Charities Act 2006 – further provisions implemented
18 March 2008
The third commencement order under the Charities Act 2006 has been made,
bringing a number of provisions into force today (18th March 2008),
including the Charity Tribunal, provisions enabling the remuneration of
trustees for providing a service to the charity, and several updated powers
for charities and the Charity Commission.
The main provisions that are coming into force on 18th March are:
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A new Charity Tribunal, to provide an affordable
independent recourse for charities to challenge legal decisions of the
Charity Commission, and to help develop charity case law.
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Allowing charities to pay trustees for goods and
services. In the past charities have been restricted from paying
trustees or anyone associated with them for goods or services to avoid
conflict of interest. New measures removing this restriction would
enable, for example, a trustee who is a roofer to fix the charity’s roof
at cost price. A range of safeguards accompany the new power, to prevent
conflicts of interest or abuse.
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Three new powers for the Charity Commission to add to its range
of enforcement powers. These will give the Commission
greater flexibility in dealing with cases of mismanagement,
maladministration or abuse of a charity.
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Modified powers for charities. Several
existing powers for charities are updated, simplified or extended.
Charitable companies will be able to make use of a simpler regime for
changing their governing document. Provisions to enable small
unincorporated charities to transfer their property or modify their
objects are modified and in some cases extended. Provisions are
also made to modify and extend the current regime for the expenditure of
capital by small unincorporated charities and certain special trusts.
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Changes to the law of Cy-Près will come into force. The
cy-près rule is a well established legal rule that applies when the
purposes for which charitable property is held are being altered by the
Commission or the Court. The 2006 Act amends the circumstances in
which alterations may be made to such purposes. In addition, the
2006 Act amends the rule in so far as it relates to the new purposes for
which property may be applied.
A fuller explanation of the provisions that will come into force is
available in the
Charities Act implementation section of the website.
