Overview

The Charity Commission for England and Wales is commonly described as the regulator of charities. It is an ‘autonomous’ government department established under statute. This simple description begs a number of questions – what is the rationale for regulating charity? What should the relationship be between the ‘regulator’ and independent charities? What is charity in law? What is the nature of the independence which the Commission, as a government department, can exercise? This paper addresses these issues in describing the origins, composition and functions of the Commission.

It will be noted that the Charity Commission's responsibilities are confined to England and Wales, one of the three distinct legal jurisdictions which make up the United Kingdom. Scotland and Northern Ireland, the other legal jurisdictions making up the United Kingdom, have different legal and administrative regimes. As with the Internal Revenue Service (IRS) in the USA, however, fiscal provisions, administered by HM Revenue and Customs (HMRC) on a UK-wide basis, impose a degree of uniformity throughout the UK. The arrangements for the rest of the UK are referred to briefly in the annex at the end of this paper.

Charity is a key concept in British not-for-profit law. It is a complex subject, but in essence a charity in English law is an independent organisation whose purpose serves the public benefit – a public benefit organisation (PBO) for short. With certain exceptions charities must register with the Charity Commission and comply with its accountability requirements.