Charity

The world of contract bridge (for what other type of bridge would lawyers discuss?) ‎has hit the headlines this week. There is a judicial review being raised by the English Bridge Union of Sport England’s decision that bridge is not a “sport” for its purposes.

In this short overview update we look at charities and third sector law ‎points that relate to the wider question of whether or not bridge is a “sport”.

We have blogged before on community sport and ways to successfully structure having regard to some key legal, fiscal and tax considerations.

What are the key points surrounding charities and third sector “sport”?

Scottish charity law

The Scottish rules on charity recognition include “the advancement of the public participation in sport” as a charitable purpose. There is also the not as related as it looks charitable purpose of “the provision of recreational facilities, or the organisation of recreational activities, with the object of improving the conditions of life for the persons for whom the facilities or activities are primarily intended”.

At issue in the current bridge case is Sport England’s determination that bridge is not a sport. The Office of the Scottish Charity Regulator (“OSCR”), in the Scottish charities context, notes that “[w]e will look to bodies such as Sportscotland and Sport England to see if they recognise activities as sports. However, not everything recognised by these bodies will be recognised under [Scottish charity law].”

In deciding whether or not a charity is furthering the purpose of public participation in sport, OSCR will take into account factors such as:-

  • is the activity governed or regulated by a set of rules or customs?
  • is there a governing body?
  • is the activity structured and organised?
  • is there an element of competition and of increasing the health and fitness of the participants? A key point coming out of the bridge case is what is meant by notions of “health and fitness”.

Importantly, under the Scottish charity law rules, there must be sufficient public access to the sport in question- after all, the purpose is about “public participation in sport” not just “sport” itself. Encouraging access to participation is important. Interestingly, under Scots law it does not necessarily rule out more elite participants being involved in benefitting from the charitable activities.

Charity tax law

Charity tax law uses a different definition of “charitable” to Scots law. In some areas it is very similar or identical. In others it can be quite different (sometimes in a subtle way). In the context of sport, the charitable tax purpose is the “advancement of amateur sport”.

In some ways this is wider than Scottish charity law (public participation is not expressly included). In other ways it is narrower- only amateur sport is included. Potentially relevant to the bridge case is the comments in the (English) Charity Commission’s guidance that the charitable sport purpose is “to promote health by involving physical or mental skill or exertion and which are undertaken on an amateur basis.

Community Amateur Sports Clubs (CASCs)

These are not charities, but get many charitable-like (tax) benefits. We have talked about them before in a blog. For now (and having an eye to the bridge case), the key point to mention is the “sport” must be recognised by a National Sports Council (Sport England, sportscotland etc) for the organisation to be able to register as a CASC.

Rates relief

Again, we have blogged about this before (including an overview of the rates relief rules) and for the community sport organisation that does or does not qualify as a charity (under Scots law) there can be opportunities to benefit from non-domestic rates relief. Rates relief (whether as a charity or not) is not to be overlooked.

Funding

Often organisations will focus on the tax benefits associated with their status as charity, CASC or something else. Non-tax funding opportunities are often the most important consideration. And that is the situation in the bridge case- access to Lottery funding.

For more about specific sports law issues contact Stephen Goldie – 0141 245 6226 or stephen.goldie@brodies.com or Derek Stillie – 0141 245 6749 or derek.stillie@brodies.com

Alan Eccles

Partner at Brodies LLP
Alan is a Partner specialising in private client (succession, incapacity and asset protection) matters as well as the charities, third and impact sectors.
Alan Eccles