You must use all reasonable efforts to verify whether third-party payment service providers or business partners are complying with the agreement you have with them (including contractual terms relating to compliance with the Code). If your third-party fundraiser has or may have a conflict of interest, you cannot enter into an agreement with them without the permission of the person or organization whose interests conflict with their interests. If there is a significant conflict of interest, both parties must determine whether it is appropriate for the relationship to continue. Business participants must solicit at any time (and anywhere) as part of a commercial advertising business or imply that money is being donated to one or more non-profit organizations or used for charitable, philanthropic or charitable purposes. Two other forms of commercial sponsorship agreements, written more in favor of the sponsor, can be found in the Sponsorship Agreements subfolder of our Business folder. Third-party fundraisers who do not fall under the legal definition of a professional fundraiser must indicate the actual amount and how the payment is calculated in a proposal or agreement, and fully clarify all fees, expenses and other related costs, how their fees are calculated and the payment deadline. Setting up this agreement takes time and resources, must comply with the Charities Act, can be available in various forms – and is known to be up to 80 pages long! As a result, charities will often require the company to commit to a minimum amount of donations before they can enter into an agreement, partner with them, and of course let the company use their logo. If a Scottish charity has an agreement on the activities of a business partner operating in England and Wales (or if an English or Welsh charity has an agreement on the activities of a business partner operating in Scotland), it must ensure that the contract meets the legal requirements of the country where the fundraising is carried out. You and external fundraisers and business partners must provide each other with full details of any possible, perceived or actual conflict of interest of which you and you are aware or of which they are aware, namely: Under the Charities Act, any business that promotes the sale on the basis that a portion of the proceeds goes to a charity is designated as a “business participant” and must comply with the relevant provisions of the Charities Act, 1992 and 2016. and the 2019 Fundraising Code of Practice.
Professional fundraisers and business participants must also meet the following additional standards. A professional fundraiser or business participant who has an agreement with you must allow you to view their books, documents and records related to your nonprofit upon request. The written agreement between you and the third-party fundraiser must include terms that define what constitutes confidential information. It is illegal for a commercial participant to claim, as part of an advertising project, that he or she is giving money to a not-for-profit organization, unless the claim is in accordance with a written agreement with the non-profit organization for which he or she is collecting funds. The agreement must be in writing and signed by both the business participant and the not-for-profit organization for which they collect donations. This may include the monitoring measures described in section 7.3 to verify that fundraisers are in compliance with the Code. The terms of the agreement should allow you to read and, if necessary, review all relevant policies and procedures that the professional fundraiser has in place that are relevant to the protection of the public. This may include policies for people in vulnerable situations, how to deal with complaints and whistleblowing, training materials and the Code of Conduct for Employees. If you place fundraising content on a third party or business partner`s website, you should take the same care as when you place it on your own website. You must have review procedures in place in the agreement. You should consider the performance of the third-party provider in these reviews and decide whether other measures are appropriate (for example. B, by examining the agreement or activating the penalty clauses that may be part of the agreement).
In England and Wales, you must meet this standard. A professional fundraiser or business participant must give you the money as soon as possible and in any case within 28 days, unless they have a reasonable excuse. As part of its fundraising efforts, a charity may, from time to time, induce a commercial company to operate an advertising company as a “business participant” or to provide financial sponsorship for an event organized by the charity in exchange for advertising or other sponsorship benefits for the Company. It is a criminal offence for a professional fundraiser or business participant not to comply with any of these conditions and trustees of a charity may have breached their duty of care if they do not make any statements, if any. You can get more information and advice from the Scottish Regulator`s Office of Charities or you should seek professional advice. You must ensure that all paid third-party service providers or business partners with whom you work to collect donations comply with the Code. If the third-party provider sells goods or services, a written agreement must be entered into that governs the relationship between the non-profit organization and the third-party fundraiser (even if this is not strictly necessary under applicable laws). In Scotland, if the contract is with a professional fundraiser or business participant, it must explain how the contract can be changed. It must contain conditions that stipulate that the change must be made in writing and that prevent a party from making an adverse change on its own.
Agreements between a business corporation and a charity are governed by the Charities Act if the business is a “business participant” under the Charities Act. The business participant and the charity must enter into a written agreement that not only establishes the agreement between them, but also addresses other matters set out in the legislation. Fundraising agreements between non-profit organisations based in England and Wales and professional fundraisers must also include the following: If a third-party fundraiser falls within the definition of “professional fundraiser”, the agreement must include details of the solicitation statement they are required to make, as well as the fees and expenses that professional fundraising receives. Any change to the terms of the contract must be in accordance with the clause in the agreement that sets out how a change is to take effect. When not-for-profit organizations work with external organizations to raise funds, it is important that there is a common understanding of what this regulation means in practice. This section sets out what needs to be established as part of fundraising agreements to ensure expectations are clear and what paid third-party providers must tell donors when collecting donations on behalf of a not-for-profit organization. If a business raises money for charity through its sale (also known as cause-driven marketing), it must have a legal agreement in place with each charity it wants to support before launching its campaign – this is called a business participation agreement. Note: There is no legislation in Northern Ireland regarding professional fundraisers or business participants.
(However, non-profit organisations that collect donations in Northern Ireland may decide to follow the legal requirements of England, Wales and Scotland as a best practice.) Before entering into an agreement with a professional fundraiser or business partner, you should conduct appropriate reviews (including their financial capacity and reputation) to make sure that you can be sure that they are able to do what you expect of them and that your relationship with them does not damage your reputation. This is especially important when working with organisations that are not based in the UK. If an agreement with a business partner falls within the definition of a “business participant”, the business participant must have a written agreement with the non-profit entity for which it intends to raise funds and certain information must be included. In Scotland, solicitation standards apply to professional fundraisers who solicit donations, business participants who make representations, and benevolent fundraisers (other than volunteers) who conduct benevolent fundraisers and need to be tracked. Where the agreement provides for different levels of payment, this shall be clearly justified in the agreements by referring to the specific circumstances in which different levels of payment may apply. If this is true, the agreement must include terms that allow you and the third-party provider to terminate the contract before its remuneration changes. .