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More Revision of ACNC Legislation

28 August 2012 at 9:47 am
Staff Reporter
There’s to be more revision of the Legislation establishing Australia’s first charity regulator, the ACNC, with the sector given only until 30 August to respond.

Staff Reporter | 28 August 2012 at 9:47 am


More Revision of ACNC Legislation
28 August 2012 at 9:47 am

The sector has until 30 August to respond to more revision of the ACNC

There’s to be more revision of the Legislation establishing Australia’s first charity regulator, the ACNC, with the sector given only until 30 August to respond.

The Federal Government introduced the ACNC Bill and associated legislation into the House of Representatives last week in an historic day for the Not for Profit sector

The Bill contains a number of changes from the second exposure draft including:

  • Adding a new clause to the objects in the legislation to make clear that the ACNC's role includes promoting a reduction in the regulatory burden on the NFP sector
  • Additional procedural fairness requirements where the ACNC Commissioner exercises particular powers under the legislation
  • Adding a statutory review provision to provide for a review of the legislation after it has been in operation for five years
  • A new power to make regulations to protect the privacy of private donors such as those who maintain a private ancillary fund
  • A substantial redrafting of provisions relating to directors' liability

The Bills went into the House of Representatives but must pass through both Houses of Parliament.

The Legislation however has been referred to the Senate Standing Committee on Community Affairs and the Parliamentary Joint Committee on Corporations and Financial Services.

Public submissions to those committees must be lodged by 30 August 2012. Reports from these committees are expected to be tabled in Parliament on 12 September 2012.

The Australian Institute of Company Directors (AICD) says the ACNC legislation is an important step on the road to reform of regulation for the Not for Profit sector.

It welcomed the Government’s changes to provisions in the original draft legislation relating to the obligations and liabilities of directors of incorporated NFPs.

It says the revised provisions affecting directors of companies limited by guarantee and incorporated associations are a significant improvement on the draft legislation, which would have had the effect of making Australia the only country which imposed more onerous obligations and liabilities on NFP directors than those of for-profit companies.

“While AICD does not agree with all aspects of the legislation, we believe some crucial flaws in the original Bill have been addressed,” Company Directors Chief Executive John Colvin said.

“In particular, we welcome the removal of criminal liability for directors of incorporated NFPs, the limiting of liability to breaches resulting from the deliberate act or omission of a director involving dishonesty, gross negligence or recklessness and the removal of provisions imposing a reverse onus of proof on directors.”

“A key measure of the legislation’s effectiveness will be its ability to reduce red-tape, and streamline regulatory requirements for charities and, as yet, it is not clear that the Bill will be able to achieve this.

“The final legislation must be written in a way that is easily understood by those in the sector and not in a way that hinders the ability of NFP organisations to deliver their core missions,” Colvin said.

“The NFP sector is awaiting greater clarity on how this legislation will interact with other Commonwealth and state-based laws governing charities.

“In this regard, it is also important that the States and Territories refer relevant regulatory powers to the Australian Charities and Not-for profits Commission (ACNC), in order to achieve the aim of a true “one stop” national regulatory framework.

“We call on Federal and State Governments to work together constructively to resolve the outstanding issues and ensure a positive outcome can be delivered for the sector.”

The Government is also yet to provide the detail of the governance, reporting and external conduct standards which are proposed to be included in regulations attached to the legislation.

“We continue to believe that these regulations should be subject to a full parliamentary approval process, rather than approval solely by the Minister.” Colvin said.

The legislation has now been referred to Parliamentary Joint Committee (PJC) on Corporations and Financial Services and the Senate Community Affairs Legislation Committee.

Company Directors says it will raise its outstanding concerns with the Bill through these Committees. 

The links to these inquiries can be found below for:

Community Affairs



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