Key Conditions in a Charitable Fundraising Licence (NSW)

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Table of Contents

• Requirement to Hold a Charitable Fundraising Licence
• Marketing Activities
• Maintenance of Accounts and Records
• Management
• Conflicts and Complaints
• Specific Conditions
• Revocation
• Key Takeaways

In many circumstances, organisations and charities that undertake fundraising activities need to obtain authority to do so through a charitable fundraising licence. If you fail to obtain a licence before fundraising, you may face fines. In New South Wales (NSW), Fair Trading regulates fundraising licensing under the Charitable Fundraising Act 1991 (NSW).  This article outlines the key conditions attached to a charitable fundraising licence.

Requirement to Hold a Charitable Fundraising Licence

An organisation that wishes to undertake any form of fundraising activity (e.g. hosting a charity fundraising event) typically needs to apply for the authority to fundraise with NSW Fair Trading. However, there is no requirement to obtain authority if the organisation:

• has an annual fundraising amount of up to $15,000;
• is religious;
• collects membership fees or appeals to its members for the receipt of money or financial benefits;
• faces an appeal to any Commonwealth, state or local government authority; or
• is a university or controlled entity.

Marketing Activities

Marketing is an excellent tool, allowing organisations to reach those beyond their immediate community for fundraising purposes. Organisations may use methods such as cold calling, mailing pamphlets or requesting donations in public spaces for fundraising purposes. Under the charitable fundraising licence, an organisation has various obligations in relation to their marketing activities. When an organisation has access to personal information, they must:

• ensure conduct is not misleading or deceptive and (if by way of a marketing medium) does not prominently disclose the name of the authorised fundraiser;
• provide details as to the purpose of the fundraising activity, e.g. how donated goods or material will be used;
• provide details of the source of a person’s contact details;
• remove a person’s contact details from the source upon the request of the person; and
• not sell a person’s contact details to third parties.

Organisations should ensure they have data protection procedures in place to ensure they establish good practices when collecting, storing and using personal information for marketing purposes.

Maintenance of Accounts and Records

Maintaining accounts and records is another obligation of an organisation with a charitable fundraising licence. For each fundraising activity, the organisation has numerous details it needs to collect and maintain. For example, the organisation must:

• record and explain transactions (e.g. cash books, register of assets);
• keep a minute book to detail business relating to fundraising activities;
• maintain a register of people who participate in fundraising activities, e.g. volunteers;
• retain annual income statements and balance sheets; and
• issue receipts (where applicable).

Management

Each fundraising activity also has specific management requirements. For example, a governing body of three people will need to administer the fundraising activity. Further, the organisation must maintain minutes of all discussions surrounding the fundraising activity. There is also a general obligation that there are proper and effective controls in place relating to accountability for:

• expenditure;
• income; and
• articles obtained from a fundraising activity.

Conflicts and Complaints

An organisation will need to set up a mechanism for handling conflicts of interest. For example, it could set up a register of financial interests or require a general meeting to ratify an appointment of service (including remuneration). Appropriate mechanisms should also be in place to address disputes or complaints that arise within the organisation or from a member of the public.

Specific Conditions

Under the Charitable Fundraising Act 1991 (NSW), NSW Fair Trading can impose conditions on a licence that is in line with the public interest. Therefore, apart from the general obligations, there may be additional conditions, depending on the fundraising activity you undertake.

Revocation

There is a possibility that a charitable fundraising licence may be revoked. For instance, a licence may be revoked when:

• an organisation conducts a fundraising activity in bad faith;
• an organisation improperly administers the fundraising activity;
• fundraising activities have not been conducted in the last 24 months; or
• it is in the public interest for the licence to be revoked.

Key Takeaways

Under a charitable fundraising licence in NSW, organisations have to consider many conditions, such as those related to:

• marketing activities;
• maintaining accounts and records;
• management;
• conflict of interest and complaints processes; and
• revocation.

Additionally, there are procedural processes an organisation needs to implement to comply with such conditions.

If you need assistance in applying for a charitable fundraising licence or advice on complying with your obligations under the licence, check the Australian Charities and Not-for-profits Commission website.