The Charities (Regulation and Administration) (Scotland) Bill ("the Bill") was introduced on 15 November 2022. If passed, the Bill will make significant changes to charity law in Scotland as it seeks to strengthen and update the current legislative framework.

Increase in transparency and accountability for charities

Certain measures introduced in the Bill are intended to address the policy intentions to increase transparency and accountability for charities and also to introduce efficiencies to the operation of the Scottish Charity Regulator (OSCR).

The key points

The measures under the Bill include requirements on OSCR to:

• include charity trustee names in the Scottish Charity Register ("the Register").

This will improve transparency and public accountability and brings the information available on the Register more in line with other regulators in the UK. The requirement on charities to notify OSCR of the changes in charity trustees may be a challenge for some. To ease that challenge it is hoped that the notification will be achieved using OSCR Online rather than via a version of the existing Notification of Changes Made Form.

• create a publicly searchable record of removed charity trustees.

This will assist, for example, charities and other bodies carrying out due diligence on prospective charity trustees. On the face of it, its practical application may be limited as it refers only to persons who have been "removed by order of the Court of Session". However, OSCR has power to include in any the entry for each person any other information which OSCR considers appropriate in relation to the person or the body to which it relates. That may include for example, where an action was raised against a person but that person then resigned before an order was granted by the Court. It will be interesting to see what OSCR proposes to include in the entry.

• keep an internal schedule of charity trustees' details.

This "off the record" internal schedule will no doubt be of use to OSCR in carrying out its functions. Although it will be "off the record", there will be transparency to the extent that OSCR is required to publish the questions it requires answers to in order to populate the schedule.

The detail

Inclusion of charity trustee names in the Register

The Bill provides that each charity's entry in the Register must include the names of each of its charity trustees. At present, the law does not require OSCR to publish on the Register any details regarding the identity of the charity trustees of a charity. The only exception is where there is no principal office of the charity – if that is the case, the name and address of one of the charity trustees is published.

A charity or any of its charity trustees will be able to apply to OSCR for a dispensation from publication if publication is likely to jeopardise the safety or security of a person or premises. This mirrors the current provisions for excluding publication of a charity's address, be whether a principal office or trustee address, on the Register.

If OSCR refuses the dispensation, the applicant can seek a review of that decision. OSCR will also be able to grant dispensations itself on safety or security grounds either to a particular charity or a class of charities, for example women's refuge charities.

In line with the current notification of changes made provisions, a charity would be required to notify OSCR of a change to its charity trustees within 3 months of the date of the change.

Record of persons removed from office

OSCR must also keep a record of persons who have been removed by order of the Court of Session from the "management or control" of any body which will include charity trustees and also senior managers.

This record must contain a separate entry for each person entered in it and must include the person's name, the date of the Court of Session order removing the person and the name of the body to which the order relates. If a waiver has been granted relating to the entry OSCR must also set out details of the waiver. OSCR is also granted discretion to set out any other information it considers appropriate to the person or the body to from which the person was removed.

OSCR must provide a facility to allow the record to be searched only by a person's name and it will not be possible to browse all removed persons. If on application, OSCR is satisfied that disclosing an entry in the record is likely to jeopardise the safety or security of any person or premises, OSCR must ensure that the entry is not disclosed to any person searching the record. OSCR may also determine other information which, though contained in the record, is not to be disclosed to any person searching it.

Schedule of charity trustees

In addition to the requirement to include the names of charity trustees on the Register, the Bill also provides that OSCR must keep "off the Register" a schedule of all charity trustees. This must contain a separate entry for each charity trustee with such information as OSCR considers appropriate.

OSCR must specify the questions about charity trustees it will require answers to for the purpose of populating the schedule and publicise those questions. OSCR will be able to retain information about a person whether or not they continue to be a charity trustee provided the information is required in connection with the performance of OSCR's functions.

These changes to Scottish charity law, particularly the public disclosure of charity trustees, are welcome and will bring information about Scottish charities up to the same standards as other parts of the UK, for example information publicly available on the register of charities maintained by the Charity Commission for England and Wales.   Please see part one, part three, and part four of our series.