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Insertion of new sections 54A to 54D in Principal Act
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22. The Principal Act is amended by the insertion of the following sections after section 54:
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“Charity trustees
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54A. (1) Subject to subsection (2), a charitable organisation shall have at least 3 charity trustees who are natural persons and a majority of those trustees shall—
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(a) be resident in the State, an EEA state or the United Kingdom, and
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(b) not be a connected relative of another trustee.
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(2) A charitable trust may have only one trustee that is a body corporate provided that the body corporate—
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(a) is incorporated in the State, an EEA state or the United Kingdom, and
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(b) has at least 3 directors who are natural persons and a majority of those directors who are natural persons are—
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(i) resident in the State, an EEA state or the United Kingdom, and
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(ii) not a connected relative of another director.
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(3) This section does not apply to an education body.
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(4) In this section—
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‘civil partner’ has the same meaning as it has in section 2(2);
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‘cohabitant’ has the same meaning as it has in section 2(2);
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‘connected relative’, in relation to a person, means a child, step-child, parent, step-parent, brother, sister, spouse, civil partner, cohabitant, grandparent or grandchild, or a child of the person’s civil partner or cohabitant.
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Principal duties of charity trustees
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54B. (1) Without prejudice to the duties of trustees generally and to the requirements of this Act, the duties of a charity trustee of a charitable organisation shall include the following:
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(a) to act in good faith in what the charity trustee considers to be the best interests of the charitable organisation;
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(b) to act honestly and responsibly in the advancement of the charitable purpose of the charitable organisation;
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(c) to avoid any conflict between the charity trustee’s duties to the charitable organisation and the charity trustee’s other (including personal) interests;
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(d) to exercise the care, skill and diligence which would be exercised in the same circumstances by a reasonable person having both—
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(i) the knowledge and experience that may reasonably be expected of a person in the same position as the charity trustee, and
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(ii) the knowledge and experience which the charity trustee has.
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(2) Where a charitable organisation is on notice that a charity trustee of the charitable organisation has committed a breach of his or her duty under subsection (1), the charitable organisation shall endeavour to remedy the consequences of that breach as soon as practicable after becoming aware of the breach.
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(3) A breach of duty by a charitable trustee under subsection (1) shall not of itself affect—
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(a) the validity of any contract or other transaction, or
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(b) the enforceability, other than by the charity trustee in breach of that duty, of any contract or other transaction by any person,
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but nothing in this subsection affects the principles of liability of a third party where he or she has been an accessory to a breach of duty or has knowingly received a benefit from that breach.
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(4) In so far as a duty of a charity trustee specified in subsection (1) corresponds to an equitable principle or common law duty of a trustee, regard shall be had to the equitable principle or common law duty in interpreting that duty and in the application of subsection (1).
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(5) Where the Authority is of the opinion that there has been a contravention of subsection (1) or (2), the Authority may make an application to the High Court citing paragraph (b) or (e) of section 74(1).
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Guidelines and codes of conduct
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54C. (1) The Authority may issue, and from time to time revise, guidelines or codes of conduct for the purpose of the performance of its functions under this Act.
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(2) Guidelines or codes of conduct under subsection (1) may relate to—
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(a) the duties of charity trustees,
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(b) minimum standards for the administration and management of charitable organisations,
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(c) procedural requirements in relation to the occurrence of a significant event,
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(d) the content of the constitution of a charitable organisation, or
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(e) an agreement or appointment (within the meaning of Part 6A).
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(3) A charitable organisation and the charity trustees of a charitable organisation shall have regard to any guidelines or codes of conduct under subsection (1).
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(4) The Authority shall publish any guidelines or codes of conduct in such manner and form as the Authority considers appropriate.
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(5) In this section, ‘significant event’, in relation to a charitable organisation, means—
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(a) substantial damage to property,
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(b) a substantial reduction or loss in assets, or
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(c) an event or situation that places the charitable organisation or its reputation at significant risk,
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but does not include a matter that is notifiable under section 59(1).
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Register of members
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54D. (1) A charitable organisation shall keep a record of the members of the charitable organisation (in this section referred to as a ‘register of members’).
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(2) A register of members shall include the following information:
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(a) the name and address of each member of the charitable organisation;
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(b) the date on which the particulars of the member referred to in paragraph (a) are entered on the register;
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(c) the date on which the member referred to in paragraph (a) ceases to be a member, if applicable.
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(3) Information in relation to a person who has ceased to be a member shall be removed from the register of members one year after that person ceases to be a member.
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(4) This section does not apply to an education body.”.
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