Bates Wells Briefing for Charities & Social Enterprises | 16 July

Bates Wells highlights


Following a recent seminar for legacy clients, Bates Wells Partners’ Leticia Jennings and Laura Soley have written for Civil Society Media about “When to look a gift horse in the mouth: Legacies and ethical and reputational risks”.

The Bates Wells Briefing is taking its summer break and will return the week beginning 5th August.

At a glance

The Fundraising Regulator has published a brief guide to where content from the current Code can be found in the new Code of Fundraising Practice.

The Information Commissioner’s Office has published its Annual Report for 2018/19.

The Government Equalities Office has published “Gender equality at every stage: a roadmap for change”.

The International Standards Organisation has launched the first ISO international standard for climate change adaptation.

Charity Commission

Serious incident reporting – confidentiality

The Charity Commission has updated its privacy notice about how it processes data when you report a serious incident.  The ‘Sharing of information’ section has been updated to provide further detail.

Commission withdraws Official Warning

The commission has withdrawn the Official Warning it made against the charitable think tank, the Institute of Economic Affairs (“IEA”):

New inquiries

The commission has announced a class statutory inquiry into a group of 8 charities alleged to be involved in money laundering, which had a common trustee. The class statutory inquiry was officially opened by the commission in 2014 after it was notified of a police investigation into the charities amid concerns that they were being used to launder £10 million. The commission says it was unable to announce the investigation until now so as to avoid prejudicing criminal proceedings. The administrator of one of the charities, Chabad UK was convicted of laundering money through the charities, as well as for supplying false information to the Commission in June 2019 and was sentenced on 4 July 2019.

Reporting on the Commission’s impact

The Charity Commission must report each year against the Business Impact Target (BIT) introduced by the Small Business, Enterprise and Employment Act 2015 (as amended).  The BIT measures the economic impact (cost or saving) of changes to regulation on businesses including charities.  The Commission’s report for 2018/19 includes the following comment on the impact of changes introduced by the Commission:

  • Reporting Serious Incidents – minor updates to guidance and processes; simpler bulk-reporting process benefiting c.40 large charities; we received over 2,800 RSIs in 2018-19, a significant increase due to raised awareness of safeguarding
  • Safeguarding (simplified and updated guidance, to increase clarity and accessibility)
  • Guidance for charities with a connection to a non-charity – new guidance following consultation with the sector, certified as de minimis through completion of a Regulatory Impact Assessment (RIA)
  • Charitable status of complementary and alternative medicine – change of policy approach and updated guidance affecting c.30 charity applications per year, certified as de minimis through completion of an RIA
  • Student Unions – minor updates to operational and public guidance on campaigning affecting c.150 charities

Tax and VAT

The First-tier Tribunal has allowed a charity’s appeal deciding that it could treat the supply of construction services and building materials for a new, independently functioning, annexe as VAT zero-rated because it did not use the annexe for business purposes. Yeshivas Lubavitch Manchester –v-  Commissioners for HMRC, 2019.


Teresa May has announced a new Office for Tackling Injustices which will “present future Governments with more effective, data-driven, evidence-based challenge to help drive forward reforms to tackle wide-ranging disparities in society”.

NPC has launched “Walking the Talk”, a collection of four podcasts and ten essays looking at diversity issues in the sector.  Walking the Talk is a cross-sector partnership led by NPC and funded by Trustees Unlimited and Russam, with input from brapCommunity LinksChwarae Teg, and The Peel.

The International Standards Organisation (ISO) has launched ISO 14090:2019 on climate change adaptation: principles, requirements and guidance.  This is the first international standard for climate change adaptation. It aims to help organisations assess and understand climate change impacts, make more informed decisions and draw up plans for effective adaptation. It helps them identify and manage risks, and seize any opportunities that climate change may bring. It provides a framework enabling organisations to consider climate change adaptation when designing and implementing policies, strategies, plans and activities. It can be used by an organisation of any size or type.

Data protection

ICO fines

The ICO has issued a notice of its intention to fine Marriott International £99,200,396 for infringements of the General Data Protection Regulation (GDPR).  The proposed fine relates to a cyber incident which was notified to the ICO by Marriott in November 2018. A variety of personal data contained in approximately 339 million guest records globally were exposed by the incident, of which around 30 million related to residents of 31 countries in the European Economic Area (EEA). Seven million related to UK residents.

ICO Annual Report

The ICO has published its Annual Report for 2018/19.   Highlights include:

  • Data protection complaints received by the ICO almost doubled from the previous year, increasing from 21,019 in 2017/18 to 41,661 in 2018/19
  • 2018/19 was a record-breaking year of monetary penalties under the Data Protection Act 1998.


Code of Fundraising Practice

To help navigate the new Code, the Fundraising Regulator has published:

  • this brief guide to where content from the current Code can be found in the new Code.
  • A list of merged sections – downloadable here
  • A list of deleted sections – downloadable here

Fundraising Regulator

The FR has published a report, The role of the Fundraising Regulator: public awareness, trust and expectations.  The report summarises recent research which found that:

  • Awareness of the Fundraising Regulator is low at 7% knowledge of the Fundraising Preference Service is similarly low at 6%.
  • See this accompanying blog by the FR Chair, Lord Harris in which he says one of the next steps will be that “The team at Fundraising Regulator will be reaching out to charities to talk about trust”. 


See here for a summary of the recent Bates Wells Legacies event.  Also see this article for Civil Society Media by Bates Wells Partners’ Leticia Jennings and Laura Soley “When to look a gift horse in the mouth: Legacies and ethical and reputational risks”.


Civil Society Media reports the new All Party Parliamentary Group on Philanthropy and Social Investment has had its first meeting in Parliament.  



The government has announced details of a national mental health programme between schools and the NHS.

A new School Sport and Activity Action Plan has been outlined by Education Secretary Damian Hinds, Sport Minister Mims Davies and Minister for Public Health, Seema Kennedy.  As part of the plan:

  • the Government has committed to launch a series of regional pilots to trial innovative approaches to getting more young people active, particularly less active groups such as girls and those from disadvantaged backgrounds.
  • Schools and sports clubs will work together to share their facilities and expertise.  They will “focus on ensuring boys and girls have an equal and coordinated offer of sport, competition and activity, including modern PE lessons and access to high-quality clubs and competitions after school and during weekends and holidays.”

The pilots will be joint-funded by the Department for Education and Department for Digital, Culture, Media and Sport through Sport England, and are expected to run from September 2020.

The Department for Education has announced new workshops will be available from September to support schools and colleges teach young people about living independently.  Leapskills workshops, developed by student accommodation provider Unite Students, will offer schools and colleges resources to teach Year 12 and 13 pupils about independent living, managing money and dealing with conflict.

The Government has issued a new publication on setting executive pay in academy trusts.

Further education

Eleven T Level providers are to benefit from a share of an £8.65 million investment to help build new classrooms and refurbish buildings in readiness for the introduction of the new technical qualifications in September 2020.  

Youth services

A review has been launched into statutory guidance for Local Authorities on providing youth services.


See above under Education, Schools.

The Government has announced a £135 million investment in health research.

Local Government Lawyer reports the High Court will hear a dispute between NHS trusts and councils in early November over whether trusts should be treated the same as charities and therefore receive 80% off their business rates.  The test case was brought by Derby Teaching Hospitals NHS Foundation Trust and 16 others against 45 councils. A trial date has been set for 4 November 2019.

Organisations working internationally/media freedom

A new UK aid package is to help promote media freedom in developing countries around the world.  Government says the UK aid will “help media experts, charities, the private sector and academics, to pioneer new approaches to keeping media outlets free and independent”.   

Public bodies

Home Secretary Sajid Javid will this week announce a new legal duty on public bodies to prevent and tackle serious violence. The new ‘public health duty’ will cover the police, local councils, local health bodies such as NHS Trusts, education representatives and youth offending services. The new duty will hold organisations to account as opposed to individual teachers, nurses or other frontline professionals.  New guidance will also be published in due course to support the legislation, which will provide examples of different partnership models and explain how different organisations and sectors can partner with each other.

Social finance

Ignoring the ‘missing middle’ is a missed opportunity. David Bartram from UnLtd comments in Pioneers Post on the social investment gap and the need for a shift in mindset towards innovation and new products designed around the needs of the market.

Last chance for third sector to call on Government to improve access to subsidised capital through SITR. Melanie Mills, from Big Society Capital, and Mark Grant, from Action Homeless, comment on the Government’s call for evidence on Social Investment Tax Relief (SITR), which will close this week. 

The Bright Ideas Fund (£3.2m) will re-open on 6 August, offering grants and tailored support to community groups, associations and organisations in England that have good ideas for community businesses but need help developing them. Power to Change is funding the initiative; press release.

Charities receive share of £3.4m from digital fund. Eight organisations will share £3.4m of funding from the National Lottery Community Fund to help them grow their digital capabilities. As well as funding, the projects can access coaching and mentoring support, and will share learnings with the sector.

Social enterprise

See below under Mutuals and Community Interest Companies.


According to Social Enterprise UK, a new report reveals that staff-owned social enterprises, also called “public service mutuals”, hold the key to solving the UK public sector’s productivity crisis.

Faith based organisations

See under Education, Higher Education above.

The government has launched a consultation on whether opposite-sex married couples should be able to convert their marriages to civil partnerships.  This follows the Civil Partnerships, Marriages and Deaths (Registration etc) Act 2019 which came into force in May 2019.


See under Education, Schools.


See under Education, Higher Education above.

The Government Equalities Office has published Gender equality at every stage: a roadmap for change. Significant proposals include a consultation on strengthening measures to tackle sexual harassment (including clarifying the rules on third party harassment and considering whether to extend the three-month time limit for bringing discrimination and harassment claims), consulting on a new right to carers’ leave, reviewing the enforcement of equal pay legislation, assessing the effectiveness of gender pay gap reporting and consulting on any changes by 2021. The government aims to complete its evaluation of the shared parental leave and pay scheme by the end of 2019, after which it will consider whether to modernise the existing system.

Community interest companies

The Office of the Regulator of Community Interest Companies’ has published its annual report for 2018 to 2019.

Modern slavery

The government has published its response to an independent review of the Modern Slavery Act 2015.  The response rejects the recommendations in the review that a designated board member should be accountable for production of the modern slavery statement, and that there should be an offence under the Company Directors Disqualification Act 1986 for failure to comply with the legislation.  But it is supportive of the recommendation to create a central, government-run registry of modern slavery statements. 


Scottish Governance Code and checkup

The Office of the Scottish Charity Regulator (OSCR) reports on the Scottish Governance Code for the third sector and notes that SCVO have created a Good Governance Checkup document to be used in conjunction with the Code to help trustees on their journey to good governance.

Interim Inquiry Report

OSCR has issued a formal direction to the bank holding property on behalf of Aspire Community Solutions, a community regeneration charity, to prevent it from parting with any property of the charity without OSCR’s consent. OSCR is concerned that there has been misconduct in the administration of the charity. OSCR’s inquiry remains ongoing. Please see here for the interim section 33 report.

This information is necessarily of a general nature and doesn’t constitute legal advice. This is not a substitute for formal legal advice, given in the context of full information under an engagement with Bates Wells.

All content on this page is correct as of July 16, 2019.