ACPNS NONPROFIT MODEL LAW PROJECT
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1 ACPNS NONPROFIT MODEL LAW PROJECT Developing Streamlined and Seamless of Nonprofit Organisations Phone: Web:
2 ACPNS NONPROFIT MODEL LAW PROJECT Developing Streamlined and Seamless of Nonprofit Organisations Over the past fifteen years, myriad national inquiries have made over 150 recommendations for reform of nonprofit law and policy, which have largely not been acted upon. At the State level there have been a number of uncoordinated attempts at reform of fundraising and incorporated association legislation, marked by long periods of hiatus between proposal and partial implementation. The freedom of citizens to associate through nonprofit organisations without hindrance and with an independent voice is foundational to a vibrant civil society, the creation of social capital and a culture of philanthropy. It also underpins a healthy democracy. For Australian nonprofit organisations to be able to operate with ease across State and Territory borders, co-ordination of regulation and harmonisation of the law are essential. Australian nonprofit organisations and, in turn, the Australian community will be served better by a nationally consistent legislative, regulatory and policy environment.
3 ACPNS NONPROFIT MODEL LAW PROJECT Developing Streamlined and Seamless of Nonprofit Organisations 1. Overview: 1.1 The object of the project is to ensure that nonprofit organisations can: 1.2 The goal is: enhance voluntary engagement in contemporary civil society; and achieve their purposes effectively. to develop draft model legislation for a nonprofit organisation regulatory environment based on evidence and international best practice, by modernising and clarifying the law governing: a variety of nonprofit legal structures, and activities uniquely engaged in by nonprofit organisations, including fundraising and charitable gaming. 1.3 This will be achieved by: enabling these nonprofit organisations to be more proactive in determining their regulatory environment; robust discussion with all stakeholders; facilitating evidence based policy research; providing draft model legislation that is informed by the needs of these organisations and their altruistic, voluntary and community benefiting characteristics. 1.4 Starting Point The freedom of citizens to associate through nonprofit organisations without reference to, or hindrance from, government, business or family is foundational to expressions of community, the creation of social capital and the cultivation of a vibrant civil society. It also underpins a healthy democracy. Freedom of speech is integral to the independent voice of these organisations. The freedoms of association and speech (augmented where appropriate by other recognised freedoms) provide benchmarks against which regulation must be justified.
4 2. Why is there a need to develop model laws in these areas? Over the past fifteen years national inquiry reports such as those by the Industry Commission, the Productivity Commission, the Charities Definition Inquiry, Senate Economics Committee report on charity reporting, and the Henry Tax Review have made over 150 recommendations for law and policy reform which have largely not been acted upon. At the State level there have been a number of uncoordinated attempts at reform of fundraising and incorporated association legislation, which have been marked by long delays between proposal and partial implementation. The sector has contributed significant resources by responding with thousands of pages of submissions, with little to show in outcomes or impacts which benefit them. This is in stark contrast to the efforts by all levels of government over the last two decades to achieve reduction in red tape affecting the business sector. Australian nonprofit organisations deserve a better legislative, regulatory and policy environment. 3. A little more detail 3.1 What is a nonprofit organisation? A nonprofit organisation is a group of people who associate for a stated purpose other than profit and are bound to apply any surplus funds solely to advance the stated purpose. They include incorporated associations, cooperatives, companies limited by guarantee, other corporate forms (eg. Aboriginal and Torres Strait Islander corporations), letters patent, royal charters, charitable trusts, special acts of parliament and unincorporated associations. 3.2 Freedom is foundational to the law for nonprofit organisations The freedom of citizens to associate through nonprofit organisations without reference to, or hindrance from, government, business or family is foundational to expressions of community, the creation of social capital and the cultivation of a vibrant civil society. It also underpins a healthy democracy. Freedom of speech is integral to the independent voice of these organisations. The freedoms of association and speech (augmented where appropriate by other recognised freedoms) provide benchmarks against which regulation must be justified. 3.3 How can nonprofit organisations become more proactive in determining their regulatory environment? Instead of responding to government proposals for legislative reform, the sector can create their own forums to produce models for legislation and mechanisms of regulation, and to influence government culture. Governments can respond to these detailed and evidence based proposals. 3.4 What regulation will the project examine? The project will start by examining current significant Commonwealth, State and Territory legislation as set out in the table in Appendix 1.
5 3.5 What other law will need to be considered? The common law as applied to nonprofit entities will also be examined. 3.6 What is the meaning of evidence based model laws? Where possible regard will be had to credible research findings, rather than merely contention and assumptions. 3.7 What is international best practice? The model legislation will be developed according to principles of best practice legislation and regulation as assessed at an international level. This will involve an examination of a legislative standards framework and regulatory regimes, principles and policies, as promoted at an international level by Commonwealth countries, the UN, the OECD and the European Union. An examination of local best practice policies as set by COAG and all current legislative standards legislation will also be undertaken to ensure best practice principles are followed. 3.8 What is a nonprofit organisation regulatory environment? A regulatory environment for nonprofit organisations consists of those laws which apply specifically to the unique activities of nonprofit organisations such as fundraising and charitable gaming. It also includes the laws which apply to the legal structures used by nonprofit organisations. 3.9 How will we have a robust discussion? The starting point for a robust discussion is to identify areas for reform of the regulatory environment. This will be achieved in consultation with the sector and regulators through discussion, papers, seminars, workshops and online forums. Discussion will also be informed by the reports and recommendations of the numerous inquiries undertaken across Australia and internationally. 4. Project work plan The project will be undertaken over 5 to 10 years in a number of stages. 4.1 First stage The first stage of the project will be setting the scene for engagement and preparation to invigorate a robust discussion throughout the nonprofit sector. This will involve forming advisory panels for each topic area, the preparation and distribution of discussion and issues papers, and hosting seminars across Australia with national and international guest speakers who are recognised experts in the regulation of nonprofit organisations Second stage The second stage of the project will identify areas that require reform followed by discussion and consultation. This phase will be focused on engagement of the sector through circulation of discussion and issues papers; publication of journal articles; and targeted workshops and seminars for specific areas of regulatory reform.
6 4.3 Third stage The third stage of the project will see the development and drafting of model laws and regulatory instruments in each regulatory area. Development of the laws will commence with the compilation of evidence gathered in the second stage. During this phase further debate, consultation and engagement will be generated through a variety of forums. 5. Short description of the Centre The mission of The Australian Centre for Philanthropy and Nonprofit Studies is to bring to the community the benefits of teaching, research, technology and service relevant to philanthropic and nonprofit communities. Further information is available at 6. Bios of research team Myles McGregor-Lowndes is a professor and director of The Australian Centre for Philanthropy and Nonprofit Studies at QUT. He is a lawyer and has been involved with nonprofit organisations for over 30 years. Linda Lavarch is a lawyer and former Queensland Attorney-General. During her 12 years as a Member of the Queensland Parliament she was involved in the development, scrutiny and debate of legislation and regulation at both a State and National level. Linda joins the project as a Research Fellow. Dr Matthew Turnour is a lawyer in private practice. He joins the Project as a Senior Research Fellow for one day per week. His Ph D entitled: Beyond Charity Outlines of a Jurisprudence for Civil Society, investigated limitations in the common law doctrine of charitable purpose and proposed ways in which the law regulating the nonprofit sector might be developed. Frances Hannah is a Senior Research Fellow with the Australian Centre for Philanthropy and Nonprofit Studies. Frances holds degrees in economics, accounting and law having practised in these disciplines for over 30 years. Together with Professor Myles McGregor- Lowndes, Frances has published a number of research papers in the areas of philanthropy and wealth taxes, bequests and succession law and incorporated associations law. Anne Overell is a senior research assistant with the Australian Centre for Philanthropy and Nonprofit Studies working chiefly on nonprofit governance policy and practice. Anne also tutors in the law of Equity and Trusts. Prior to working for the Australian Centre for Philanthropy and Nonprofit Studies she worked variously as a policy officer and as a research officer for the Queensland government. Julie-Anne Mee is a Senior Research Fellow and qualified accountant who has worked in the government, commercial businesses and the nonprofit sector for over 30 years. Julie-Anne has been instrumental in having State, Territory and the Federal governments adopt the Standard Chart of Accounts (SCOA) for the purpose of governments applying a uniform standard chart of accounts, data dictionary and definitions for the nonprofit sector.
7 APPENDIX 1 Significant Legislative Provisions* Cth NSW Vic Qld Tas SA WA ACT NT Act Act 2009 Act 1981 Act 1981 Act 1964 Act 1985 Act 1987 Act 1991 Corporations Act 2001 [companies limited by guarantee] Australian Securities and Investments Commission Act 2001 Corporations (Aboriginal and Torres Strait Islander) Act Fundraising Act 1991 Fundraising Fundraising Act 1998 Fundraising 2009 Veterans Act 2005 ( Part 4 - Patriotic Funds) Veterans (Patriotic Funds) Act ( Model Rules) Regs 2007 for CharitiesAct 2001 for Charities for Purposes Act 1939 Public Charities Funds Act Act Street ()A ct Act (Model Constitution) [Model uniform law] National Law 1 Lotteries and Art Unions Act 1901 Lotteries and Art Unions 2007 Act Gambling Act 2003 Gambling 2005 Act and Non-Profit Act 1999 and Not-Profit 1999 Act Control Act 1993 Control 2004 Act 1999 Regs 2010 Lottery and Act 1936 Lottery and 2008 Act Street 1999 and Wagering Commission Act 1987 and Wagering 1988 Act Lotteries Act 1964 Act Control Act Control (Community ) 2006 Act Extension of Purpose Act 2004 (Cth) Trusts Act 1993 Charities Act 1978 Charities 2005 Trustee Act 1958 Trusts Act 1973, Part 8 Trustee Act 1898 (No specific provns: s 45 charity trstees; s 47 pwrs of court) Trustee Act 1936, Part 4 Trustee 1996 Trusts Act 1962 *Visit the NMLP web site for a more comprehensive list of legislation Trustee Act 1925, Part 3 Div 3.6; ss 104, 106 and Sched 1 Trusts Act (No real provns: s 42, vesting property in charit trstees) 1
8 INVITATION The Australian Centre for Philanthropy and Nonprofit Studies (ACPNS) would like you to become part of this very important project. You can be a corresponding member to be updated on the project s progress or consider putting your name forward for the reference panel which will formally review proposed documents, briefs and proposals. If you would like to participate in the Nonprofit Model Law Project send your details to nmlp@qut.edu.au Visit the web site at
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