The International Journal
of Not-for-Profit Law

Volume 2, Issue 4, June 2000

A quarterly publication of the International Center for Not-for-Profit Law

Table of Contents

Letter from the Editor

Articles

Scottish Charity Law: Proposals for Reform
By Dr. Christine R. Barker

Volunteering-- The Long Arm of the Law
By Debra Morris

Do Czechs Need a New Law on Associations?
By Dr. Petr Pajas

The Freedom to Join an Association: A Principle in Question
By Barbara Rigaud

Structural and Systematic Issues Surrounding the Establishment and Management of Endowments in the Czech and Slovak Republics
By Robert N. Thomas

Report on the Violations Committed in the Course of Registration and Re-Registration of Public Associations in the Russian Federation in 1999
Prepared by the Information Center of the Human Rights Movement and the Center for the Development of Democracy and Human Rights

Reviews

An Introduction to the Not-for-Profit Sector in China
By Nick Young and Anthony Woo
Reviewed by Georgina McCaughan

Las Organizaciones de la Sociedad Civil en el Ordenamiento Legal Argentino
By GADIS and Foro del Sector Social
Reviewed by Fernando Latorre

Hacia un Desarrollo con Ciudadania
By La Sociedad Internacional de Investigación del Tercer Sector
Reviewed by Antonio Itriago

Entidades Sin Ánimo De Lucro - Regimen Tributario Especial
By Juan Carlos Jaramillio Diaz, Vargas Ballen, Jenny & Fabio Andres Duran Acosta
Reviewed by Antonio Itriago

Case Notes

North America:
the United States

South Asia:
India

Country Reports

Asia Pacific:
Australia

Central and Eastern Europe:
Regional
| Bulgaria | Croatia | Czech Republic | Estonia | Kosovo | Macedonia | Montenegro | Romania | Slovak Republic | Yugoslavia

Latin America:
Belize
| Chile | Colombia | Nicaragua | Venezuela

Middle East and North Africa:
Egypt

Newly Independent States:
Armenia
| Moldova | Russia

North America:
Canada | Mexico | the United States

South Asia:
India

Sub-Saharan Africa:
Ghana
| South Africa | Tanzania | Uganda

Western Europe:
France
| Germany | the United Kingdom

International:
CIVICUS Diamond Project | G4+1 Accounting Standards

International Grantmaking

Determining Whether to Make an Equivalency Determination or to Excercise Expenditure Responsibility
By Derek J. Aitken

Supporting Microfinance Abroad: Introductory Legal Issues for U.S. Grantmakers
By Timothy R. Lyman

United States International Grantmaking (USIG) Project Unveils New Web Site
By Derek J. Aitken

Community and Corporate Philanthropy

The Enabling Environment for Community Philanthropy

Changemakers.net

German Publication

Partnerships

Survey of the Current Legislative Framework for NPOs to Perform Social Services in Bulgaria

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Editorial Board

Subscription Information

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Scottish Charity Law: Proposals for Reform  

By Dr Christine R. Barker*

Charity law is an area of increasing importance, and its reform is a subject in which the recently (re-)formed Scottish Parliament has expressed interest. Although the present members of the Scottish Parliament were elected as recently as 1999, Scotland was a separate kingdom until the seventeenth century and has its own legal system whose separate existence was guaranteed by the Act of Union in1701. It is not surprising, therefore, that charities in Scotland are regulated differently from those in other parts of the UK, and that the Scottish Parliament is considering proposals to change the law which governs them.

In recent years reform of the law in England and Wales has been proposed in the report of the Commission on the Future of the Voluntary Sector in England and Wales (Deakin 1996), and in Scotland by the report of the Commission on the Future of the Voluntary Sector in Scotland (Kemp 1997) and in the recently published reports of Dundee University’s Charity Law Research Unit, of which I am a member (CLRU 2000).

The first major evaluation of the statutory supervision of charities in Scotland, conducted by Dundee University’s Charity Law Research Unit, was published on 12th June 2000 by the Scottish Executive Central Research Unit. The evaluation examined the implementation of the principal legislation governing Scottish charities, namely Part I of the Law Reform (Miscellaneous Provisions) (Scotland) Act 1990 (“the 1990 Act”), and two other sets of provisions which are relevant in this area, Part VI of the Education (Scotland) Act 1980 (relating mainly to educational endowments) and section 119 of the Civic Government (Scotland) Act 1982 (relating to public charitable collections). This paper provides a summary of our proposals for reform of the Scottish system.

Three separate reports have been published by the Scottish Executive Central Research Unit as a result of this research. Scottish Charity Law: An Evaluation is the main report; Public Trusts and Educational Endowments examines, at an exploratory level (1) the regulation of public trusts and educational endowments and (2) the reorganisation of public trusts and endowments (both educational and non-educational); Public Charitable Collections, examines some of the problems associated with collections of cash from members of the public, either in the street or from house to house, in aid of a particular charitable cause.

A variety of research techniques were employed for our research, both desk-based and empirical. The desk research involved a legal analysis of the regulatory system in Scotland and comparative studies of the legal position in other jurisdictions, including England and Wales. The empirical study involved a postal survey of 2500 Scottish charities; interviews with 45 advisers to charities; an analysis of the work of the Scottish Charities Office (the main regulatory agency in Scotland), including in-depth scrutiny of 7 cases taken to the Court of Session (Scotland’s principal civil law court); and discussions with the other regulatory institutions.

While recognising that the provisions of the 1990 Act have greatly improved the supervision of charities in Scotland and that the allocation of certain tasks to a number of different regulatory agencies has, on the whole, worked well, we discovered that a significant number of charities were unclear about their legal responsibilities, and small charities without an infrastructure of “umbrella” support had difficulty in implementing some of the legislation. We also consider the current system of providing information to the public about Scottish charities to be unreliable. Charities themselves also expressed a desire for more readily available information and guidance on charity law and regulation.

Concluding that there is a lack of cohesion between the provisions in the different pieces of legislation and that a fresh start is required, we recommend that the existing provisions should be repealed and replaced by a single Act of the Scottish Parliament governing (1) the regulation of Scottish charities and public trusts; (2) the reorganisation of Scottish charities and public trusts; (3) fund-raising by means of public charitable collections; and (4) the provision of information and advice to organisations which are subject to the system and to members of the public.

Specific recommendations include the following:

In a little more detail, our proposals for improvement of the current legislation for charities in Scotland may be summarised as follows:

Definition

Public Information

Standard-setting

Monitoring

Facilitation

The Diagram outlines a revised institutional structure for the legislative and administrative supervision of charities in Scotland.

Diagram Revised Institutional Structure (new or reallocated tasks in italics)

Scottish Executive

  • Legislation
  • Co-ordination
  • Responsibility for Registrar of Scottish Charities
  • Prescription of information to be held on registers
  • Prescription of accounting/reporting standards (including exemptions)
  • Designation of religious bodies
  • Prescription of standards for public charitable collections
  • Authorisation of general guidance
  • Promoting reorganisations

Registrar of Scottish Charities

  • Determination of status for registration as Scottish charity
  • Determination of status for registration as “benevolent organisation”
  • Maintenance of registers:

Register of Scottish Charities

Register of Benevolent Organisations

Register of Persons Removed

  • Provision of public access to registers
  • Management of statistical data
  • Reorganisation of dormant accounts
  • Information/advice on reorganisations
  •   Registration of reorganisations
  • Dissemination of general guidance
  • Facilitating access (1st point of contact)
  • Function-related information/advice
  • Reference of misconduct to Lord Advocate

 

Lord Advocate

  • Investigation
  • Intervention (provisional)
  • Applying to Court of Session for intervention
  • Monitoring disqualifications
  • Opposing/proposing reorganisations
  • Consent to re-organisational resolutions
  • Cross-border monitoring
  • Function-related information/advice

Court of Session

  • Appeals on status for purposes of registration
  • Intervention
  • Approval of schemes for reorganisation
  • Provision of definitive directions
  • Cross-border monitoring

Local Authorities & Police

  • Permissions for public charitable collections
  • Monitoring of conduct/results of collections
  • Function-related information/advice
  • Reference of misconduct to Lord Advocate

Inland Revenue

  • Administration of tax reliefs
  • Monitoring of non-charitable activities/use of funds and reference to Lord Advocate
  • Function-related information/advice

I should emphasise that these recommendations are those of our research team, and not those of the Scottish Executive. Our research reports are currently being considered by the Scottish Charity Law Review Commission which has been established by the Scottish Parliament to examine how charity law might be modernised to meet the needs of both the charitable sector and the general public in the 21st century.

Publications to which reference is made

*Dr Christine Barker is Senior Research Fellow in the Department of Law at the University of Dundee, Scotland, and for the past four years has been Director of the University’s Charity Law Research Unit. She played a key role in the Unit’s recently published evaluation of Scottish charity legislation, and has written a number of articles on charity law related subjects.

 

Copyright 2008 The International Center for Not-for-Profit Law (ICNL)
ISSN: 1556-5157