New rules coming into force about who can run a charity

The Charity Commission updates its regulations

From 1 August 2018 there will be new rules about who will be disqualified from running a charity. We anticipate the impact will be minimal for our groups but it is something to be aware of.

The new rules will add to the existing disqualification criteria for trustees and will now also apply to some senior management roles. The new reasons will include being in contempt of court, being named under particular anti-terrorism legislation or being on the sex offenders register. The Charity Commission have produced a table that details the current and existing disqualification rules, which you can view on the Commission website. The rules do not just apply to registered charities – any un-registered charities (e.g. income under £5K/year) also have to act.

What you need to do

We anticipate the impact will be very small for our groups – by far the most common action will be for existing trustees to sign a new declaration. However, if an existing trustee is disqualified under the new rules, or you employ senior management, there may be a bit more to think about.

Existing trustees: All existing trustees should read the existing and new rules to check if they are disqualified from acting as a trustee. If they are:

not disqualified under new rules – sign a new trustee declaration form (see below).
disqualified under the new rules:

- they cannot be a trustee after 1 August – and so should stand down from their role. However they can apply for a waiver from the Charity Commission using an online form
- the individual must apply for the waiver – not the group on the individual's behalf
- anyone who applies for a waiver before 1 August won’t be disqualified from their role until they have received a decision from the Charity Commission.

You can find more information on waivers and the online form in the guidance on the Charity Commission website.

Senior Management: Currently disqualification rules don’t apply to senior management, but they will from 1 August. We don’t think this will affect our member groups but if you do have employed senior management roles then you may need to take action. The types of senior management roles likely to be affected are chief executive and chief finance officer. The key point here is that it is the function of the role and not simply the title that defines whether the disqualification rules apply. If you think this will affect your charity you can find our more in the Charity Commission guidance.

Future recruitment: Before you appoint any new trustees (or relevant senior management roles) they must confirm that they are not disqualified from acting in the role and sign the declaration. If they are disqualified they can apply for a waiver – but you should not appoint them until the waiver has been granted.

Ongoing: It is also good practice to ask trustees and relevant senior management roles to sign fresh declarations, at reasonable intervals, to confirm that they are not disqualified.