Scots to launch charitable incorporated organisation on 1 April

It will allow charities to be corporate bodies without dual regulation

Office of the Scottish Charity Regulator
Office of the Scottish Charity Regulator

The charitable incorporated organisation legal form, which will allow charities to operate in a similar way to companies without registering at Companies House, will be available in Scotland from 1 April.

The new form was included in the Charities and Trustee Investment (Scotland) Act 2005, and detailed provisions for it to come into force have been drawn up more recently.

Under the new form, charities will be able to apply to the Office of the Scottish Charity Regulator to be registered as corporate bodies with limited liability.

They will not have to register with Companies House, as they do at present, and will not be subject to company law.

Provisions for the CIO form were also included in the 2006 Charities Act, which applies to England and Wales, but secondary legislation to activate it has not yet been brought in.

Civil society minister Nick Hurd said last year that it would be introduced early in 2011.

Alistair Burrow, a partner at the law firm Tods Murray, said the SCIO form was, in broad terms, a good idea, but that several practical obstacles remained.

"A number of the proposed regulations associated with the creation and operation of a SCIO, particularly when winding up a charity, are not yet clearly defined," he said.

"The difficulties of dual regulation by Companies House and the OSCR have perhaps been overstated or misunderstood, and reaction so far is that the SCIO and its regulatory framework will not be significantly more attractive."

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