Donations from property developers and their associates to
political parties are prohibited in New South Wales. If you are in
the development industry and have been invited to political
fundraisers or functions, it is important to be aware of whether
the prohibition applies to you or your company. With a state
election around the corner, and the media spotlight on political
fundraising events, we set out a brief guide to the prohibition on
We strongly recommend that people in the development industry
seek advice and closely check the requirements in the Election
Finding and Disclosures Act 1981 and the Environmental
Planning and Assessment Act 1979 before contemplating
attending any political functions. If you are not sure whether a
particular act is a 'gift' or 'political donation',
or whether a particular donation must be disclosed, or whether you
are a company or person who is prohibited from making a political
donation, Gadens can advise you on you particular
Property developers – political donations are
A property developer must not make a political donation or get
another person to make a political donation. It is also unlawful
for another person to make a political donation on behalf of a
property developer or to solicit another person to do so.
'Property developer' includes corporations which make
development and planning applications, and close associates of the
corporation. A close associate is broadly defined and can include a
director or officer of the corporation, related bodies, or a person
with greater than 20% voting power (or their spouse), amongst other
These prohibited actions are criminal offences, and penalties of
up to $11,000 apply.
What is a political donation
Political donation is widely defined to capture both direct and
indirect gifts to a party, elected member or candidate. It also
includes a gift to a third party or other entity for that entity to
make (whether directly or indirectly) a political donation or incur
Political donations which are unlawful for property developers
payments for fundraising functions or ventures
a loan (not from a financial institution)
some annual or other party membership.
Payments for participating in a fundraising event is
specifically defined as a gift. This means that if you are a
property developer you must not make payments for fundraising
Disclosure of donations
In addition to the prohibition, which has applied since December
2009, the requirement to disclose reportable political donations or
gifts also remains in place.
This disclosure requirement applies when making a 'relevant
planning application' to the Minister or a consent authority,
or when a public submission is made in relation to a planning
application. A relevant planning application includes amongst other
development applications under Part 4,
concept plan applications under Part 3A, and
The disclosure must be made by a person with a financial
interest in the application or submission. A person is considered
to have a financial interest if the person is:
the applicant, or
the person on whose behalf the application is made, or
associated with the Applicant and is likely to obtain a
financial gain if the development is approved.
The political donation which must be reported are those
'reportable donations' made in the two years prior to
lodging the application (and up to the time of determination)
A 'reportable political donation' is a political
donation of or exceeding $1,000 made to or for the benefit of a
party, elected mamber, group or candidate. If a person has made
separate donations to the same person or party which add up to more
than $1,000 in one financial year, these must also be reported.
To party or not to party
In the lead up to the State election we strongly recommend that
people in the development industry seek advice and closely check
the requirements in the Election Finding and Disclosures Act 1981
and the Environmental Planning and Assessment Act 1979 before
contemplating attending any political functions.
If you are not sure whether a particular act is a 'gift'
or 'political donation', or whether a particular donation
must be disclosed, or whether you are a company or person who is
prohibited from making a political donation, Gadens can advise you
on your particular circumstances.
This legal update is an overview of existing eligible project activities and new project types proposed to be developed.
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