Key points

• Charities (and their Responsible Persons) must abide by their obligations under law in order to preserve their charitable status and associated benefits and avoid adverse regulatory action.
• As part of those obligations, charities must not have or engage in a disqualifying political purpose and must generally comply with Australian law.
• In satisfaction of those obligations, charities must ensure that any:
  • political donations, advocacy or activity is undertaken solely in accordance with and further of the charity’s established purposes; and
  • applicable Electoral laws are strictly complied with.

Background

It is critical for charities intending to venture into the territory of political advocacy and donations to ensure that any efforts in this space are:

• animated by, and in execution of, their charitable purposes; and
• devised and exercised prudently, with due regard for the applicable regulatory regimes, including Charity laws and State and Federal Electoral laws.

Charity laws

Charities are generally permitted to engage in activities that are allowed under their governing document (constitution), in pursuit or furtherance of their charitable purpose and involve the application of its income and assets to its established purpose.

Under Charity laws, organisations are required to have purposes which are all charitable (except for those which are incidental and ancillary) and to not have a disqualifying purpose, such as promoting or opposing a political party or candidate for political office.

Charities engaging in political advocacy, activities and donations may risk having, or being seen to have, a disqualifying political purpose. This may expose the organisation, and its Responsible Persons, to enforcement action and sanctions by the charities regulator – the ACNC – for breaches of Charity laws and governance standards, consequently jeopardising their charitable status and registration.

Electoral laws

In addition to regulation under Charity laws, charitable organisations engaging in political advocacy and campaigning may also be subject to disclosure and other requirements under the applicable State and Federal Electoral laws depending on (for example):

• the type of political advocacy and activities engaged in; and
• the amount and value of political donations.

Charities engaging in or considering political advocacy or campaigning should first obtain legal advice to ensure they are aware of, and complying with, their specific obligations under Electoral laws.

Takeaway points

If your charity is approached to, or considering, political advocacy, campaigning, making political donations or attending political events or fundraisers:

• Consult and comply with the terms of your constitution
• Obtain legal advice on, and ensure you are aware of and understand, your obligations under Charity and State and Federal Electoral laws prior to engaging in any such activity
• Implement and audit a political advocacy and donations policy to ensure that any such activity is exercised in accordance with your constitution, in pursuit and furtherance of your charitable purposes and does not amount to a disqualifying political purpose.