The new regime for charities in Australia is a major step closer
to being implemented, with the passage today of the Australian
Charities and Not-for-profit Commission Bill 2012 and Australian
Charities and Not-for-profit Commission (Consequential and
Transitional) Bill 2012.
When they will come into effect is still unknown, and currently
they affect only charities, not all not-for-profits. We are of
course still waiting for the Regulations, which will fill in many
gaps in the legislation, most importantly the governance
Nonetheless, charities will need to ensure they're ready for
the new regime, particularly to comply with the new requirements
annual information statements: registered
charities will be required to provided annual information
statements to the ACNC from the 2012-13 financial year, with the
first due in December 2013 for most charities.
financial reporting: registered charities will
be required to provide financial reports from the 2013-14 financial
year, with the first due in December 2014 for most charities.
governance and external conduct standards:
compliance with governance standards and standards for dealings
outside Australia will be a prerequisite for registration and
failure to comply can result in a charity's registration being
directors' liabilities: directors of
incorporated charities will not be generally responsible for the
obligations of the charities but may be personally liable to pay
amounts due under the legislation in limited circumstances.
However, trustees, directors of trustee companies and members of
committees for unincorporated associations may be personally liable
for obligations in a broader range of circumstances.
Corporations Act amendments: For charities
that are incorporated under the Corporations Act 2001 (eg.
charities that are companies limited by guarantee), the ACNC will
replace the Australian Securities and Investments Commission as the
main regulator. Under consequential changes made in the ACNC
legislation, these charities will report to the ACNC instead and a
number of governance requirements in the Corporations Act will
cease to apply over time, including a number of civil duties of
directors and requirements in relation to holding meetings or
notifying ASIC of certain events.
Coupled with the broad powers given to the Australian Charities
and Not-for-profits Commissioner, and the limited ability of
registered entities to dispute his or her exercise of them,
charities should getting ready now.
We'll be sending out an updated guide to the new regime next
week incorporating some last-minute changes made by the Government,
and of course be following all developments closely, especially the
release of the Regulations.
Clayton Utz communications are intended to provide
commentary and general information. They should not be relied upon
as legal advice. Formal legal advice should be sought in particular
transactions or on matters of interest arising from this bulletin.
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