registered parties. Therefore, a transfer from the Progressive Conservative Association of Canada Foundation may arguably be made to any registered party, be it a new party or a merged party.

But Resler may be relying on Section 35. It says, “No registered political party… shall, directly or indirectly, contribute or transfer funds to any political party, constituency association or candidate …”

So far so good, but Resler seems to ignore what comes next, namely, “not registered under this act.” There’s the rub. Both the PC and the Wildrose party, and presumably any new party, would be “registered under this act,” and therefore transfers would presumably be permitted between them. Both parties could transfer their assets to the NDP if they so wished (as long as the NDP remained registered at the time).

More likely, Resler is relying on Section 38: “A registered party and any of its registered constituency associations or registered candidates may annually transfer to or accept from each other…”

This section uses permissive language to permit intra-party transfers, and Resler seems to be suggesting that everything not enumerated in this section (i.e., inter-party transfers) is therefore prohibited. But it is incorrect to take permissive language and interpret that as saying that everything not enumerated is therefore prohibited. Besides, this restrictive interpretation of Section 38 would be at odds with Section 35, as argued above.

We would also point out that parties are permitted to change the names on their bank accounts or with corporate registry. They are permitted to change their names with Elections Canada. They stay the same party. To say that the Wildrose or PC Party would be a different “registered party” than, say, the “Conservative Party of Canada,” if the members and executive of each party agreed to become the “Conservative Party of Canada,” would likely contravene Section 3 of the charter.

Finally, by “forfeiting” assets, Resler meant the section of the act that says when a political party’s registration is cancelled, the funds shall be transferred to the general revenue fund. But should both parties agree to merge, whether a third party was created from scratch or the parties folded into one of the existing two parties, it would be a rather simple matter for the dissolving party or parties to simply run their bank accounts dry during the transition period. In that case, when cancellation happens, there wouldn’t be any assets to forfeit.

We are not here making the case about whether the parties should merge. That debate will take place and the two of us are not completely aligned on the issue. The case we are making is that parties can merge and can transfer their assets without contravening the act.

Ken Boessenkool and Tyler Shandro are long-standing members of the Progressive Conservative Association of Canada.

Boessenkool and Shandro: Don't be so quick to believe political parties can't merge in Alberta

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