KNOWLEDGE CENTRE

Post-closing disputes in M&A often start the same way. Something surfaces, a claim is threatened, and the seller's first response is that the buyer had all of the information. It was in the data room.

A recent judicial decision reminded me of something worth sharing with anyone navigating charity registration in Canada under the Income Tax Act. The Charities Directorate of the CRA has a habit of treating registration applications for registered charities and registered amateur athletic associations alike — a bit like audits.

Due diligence and Disclosure Schedules are connected, but they are not interchangeable. One is investigative. The other is contractual. Treating them as the same exercise, or leaving the schedules to reflect diligence findings on their own, is where deals create problems they did not need to have.

Registered charities are facing a material shift in regulatory risk. In January 2026, the CRA quietly announced that it will no longer pre-approve or automatically review proposed changes to a charity's purposes or activities before those changes are adopted.

Disclosure Schedules are a critical component of M&A transactions. They translate due diligence findings into contractual language and reflect the seller's understanding of the business. By treating them as a priority from the outset, you can help ensure a smoother transaction process.

Did you know that directors' addresses are public? Here are ways to maintain director privacy.