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The International Journal
of Not-for-Profit Law

Volume 5, Issue 1, September 2002

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

Table of Contents


The Economics of Non Profit Accounting and Auditing: Suggestions for a Research Agenda
Marc Jegers

Australian Charity Law Reform Proposals
Prof. Myles McGregor-Lowndes

Charities and Terrorism: The Charity Commission Response
Debra Morris

Charity Law Review in Ireland and the Challenges for the State/Third Sector Partnership
Kerry J. O'Halloran

The Kamehameha Schools Admissions Policy Controversy
Randall W. Roth

Case Notes

Asia Pacific:
Fiji | New Zealand

Central and Eastern Europe: Croatia

Middle East and North Africa:

North America:
Canada | United States

Sub-Saharan Africa:
South Africa

Western Europe:
European Union | The Netherlands

Country Reports

Financial Action Task Force (FATF) on Money Laundering

Asia Pacific:
Regional | Burma | China | Japan | New Zealand | Singapore

Central and Eastern Europe: Estonia | Kosovo | Latvia | Romania

Latin America and the Caribbean: Regional

Middle East and North Africa: Regional

Newly Independent States: Belarus

North America:
Canada | Mexico | United States

South Asia:
Afghanistan | India | Sri Lanka

Sub-Saharan Africa:
Congo | Malawi | Nigeria | South Africa | Sudan | Tanzania | Togo | Zimbabwe

Western Europe:
Regional | Belgium | France | Germany | Italy | The Netherlands | Portugal | Spain | United Kingdom

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Editorial Board

Case Notes: Asia Pacific


Possible De-Registration in Fiji.

In June 2001 the Registrar of Charitable Trusts, acting on the instructions of the Ministry of Justice, published a notice in the Government Gazette canceling the registration of the Citizens Constitutional Forum on the grounds that it was engaged in political activities inconsistent with its stated educational purposes.  CCF’s role in the adoption of the 1997 Constitution and its participation in a court challenge to the legitimacy of the caretaker government were cited as examples of non-charitable activities.  It is reported that CCF is seeking judicial review of the decision.  PB  from the Europe Pacific Solidarity Bulletin, Volume 9 Issue ½.

New Zealand

Commissioner of Inland Revenue v Dick , AP 64-SW00, High Court, 31 October 2001, 4 ITELR 317.

A foundation was established to operate gaming machines, which can only lawfully be operated in New Zealand if the income is distributed to authorized purposes, and to distribute the profits to charitable purposes.  One of these purposes involved supporting the New Zealand League of Rights in making educational videos, and to this end the foundation paid the Australian League of Rights to produce these videos.  The initial nominal capital of the foundation was provided by an employee of the founder.  The founder did not settle any capital on the foundation until 7 years after its creation, but provided interest free loans and guarantees to the trustees to enable them to by the machines and provided locations for some machines.  The foundation paid the founder for servicing the machines, and acted as a middleman in deals between the founder and other businesses.  The foundation also assisted one of the trustees in moving from one home to another.  The Inland Revenue claimed that the foundation was not charitable, that its purposes were not limited to New Zealand (which would mean that it was only entitled to partial exemption from income tax), and that the foundation’s business income is liable to income tax because the founder and the trustees had received benefits from the foundation.  The court held that:

The court also stated that where a benefit or income has been provided to a trustee or settlor in breach of trust, the proper course was not to remove tax exemption but for the tax authority to consider making a report to the minister under section 89 Tax Administration Act 1994 that funds had been applied for other than a charitable purpose. PB

Re Crown Forestry Rental Trust; Latimer v Commissioner of Inland Revenue, CP 127/99 and CP 221/99, High Court, 7 August 2001, 4 ITELR 246.

The Crown Forest Assets Act 1989 provided for the establishment by deed of a forestry rental trust with the purpose of investing the income for the benefit of assisting various Maori claimants before the Waitangi Tribunal, which was established to hear claims for compensation or return of land owned by the Crown.  The trust was to be wound up after 80 years within the statutory perpetuity period under section 6 of the Perpetuities Act 1964, and any capital remaining was to be paid to the Crown.  Following the withdrawal of a ruling by the Inland Revenue that the trust could deduct payments to claimants in calculating its taxable income, the trust claimed that it was established for charitable purposes.  The court held that:

Accordingly, since the purposes of the trust were not exclusively charitable, the claim failed. PB


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ISSN: 1556-5157