The Not-for-Profit Corporations Act –
Impact on Charities
Since a charity is a type of not-for-profit corporation, the Act will govern the incorporation, governance and dissolution of charities, but will not affect the regulation of charities.
The legal restrictions, requirements and other affairs of charities continue to be governed by charities law. The Office of the Public Guardian and Trustee (Ministry of the Attorney-General) continues to have supervisory jurisdiction over charities.
Where there is a conflict between charities law and the new Act, charities law prevails.
Definition of a Not-for-Profit Corporation
A not-for-profit corporation:
- is a corporation without share capital
- is dedicated to objectives other than the pursuit of profit
- must use any surplus exclusively to achieve the not-for-profit purpose
- encompasses both charitable not-for-profit organizations (such as medical research organizations and museums) and non-charitable not-for-profit organizations (such as trade associations and social clubs).
Definition of a Charity
A charity is a type of not-for-profit corporation. In order to be a charity, a corporation must meet the general requirements for not-for-profit corporations and some additional requirements. A charity must be set up to carry out activities in one or all of the following charitable purposes:
- relief of poverty
- advancement of education
- advancement of religion
- other purposes beneficial to the community, as determined by the courts, but not falling under any of the above.
