From:
 Party status What it means to be official
Andrea Sellinger
CBC News Online, June 2001

There are two types of official party status in Canada:
1.  Status in Parliament or legislature
If a party has status in the Parliament or in a provincial legislature it means its won a certain number of seats in the election. In a federal election a party needs to win 12 seats. In provincial elections the number differs between provinces.

2.  Status with the Chief Electoral Officer
If a party has status with Canada's Chief Electoral Officer it means the party name will appear on the ballot during an election. To gain this status parties need to have:
A number of parties have official status with the Chief Electoral Officer, but don't have party status in the House of Commons including:  History
The notion of official party status in the House of Commons began in the late 1960s.
While the ruling party had enough money to pay for staff and research, opposition parties weren't so lucky. MPs who didn't belong to the government didn't have teams of researchers and speechwriters at their disposal.
To fix the problem it was agreed that money would be given to parties that won at least 12 seats in a federal election. The money would be used to better equip MPs for their duties.

Benefits of party status
Official status is a crucial element to the life of any political party in Canada. In the House of Commons getting this status means getting some important benefits such as:

1. Time to ask questions during question period
A limited amount of time is given to parties with official status to challenge and question the government. The percentage of time a party gets is proportionate to the number of seats they have.
For example, Joe's Clark's Progressive Conservatives, who have 12 seats, are guaranteed the chance to ask at least two questions during question period.

2. Money for research and staff
A certain amount of money is given to each official party to pay for staff and research.
Right now the PCs are given a base amount of $500,000 for having official status. The amount of money a party receives is also related to the number of seats they have.

3. Increased visibility for the party

Provincial parties
The idea of official party status applies to the provincial legislatures too, but each province and territory has its own rules regarding the number of seats needed.
In B.C., for example, a party needs to win at least four seats before it will have party status. In Saskatchewan, a party only needs to win two seats.
However, a government can choose to grant a party official status even if it doesn't win the required number of seats.
In 1999, for example, Ontario Premier Mike Harris lowered the number of seats required from 12 to eight. This allowed the NDP to remain an official party in the provincial legislature.
But earlier this year in B.C., Premier Gordon Campbell decided against recognizing the NDP as an official party because it didn't win the four seats it needed to.

Seeking status after elections
After an election is over it's still possible for a breakaway group or a party without enough seats to gain official status. Defections and byelections can help a party to eventually get the right number of seats. The party can then apply for official status and all the benefits that come with it.
In the case of a breakaway group, the various members would have to come together to decide if they and their constituents wanted them to seek party status. They would then have to come up with a name and form a platform before seeking official party status.