News & Blog

We are regularly approached for advice by clients on how to set up a social enterprise.  The first thing to establish is that there is no such legal structure as a ‘social enterprise’.  The term is a loose definition that is used by very many business structures; both for profit and not for profit including charities and co-operatives. Generally speaking the following legal structures are used by social enterprises; Unincorporated Associations Community Interest Company Limited by Shares or by Guarantee; Industrial & Provident Societies; Company ...Continue Reading

There is a common misconception that when a member organisation nominates a director, that the director is elected to represent that organisation.  This is becoming increasingly common with partnership arrangements and directors sitting on multiple boards.  It is therefore crucial that a director understands that their duty is to the company on whose board they are sitting.  Whether you are an executive or non-executive director you are still subject to the same legal duties.  Many of these duties were known in ...Continue Reading

With so many acronyms these days, clients are often confused about what different terms mean.  In this issue we are giving the quick once over to CIO’s. Currently many charities are company’s limited by guarantee and registered charities.  This gives the trustees the benefits of being a company, such as limited liability, but also comes with the dual compliance requirements of both the Companies Act and the Charities Act. The Charitable Incorporated Organisation (CIO) is a new legal structure that has been ...Continue Reading

With so many acronyms these days, clients are often confused about what different terms mean.  In this issue we are giving a quick once over on CIC’s. A CIC is a Community Interest Company and is a new type of legal structure that was introduced in 2005 to assist organisations that wanted to be identified as social enterprises.  Generally it is used by organisations that are driven by public or community benefit rather than by profit although that is not to ...Continue Reading

Reviewing a charity’s governing document is far down the list of priorities for today’s charities.  But trustees should be aware that charities ignoring these important documents can find themselves operating unlawfully. The ‘objects’ of a charity essentially set out what the organisation was set up to do, who it’s beneficiaries are and where it is permitted to operate geographically.  Trustees need to know these restrictions when they are seeking to develop new income streams to tackle the latest round of funding ...Continue Reading

As a result of the economic climate many organisations are looking at new ways of working together.  This can be a one off partnership for a specific project or a more permanent amalgamation, such as merger. Partnering is a complicated area of law and organisations can unwittingly find themselves subject to legislation such as the Partnership Act 1890 without even realising it.  Getting agreement in writing is important if organisations don’t want to find themselves liable for failures of their partners, ...Continue Reading

WELCOME to the winter edition of Third Sector Law covering issues affecting Charities, CIC’s, CIO’s, Trusts and Associations. With the economic situation continuing to cause concern, many third sector organisations are having to find more creative solutions to plug gaps in funding.  In this issue we are looking at two key areas; Working in Partnership and Governing Documents. We hope you enjoy reading the newsletter and that the articles are of use.  Our next issue will be out in Spring, if there ...Continue Reading

For many charities the idea of cost sharing with other organisations for core back room services such as finance and HR is an attractive proposition.   However, many are put off by the punitive VAT position that exists when organisations come together to set up an association to buy services centrally and then recharge them amongst themselves.   In many other parts of Europe there is already an exemption that allows organisations that make exempt or non business supplies to avoid a VAT cost ...Continue Reading