For charities to continue to receive tax concessions, they need to be registered under the new national regulatory regime. They may be de-registered if they fail to adhere to governance and conduct standards established under the regime. The Commissioner of the Australian Charities and Not-for-profits Commission (ACNC) is responsible for policing charities’ compliance with the standards.
The Australian Charities and Not-for-profits Commission Act 2012 (Cth) (the Act) set up the new regulatory framework for not-for-profit charitable entities, including the ACNC which began operating at the end of 2012. The ACNC is responsible for maintaining a publicly accessible register of charities in Australia and for the registration of charities. Previously, the Australian Taxation Office (ATO) determined whether an entity was eligible for charitable status and therefore able to lawfully access tax concessions. Now the ATO will accept an ACNC determination that an entity is a charity.
The ACNC Commissioner has information-gathering, monitoring, and enforcement powers to ensure that the registered charities comply with governance and external conduct standards provided under the Act and with record-keeping and reporting obligations. Specific powers of the Commissioner include issuing warning notices and written directions in relation to charities not complying with the Act or the various standards, and applying for court injunctions.
Other than non-compliance with governance and conduct standards, a charity’s registration may be revoked by the ACNC Commissioner in circumstances including where the charity has provided false or misleading information in its application for registration or where it is unable to pay all its debts when they become due and payable. Provision is made under the Act for a charity to object to the Commissioner if its registration is denied or revoked, and for it to seek review by the Administrative Appeals Tribunal and lodge a court appeal if necessary.
The national regulatory regime for charities is examined in the new Chapter 4 of The Laws of Australia Subtitle 4.8 “Non-corporate Organisations”.