[cma-l] Charity limited company

[Cathy Aitchison]

Quick clarification: when I mentioned London Link Radio and Women's 
Radio Group as registering later as charities, they each did so a few 
months after setting up at Companies House - the intention was always to 
be registered charities, so perhaps not such good examples for 
comparison, sorry. :)
Cathy

Cathy Aitchison wrote:

> Hi Claire
> I'm coming late to the debate and most points have already been well 
> made.
> I would also ask you "why?" - would charitable status perhaps enable 
> you to access certain funds?
>
> 1. Your company Stroud Community Radio Ltd (as the Charity) would keep 
> the same name, so there should be no problem with the licence from Ofcom.
>
> 2. Your directors would be the trustees - that could be a problem if 
> they are employed by the company - check your memorandum and articles 
> of association (they can never be paid for being trustees, although if 
> you get the wording right in the relevant sections (4 and 5?) they can 
> be paid for services to the organisation, subject to a strict 
> procedure beforehand.....
>
> 3. Also check your objects carefully - however, the Charity Commission 
> will discuss them with you and recommend changes if they are not 
> charitable enough. Again, as you would be making them more charitable, 
> that shouldn't be a problem for Ofcom, especially as in your key 
> commitments your Community to be served is "The people of Stroud".
>
> Phrases used as charitable objects include the following:
> "To advance the education of the public in radio broadcasting, in 
> particular but not exclusively through the provision of training and 
> exhibitions" (I imagine you already do training)
>
> "To provide inclusive education, arts and music facilities for [xxx 
> town] including a community radio service."
>
> "To advance the education of the public, primarily but not 
> exclusively, across the [xxx region] in the appreciation and practice 
> of the arts."
>
> There's a useful section here (it's part of the guidance for setting 
> up a new charity, but the Charity Commission will apply the same 
> principles to existing companies wanting to register as charities)
> http://www.charitycommission.gov.uk/Start_up_a_charity/Guidance_on_registering/Choosing_your_governing_document_index.aspx#purposes
>
> Here is some more guidance on charitable purposes:
> http://www.charitycommission.gov.uk/Charity_requirements_guidance/Charity_essentials/Public_benefit/charitable_purposes.aspx
>
> 4. I do think it would be useful to tell your contact at Ofcom that 
> there are now 3 different kinds of charity (that's not including CICs 
> - community interest companies):
> a. unincorporated charities, of which there are thousands, often 
> small, across the country (presumably the Ofcom person was thinking of 
> these)
> b. companies like yours (limited by guarantee) which were also 
> registered as charities - on setting up or later (London Link Radio 
> and Women's Radio Group are two examples of those which registered 
> later, although neither have licences, so no help re. Ofcom)
> c. the new Charitable Incorporated Organisation, which is halfway 
> between the existing two - see
> http://www.charity-commission.gov.uk/start_up_a_charity/do_i_need_to_register/cios/default.aspx?
> The information is dated today, 11th Sept, and it warns that there may 
> be changes to the guidance - however, it includes info on how a 
> charitable company can convert to a CIO, so worth a look. Under "How 
> does an existing charitable company convert to a CIO?" it specifically 
> says:
> "Although the regulations have not been made yet, we know from the 
> Charities Act 2006 that the process will be relatively 
> straightforward. The existing corporate body will simply be 
> re-registered as a CIO with a new constitution. The conversion process 
> will not affect the legal personality of the organisation or its 
> business relationships."
>
> So that could be good news, although what with CICs, and now CIOs, 
> they don't make it easy to follow, do they :)
>
> Good luck
> Regards
> Cathy Aitchison
> -----------
>
> On 10/09/2011 09:33
> claire penketh wrote:
>
>>  Stroud FM, currently a company limited by guarantee, is thinking 
>> about becoming a charity limited company. Had a quick chat with OFCOM 
>> re implications for our licence, which is held in the name of Stroud 
>> Community Radio Limited and they said that we will have to keep the 
>> current ltd company and set up the charity alongside, because the 
>> charity isn't a body coperate. Then they suggesed I ask the CMA what 
>> other members do, so here I am. However, I think a charity limited 
>> company is a body corporate? But, if the licence is held by Stroud 
>> community Radio limited, does that mean we still have to keep the 
>> company, or could the licence be transferred to the charity limited 
>> company?
>>  
>> Yours, confused.
>>  
>>  Claire Penketh, Stroud FM
>>  
>>  
>>
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