Charities Bill (HC Bill 257)

The official custodian

21 The official custodian for charities

(1) There continues to be an officer known as the official custodian for charities (in
this Act referred to as “the official custodian”).

(2) 5The official custodian’s function is to act as trustee for charities in the cases
provided for by this Act.

(3) The official custodian is such individual as the Commission may from time to
time designate.

(4) The official custodian’s duties must be performed in accordance with such
10general or special directions as may be given by the Commission.

(5) Schedule 2 contains provisions relating to the official custodian.

Part 3 Exempt charities and the principal regulator

Exempt charities

22 15Meaning of “exempt charity” and Sch.3

(1) In this Act “exempt charity” means any institution, so far as it is a charity, that
is within Schedule 3.

(2) Subsection (1) is subject to any other enactment by virtue of which a charity is
an exempt charity.

23 20Power to amend Sch.3 so as to add or remove exempt charities

(1) The Minister may by order make such amendments of Schedule 3 as the
Minister considers appropriate for securing—

(a) that (so far as they are charities) institutions of a particular description
become or (as the case may be) cease to be exempt charities, or

(b) 25that (so far as it is a charity) a particular institution becomes or (as the
case may be) ceases to be an exempt charity.

(2) An order under subsection (1) may be made only if the Minister is satisfied that
the order is desirable in the interests of ensuring appropriate or effective
regulation of the charities or charity concerned in connection with compliance
30by the charity trustees of the charities or charity with their legal obligations in
exercising control and management of the administration of the charities or
charity.

(3) The Minister may by order make such amendments or other modifications of
any enactment as the Minister considers appropriate in connection with—

(a) 35charities of a particular description becoming, or ceasing to be, exempt
charities, or

(b) a particular charity becoming, or ceasing to be, an exempt charity,

as a result of provision made under subsection (1).

(4) In subsection (3), “enactment” includes—

(a) any provision of subordinate legislation (within the meaning of the
Interpretation Act 1978), and

(b) a provision of a Measure of the Church Assembly or of the General
Synod of the Church of England,

5and references to enactments include enactments whenever passed or made.

24 Power to remove defunct institutions from Sch.3

The Minister may by order make such amendments of Schedule 3 as the
Minister considers appropriate for removing from that Schedule an institution
that has ceased to exist.

10The principal regulator

25 Meaning of “the principal regulator”

In this Act “the principal regulator”, in relation to an exempt charity, means
such body or Minister of the Crown as is prescribed as its principal regulator
by regulations made by the Minister.

26 15General duty of principal regulator in relation to exempt charity

(1) This section applies to any body or Minister of the Crown who is the principal
regulator in relation to an exempt charity.

(2) The body or Minister must do all that the body or Minister reasonably can to
meet the compliance objective in relation to the charity.

(3) 20The compliance objective is to promote compliance by the charity trustees with
their legal obligations in exercising control and management of the
administration of the charity.

27 Power to make amendments in connection with s.26

(1) Regulations under section 25 may make such amendments or other
25modifications of any enactment as the Minister considers appropriate for the
purpose of facilitating, or otherwise in connection with, the discharge by a
principal regulator of the duty under section 26(2).

(2) In subsection (1), “enactment” includes—

(a) any provision of subordinate legislation (within the meaning of the
30Interpretation Act 1978), and

(b) a provision of a Measure of the Church Assembly or of the General
Synod of the Church of England,

and references to enactments include enactments whenever passed or made.

28 Commission to consult principal regulator

35Before exercising in relation to an exempt charity any specific power
exercisable by it in relation to the charity, the Commission must consult the
charity’s principal regulator.

Part 4 Registration and names of charities

The register

29 The register

(1) 5There continues to be a register of charities, to be kept by the Commission in
such manner as it thinks fit.

(2) The register must contain—

(a) the name of every charity registered in accordance with section 30, and

(b) such other particulars of, and such other information relating to, every
10such charity as the Commission thinks fit.

(3) In this Act, except in so far as the context otherwise requires, “the register”
means the register of charities kept under this section and “registered” is to be
read accordingly.

Charities required to be registered

30 15Charities required to be registered: general

(1) Every charity must be registered in the register unless subsection (2) applies to
it.

(2) The following are not required to be registered—

(a) an exempt charity (see section 22 and Schedule 3),

(b) 20a charity which for the time being—

(i) is permanently or temporarily excepted by order of the
Commission, and

(ii) complies with any conditions of the exception,

and whose gross income does not exceed £100,000,

(c) 25a charity which for the time being—

(i) is, or is of a description, permanently or temporarily excepted
by regulations made by the Minister, and

(ii) complies with any conditions of the exception,

and whose gross income does not exceed £100,000, and

(d) 30a charity whose gross income does not exceed £5,000.

(3) A charity within—

(a) subsection (2)(b) or (c), or

(b) subsection (2)(d),

must, if it so requests, be registered in the register.

(4) 35In this section any reference to a charity’s gross income is to be read, in relation
to a particular time—

(a) as a reference to the charity’s gross income in its financial year
immediately preceding that time, or

(b) if the Commission so determines, as a reference to the amount which
40the Commission estimates to be the likely amount of the charity’s gross

income in such financial year of the charity as is specified in the
determination.

31 Restrictions on extending the range of excepted charities etc.

(1) No order may be made under section 30(2)(b) so as to except any charity that
5was not excepted immediately before 31 January 2009.

(2) Subject to subsection (3), no regulations may be made under section 30(2)(c) so
as to except any charity or description of charities that was not excepted
immediately before 31 January 2009.

(3) Such regulations must be made under section 30(2)(c) as are necessary to
10secure that any institution ceasing to be an exempt charity by virtue of an order
made under section 23 is excepted under section 30(2)(c) (subject to compliance
with any conditions of the exception and the financial limit mentioned in
section 30(2)(c)).

(4) Subsection (1) does not prevent an order which—

(a) 15was in force immediately before 31 January 2009, and

(b) has effect (by virtue of paragraph 4 of Schedule 8) as if made under
section 30(2)(b),

from being varied or revoked.

(5) Subsection (2) does not prevent regulations which—

(a) 20were in force immediately before 31 January 2009, and

(b) have effect (by virtue of paragraph 4 of Schedule 8) as if made under
section 30(2)(c),

from being varied or revoked.

32 Power to alter sums specified in s.30(2)

(1) 25The Minister may by order amend—

(a) section 30(2)(b) and (c), or

(b) section 30(2)(d),

by substituting a different sum for the sum for the time being specified there.

(2) The Minister may only make an order under subsection (1)—

(a) 30so far as it amends section 30(2)(b) and (c), if the Minister considers it
expedient to do so with a view to reducing the scope of the exceptions
provided by section 30(2)(b) and (c);

(b) so far as it amends section 30(2)(d), if the Minister considers it
expedient to do so—

(i) 35in consequence of changes in the value of money, or

(ii) with a view to extending the scope of the exception provided by
section 30(2)(d).

(3) No order may be made by the Minister under subsection (1)(a) unless a copy
of a report under section 73 of the Charities Act 2006 has been laid before
40Parliament in accordance with that section.

33 Power to repeal provisions relating to excepted charities

The following provisions—

(a) section 30(2)(b) and (c) and (3)(a),

(b) section 31,

(c) section 32(1)(a), (2)(a) and (3), and

(d) this section,

5cease to have effect on such day as the Minister may by order appoint for the
purposes of this section.

Removal of charities from register

34 Removal of charities from register

(1) The Commission must remove from the register—

(a) 10any institution which it no longer considers is a charity, and

(b) any charity which has ceased to exist or does not operate.

(2) If the removal of an institution under subsection (1)(a) is due to any change in
its trusts, the removal takes effect from the date of the change.

(3) A charity which is for the time being registered under section 30(3) (voluntary
15registration) must be removed from the register if it so requests.

Registration: duties of trustees and claims and objections

35 Duties of trustees in connection with registration

(1) If a charity required to be registered by virtue of section 30(1) is not registered,
the charity trustees must—

(a) 20apply to the Commission for the charity to be registered, and

(b) supply the Commission with the required documents and information.

(2) The required documents and information are—

(a) copies of the charity’s trusts or (if they are not set out in any extant
document) particulars of them,

(b) 25such other documents or information as may be prescribed by
regulations made by the Minister, and

(c) such other documents or information as the Commission may require
for the purposes of the application.

(3) If an institution is for the time being registered, the charity trustees (or the last
30charity trustees) must—

(a) notify the Commission if the institution ceases to exist, or if there is any
change in its trusts or in the particulars of it entered in the register, and

(b) so far as appropriate, supply the Commission with particulars of any
such change and copies of any new trusts or alterations of the trusts.

(4) 35Nothing in subsection (3) requires a person—

(a) to supply the Commission with copies of schemes for the
administration of a charity made otherwise than by the court,

(b) to notify the Commission of any change made with respect to a
registered charity by such a scheme, or

(c) 40if the person refers the Commission to a document or copy already in
the Commission’s possession, to supply a further copy of the
document.

36 Claims and objections to registration

(1) A person who is or may be affected by the registration of an institution as a
charity may, on the ground that it is not a charity—

(a) object to its being entered by the Commission in the register, or

(b) 5apply to the Commission for it to be removed from the register.

(2) Provision may be made by regulations made by the Minister as to the manner
in which any such objection or application is to be made, prosecuted or dealt
with.

(3) Subsection (4) applies if there is an appeal to the Tribunal against any decision
10of the Commission—

(a) to enter an institution in the register, or

(b) not to remove an institution from the register.

(4) Until the Commission is satisfied whether the decision of the Commission is or
is not to stand, the entry in the register—

(a) 15is to be maintained, but

(b) is in suspense and must be marked to indicate that it is in suspense.

(5) Any question affecting the registration or removal from the register of an
institution—

(a) may be considered afresh by the Commission, even though it has been
20determined by a decision on appeal under Chapter 2 of Part 17 (appeals
and applications to Tribunal), and

(b) is not concluded by that decision, if it appears to the Commission that—

(i) there has been a change of circumstances, or

(ii) the decision is inconsistent with a later judicial decision.

25Effect of registration and right to inspect register

37 Effect of registration

(1) An institution is, for all purposes other than rectification of the register,
conclusively presumed to be or to have been a charity at any time when it is or
was on the register.

(2) 30For the purposes of subsection (1) an institution is to be treated as not being on
the register during any period when the entry relating to it is in suspense under
section 36(4).

38 Right to inspect register

(1) The register (including the entries cancelled when institutions are removed
35from the register) must be open to public inspection at all reasonable times.

(2) If any information contained in the register is not in documentary form,
subsection (1) is to be read as requiring the information to be available for
public inspection in legible form at all reasonable times.

(3) If the Commission so determines, subsection (1) does not apply to any
40particular information contained in the register that is specified in the
determination.

(4) Copies (or particulars) of the trusts of any registered charity as supplied to the
Commission under section 35 (duties of trustees in connection with
registration) must, so long as the charity remains on the register—

(a) be kept by the Commission, and

(b) 5be open to public inspection at all reasonable times.

(5) If a copy of a document relating to a registered charity—

(a) is not required to be supplied to the Commission as the result of section
35(4), but

(b) is in the Commission’s possession,

10a copy of the document must be open to inspection under subsection (4) as if
supplied to the Commission under section 35.

Disclosure of registered charity status

39 Statement required to be made in official publications etc.

(1) This section applies to a registered charity if its gross income in its last financial
15year exceeded £10,000.

(2) If this section applies to a registered charity, the fact that it is a registered
charity must be stated in legible characters—

(a) in all notices, advertisements and other documents issued by or on
behalf of the charity and soliciting money or other property for the
20benefit of the charity,

(b) in all bills of exchange, promissory notes, endorsements, cheques and
orders for money or goods purporting to be signed on behalf of the
charity, and

(c) in all bills rendered by it and in all its invoices, receipts and letters of
25credit.

(3) The statement required by subsection (2) must be in English, except that, in the
case of a document which is otherwise wholly in Welsh, the statement may be
in Welsh if it consists of or includes “elusen cofrestredig” (the Welsh equivalent
of “registered charity”).

(4) 30Subsection (2)(a) has effect—

(a) whether the solicitation is express or implied, and

(b) whether or not the money or other property is to be given for any
consideration.

40 Power to alter sum specified in s.39(1)

35The Minister may by order amend section 39(1) by substituting a different sum
for the sum for the time being specified there.

41 Offences

(1) It is an offence for a person, in the case of a registered charity to which section
39 applies, to issue or authorise the issue of any document falling within
40section 39(2)(a) or (c) which does not contain the statement required by section
39(2).

(2) It is an offence for a person, in the case of a registered charity to which section
39 applies, to sign any document falling within section 39(2)(b) which does not
contain the statement required by section 39(2).

(3) A person guilty of an offence under subsection (1) or (2) is liable on summary
5conviction to a fine not exceeding level 3 on the standard scale.

Power to require charity’s name to be changed

42 Power to require name to be changed

(1) If this subsection applies to a charity, the Commission may give a direction
requiring the name of the charity to be changed, within such period as is
10specified in the direction, to such other name as the charity trustees may
determine with the approval of the Commission.

(2) Subsection (1) applies to a charity if—

(a) it is a registered charity and its name (“the registered name”)—

(i) is the same as, or

(ii) 15is in the opinion of the Commission too like,

the name, at the time when the registered name was entered in the
register in respect of the charity, of any other charity (whether
registered or not),

(b) the name of the charity is in the opinion of the Commission likely to
20mislead the public as to the true nature of—

(i) the purposes of the charity as set out in its trusts, or

(ii) the activities which the charity carries on under its trusts in
pursuit of those purposes,

(c) the name of the charity includes any word or expression for the time
25being specified in regulations made by the Minister and the inclusion
in its name of that word or expression is in the opinion of the
Commission likely to mislead the public in any respect as to the status
of the charity,

(d) the name of the charity is in the opinion of the Commission likely to
30give the impression that the charity is connected in some way with Her
Majesty’s Government or any local authority, or with any other body of
persons or any individual, when it is not so connected, or

(e) the name of the charity is in the opinion of the Commission offensive.

(3) Any direction given by virtue of subsection (2)(a) must be given within 12
35months of the time when the registered name was entered in the register in
respect of the charity.

(4) In subsection (2) any reference to the name of a charity is, in relation to a
registered charity, a reference to the name by which it is registered.

(5) Any direction given under this section with respect to a charity must be given
40to the charity trustees.

43 Duty of charity trustees on receiving direction under s.42

(1) On receiving a direction under section 42 the charity trustees must give effect
to it regardless of anything in the trusts of the charity.

(2) If the name of any charity is changed by virtue of section 42, the charity trustees
must without delay notify the Commission of—

(a) the charity’s new name, and

(b) the date on which the change occurred.

(3) 5Subsection (2) does not affect section 35(3) (duty of charity trustees to notify
changes in registered particulars).

44 Change of name not to affect existing rights and obligations etc.

A change of name by a charity by virtue of section 42 does not affect any rights
or obligations of the charity; and any legal proceedings that might have been
10continued or commenced by or against it in its former name may be continued
or commenced by or against it in its new name.

45 Change of name where charity is a company

(1) In relation to a charitable company, any reference in section 42 or 43 to the
charity trustees of a charity is to be read as a reference to the directors of the
15company.

(2) Subsections (3) to (5) apply if a direction is given under section 42 with respect
to a charitable company.

(3) The direction is to be treated as requiring the name of the company to be
changed by resolution of the directors of the company.

(4) 20Where a resolution of the directors is passed in accordance with subsection (3),
the company must give notice of the change to the registrar of companies.

(5) Where the name of the company is changed in compliance with the direction,
the registrar of companies must—

(a) if satisfied that the new name complies with the requirements of Part 5
25of the Companies Act 2006, enter the new name on the register of
companies in place of the former name, and

(b) issue a certificate of incorporation altered to meet the circumstances of
the case;

and the change of name has effect from the date on which the altered certificate
30is issued.

Part 5 Information powers

Inquiries instituted by Commission

46 General power to institute inquiries

(1) 35The Commission may from time to time institute inquiries with regard to
charities or a particular charity or class of charities, either generally or for
particular purposes.

(2) But no such inquiry is to extend to any exempt charity except where this has
been requested by its principal regulator.

(3) 40The Commission may—

(a) conduct such an inquiry itself, or

(b) appoint a person to conduct it and make a report to the Commission.

(4) This section and sections 47 to 49 (obtaining evidence and search warrants)
have effect in relation to a body entered in the Scottish Charity Register which
5is managed or controlled wholly or mainly in or from England or Wales as they
have effect in relation to a charity.

47 Obtaining evidence etc. for purposes of inquiry

(1) In this section “inquiry” means an inquiry under section 46.

(2) For the purposes of an inquiry, the Commission, or a person appointed by the
10Commission to conduct it, may direct any person—

(a) if a matter in question at the inquiry is one on which the person has or
can reasonably obtain information—

(i) to provide accounts and statements in writing with respect to
the matter, or to return answers in writing to any questions or
15inquiries addressed to the person on the matter, and

(ii) to verify any such accounts, statements or answers by statutory
declaration;

(b) to provide copies of documents which are in the custody or under the
control of the person and which relate to any matter in question at the
20inquiry, and to verify any such copies by statutory declaration;

(c) to attend at a specified time and place and give evidence or produce
any such documents.

But this is subject to the provisions of this section.

(3) For the purposes of an inquiry—

(a) 25evidence may be taken on oath, and the person conducting the inquiry
may for that purpose administer oaths, or

(b) the person conducting the inquiry may instead of administering an
oath require the person examined to make and subscribe a declaration
of the truth of the matters about which that person is examined.

(4) 30The Commission may pay to any person attending to give evidence or produce
documents for the purpose of an inquiry the necessary expenses of doing so.

(5) A direction under subsection (2)(c) may not require a person to go more than
10 miles from the person’s place of residence unless those expenses are paid or
tendered to the person.

48 35Power to obtain search warrant for purposes of inquiry

(1) A justice of the peace may issue a warrant under this section if satisfied, on
information given on oath by a member of the Commission’s staff, that there
are reasonable grounds for believing that each of the conditions in subsection
(2) is satisfied.

(2) 40The conditions are—

(a) that an inquiry has been instituted under section 46,

(b) that there is on the premises to be specified in the warrant any
document or information relevant to that inquiry which the
Commission could require to be produced or provided under section
4552(1), and