Keep it legal: Cross-border registration

The pilot of the Office of the Scottish Charity Regulator's rolling review of the sector has started off on the right foot. There are lessons for Scottish charities to learn from the process.

The work of the OSCR should also be on the radars of English and Welsh charities with operations in Scotland, because it is necessary for them to register with the OSCR. Registration with the Charity Commission will not suffice.

Activities by English and Welsh charities that trigger the need to register with the OSCR include occupying land or buildings in Scotland or carrying out activities in any office, shop or premises in Scotland. Failure to register will prevent organisations from being recognised as charities in Scotland and could be a breach of charity trustee duties.

Cross-border registration involves applications being made by charities to satisfy the OSCR that they provide public benefit and that their purposes meet the Scottish legal definition of 'charitable purposes'. Charities will need to provide the regulator with business plans and annual reports or other documents showing their policies and practices.

The OSCR has also asked charities to give concrete examples of work being undertaken. Charities will need to prepare documents altering the definition of 'charitable purposes' in their constitutions so those definitions are consistent with the Charities and Trustee Investment (Scotland) Act 2005. Charities governed by English or tax law do not satisfy the act's definition. The intended amendments must be agreed by the Charity Commission and the OSCR.

Charities must convene meetings in accordance with their constitutions to pass the changes. Once they are registered with the OSCR, they must adhere to all the requirements of the 2005 act. These include making annual returns to the regulator and seeking its consent for actions such as name changes and mergers.

In the future, it may no longer be necessary for English and Welsh charities active in Scotland to register with the OSCR. Scottish ministers have power to disapply parts of the 2005 act. Until they do so, the full process of cross-border registration must be complied with. The OSCR's regulations will need to be navigated carefully by charities.

- Alan Eccles is a solicitor at Maclay Murray & Spens LLP 

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