Charities (Regulation and Administration) (Scotland) Act 2023 (the “Act”)
The Act aims to refine the current legislative system by improving transparency and accountability of charities within Scotland and increases the powers of the Scottish Charity Regulator (OSCR).
As discussed in our previous articles on the Bill (Charities (Regulation and Administration) (Scotland) Bill published and Charities (Regulation and Administration) (Scotland) Bill), the Act does not focus on addressing any of the key principles of the Charities and Trustees Investment (Scotland) Act 2005.
What are the key take-aways from the Act?
We detail below some of the key changes detailed within the Act:
- it prioritises improved financial reporting, mandating charities to provide detailed statements of account and independent reports. OSCR will have the discretion to determine the method of sharing these reports with the public, promoting transparency;
- it provides OSCR with wider powers to investigate charities and charity trustees;
- it grants OSCR the power to remove charities from the Scottish Charity Register if they fail to submit required statements and don’t respond to OSCR’s communications within a specified timeframe;
- it provides detail as to when an individual will be disqualified from becoming, or continuing as a charity trustee;
- it places a requirement upon charities to notify OSCR of any charity mergers to allow a record to be kept of any charities that have merged; and
- it allows OSCR to refuse regulation of charities with minimal or no significant connection to Scotland.
The Act reflects a comprehensive effort to strengthen charity regulations, emphasising transparency, proper conduct, and accountability, all of which are pivotal for the well-being of Scotland’s charity sector. However, the Act does fail (in some respect) to address wider issues facing the charity sector (e.g. the failure to introduce a new regime for Scottish charitable incorporated organisations (SCIOs) as it relates to the conversion of unincorporated charities).
Nonetheless, the unfolding narrative of the Acts practical implementation will undoubtedly be a focal point of interest moving forward.
This article was co-written by Amina Amin, a Solicitor in our Charities & Social Enterprise team.
