News
26 March 2007Avoid Problems for Cross-border Charities
New charity legislation is causing problems for English and Welsh charities seeking registration in Scotland – to the extent that some might find it prohibitively expensive to register here, say Scottish charity lawyers, Turcan Connell. But it is an issue that could be resolved.
The problem arises because the Charity Commission and the Office of the Scottish Charity Regulator apply different criteria when deciding if an organisation qualifies as a charity. Charities registered in England and Wales will have to meet the Scottish charity test if they wish to register in Scotland. To pass this test, a charity must satisfy OSCR that it provides public benefit and exists for one or more of a set of charitable purposes.
But because the Scottish list of charitable purposes differs slightly from that in England, recognised English charities may be unable to register in Scotland. They had until the end of February to register with OSCR, but some charities have been told that they would have to change their constitutions in order to meet the Scottish charity test. This can be a time-consuming and expensive process, and charities are questioning whether it is really necessary. It also means that their worldwide activities would be assessed in accordance with Scots law – although Scotland is not their main base.
Simon Mackintosh, Head of the Charity Team at Turcan Connell, said: “This may cause UK-wide charities to reconsider their operations in Scotland.”
Given the close alignment of the charitable purposes in the two jurisdictions, he thinks a simple solution exists that would save charities considerable time and expense.
“Ministers have power to disapply parts of the Charity Test,” he said. “And they have already done this for major national bodies such as the National Galleries of Scotland and the National Library of Scotland. They could exercise their discretion and allow charities regulated by the Charity Commission to register and operate in Scotland without having to change their constitutions.”
The risk from using different definitions was known about before the Act became law. At the Bill stage, Turcan Connell and others questioned the value of making OSCR put charities already controlled by the Charity Commission onto the Scottish register. “We all have to operate within the Act as passed,” said Simon Mackintosh, “But that Act does seem to offer a way of resolving the problem.”
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For further information, contact:
Tom Govan, Marketing and Communications Manager
Tel: 0131 228 8111
Mobile: 07779 579737
DD: 0131 659 8689
E-mail: tg@turcanconnell.com
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