Read and download the following Standard Forms of Agreement:
Footnote 7 of this standard form of agreement includes refernce to the Charity Commission's 1991 annual report. This states that:
Commercial use of charity
106. We also had occasion to consider the use of charity names by commercial names concerns. In our view, charity trustees should be wary of entering into arrangements whereby the charity's name is to be used by a commercial company in return for money. This might involve the endorsement of a commercial product by a charity or the use of the charity's name in relation to a commercial product. There are cases when a charity can properly associate with a commercial organisation to their mutual benefit but care must be taken to protect the interests of the charity and to ensure that the relationship is, and remains, appropriate.
107. The charity's name is a valuable asset. It is the means by which it is identified in the Central Register of Charities and to the public. Before allowing the use of a charity name on a commercial basis, charity trustees must first consider the needs of the charity and whether funds could be raised by other methods. The name of a charity must not be exploited for non-charitable purposes. If a charity's name is used commercially it must be shown that the arrangement is expedient, in the
interests of the charity and on terms which are advantageous to the charity. Any such arrangement must be precisely defined by the charity trustees in every detail and kept under review. They must ensure that there is no misuse of the charity name nor any improper exploitation of its association with a commercial organisation and that the arrangements made allow them to prevent any such misuse.
108. Payments to charities for promoting commercial products are usually taxable. Tax can only be avoided if the relationship between the charity and the commercial product is a purely passive one, such as direct payment for the use of a logo. Charity trustees should ask the Inland Revenue for advice before entering into an arrangement.
Requirements for commercial participators and professional fundraisers
Charities and voluntary organisations should be aware that under the Charities Act 2006, there are legal requirements for professional fundraisers and the statements they are required to make when fundraising. Further information is available on the Solicitation Statements page of this website.
