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Cancer & Bowel Research Australia Ltd and Commissioner of the Australian Charities and Not-for-profits Commission [2021] AATA 3875

Brief summary of the facts

  1. Three applicants – Cancer & Bowel Research Australia Ltd, Breast Cancer Australia Ltd, and Kids Cancer Research Australia Ltd (the applicants) – applied to be registered as charities. Each applicant was incorporated as a company limited by guarantee in 2017. It was intended that the applicants would raise funds in respect of different types of cancer.
  2. The applicants were refused registration on the basis that they each had a purpose, among others, of providing private benefits to people involved in their operations (paragraph 6). The Commissioner upheld that decision on objection.
  3. Because each application involved the same issue, they were considered by the Tribunal together.
  4. On the basis of evidence given at the hearing, the Tribunal found that the applicants were founded for the purpose of duplicating and taking over the fundraising activities of another charity, Cancer and Bowel Research Association Inc (CBRA Inc) (and the trusts it administers). This was because funds raised by CBRA Inc would be required to repay a debt to the Australian Taxation Office (ATO) (paragraph 12).

Issues decided

  1. The Tribunal affirmed the decision of the ACNC Commissioner.
  2. The Tribunal found that in deciding whether each applicant was eligible for registration as a charity, the ACNC Commissioner was not limited to having regard only to their recorded purposes. It stated that the ACNC Commissioner was obliged to consider the circumstances in which each applicant was formed (paragraph 24).
  3. In reaching this decision, the Tribunal found that each applicant was formed to seek to terminate or substantially reduce CBRA Inc’s liability to the ATO by taking over its functions and donor lists and leaving it with insufficient assets to pay the liability. The Tribunal noted the three applicants would largely be duplicating the work of CBRA Inc (and of the trusts it administers) (paragraph 25).
  4. The Tribunal observed that the circumstances of the three applicants’ incorporation should be considered when determining their purposes. It found that these circumstances indicated the applicants did not have solely charitable purposes (or ancillary purposes) as required under the definition of “charity” in the Charities Act 2013 (Cth) (the Charities Act).
  5. The Tribunal also observed that the purpose of avoiding or limiting the tax liability of CBRA Inc may well be a disqualifying purpose, as defined in the Charities Act, for being contrary to public policy (paragraph 27).

Our view of the decision

  1. While the Tribunal affirmed the ACNC Commissioner’s decision to refuse to register the applicants as charities, it found that the applicants were not eligible on a different basis. The Tribunal’s decision was based on evidence about the establishment of the applicants that came out at the hearing and was not before the ACNC Commissioner.
  2. The Tribunal’s finding that the ACNC Commissioner should take into account any relevant circumstances in which the applicants were incorporated supports our approach to determining an organisation’s purpose. Apart from an organisation’s governing documents, we look at other types of evidence, including the organisation’s activities and reports, to determine whether an applicant has a charitable purpose.

Impact on guidance

  1. None