Charities (Amendment) Act 2005

i Charities (Amendment) Act 2005 Act No. 11/2005 TABLE OF PROVISIONS Section Page 1. Purposes 1 2. Commencement 2 3. Principal Act 2 4. Section 1A substituted 2 1A. Definitions 2 5. Monetary limits increased 3 6. New sections 4A and 4B inserted 4 4A. Governor in Council may increase monetary limits 4 4B. Tabling before Parliament and disallowance 4 7. Regulations prescribing fees 5 8. New section 7A inserted 5 7A. Transitional provision—Charities (Amendment) Act 2005 5 9. New Part IA inserted 5 PART IA—APPROVAL FOR INVESTMENT IN COMMON FUNDS 5 7B. Powers of trustees under this Part 5 7C. Powers under this Part subject to provisions and conditions of Order or approval 7 7D. Application to court 8 7E. Powers of court do not derogate from other powers 8 7F. Application to Attorney-General in respect of eligible property 8 7G. Attorney-General may make investigations 9 7H. Attorney-General may approve application of Part 9 7I. Part continues to apply if corpus exceeds initial limits 10 10. New sections 9A and 9B inserted 10 9A. Attorney-General may require information 10 9B. Offence to fail to comply with requirement 11 ═══════════════ ENDNOTES 12 -- 1 of 13 -- 1 Charities (Amendment) Act 2005 † [Assented to 10 May 2005] The Parliament of Victoria enacts as follows: 1. Purposes The main purposes of this Act are— (a) to increase the monetary limits for applications to the Attorney-General for approval of cy près schemes; (b) to provide for further increases of such monetary limits by Order in Council; (c) to provide for a scheme for the approval of the investment of charitable trust property in common funds by trustees; Victoria No. 11 of 2005 -- 2 of 13 -- Act No. 11/2005 Charities (Amendment) Act 2005 2 (d) to provide for information to be obtained by the Attorney-General from a charity or charitable estate for the purposes of inquiring into the administration of the charity or estate under Part II of the Charities Act 1978. 2. Commencement (1) Subject to sub-section (2), this Act comes into operation on a day or days to be proclaimed. (2) If a provision of this Act does not come into operation before 30 November 2005, it comes into operation on that day. 3. Principal Act In this Act, the Charities Act 1978 is called the Principal Act. 4. Section 1A substituted For section 1A of the Principal Act substitute— '1A. Definitions In this Act— "eligible property" means property given for charitable purposes where the total value of the corpus of the property— (a) is less than $500 000 or an amount fixed under section 4A, whichever is the greater; or s. 2 See: Act No. 9227. Reprint No. 2 as at 10 February 2000 and amending Act No. 74/2000. LawToday: www.dms. dpc.vic. gov.au -- 3 of 13 -- Act No. 11/2005 Charities (Amendment) Act 2005 3 (b) does not exceed $50 000 or an amount fixed under section 4A, whichever is the greater and the property is given for specific charitable purposes which fail; "the court" means the Supreme Court.'. 5. Monetary limits increased (1) In section 4(1) of the Principal Act— (a) in paragraph (a), for "$50 000 or the prescribed amount" substitute "$500 000 or an amount fixed under section 4A"; (b) in paragraph (b), for "$1000" substitute "$50 000 or an amount fixed under section 4A, whichever is the greater,"; (c) for "prescribed fee" substitute "relevant prescribed fee". (2) In section 4(3) of the Principal Act— (a) in paragraph (a)(ii), for "$50 000 or the prescribed amount" substitute "$500 000 or an amount fixed under section 4A"; (b) in paragraph (b)(ii), for "$1000" substitute "$50 000 or an amount fixed under section 4A, whichever is the greater". (3) In section 5(1) of the Principal Act, for "$50 000 or the prescribed amount" substitute "$500 000 or an amount fixed under section 4A". s. 5 -- 4 of 13 -- Act No. 11/2005 Charities (Amendment) Act 2005 4 6. New sections 4A and 4B inserted After section 4 of the Principal Act insert— "4A. Governor in Council may increase monetary limits Subject to section 4B, the Governor in Council, by Order published in the Government Gazette, may increase the monetary limits set out in section 4 or 5. 4B. Tabling before Parliament and disallowance (1) The Attorney-General must cause a copy of an Order made under section 4A to be laid before each House of the Parliament within 10 sitting days after the Order is published in the Government Gazette. (2) An Order made under section 4A may be disallowed by resolution of a House of the Parliament within 15 sitting days after the Order is tabled under sub-section (1). (3) If an Order made under section 4A is not disallowed under sub-section (2), the Order takes effect on the later of— (a) the date specified in the Order; or (b) the date which is the day after the expiry of the period for disallowance under sub-section (2). (4) If an Order made under section 4A is disallowed under sub-section (2), the Clerk of the Parliaments must cause notice of the disallowance to be published in the Government Gazette.". s. 6 -- 5 of 13 -- Act No. 11/2005 Charities (Amendment) Act 2005 5 7. Regulations prescribing fees At the end of section 7 of the Principal Act insert— "(2) Regulations made under this Act— (a) may be of general or limited application; (b) may differ according to differences in time, place or circumstances; (c) in the case of regulations prescribing fees under sub-section (1)(b), may provide for fees calculated on a sliding scale.". 8. New section 7A inserted After section 7 of the Principal Act insert— "7A. Transitional provision—Charities (Amendment) Act 2005 The amendments to sections 4 and 5 made by the Charities (Amendment) Act 2005 apply in respect of any application under either of those sections on or after the commencement section 5 of that Act.". 9. New Part IA inserted At the end of Part I of the Principal Act insert— 'PART IA—APPROVAL FOR INVESTMENT IN COMMON FUNDS 7B. Powers of trustees under this Part (1) The trustees of any property given for charitable purposes in respect of which this Part applies may— s. 7 -- 6 of 13 -- Act No. 11/2005 Charities (Amendment) Act 2005 6 (a) establish one or more investment common funds for the collective investment of that property held by or in the custody of the trustees; (b) invest that property held by or in the custody of the trustees in one or more investment common funds. (2) The trustees of any property given for charitable purposes in respect of which this Part applies, from time to time without liability for breach of trust, may bring into or withdraw from any investment common fund the whole or any part of that property, despite any direction to the contrary (whether express or implied) contained in the trust instrument. (3) Subject to sub-section (4), the trustees of any property given for charitable purposes in respect of which this Part applies must periodically distribute the income of each investment common fund among the trusts participating in the common fund, having regard to the extent of the participation by each trust in the common fund during the relevant accounting period. (4) The trustees of any property given for charitable purposes in respect of which this Part applies, if they consider it expedient to do so, may, from time to time— (a) add some portion of the income of the common fund to the capital of the common fund; or (b) use some part of the income to establish or augment a fund or funds as a provision against capital depreciation or reduction of income. s. 9 -- 7 of 13 -- Act No. 11/2005 Charities (Amendment) Act 2005 7 (5) The trustees of any property given for charitable purposes in respect of which this Part applies may, out of the annual income of a trust in an investment common fund, periodically deduct an amount not exceeding 5% of that annual income as commission for the administration of that trust. (6) The commission deducted in accordance with sub-section (5) is to be received and accepted by the trustees of any property given for charitable purposes in respect of which this Part applies as full payment to them for the costs of administration of the trust in an investment common fund. (7) The trustees of any property given for charitable purposes in respect of which this Part applies must not make any other charges on a trust in an investment common fund in addition to the commission received under sub-section (6), except in accordance with the trust instrument. 7C. Powers under this Part subject to provisions and conditions of Order or approval The powers under section 7B of trustees of any property given for charitable purposes in respect of which this Part applies must be exercised in accordance with the Order of the court or the Attorney-General's approval given under this Part, including any provisions or conditions to which that Order or approval is subject, as the case requires. s. 9 -- 8 of 13 -- Act No. 11/2005 Charities (Amendment) Act 2005 8 7D. Application to court (1) The trustees of any property given for charitable purposes may apply to the court for an Order that this Part applies to those trustees in respect of that property. (2) An application under sub-section (1) must specify the property or individual trusts or class of property or trusts to which this Part is to apply. (3) On an application under this section, the court, if satisfied that it is appropriate in the circumstances for this Part to apply to those trustees in respect of that property, may make an Order that this Part applies, subject to any provisions or conditions in that Order that the court considers appropriate. 7E. Powers of court do not derogate from other powers The powers of the court under this Part are in addition to, and not in derogation of, any powers exercisable by the court in charity proceedings. 7F. Application to Attorney-General in respect of eligible property (1) In lieu of making application to the court (under this Part or otherwise), the trustees of any eligible property may apply to the Attorney-General for approval that this Part applies to those trustees in respect of that property. s. 9 -- 9 of 13 -- Act No. 11/2005 Charities (Amendment) Act 2005 9 (2) An application under this section must— (a) be in writing; and (b) specify the eligible property or class of eligible property to which this Part is to apply; and (c) be accompanied by the relevant prescribed fee. 7G. Attorney-General may make investigations On receiving an application under section 7F, the Attorney-General— (a) may make such investigations and inquiries as the Attorney-General thinks fit; and (b) may require the trustees to furnish such information, opinions or advice as the Attorney-General thinks fit. 7H. Attorney-General may approve application of Part (1) The Attorney-General, in his or her absolute discretion, may approve an application made under section 7F if the Attorney-General is satisfied that it is appropriate in the circumstances for this Part to apply to those trustees in respect of the eligible property. (2) An approval under this section— (a) may be subject to any provisions and conditions that the Attorney-General thinks fit; and (b) may authorise the investment of the eligible property in common funds by the trustees, despite the trustees having no such power pursuant to the relevant trust instrument. s. 9 -- 10 of 13 -- Act No. 11/2005 Charities (Amendment) Act 2005 10 (3) The Attorney-General does not, by virtue of this Part, have any greater powers than are exercisable by the court in charity proceedings. (4) In any case where the Attorney-General approves the application of this Part in respect of trustees of eligible property, the trustees are not subject to any liability for breach of trust arising solely from their investment of that eligible property in common funds, in accordance with this Part. 7I. Part continues to apply if corpus exceeds initial limits If the Attorney-General, under section 7H, has approved the application of this Part to trustees in respect of property given for charitable purposes which is eligible property at the time of that approval, this Part continues to apply despite the total value of the corpus of that property subsequently exceeding the relevant amount specified in the definition of "eligible property".'. 10. New sections 9A and 9B inserted After section 9 of the Principal Act insert— "9A. Attorney-General may require information (1) The Attorney-General may require the trustees of a charity to give him or her any information that the Attorney-General considers necessary to determine whether an inquiry under this Part should be conducted. s. 10 -- 11 of 13 -- Act No. 11/2005 Charities (Amendment) Act 2005 11 (2) The Attorney-General must make the requirement in a written notice that— (a) identifies the information; and (b) specifies— (i) by when the requirement must be complied with, being a period of not less than one month; and (ii) in what form the information is to be given to the Attorney-General. 9B. Offence to fail to comply with requirement A person must comply with any requirement made by the Attorney-General under section 9A, unless the person has a reasonable excuse for not doing so. Penalty: 60 penalty units.". ═══════════════ s. 10 -- 12 of 13 -- Act No. 11/2005 Charities (Amendment) Act 2005 12 ENDNOTES † Minister's second reading speech— Legislative Assembly: 24 February 2005 Legislative Council: 24 March 2005 The long title for the Bill for this Act was "to make miscellaneous amendments to the Charities Act 1978 and for other purposes." Endnotes -- 13 of 13 --