Loan Guidelines
What is a loan?
A loan is when money is borrowed by a political entity (a registered political party, a candidate, a leadership contestant, or a constituency association) to finance their campaign.
Are there any limitations?
- The maximum term of a loan (including a refinanced loan) is 24 months.
- An individual or organization shall not provide loans to a political entity in excess of $3,000 in a calendar year.
- Candidates cannot lend to any person or organization money that has been raised for the purposes of an election.
- A constituency association may only lend money to its nominated candidate or its registered political party.
Note: Limitations 1 and 2 above are not applicable to loans made by financial institutions, registered political parties, or constituency associations.
What are the requirements for loan agreements?
- Must be in writing.
- Must include:
- the amount
- the annual rate of interest
- the term
- the name and address and signature of the lender
- the name and address of any guarantor
- the details of any agreements made to assign any portion of the election expense reimbursement
- the signature of the borrower authorized to act on behalf of the entity
- Must be filed with the Chief Electoral Officer immediately after it is made.
Note: Line of credit or overdraft agreement must also be filed with the Chief Electoral Officer.
Is the loan agreement disclosed to the public?
If the loan is equal to or more than $250, the Chief Electoral Officer will publish a notice that identifies the debtor and the loan agreement. Financial institutions are exempt from this disclosure.
When is a loan considered a deemed contribution?
- A loan that is uncollected within 6 months after becoming due and the creditor has not commenced legal collection proceedings.
- The difference between the prime interest rate and the interest rate of the loan.
- A payment on the loan is made by someone other than the debtor.
Note: No tax receipts shall be issued for deemed contributions.
Which sections in the EFA relate to loans?
Sections 41.1(1) to 47 relate to loans.
