The new CIO legal structure is facing yet more delays, with its introduction now pushed back until the end of the year or possibly the beginning of 2011.
This will be of great disappointment to the many organisations that are eagerly awaiting the arrival of this new structure as a much needed alternative to the current legal vehicles employed by charities.
Many charities, particularly those small in size, will be constituted as either unincorporated associations or trusts. Although flexible and relatively straightforward they do not protect trustees from liabilities arising from the organisations operations. With no separate legal personality, trustees face serious personal risks if litigation were to arise.
In the past charities have often incorporated as Companies Limited by Guarantee as a way of avoiding liability. However incorporation in this form is not really suitable for small charities given the regulation and accounting requirements governing such forms. As an added headache, such legal forms suffer from the regulation requirements of both the newly formed NI Charity Commission and Company House. Many charities can as a consequence become suffocated by a mountain of red-tape.
The Government placed the two key tenets of unlimited liability and dual regulation at the forefront of their policy objectives underpinning the new CIO. The structure was designed to provide charities with a separate corporate personality (and thus reduced personal liability) and also end the dual regulation requirements.
This will be of great disappointment to the many organisations that are eagerly awaiting the arrival of this new structure as a much needed alternative to the current legal vehicles employed by charities.
Many charities, particularly those small in size, will be constituted as either unincorporated associations or trusts. Although flexible and relatively straightforward they do not protect trustees from liabilities arising from the organisations operations. With no separate legal personality, trustees face serious personal risks if litigation were to arise.
In the past charities have often incorporated as Companies Limited by Guarantee as a way of avoiding liability. However incorporation in this form is not really suitable for small charities given the regulation and accounting requirements governing such forms. As an added headache, such legal forms suffer from the regulation requirements of both the newly formed NI Charity Commission and Company House. Many charities can as a consequence become suffocated by a mountain of red-tape.
The Government placed the two key tenets of unlimited liability and dual regulation at the forefront of their policy objectives underpinning the new CIO. The structure was designed to provide charities with a separate corporate personality (and thus reduced personal liability) and also end the dual regulation requirements.
Whilst the structure does appear to offer very real benefits to charities, its true worth will not be established until the final corresponding regulations governing the structure are published by the Government (Don't hold your breath).
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