Monies raised through fundraising represent one of the main streams of income for many charities. Therefore it is vitally important that charities and charity trustees are aware of the applicable rules and regulations.

There are several places where charity trustees and administrators can inform themselves regarding the law and best practice of fundraising. The Office of the Scottish Charity Regulator (OSCR) has published a user-friendly guide on complying with the 2009 Regulations on fundraising, which can be found here.

There are also two membership-based bodies which can provide guidance on fundraising standards and best practice: the Fundraising Standards Board ("FRSB") and the Institute of Fundraising ("IoF"), both of whom work closely with OSCR. The FRSB has adopted the IoF Code and Fundraising Promise, which"outlines how its members will behave when doing their fundraising and ensures fundraising is legal, honest, open, transparent and accountable".

The applicable rules will vary depending on the type of fundraising, and what follows is only a summary of the more important points charities should be aware of.

The legislation covers three types of fundraisers: a benevolent fundraiser, a commercial participator and a professional fundraiser.

A benevolent fundraiser is a person (which may include a manager, employee or volunteer) connected with a benevolent body (a body established for charitable, benevolent or philanthropic purposes) which may be a charity. In contrast, a commercial participator is someone who carries out a business unrelated to fundraising, but who is engaged in a promotional venture whereby some or all of the proceeds will go to charitable purposes. A professional fundraiser's business is to raise money for a charity in exchange for payment or benefit. Examples can be found in OSCR's guidance on the Regulations.

It is important that charities know who is fundraising for them, as there are different rules for each group. One of the main differences is the type and amount of information which the fundraiser must give to any prospective donors: it depends not only on the category of fundraiser but also on the method of solicitation they are using.

Professional fundraisers and commercial participators cannot act without having a formal agreement in place with the charity. The agreement must follow certain requirements found in the 2009 Regulations. If it does not, it is not enforceable against the benevolent body (unless by order of a sheriff). If the professional fundraiser or commercial participator is to receive expenses and remuneration, this must be set out in the agreement.

If a charity is planning to organise a public charitable collection, specific regulations apply. Charities should particularly be aware that they are required to obtain permission from the relevant local authority. For a planned public collection across Scotland, rather than in a single local authority area, it is possible for charities and individuals to apply to OSCR to become an Exempt Promoter. Becoming an Exempt Promoter removes the requirement to co-ordinate permission with each local authority, but they must be given three months' advance notice of collections which will take place. Charities should also ensure they understand the rules on public collections, as these are quite strict on how donations are to be collected and include specific conditions on handling and accounting for funds.

If a charity becomes aware that someone is engaging in unauthorised fundraising, they can prevent this using a procedure set down under the Charities and Trustee Investment (Scotland) Act 2005. That procedure may be useful if fundraising is being carried out in a way which could cause reputational harm to a charity, or where a charity's name is being used inappropriately.

This is only a brief overview of some of the headline principles which apply to fundraising in Scotland. Given that non-compliance can in some cases amount to a criminal offence, charities should ensure their fundraising activities are in line with the rules, and, if in doubt, seek advice. Turcan Connell would be happy to provide such advice.

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