Elections Nova Scotia Circular #10-01

Official agents should review the new contribution rules (Chapter 19 of the Acts of 2009) that apply to individuals, corporations, partnerships, trade unions, related corporations, and locals and affiliates of a trade union.

Only individuals resident in Nova Scotia may make political contributions.

Reference: Section 14B(1) of MPEDA

Corporations, partnerships and trade unions may not make political contributions. (Effective January 1, 2010)

Reference: Section 14B(1A) of MPEDA

An official agent shall not accept a cash donation of more than $100.

Reference: Section 12A of MPEDA

Where an individual makes contributions exceeding $5,000 to a recognized party and its affiliated electoral district associations and candidates, the recognized party, electoral district associations and candidates must return the excess contributions.

The MPEDA contains a formula to help you determine how to repay excess political contributions.

Reference: Section 14C of MPEDA

No person shall lend money to a candidate, electoral district association or recognized party for a term of more than two years, including any renewal or refinancing of the loan. (This does not include loans from financial institutions, electoral district associations or recognized parties.)

Reference: Subsection 14D(3) of MPEDA

No loan shall be accepted unless there is a written loan agreement setting out the amount of the loan, the term, the name and address or the lender, the name and address of any guarantor and the details of any assignment or reimbursement.

Loan agreements must be disclosed as part of the annual disclosure statement filed in accordance with Section 14 of MPEDA.

In any year where there is a balance outstanding on the loan, the official agent must include, as part of the annual disclosure statement filed in accordance with Section 14 of MPEDA, a statement containing the outstanding balance on the loan and describing any changes to the loan agreement.

Reference: Subsection 14F(1) of MPEDA

Loan agreements will be published by the Chief Electoral Officer, along with the disclosure statement for the previous calendar year, by June 30th of each year.

Reference: Section 20A of MPEDA

Loans are not normally considered to be contributions. However, loans, or portions of loans, will be considered to be contributions in the following circumstances:

Where a loan is made at a rate of interest lower than the bank prime rate, in such a case, the difference between the rate charged and the bank prime rate is considered a contribution.

The bank prime rate is available on Elections Nova Scotia website. Please click here for the information.

When someone other than the borrower makes a payment on the loan, the payment is considered to be a contribution.

Where a payment is due but is partly or wholly unpaid six months after becoming due, the outstanding amount is a contribution. (This rule does not apply to a loan from a financial institution.)

Reference: Section 14E of MPEDA

If a loan amount is deemed to be a contribution under the above rules, and the deemed contribution results in the lender exceeding their contribution limit of $5,000, the excess contribution will be deducted from any amounts owing to the candidate, electoral district association or recognized party.

Reference: Subsection 14G of MPEDA

Reminders for Official Agents

The responsibilities and duties of official agents have changed. You should familiarize yourself with the new rules re: political contributions. Review the recent amendments.

You should not accept any donation of more than $5,000, or any cash donation of more that $100 or any donation where you know, or have reason to believe, the individual has already exceeded their annual contribution limit of $5,000.

If you know, or have reason to believe, a individual is intentionally or inadvertently exceeding the contribution limits, you should advise the individual. You must also advise Elections Nova Scotia immediately.

You must disclose all loan agreements: all loan agreements, and a report of changes to previously disclosed loan agreements, must be included in the annual disclosure statement required under Section 14 of MPEDA.

Loans will be deemed to be contributions in certain circumstances. If you are an official agent for a candidate, you should familiarize yourself with these rules to ensure that a candidate’s deposit is not reduced as a result of an excess contribution. If you are an official agent for a recognized party, you should monitor loans closely to ensure that loan amounts are not deemed to be contributions. Excess contributions will be recovered from amounts payable to the recognized party.