MT
SOCIAL ENTERPRISE ACT
Table of Provisions (39)
Statutory Text (39 Articles)
CHAPTER 630
SOCIAL ENTERPRISE ACT
AN ACT to regulate social enterprise organisations and their
administration.
ACT IX of 2022.
(Not yet in force)
(1)
The short title of this Act is the Social Enterprise
Act.
(2) This Act shall come into force on such date as the
Minister responsible for enterprise may by notice in the Gazette
establish, and different dates may be so established for different
provisions of this Act.
(Article 3(2)(a))
Social Enterprise Company
1. A social enterprise company shall be a private liability
company including a single member company, registered under the
Companies Act. Article 213 of the Companies Act shall not apply to
a social enterprise company for the purposes of this Act.
2. The provisions of Part V - Limited Liability Company -
of the Companies Act shall apply to the social enterprise company
subject to the following modifications
(a)
the statute of a social enterprise company shall
state that it is a social enterprise organisation taking the legal
form of a company in terms of this Act;
(b)
the statute of a social enterprise company shall
be drafted in a manner which is consistent with the provisions
of this Act regarding the statute and article 75 and the First
Schedule - Model regulations for a limited liability company -
of the Companies Act shall be construed accordingly. A social
enterprise company shall also, insofar as its statute is
concerned, comply with the requirements of article 69 of the
Companies Act and article 8;
(c)
notwithstanding anything stated in the
Companies Act it shall be permitted that all or a percentage of
the shares in the initial share capital of a social enterprise
company to be voting but non-participating so as to comply
with the requirements of this Act.
3. The reference to the objects of the social enterprise
partnership indicated in article 69(1)(8) of the Companies Act shall
also include the declaration indicated in article 8(2)(b).
4. Article 144 of the Companies Act shall prevail over
article 5.
5. (1)
Any provisions in the Companies Act relating to
dividends and to rights of participation in the profits of a company
shall be interpreted in a way so as to comply with this Act insofar as
it relates to the seventy-five per cent of income in a social enterprise
company and Chapter XI - Distribution of Profits and Assets - found
in Title I of Part V of the Companies Act shall be interpreted
accordingly.
(2) Article 204 of the Companies Act shall also apply to
any distribution that is considered to be unlawful because it is in
breach of any of the provisions of this Act and particularly article 5
when the distribution is in excess of the twenty-five per cent
permitted by this Act.
6. Title II - Dissolution and Consequential Winding Up of
Companies - found in Part V of the Companies Act shall apply to
social enterprise companies subject to the provisions of article 9.
7. Part VII - Conversion of Commercial Partnerships, Part
VIII - Amalgamation of Commercial Partnerships, and Part IX -
Division of Companies - of the Companies Act shall apply to social
enterprise companies
Provided that social enterprise companies may only
amalgamate with other social enterprise companies
Provided further that insofar as division is concerned
under this Schedule it is restricted to division within the context of
social enterprise companies only.
8. Article 402 of the Companies Act shall apply to the
shareholders of social enterprise companies in a manner which is
inconsistent and that does not breach this Act.
9. (1)
The provisions of this Act and particularly
article 19 and the Fourth Schedule regarding annual returns shall
apply in addition to Chapter X - Accounts, Audit and Annual Return -
found in Title I of Part V of the Companies Act and all other relevant
provisions of the Companies Act relating to accounts and auditing
shall apply.
(2) A social enterprise company shall not be required to
prepare any additional annual accounts for the purposes of this Act
and any regulations made thereunder. A copy of the annual accounts
prepared in accordance with the provisions of the Companies Act
shall be submitted to the Regulator who shall file such copy in the
Register of Social Enterprise Organisations.
(1)
In this Act, unless the context otherwise
requires
"acts of trade" shall be those identified in article 5 of the
Commercial Code and any transactions ancillary to or connected
with any of the said acts;
"administrator" means any person who controls, supervises or
administers a social enterprise organisation such as a director of a
company or a partner of a partnership or a member of the committee
of management of a co-operative and includes any other person who
carries out such functions even if under another name, but shall not
include a manager or an executive while carrying out functions under
a contract against remuneration except in so far as he is an
administrator and only relating to his functions as an administrator;
"applicant" means an organisation seeking to register as a
social enterprise organisation under this Act;
"benefit of the community" means what a reasonable person
might consider to be -
(a)
for the benefit of the community in Malta as a
whole; or
(b)
for the benefit of a section of the community in
Malta;
and for the purpose of this definition "section of the community"
means any group of individuals which
(i)
shares a common characteristic which may
be classified as a social purpose and which
distinguishes the group of individuals from
other members of the community; and
(ii) a reasonable person might consider to
constitute a section of the community;
"benefits" means any assistance or relief granted to a social
enterprise organisation in terms of the Income Tax Act, the Malta
Enterprise Act, the Business Promotion Act and in terms of any
other law or scheme as the Minister may prescribe;
"calendar year" means the period from 1st January to 31st
December of each year;
"charitable purpose" means a social purpose;
"Committee'' means the Social Affairs Committee of the
House of Representatives or any other committee substituting the
same;
"company" means a company formed in Malta and registered
under Part V of the Companies Act, and if not a Maltese company,
means a company established in Malta;
"controlled by, related or affiliated to a political party" or
similar terms means, in the case of the controlled, related or affiliated
organisation -
(a)
its statute, financial statements or other
documents expressly state that it is controlled by, related or
affiliated to the political party; or
(b)
it has been established by the political party
which supports it financially; or
(c)
its assets devolve on the political party upon its
dissolution,
and, in the case of a political party, that a political party as defined in
the Financing of Political Parties Act, whether registered under the
said Act or otherwise
(i)
has the power, whether directly or
indirectly, to nominate, appoint, change or
remove
more
than
half
of
the
administrators of the organisation; or
(ii) is a beneficiary, in any manner and at any
time, of the income or capital of the
organisation; or
(iii) is the beneficiary of the purposes of the
organisation, including the promotion of
the specific vision, policies and goals of
the political party or its candidates;
"controlled by the Government" means that the Government of
Malta has the power, whether directly or indirectly, to nominate,
appoint, change or remove any of the administrators of the
organisation or the organisation is a public agency;
"co-operative" means a co-operative society formed in Malta
and registered under the Co-operative Societies Act and if not a
Maltese co-operative, means a co-operative established in Malta;
"Co-operatives Board" means the Co-operatives Board
established under the Co-operative Societies Act and includes any
person exercising such powers of the Board as may have been
conferred upon him by the Board;
"Court" means the First Hall of the Civil Court unless it is
otherwise expressly stated;
"disadvantaged worker" means any person who
(a)
has not been in regular paid employment for the
previous six months; or
(b)
is between fifteen and twenty-four years of age;
or
(c)
has not attained an upper secondary educational
or
vocational
qualification
(International
Standard
Classification of Education 3) or is within two years after
completing full-time education and who has not previously
obtained his or her first regular paid employment; or
SOCIAL ENTERPRISE
(d)
is over the age of fifty years; or
(e)
lives as a single adult with one or more
dependants; or
(f)
works in a sector or profession where the gender
imbalance in Malta is at least twenty-five per cent higher than
the average gender imbalance across all economic sectors in
Malta, and belongs to that under-represented gender group; or
(g)
is a member of an ethnic minority within Malta
and who requires development of his or her linguistic,
vocational training or work experience profile to enhance
prospects of gaining access to stable employment
Provided that the Minister may by regulations establish, and
consistently with applicable European Union Regulations apply,
administrative or compliance conditions arising under Maltese law to
the above categories or add the following categories of persons to the
definition of "disadvantaged worker"
(a)
any migrant worker, whether a citizen or resident
of the European Community or third country national, who has
moved to Malta to take up work and who is registered,
enrolled or in possession of any relevant licences, permits or
documentation as may be required from time to time by
applicable law to work in Malta, including an employment
licence or permit or a National Insurance or social security
number and registration for the purposes of taxation; or
(b)
any person who wishes to enter or to re-enter
working life and who has been absent both from work and
from education for at least two years, and particularly any
person who gave up work on account of the difficulty of
reconciling his or her family life with his or her working life;
or
(c)
any long-term unemployed person, that is, any
person who has been unemployed for twelve of the previous
sixteen months; or
(d)
any person recognised to be or to have been an
addict and who is or who was on the Register of Addicts kept
by the Superintendent of Public Health in accordance with the
Registration of Drug Addicts Regulations; or
(e)
any person who has not obtained his or her first
regular paid full-time employment on account of serving a
period of imprisonment or other penal measure that appears on
such person’s Police Conduct Certificate;
"ecclesiastical entity" means an association of persons or a
universality of things which are established by the competent
ecclesiastical or other religious authority so that they might, in the
name of such authority and in accordance with the provisions of the
relevant law, fulfil the specific task entrusted to them in view of the
public good, including the imparting of religious teaching, the
promoting of public worship and the undertaking of projects which
are appropriate to their character and governed by their statutes,
under the higher direction of the said authority. Such entities include
dioceses, parishes and all institutes of consecrated life and societies
of apostolic life, and include similar organisations of any religious
denomination;
"engagement" means a contract of service other than a contract
of employment;
"established" means an organisation which, having a
permanent establishment or branch in Malta, is registered under Part
XI of the Companies Act or under any other similar provision under
applicable law and in the case of a co-operative, is also recognised as
an overseas co-operative by the Co-operatives Board;
"financial year" means the period from 1st January to 31st
December of each year unless otherwise determined in the statute of
the social enterprise organisation or otherwise in accordance with
applicable law;
"Government" includes the Government of Malta, any Local
Council, any statutory corporation, public agency and other
organisation of whatever legal form controlled by the Government
and includes the President of Malta;
"guidelines" means the set of binding rules issued by the
Regulator from time to time for the further implementation of the
provisions of this Act and any regulations made thereunder, including
the definition, application, administration, grant and revocation of
benefits, schemes and other arrangements for the regulation and
management of social enterprise organisations;
"Minister" means the Minister responsible for enterprise;
"normal market levels" means any remuneration, honorarium,
wage, salary or fee which is normally granted
(a)
by social enterprise organisations of the same
legal form and operating in the same or in a similar area of
activity and under the same or similar conditions; and
(b)
to persons in the same or in a similar office or
role and under the same or similar conditions and who have
the same or similar qualifications.
SOCIAL ENTERPRISE
In applying the above principles, reference shall be made to
market levels prevailing in Malta, or, in case of organisations which
operate internationally, in the country where the relevant activities or
transactions take place;
"partnership" means a commercial partnership formed in Malta
and registered under Part III or IV of the Companies Act, and if not a
Maltese partnership, means a partnership established in Malta;
"philanthropic" means for the relief of poverty, pain and
suffering, and other humanitarian needs;
"pious foundation" comprises -
(a)
an autonomous pious foundation, that is, an
aggregate of things destined for pious or religious purposes
and established as a juridical person by the competent
ecclesiastical or other religious authorities;
(b)
non-autonomous pious foundations, that is,
temporal goods given in any way to a public juridical person
established by the competent ecclesiastical or other religious
authorities and carrying with them a long-term obligation,
such period to be determined by applicable law, whether
religious or national, and where a long-term obligation
consists of binding the juridical person, from the annual
income, to celebrate Masses or other religious ceremonies, to
perform other determined ecclesiastical functions, or in some
other way to fulfil the pious or religious purposes as defined
by the applicable religious laws or rules;
and "pious or religious purposes" are understood to be those which
concern acts of piety, of the apostolate, or of charity, whether spiritual
or temporal and include similar organisations of any religious
denomination;
"prescribed" means either prescribed by regulations made by
the Minister under this Act or prescribed by binding guidelines issued
by the Regulator under this Act, unless otherwise expressly stated,
and in the event of a conflict between the regulations made by the
Minister and guidelines issued by the Regulator on any particular
matter, the regulations shall prevail;
"public agency" means any entity which is established to carry
out public administration in terms of the Public Administration Act
or any other law and includes a statutory body;
"Registrar" means the Registrar of Companies and the Co-
operatives Board, or any other Registrar, howsoever named, with
whom the organisations which may qualify as social enterprise
organisations in terms of this Act may or are required to register;
"Registrar of Companies" means the Registrar of Companies
appointed in terms of the Companies Act;
"Regulator" means the person appointed by virtue of article 11;
"remuneration" means any honorarium, wage, salary, fee or
other payment for services, whether under a contract or otherwise,
but shall not include the refund of any expenses incurred on behalf of
any organisation;
"social enterprise company" means a company which is
registered in terms of this Act;
"social enterprise co-operative" means a co-operative which is
registered in terms of this Act;
"social enterprise organisation" means a social enterprise
company, a social enterprise partnership or a social enterprise co-
operative which is registered in terms of this Act;
"social enterprise partnership" means a partnership which is
registered in terms of this Act;
"social enterprise sector" includes social enterprise
organisations and their employees, the administrators of such
organisations and any volunteers supporting such organisations;
"social purpose" is a purpose which is of benefit to the
community and which means any charitable or philanthropic purpose,
and without prejudice to the generality of the aforesaid, includes -
(a)
the advancement
of
education,
including
physical education and sports;
(b)
the advancement of health;
(c)
social and community advancement;
(d)
the advancement of culture, arts and national
heritage;
(e)
the advancement of environmental protection
and improvement, including the protection of animals;
(f)
the promotion of human rights,
conflict
resolution, democracy and reconciliation; or
(g)
any other purpose as may be prescribed by the
Minister by means of regulations made by virtue of this Act
but does not include a political purpose. For the purposes of this
definition ''political purpose'' means the promotion of the interests of
a political party or a political candidate, whether at local, national or
international level and "political party" shall have the meaning
assigned to it by any special law regulating political parties, whether
it is registered as a political party or not under such law, and for the
purpose of this Act shall include any other organisation, of whatever
legal form, controlled by, related or affiliated to the political party or
its purpose as stated in its statute or constitutive deed in such manner
as renders it non-autonomous, and the terms "political candidate" and
"political organisation" shall be construed accordingly;
"special law" means an Act of Parliament or any regulations
made thereunder which regulates specifically a particular legal form
or forms of organisations;
"statute" means the memorandum and articles of association of
a company, the deed of partnership or the statute of a co-operative
which provides for the setting up of such organisation as the case may
be;
"volunteer" means a person who provides unremunerated
services through or for a social enterprise organisation but who may
receive a refund of any reasonable expenses incurred in connection
with these services;
"worker with a disability" means any person who is on the
Register of Persons with Disability in terms and for the purposes of
the Persons with Disability (Employment) Act.
(2) Terms which are not specifically defined in this Act
shall have the meaning assigned to them under the relevant law
governing the legal form of the organisation qualifying as a social
enterprise organisation under this Act.
(3) In the case of social enterprise companies, social
enterprise partnerships and social enterprise co-operatives, the
Companies Act or the Co-operative Societies Act, as the case may
be, shall be interpreted so as to facilitate the application of the
provisions of this Act to the particular legal form, and this,
irrespective of the specific provisions indicated in the Schedules
intended for the same purpose.
(4) This Act is intended also to reflect the principles in the
European Union Commission Regulation No. 651/2014 of 17th
June 2014 as the same may be amended or replaced from time to time
and this Act shall be interpreted consistently with such Regulation.
Part II
Social Enterprise Organisations
(Article 3(2)(b))
Social Enterprise Partnership
1. The statute of the social enterprise partnership shall state
that it is a social enterprise organisation taking the legal form of a
social enterprise partnership in terms of this Act.
2. Any agreement to pay a share of profits in the manner
laid down in article 8 of the Companies Act shall be made in
accordance with article 5 and any other relevant provisions of this
Act.
3. (1)
In the case of death or expulsion of a partner
such partner shall only be entitled to twenty-five per cent of the
profits as permitted by this Act.
(2) There is no restriction on the return of any capital
contribution under this Act and is permitted subject to the observance
of the provisions of the Companies Act.
4. The entitlement to pro rata share of profits contemplated
in article 34(2) of the Companies Act shall be compliant with article
5 and there can be non-participating interests in the social enterprise
partnership.
5. Any relevant provisions regarding the dissolution and
winding up of social enterprise partnerships contemplated in the
Companies Act shall apply with such modifications as may be
expressly or impliedly required under the provisions of this Act and
particularly by article 9.
6. Part VII - Conversion of Commercial Partnerships - and
Part VIII - Amalgamation of Commercial Partnerships - of the
Companies Act shall apply to social enterprise partnerships
Provided that social enterprise partnerships may only
amalgamate with other social enterprise partnerships and in
accordance with any relevant provisions of the Companies Act.
7. Any distribution of any assets as contemplated in article
45, article 47 and any other relevant provisions of the Companies
Act shall only be done if it is permitted by articles 5 and 9 in the case
of social enterprise partnerships.
8. Article 66 of the Companies Act shall apply with such
modifications as may be expressly or impliedly required under the
provisions of this Act and in particular article 5 and when the
contributions have been converted into shares the principles in the
First Schedule shall apply mutatis mutandis.
9. Article 66A and the Tenth Schedule - Partnerships en
commandite or limited partnerships - of the Companies Act shall not
apply to social enterprise partnerships.
10. (1)
In the case of social enterprise partnerships, the
provisions of this Act and particularly article 19 and the Fourth
Schedule regarding annual returns shall apply, in addition to Chapter
X - Accounts, Audit and Annual Return - found in Title I of Part V of
the Companies Act and other relevant provisions regarding accounts
and auditing laid down in the Companies Act.
(2) A social enterprise partnership shall not be required to
prepare any additional annual accounts for the purposes of this Act
and any regulations made thereunder. In such cases, a copy of the
annual accounts prepared in accordance with the provisions of the
Companies Act shall be submitted to the Regulator who shall file
such copy in the Register of Social Enterprise Organisations.
(1)
A social enterprise organisation is one
(a)
which is established in the legal form of a
company, a partnership or a co-operative and which complies
with the provisions of the applicable Schedule;
(b)
which is established for
(i)
the carrying out of any act of trade or other
activity which is principally aimed,
through the activity itself, towards the
fulfilment of a social purpose for the
benefit of the community; or
(ii)
the carrying out of any act of trade or other
activity with the purpose of integrating
into the labour market workers with a
disability or disadvantaged workers;
(c)
which is not controlled by the Government; and
(d)
which is registered with the Regulator in terms
of this Act as a social enterprise organisation
Provided that for the purposes of this Act, the above
requirements shall subsist throughout the existence of the social
enterprise organisation.
(2)
A social enterprise organisation shall
(a)
in the case of a social enterprise company be
regulated by the relevant provisions of the Companies Act as
modified by the provisions of the First Schedule;
(b)
in the case of a social enterprise partnership be
regulated by the relevant provisions of the Companies Act as
modified by the provisions of the Second Schedule; and
(c)
in the case of a social enterprise co-operative be
regulated by the relevant provisions of the Co-operative
Societies Act as modified by the provisions of the Third
Schedule.
(3) Until such time as the Minister makes regulations in this
regard, organisations of other legal forms, not being companies,
partnerships or co-operatives, may not be registered as social
enterprise organisations in terms of this Act
Provided that such other organisations, including pious
foundations, ecclesiastical entities and voluntary organisations,
whether enrolled or not under the Voluntary Organisations Act, may
be the holder of any or all the shares or interests in a social enterprise
organisation.
(Article 3(2)(c))
Social Enterprise Co-operative
1. The statute of the social enterprise co-operative shall
include a statement that it is a social enterprise organisation taking
the legal form of a social enterprise co-operative.
2. Insofar as the name of a social enterprise co-operative is
concerned it shall be required to comply with article 24 of the Co-
operative Societies Act and with article 8(3), (4) and (5) and the
social enterprise co-operative shall have the word "co-operative
limited" or the abbreviation "co-op ltd." at the end of its name as
required by article 24(2)(b) of the Co-operative Societies Act after
the words "Social Enterprise" or the letters "SEO".
3. Article 34(2) and the Second Schedule of the Co-
operative Societies Act shall apply as modified by article 8 and any
other relevant provisions of this Act and the provisions of this Act
shall prevail over the provisions of the Co-operative Societies Act
insofar as the statute of a social enterprise co-operative is concerned.
4. (1)
The description of a co-operative laid down in
article 21(1) of the Co-operative Societies Act shall insofar as social
enterprise co-operatives are concerned be construed in accordance
with articles 3 and 4 and in the event of conflict between the
provisions of the Co-operative Societies Act and this Act, this Act
shall prevail.
(2) The Third principle - Member economic participation -
laid down in article 21(2) of the Co-operative Societies Act shall be
compliant with articles 5 and 9 and any other applicable provision of
this Act and a social enterprise co-operative can define interests as
non-participating.
5. The proviso to articles 10 and 12 of the Co-operative
Societies Act shall not apply to social enterprise co-operatives and
the provisions of this Act shall prevail.
6. Article 40 of the Co-operative Societies Act shall apply
as modified by article 5 and the provisions of this Act shall prevail
over article 40 of the Co-operative Societies Act.
7. In the case of social enterprise co-operatives, insofar as
payment of allowances, honoraria, wages or salaries are concerned as
laid down in article 77 of the Co-operative Societies Act in the event
of conflict with article 5, the provisions of article 5 shall prevail.
8. (1)
Any
considerations
and
determinations
regarding the distribution of any available net surplus referred to in
article 66 of the Co-operative Societies Act shall be made in
accordance with article 5 and any other applicable provisions of this
Act.
(2) Articles 5 and 9 shall prevail over Part VII - Property
and Funds of Societies - of the Co-operative Societies Act and
(a)
insofar as social enterprise co-operatives are
concerned the rules regarding the division surplus funds
contemplated in article 92 of the Co-operative Societies Act
shall apply as modified by article 5 and any other relevant
provisions of this Act;
(b)
insofar as social enterprise co-operatives are
concerned the rules regarding the patronage refund
contemplated in article 93 of the Co-operative Societies Act
shall apply as modified by article 5 and any other relevant
provisions of this Act;
(c)
insofar as social enterprise co-operatives are
concerned the rules regarding bonus certificates and bonus
shares contemplated in article 94 of the Co-operative
Societies Act shall apply as modified by article 5 and any
other relevant provisions of this Act.
9. Part VIII - Amalgamation - of the Co-operative
Societies Act shall apply to social enterprise co-operatives, and
social enterprise co-operatives shall only be permitted to amalgamate
with other social enterprise co-operatives.
10. Part IX - Dissolution and Liquidation of Societies - of
the Co-operative Societies Act shall apply as modified by article 9
and the provisions of this Act shall prevail over Part IX of the Co-
operatives Societies Act insofar as dissolution and liquidation of
social enterprise co-operatives are concerned and in the event of any
conflict between the provisions of the Co-operative Societies Act and
the provisions of this Act, the provisions of this Act shall prevail.
11. (1)
The Third Schedule - Form and Content of
Individual Accounts - including any other provisions of the Co-
operative Societies Act relating to accounts and auditing shall apply
to social enterprise co-operatives but they shall be construed in
accordance with the provisions of this Act.
(2) A social enterprise co-operative shall not be required to
prepare any additional annual certified accounts for the purposes of
this Act and any regulations made thereunder. A copy of the annual
accounts certified shall be submitted to the Regulator who shall file
such copy in the Register of Social Enterprise Organisations.
(1)
For the purposes of article 3, a social enterprise
organisation shall be considered to be
(a)
carrying out an act of trade or other activity
which is principally aimed, through the activity itself, towards
the fulfilment of a social purpose for the benefit of the
community when at least sixty per cent of its total income in
any financial year is acquired from such act of trade or other
activity; or
(b)
carrying out an act of trade or other activity with
the purpose of integrating into the labour market workers with
a disability or disadvantaged workers when not less than thirty
per cent of the total number of workers engaged or employed
by it on a full-time basis, in any capacity, are workers with a
disability or disadvantaged workers.
(2) For the purposes of sub-article (1)(b), the minimum
requirement of thirty per cent of full-time workers with a disability or
disadvantaged workers may also be satisfied by a greater number of
eligible persons working on a part-time basis but cumulatively
working the equivalent hours to the required number of full-timers.
(3) A social enterprise organisation may make use of the
services of volunteers participating in the activity of such social
enterprise organisation.
(Article 19)
Annual return
Purpose.
The purpose of this annual return is to provide the Regulator
with up to date information about the social enterprise organisation,
its administrators and its activities, generally. It is important that the
exercise be qualitative in that the persons preparing the annual return
must give a true account of the facts.
Name of Social Enterprise Organisation: ..................................
Social Enterprise Label: ............................................................
Address: ...................................................................................
Postcode ...................................................................................
Telephone number(s): ...............................................................
Fax number: ..............................................................................
E-mail address/es: .....................................................................
Website: ....................................................................................
Name of Contact Person: ..........................................................
Designation: .............................................................................
Mobile/Telephone Number: ......................................................
Annual Return for the twelve month period .............................
If the social enterprise organisation must nominate a local
representative in terms of the Act please provide the details of the
local representative below. It must be ensured that the address that is
included is the address of the local representative in Malta.
Name and Surname: ..................................................................
ID Card/ Passport / Registration Number: ................................
Address: ....................................................................................
Postcode: ..................................................................................
Telephone number(s): ...............................................................
Mobile number: ........................................................................
E-mail address/es: .....................................................................
Declaration of Completeness and Correctness.
I hereby confirm that the details provided, including the
attached Appendices, are complete and truthful as to their contents.
Signature of administrator: .........................................
Name of administrator: ..............................................
Date: ..........................................................................
Appendices
Appendix A - Organisational Chart _____________________
Appendix B - an authenticated updated copy of the statute of
the social enterprise organisation as issued by the Registrar, if any
amendments have been made to such statute and in such case a
declaration signed by at least one administrator stating what
amendments have been made _______________________________
Appendix C - a copy of the annual accounts together with a
report of reviewers, accountants or auditors as may be required under
applicable law____________________________________________
Appendix D - a copy of the annual report _________________
Appendix E - a copy of the business plan _________________
Appendix F - an authenticated copy of any renewed identity
cards or passports or registration certificates of the administrators and
local representative of the social enterprise organisation (if
applicable) ______________________________________________
(1)
Subject to the provisions of sub-article (2), the
profits generated from the activities of a social enterprise
organisation may be
(a)
used in any manner as may be determined by the
administrators to achieve the purposes of the organisation as
stated in its statute;
(b)
retained and transferred to a reserve account for
future use;
(c)
used to capitalise its profits; or
(d)
used as may be prescribed and in a manner
which is consistent with the achievement of the purposes of
the organisation.
(2) Notwithstanding anything stated in the statute of a social
enterprise organisation or in any other applicable law, only twenty-
five per cent (25%) of the profits generated over a three (3) year
rolling period by the social enterprise organisation may be distributed
and it shall not be permissible for any person, whether a private
interest or a non-profit making organisation, to enjoy directly or
indirectly more than twenty-five per cent (25%) of the profits through
the holding of shares or other interests in such organisation, or in any
other manner.
(3) The social enterprise organisation shall be obliged to
maintain records of capital contributions to the organisation that are
clearly distinct from any profits which are subsequently capitalised
including when they are capitalised against the issue of shares or
other interest to the shareholders or partners of the social enterprise
organisation. Nothing in this article shall prohibit the reduction or
return of capital in favour of a person who holds any shares or
interest in any social enterprise organisation provided it does not
reflect capitalised profits and if it does, does not exceed the limits in
sub-article (2) and the organisation has available funds after
providing for any losses.
(4) Notwithstanding the provisions of sub-article (2), it shall
be lawful for any person, including a shareholder within an
organisation or any person having an interest therein, to receive
income from a social enterprise organisation for his personal benefit
in the following cases
(a)
income under contracts of employment or
engagement;
(b)
income for the sale of goods or services;
(c)
interests on loans granted to a social enterprise
organisation to finance the development or operations of such
organisation even when such income is payable on a bond or
other financial instrument
Provided that such income or interest shall not be treated
as participation in the profits of the organisation and shall not be
considered to form part of the maximum of twenty-five per cent of
the profits referred to in sub-article (2).
(5)
A social enterprise organisation shall not
(a)
remunerate an administrator at a rate which is
higher than normal market levels unless the social enterprise
organisation is satisfied that the administrator has specific
skills which the organisation needs, in which case, the
remuneration may exceed normal market levels by such
percentage as may be stated in guidelines issued by the
Regulator or as otherwise approved by him;
(b)
remunerate any person, whether an employee or
otherwise, with a salary, wage or a fee which is higher than
normal market levels unless the social enterprise organisation
is satisfied that in that particular case specific conditions
apply;
(c)
pay interest or other remuneration on loans or
financial instruments raised or acquired from organisations
which are not licensed credit or financial institutions other
than in accordance with applicable market conditions or, in
any case, not in excess of the limits permitted by article 986 of
the Civil Code or as otherwise allowed by law; or
(d)
pay a price for any property acquired which is
higher than the generally established market price for such
property disregarding special discounted sales or other special
arrangements
Provided that the basis on which a social enterprise
organisation satisfies itself of such compliance shall be recorded in
sufficient detail in the minutes of a meeting of the administrators
when such decision is taken, which minutes shall be submitted to the
Regulator on written demand
Provided further that in the event that any of the above
limits are exceeded
(a)
if to the benefit of any holder of any shares or
interests, the sum paid to him in excess of the market levels as
stated above shall be considered to be an advance on the
twenty-five per cent permitted to be paid to him; and
(b)
if to the benefit of a third party, the excess shall
be brought to the attention of the administrators who shall be
entitled to make representations on the matter to the Regulator
and, if found to be unjustifiable, the excess shall either be
refunded to the organisation within the time stipulated by the
Regulator or the Regulator may proceed with the cancellation
of the registration and the demand for the reversion of any
benefits in accordance with this Act.
(6) In the case of those organisations which are registered as
social enterprise organisations under the provisions of article
3(1)(b)(i), the administrators shall seek to maintain a level of
expenses for persons who are employed or engaged which shall not
materially prejudice the continued functioning of the social enterprise
organisation. The Regulator may issue guidelines on the level of
these expenses and also on the manner and the time frame in which
this obligation shall be assessed.
(7) It shall be the responsibility of the administrators of a
social enterprise organisation to ensure compliance with the
provisions of this article. When an accountant, reviewer or auditor is
engaged to review the accounts of the social enterprise organisation,
such accountant, reviewer or auditor shall notify the administrators in
writing, with a copy to the Regulator, if the social enterprise
organisation has exceeded the limits established by this Act. In such
case, the Regulator shall notify the administrators with a time limit to
comply with the provisions of this Act, which shall not be less than
ninety days and the maximum of which shall be established by the
Regulator on a case by case basis.
(8) The performance of the purposes to which the profits of
the social enterprise organisation are applied shall be an express
fiduciary duty binding the administrators of the social enterprise
organisation and the social enterprise organisation itself.
(9) The provisions of this article shall apply irrespective of
the manner in which the persons involved in the social enterprise
organisation hold shares or other participation rights therein and in
the case of a conflict between this article and the provisions of any
other law the provisions of this article shall prevail.
(1)
A social enterprise organisation may, subject to
the observance of this Act and to applicable provisions of law, enjoy
the benefits contemplated by this Act and any regulations made
thereunder.
(2) Upon receiving benefits, it shall not be possible for a
social enterprise organisation to transfer or assign in whole or in part
any benefit granted by virtue of this Act to any other person.
(3) When granting benefits to social enterprise
organisations, the Government or any other entity shall consult and
may rely on the information contained in the Register of Social
Enterprise Organisations maintained by the Regulator.
(4) In the event that a social enterprise organisation does not
operate as such in the twelve consecutive months following the
receipt of any benefit, and is subsequently removed from the Register
in accordance with this Act, such social enterprise organisation shall
refund any benefits received with reference to the period during
which it did not operate and failure to do so shall constitute an
offence under this Act. This article shall apply in accordance with
regulations and guidelines which may be issued from time to time.
The Government, government departments, public
agencies and entities controlled by the Government shall act upon a
Certificate of Recognition issued in terms of article 18, as evidence of
the status of an organisation as a social enterprise organisation, and
shall not require any further evidence of its existence or status when
dealing with such an organisation
Provided that such certificate shall not imply any
exemption of such organisation from any procedure, duty, obligation,
liability, fees or dues unless expressly stated in the applicable law,
regulation or policy.
Part III
The Statute of the Social Enterprise Organisation
(1)
The contents of the statute of a social enterprise
organisation shall be regulated by the law which is applicable to the
particular legal form with such modifications as are stated in this Act
and the relevant Schedule, as the case may be, and in the case of
conflict, the applicable provisions of this Act and the relevant
Schedule shall prevail.
(2) The statute of an applicant shall comply with the
following requirements for it to be eligible for registration as a social
enterprise organisation
(a)
the name of the social enterprise organisation
shall comply with sub-article (3);
(b)
the objects for which the social enterprise
organisation is established shall state that the organisation is
established for
(i)
the carrying out of an act of trade or other
activity which is principally aimed,
through the activity itself, towards the
fulfilment of a social purpose for the
benefit of the community and, in such
case, the social purpose shall be expressly
stated; or
(ii)
the carrying out of an act of trade or other
activity with the purpose of integrating
into the labour market workers with a
disability or disadvantaged workers;
(c)
the statute shall also
(i)
state that the organisation is a social
enterprise organisation in terms of this
Act;
(ii) state that investments in the social
enterprise organisation to receive profits
shall not entitle any person to participate
in more than an aggregate of twenty-five
per cent (25%) of the profits of the social
enterprise organisation as per article 5;
(iii) restrict the rights of participating shares,
or contributions, or any interest as the case
may be in the social enterprise
organisation so as to comply with the
provisions of this Act and a waiver of
participating rights on dissolution and
winding up;
(iv)
provide for the manner in which the
remaining assets, if any, of the social
enterprise organisation shall devolve on
dissolution and winding up, which
provision shall comply with article 9.
(3) The social enterprise organisation shall be identifiable
by a unique name which shall conform to the applicable law and
which shall include the words "Social Enterprise" or "SEO" in its
name.
(4) No other organisation shall be permitted to use the
words "Social Enterprise" or the letters "SEO" in its name unless it is
one which is registered in terms of this Act and any breach of this
sub-article shall constitute an offence under this Act.
(5) The Regulator shall refuse registration if, to the best of
his knowledge, the name of the applicant is already used by another
social enterprise organisation or if the proposed name is offensive or
is likely to deceive or be misleading
Provided that in the event that a social enterprise
organisation has been registered with a name which is already used
by another social enterprise organisation, the Regulator shall request
the social enterprise organisation which has been last registered to
change its name.
(6) Additions or alterations to the statute of a social
enterprise organisation shall be notified to the Regulator within
fourteen days from the date of registration with the Registrar of the
resolution or decision, which information shall be submitted to the
Regulator together with any consolidated version of the statute filed
with the Registrar.
Part IV
Dissolution, Winding Up or Cessation
On dissolution and winding up of a social enterprise
organisation made in accordance with the law applicable to its legal
form, any assets after the payment of all liabilities shall be paid out
(a)
to another social enterprise organisation
expressly identified in the statute having similar purposes as
the social enterprise organisation being dissolved; or
(b)
to a social enterprise organisation identified by
the members in a decision supported by at least seventy-five
per cent of all the members and at least a majority of the
administrators present at a meeting of administrators; or
(c)
in the case of any obstacle which cannot be
overcome in the manner stated above, to a social enterprise
organisation identified by the Civil Court in its voluntary
jurisdiction following an application made by any
administrators of the social enterprise organization being
dissolved; or
(d)
in any other manner as may be prescribed
Provided that in case any profits have been capitalised
and not distributed as permitted under this Act to the holders of
shares or interests in a social enterprise organisation, the organisation
may distribute such capitalised profits to the holders of the shares or
interests limitedly up to an amount which does not exceed twenty five
per cent of the capitalised profits being an amount which is calculated
after the organisation has settled all its liabilities and made adequate
provisions for any losses.
(1)
It shall be an obligation on all administrators of a
social enterprise organisation which for any reason ceases to operate
as such or to qualify as a social enterprise organisation in terms of
this Act to bring the facts to the attention of the Regulator within
three (3) working days, and, in such case, the Regulator shall cancel
the registration of the social enterprise organisation.
(2) The social enterprise organisation may also resolve not
to continue to operate as such by a resolution of the holders of the
shares or participating interests therein and may, subject to the other
provisions of this Act, resolve to continue the operations of the
organisation without the benefits under this Act, in which case article
22(2) and (5) shall apply mutatis mutandis.
Part V
The Regulator of Social Enterprise Organisations
(1)
There shall be a Regulator of Social Enterprise
Organisations who shall be appointed by the Minister following
consultation with the Committee for this purpose.
(2) The Regulator shall be appointed for a period of three
years and may be re-appointed upon expiration of the term of office
for a further period or periods.
(3) A person shall not be qualified to be appointed or
continue to hold office as Regulator if such person
(a)
is a Judge, a Magistrate, a Member of the House
or a Local Council, or running for election to the House, a
Local Council, or to the European Parliament; or
(b)
is legally incapacitated or interdicted; or
(c)
has been declared bankrupt or has made a
composition or arrangement with his creditors; or
(d)
has been convicted of a crime affecting public
trust or theft or fraud, or of knowingly receiving property,
obtained by theft or fraud, a crime affecting the good order of
the family or of an offence against this Act.
(4) During his term as Regulator, such person shall not hold
any position which results in a conflict of interest or is incompatible
with the correct performance of his official duties as Regulator or
with the impartiality expected from this office or with the public
confidence therein.
(5) When the office of the Regulator becomes vacant, a
person appointed as Regulator shall hold office temporarily until a
successor is appointed and, subject to the qualifications in sub-article
(3), the Minister may, at any time, during the absence of the
Regulator or for any other temporary purpose where the Minister
considers it necessary to do so, appoint a person to act in the office of
the Regulator, until the resumption of office by the Regulator.
(6) The Minister may also appoint one or more Deputy
Regulators to assist the Regulator as directed by him and in the
performance of his functions.
(7) The Regulator shall receive such remuneration as the
Minister may establish and shall be provided with premises and an
adequate number of staff to carry out the functions assigned to him
under this Act. The officials and staff appointed to assist the
Regulator shall receive such remuneration as the Minister may
establish.
(1)
The Regulator may, at any time, be removed or
suspended from office by the Minister after consultation with the
Committee on the grounds of proved inability to perform the
functions of the office of the Regulator or due to proved
misbehaviour
Provided that if the Committee is not constituted or if
Parliament is not in session, the Regulator may be suspended from
office by the Minister, acting in accordance with his own discretion,
for proved inability to perform the functions of the office or due to
proved misbehaviour to the satisfaction of the Minister, but any such
suspension shall not continue to be in force beyond two (2) months
after the Committee is constituted and Parliament is in session.
(2) The Regulator may, at any time, resign from office by
notice in writing addressed to the Minister.
(1)
The Regulator shall perform the duties and
exercise the functions imposed and conferred on him by this Act and
by any regulations made thereunder including
SOCIAL ENTERPRISE
(a)
providing registration facilities for applicants
which are eligible for registration in terms of this Act;
(b)
accepting or refusing applications from
applicants to register as social enterprise organisations in
terms of this Act;
(c)
maintaining and updating the Register of Social
Enterprise Organisations;
(d)
monitoring the activities of social enterprise
organisations in order to ensure that they comply with their
statute, with the provisions of this Act, any regulations and any
guidelines made thereunder and to ensure that the social
enterprise organisation implements the necessary policies,
regulations and reporting structures to ensure accountability
and transparency in their operations;
(e)
monitoring the behaviour of the administrators
of social enterprise organisations to ensure the observance of
high standards of accountability and transparency and
compliance with law;
(f)
investigating any complaints relating to social
enterprise organisations or organisations purporting to be
social enterprise organisations and their activities,
investigating ex officio any social enterprise organisation for
any shortcomings and taking such action as is in his power to
redress any justified grievance that may come to his notice,
including referring his findings to the Police;
(g)
ensuring that the social enterprise organisation
achieves its purposes and protects its capital base while
developing operational surpluses to ensure sustainability;
(h)
co-ordinating and communicating with each
Registrar and with any competent authority
(i)
to facilitate the registration processes for
social enterprise organisations and to
ensure the continuous monitoring and
eligibility
of
social
enterprise
organisations in terms of this Act;
(ii)
to establish procedures to ensure that the
Regulator and each Registrar are aware of
the status of a social enterprise
organisation at all times and of any
investigation or action which is being
taken in respect of such social enterprise
organisation;
(i)
promoting the social enterprise sector,
developing
co-operation
between
social
enterprise
organisations and the Government and co-operation between
social enterprise organisations amongst themselves;
(j)
making recommendations to the Minister on
legislation and policies in support of social enterprise
organisations and the social enterprise sector in general;
(k)
assisting Government, government departments,
public agencies, authorities and entities controlled by the
Government in preparing and reviewing policies in support of
social enterprise organisations and the social enterprise sector
in general;
(l)
performing any other function or duty that is
assigned to him under this Act and any regulations made
thereunder as well as such other functions as may be assigned
to him under any other law;
(m)
the extension of these regulations and
obligations to other organisations that he considers as
achieving the same objectives set out in the law. In these
instances, the Regulator may apply temporary derogation in
relation to profit distribution, engagement of volunteers and
the employment of disadvantaged workers according to the
exigencies of the case.
(2) In the exercise of his functions, the Regulator shall act
impartially and shall not be subject to the direction of any other
person or authority.
(3) The Regulator may by writing under his hand, delegate
to any person specific functions, powers or authorities assigned to or
conferred on him by this Act or any other law, and may at any time
revoke or vary such delegation
Provided that no such delegation shall be deemed to
divest the Regulator of any of his functions, powers or authorities and
he may, if he thinks fit, exercise such functions, powers or authorities
collaterally with the person so delegated.
(4) The provisions of article 72 of the Financial
Administration and Audit Act shall not apply to the Regulator or
any other person carrying out his functions in terms of this Act.
(1)
The Regulator shall seek to encourage an
environment where the credibility and good reputation of the social
enterprise sector is continually enhanced through high standards of
operation of social enterprise organisations and their administrators,
of transparency and public awareness and of proper accountability.
(2) The Regulator shall promote and facilitate the
development of the social enterprise sector by complying with the
obligations imposed and conferred on him by this Act and any
regulations made thereunder including
(a)
providing assistance with regard to any matter
relating to social enterprise organisations; and
(b)
promoting and publicising any measures meant
to support the social enterprise sector.
(3) The Regulator, in order to better implement and
safeguard the principles of this Act, may issue binding guidelines
regarding
(a)
the social enterprise sector in general and social
enterprise organisations and their activities and the
requirements, benefits and responsibilities deriving from
registration in terms of this Act;
(b)
when a social purpose may be considered to
benefit the community or a section of the community;
(c)
persons
involved
in
social
enterprise
organisations, including -
(i)
their remuneration, in so far as they act as
administrators;
(ii) their employment or engagement and the
remuneration payable to them; and
(iii) the supply of goods or services by them
under a contract of engagement to the
social enterprise organisation, including by
volunteers,
and this, for the better performance of their role and for the
better achievement of the objectives of the social enterprise
organisation in which they serve;
(d)
the provision of loans or other financial
assistance with or to a social enterprise organisation;
(e)
the sale of goods and services to a social
enterprise organisation; and
(f)
the relevant market rates or margins applicable
to social enterprise organisations.
(4) The Regulator may request any information from any
Government entity, public authority or department in order to fulfil
his duties and such entities shall co-operate with the Regulator as
required in the performance of his functions under this Act, and this,
in accordance with any special law which may be applicable
Provided that information obtained under this article
shall only be used to the extent and only for the purposes required for
the implementation of the provisions of this Act and the avoidance of
any abuse and shall be kept confidential by the Regulator under the
same duty of confidentiality binding the other entity providing the
information.
(1)
The Regulator shall, by not later than eight
weeks after the end of each calendar year, make and present to the
Minister an annual report which shall include
(a)
a report of the Regulator’s activities during the
preceding year including those relating to the monitoring of
social enterprise organisations;
(b)
a general description of the circumstances of the
social enterprise sector in Malta and any developments which
may have affected such sector;
(c)
any recommendations regarding legislation,
regulation, policies or other matters affecting the social
enterprise sector; and
(d)
the accounts and other financial records referred
to in sub-article (2), duly audited, together with a copy of any
report made by the auditor on such accounts.
(2) The Regulator shall cause to be kept proper accounts
and other financial records in respect of the operations of his office,
and shall cause to be prepared a statement of accounts in respect of
each financial year. The accounts of the Office of the Regulator shall
be audited by an auditor to be approved by the Minister.
Part VI
Register of Social Enterprise Organisations
(1)
There shall be a Register of Social Enterprise
Organisations (hereinafter referred to as "the Register") which shall
be maintained by the Regulator and shall contain the following
information, supported by the documentation referred to in
paragraphs (f) to (l), as the same may be amended or updated as may
be prescribed
(a)
the name of the social enterprise organisation;
(b)
the address of the social enterprise organisation;
(c)
the social enterprise label of the social enterprise
organisation;
SOCIAL ENTERPRISE
(d)
the names, identity card numbers or passport
numbers or registration numbers, if any, accompanied by an
authenticated copy of a valid identification document or
registration certificate, as applicable, and the residential
addresses of the administrators of the organisation;
(e)
if the administrators of the social enterprise
organisation are all not ordinarily resident in Malta, the name,
identity card number or passport number or registration
number if any, including an authenticated copy of a valid
identification document of a person ordinarily resident in
Malta who shall act as local representative of such social
enterprise organisation in Malta;
(f)
an authenticated copy of the statute of the social
enterprise organisation and any amendments made thereto;
(g)
an authenticated copy of the social enterprise
organisation’s certificate of registration issued by the
Registrar;
(h)
the annual accounts of the social enterprise
organisation, together with a report of reviewers, accountants
or auditors as may be required under applicable law;
(i)
the annual reports of the social enterprise
organisation;
(j)
an organisational chart of the social enterprise
organisation;
(k)
the social impact report of the social enterprise
organisation;
(l)
the written consent of the administrators to hold
office as administrators of the social enterprise organisation
after registration;
(m)
a resolution signed by the administrators of the
social enterprise organisation indicating that they resolve to
register the social enterprise organisation with the Regulator;
and
(n)
any other information which, in the opinion of
the Regulator, should be included in the Register.
(2) The list of names of social enterprise organisations in
the Register shall be available upon written request. No other
information or contents of the Register other than the name of the
social enterprise organisation and its social enterprise label shall be
available except to the competent authorities granting benefits as
referred to in this Act.
(3) The Regulator shall compile and maintain the Register
in accordance with the provisions of the Data Protection Act.
(1)
An applicant may apply for registration by
submitting the prescribed application form to the Regulator, which
form shall be accompanied by
(a)
an authenticated copy of the statute of the
applicant;
(b)
an authenticated copy of the applicant’s
certificate of registration or, if not yet registered, an
undertaking to provide an authenticated copy of the applicant’s
certificate of registration issued by the Registrar when the
organisation is registered with the Registrar;
(c)
an authenticated copy of the identity card or
passport or certificate of registration of the administrators of
the applicant;
(d)
an authenticated copy of the identity card or
passport or certificate of registration of the local representative
of the applicant, if any;
(e)
the annual accounts of the applicant for the last
financial year prior to registration, if any, together with a
report of reviewers, accountants or auditors as may be required
under applicable law;
(f)
the annual report of the applicant for the last
financial year prior to registration, if any, which must include
(i)
a description of the activities carried out
by the applicant; and
(ii) if the applicant is one which may be
classified under article 3(1)(b)(i), an
indication of the social purpose being
fulfilled through the carrying out of the act
of trade or other activity; or
(iii) if the applicant is one which may be
classified
under
article
3(1)(b)(ii),
information
regarding
the
persons
employed or engaged by the applicant
particularly the workers with a disability
or the disadvantaged workers;
(g)
an organisational chart of the applicant which
shall be signed by at least one administrator and shall include
(i)
the organisational
structure
of
the
applicant;
SOCIAL ENTERPRISE
(ii)
an indication of who the ultimate
beneficial owners of the shares or interests
in the applicant are;
(iii) a depiction of the management and
administrative structure of the applicant,
showing the responsibility of each board
and any working groups, the relationship
of each board and any working groups to
each other, and the hierarchy of
management and administration;
(iv) an indication of who is responsible for the
day to day running of the applicant;
(v) to demonstrate the basis of the application
of the provisions of this Act, the names
and identification numbers of any
employees and, in the case of an applicant
which may be classified under article
3(1)(b)(ii), the persons who qualify;
(vi) information regarding the number of
volunteers;
(h)
a social impact report which indicates the
primary social objective or objectives of the organisation and
the manner in which the applicant intends to achieve these
social objectives together with the manner in which the
applicant intends to operate so as not to
(i)
prejudice the fulfilment of the social
purpose for which it was established, if the
applicant is one which may be classified
under article 3(1)(b)(i);
(ii) prejudice the integration into the labour
market of disadvantaged workers or
workers with a disability if the applicant is
one which may be classified under article
3(1)(b)(ii);
(iii) grant gratuitous distributions from the
profit or bonuses to its administrators,
employees or other officers which will
lead to the same results indicated in sub-
paragraphs (i) and (ii);
(i)
the written consent of the administrators to hold
office as administrators of the applicant after registration;
(j)
a resolution signed by the administrators of the
applicant indicating that they resolve to register the applicant
with the Regulator;
(k)
the application fees due to the Regulator; and
(l)
any other document as may be required by this
Act or as may be prescribed.
(2) In considering an application, and at any time thereafter,
the Regulator may request the applicant to provide further
information about or make representations on any matter on which he
may have reservations or concerns in relation to the application.
(3) The Regulator may accept or refuse any application for
registration on the basis of
(a)
the observance or otherwise of all the formalities
required by this Act or as may be prescribed;
(b)
the presence or otherwise of any factors which
bar registration under an express provision of this Act or as
may be prescribed;
(c)
the legality or otherwise of the proposed
purposes and objects of the applicant having regard to the
stated purposes and objects of the applicant and the stated
intentions of the promoters relating to its activities;
(d)
the fulfilment or otherwise of obligations
relating to the payment of social security contributions in
accordance with applicable law; or
(e)
the fulfilment or otherwise of obligations
relating to the payment of taxes due in accordance with
applicable law.
(4)
The Regulator shall
(a)
pay due regard to all information provided and
representations made, but in the event that the applicant fails
to provide any requested information or to make
representations, the Regulator shall proceed with the
determination of the application for registration on the basis of
the information available to him;
(b)
determine whether the applicant is eligible for
registration as a social enterprise organisation;
(c)
notify the applicant, in writing, of his
determination, and in the case of a decision not to accept an
application, the reasons for such determination.
(5) The Regulator shall seek to determine all applications
from the date of application.
(6) The Regulator shall issue a confirmation of eligibility to
register the applicant as a social enterprise organisation so as to
facilitate the registration of the applicant, or of an amendment to its
statute so as to comply with this Act, with the Registrar who shall
proceed with registration in terms of applicable law on being satisfied
with compliance with such law keeping in view the modifications
made in accordance with this Act.
(1)
Upon being satisfied that the applicant is eligible
for registration in terms of this Act, and upon receiving an
authenticated copy of the applicant’s certificate of registration or an
authenticated copy of the applicant’s updated statute so as to comply
with this Act issued by the Registrar, the Regulator shall proceed to
register the applicant as a social enterprise organisation and shall
(a)
allocate a unique registration number to the
social enterprise organisation which shall be preceded by the
letters "SEO", which letters and numbers shall cumulatively be
referred to in this Act as the "social enterprise label";
(b)
enter the particulars of the social enterprise
organisation in the Register; and
(c)
issue a certificate of recognition including the
social enterprise label of the social enterprise organisation.
(2) The social enterprise label shall, at all times, be quoted
by the social enterprise organisation on any published materials,
letters, notices, advertisements and other documents issued by such
social enterprise organisation.
(3) Certificates of recognition shall be considered to be
public instruments and shall be surrendered to the Regulator on his
simple demand in writing. The Regulator shall be bound to provide
written reasons for any withdrawal of a certificate of registration
when making such written demand.
(4) The certificate of recognition issued in terms of this
article shall not determine the fiscal status of a social enterprise
organisation or the taxability or otherwise of its income and
transactions.
(5) The administrators of a social enterprise organisation
may, upon a resolution of the holders of shares or other participating
rights therein, request the removal of the organisation from the
Register upon giving three months notice to the Regulator and, in
such case, the Regulator shall proceed to cancel the registration
subject to the issue of any orders under article 22(5) which he may
consider appropriate.
(1)
A social enterprise organisation shall submit the
annual return found in the Fourth Schedule to the Regulator by the
end of each calendar year. In default, there shall be a penalty of
twenty-five euro (€25) for each month of delay. In the event of non-
compliance for a year, the registration of the social enterprise
organisation shall be duly cancelled and all benefits shall be refunded
and reimbursed immediately.
(2) The annual return for social enterprise organisations
shall cover a calendar year from the first day of January to the thirty
first day of December of each year
Provided that
(a)
if a social enterprise organisation was registered
between the first day of January and the thirtieth day of
September of any year, it shall file the annual return normally
but such annual return shall, for the first year only, cover a
period of less than twelve months since its registration;
(b)
if a social enterprise organisation was registered
between the first day of October and the thirty-first day of
December of any year, it shall not file an annual return for its
first year of registration but it shall file, for the second year
only, an annual return up to the thirty-first day of December
following the year of registration for a period over twelve
months but not exceeding fifteen months.
(3) The annual return and all the required documents
relating to a social enterprise organisation shall be filed by not later
than the thirtieth day of April of the following year.
The Regulator may request any information and any
clarification from the social enterprise organisation, and may also
carry out any verification, investigation or audit so as to ascertain to
his satisfaction that such social enterprise organisation is in
compliance with the provisions of this Act or as may be prescribed.
The registered social enterprise organisation shall seek to comply
with this request expediently and in default the Regulator may cancel
the registration of the social enterprise organisation.
(1)
The Regulator may order the cancellation of the
registration of a social enterprise organisation by the issue of a
cancellation order, which shall come into effect thirty days from the
date of notification of such order, to all or any one of the
administrators, unless an application is filed within the period
provided for in article 26 in which case such order shall only have
effect if so determined and from the date established by the Court.
(2) A cancellation order may be issued if the social
enterprise organisation
(a)
is not pursuing the purposes stated in the statute;
(b)
is carrying out unlawful activities or is acting in
contravention of the provisions of any law;
(c)
is failing to comply with the provisions of its
statute or of this Act or as may be prescribed or the
administration thereof is being carried out to poor standards of
corporate governance and continues to be so carried out for a
period in excess of three months notwithstanding a written
warning by the Regulator;
(d)
is distributing profits directly or indirectly in
excess of the twenty-five per cent permitted under this Act;
(e)
appears to have continued operating after it has
been formally dissolved;
(f)
has not functioned for a period which exceeds
twelve consecutive months;
(g)
is not seeking to uphold and maintain the
objectives of this Act;
(h)
is using its certificate of recognition in an
incorrect manner or has committed a forgery thereof; or
(i)
has obtained registration on the basis of
materially incorrect or incomplete information that would have
otherwise resulted in a refusal had the correct or complete
information been known to the Regulator.
(3) Prior to ordering the cancellation of the registration of a
social enterprise organisation by the issue of a cancellation order, the
Regulator shall grant the social enterprise organisation a period of
time in which to regularise its position and conform with the
provisions of this Act. If the social enterprise organisation does not
do so within this stipulated time period, which may be extended by
the Regulator at his discretion, the Regulator shall order the
cancellation of the registration of the social enterprise organisation in
accordance with sub-article (1).
(4) The Regulator may appoint any person to assist the
social enterprise organisation to regularise its position.
(5) Until a cancellation order comes into effect in
accordance with sub-article (1), the affairs of the social enterprise
organisation shall continue to be administered by the administrators
who shall only carry out acts of ordinary administration or, in case
where judicial proceedings are pending, such acts as may be
authorised by the Regulator or the Court.
(6) The cancellation order shall include all determinations
under such terms and conditions as the Regulator or the Court, as the
case may be, may consider appropriate in the circumstances and such
order shall not however imply a restriction of the right of association
of any persons involved in the organisation or of the right of said
persons to continue to operate the organisation without the continuing
benefits of registration under this Act.
(7) The Regulator shall publish, in one local newspaper or
by means of a notice in the official website of the office of the
Regulator, as the Regulator may consider appropriate in the
circumstances of the case, any cancellation orders which have
become final with a brief statement as to the effects of the order and
such statement shall be re-published regularly for as long as the
Regulator may consider necessary to ensure that the necessary public
awareness has been achieved.
(8) The registration of a social enterprise organisation shall
terminate ipso iure if the organisation is struck off the register
applicable to its legal form by the Registrar.
(1)
In the event of the cancellation of registration of
a social enterprise organisation, the administrators shall make all the
necessary amendments to the statute of the organisation including
amending its name to remove any references to the term "Social
Enterprise" or the letters "SEO".
(2) Notwithstanding anything stated in the organisation’s
statute or in any applicable law, the administrators of a social
enterprise organisation which has been cancelled may resolve to
retain the organisation in operation and shall be deemed to have all
the necessary powers and authority to make any amendments to the
statute so as to remove any particular statutory requirements imposed
by this Act and to bring it in line with the law applicable to its legal
form should it be resolved by the administrators to retain its
registration in the relevant register.
(3) In the event of the cancellation of registration of a social
enterprise organisation, the administrators shall forthwith surrender,
to the Regulator, the certificate of recognition of such social
enterprise organisation and any person failing to surrender such
certificate within the time stated in the demand, in writing, made by
the Regulator, shall be guilty of an offence against this Act and shall
be liable, on conviction, to a fine (multa) of two hundred and fifty
euro (€250) and a fine (multa) of twelve euro (€12) for every day of
default.
(4) In the event of the cancellation of registration of a social
enterprise organisation, all benefits granted to such social enterprise
organisation by virtue of registration shall cease from the date when
the decision to cancel takes effect
Provided that such loss of benefits shall not apply to the
acts required to liquidate and dissolve the social enterprise
organisation, including any transfer of property to other social
enterprise organisations as required by the statute of the social
enterprise organisation or otherwise in accordance with article 9 or
the provisions of applicable law.
(5) Cancellation for the reasons mentioned in article 21
shall entitle the Regulator to demand in writing the refund of, or fair
compensation for, any benefits received by the social enterprise
organisation or any other person by virtue of its registration in terms
of this Act, and that demand, when done by judicial letter, issued in
accordance with article 466 of the Code of Organization and Civil
Procedure shall constitute an executive title against the organisation
or any named administrator in favour of the Regulator, in his own
name or as trustee for the person entitled to the refund or fair
compensation as aforesaid. Any person aggrieved by such order may
file an application in Court within thirty days of receipt thereof
Provided that there shall lie an appeal to the Court of
Appeal from any confirmation of liability by the Court in terms of
this sub-article.
(6) An order of the Regulator against an organisation or any
named administrator shall be enforceable as an executive title once
any judgment has become res judicata or no proceedings have been
filed within the relevant time limits.
(1)
Without prejudice to the provisions of any other
law, in those cases where the Regulator is of the opinion that a person
or a social enterprise organisation is making or has made abusive use
of a certificate of recognition issued in terms of article 18 or has
made or made use of a forgery thereof, the Regulator may
(a)
prohibit such person from using such Certificate
of Registration by giving notice to such person in writing; or
(b)
issue public statements on the facts to warn the
public about any abuse by the person or social enterprise
organisation.
(2) Prior to the taking of any of the actions referred to in
sub-article (1)(a) and (b), the Regulator shall notify in writing, any
person or social enterprise organisation who appears to him to have
abused a certificate of recognition, of his findings and of the actions
he intends to take and such person or social enterprise organisation
shall be entitled to make submissions to the Regulator within five
days from the date of receipt of the written notice.
Part VII
Applications to the Court
The Court shall be competent to hear and determine any
applications made under this Act and made in terms of article 25. The
Court shall have jurisdiction in relation to any breach of the
provisions of this Act or any regulations made thereunder when such
breach does not constitute a criminal offence.
(1)
Any person or organisation aggrieved by any
cancellation order issued by the Regulator may apply to the Court for
review of such decision within thirty days of receipt thereof.
(2) Applications shall be made in writing and shall be
lodged with the Court in accordance with the provisions of the Code
of Organization and Civil Procedure or shall be made in the manner
as may be prescribed by regulations made by the Minister by virtue of
this Act.
(3) All applications shall be made to the Court which
applications shall be served on the Regulator by the applicant.
(4) An application to the Court may also be made by an
administrator or member of a social enterprise organisation for an
order on the affairs of such organisation on the grounds that such
organisation is not being administered in accordance with this Act,
any regulations or guidelines made thereunder or as provided in the
statute of such organisation.
(5) In determining an application, the Court may dismiss the
application or annul, revoke or substitute the decision of the
Regulator.
Compliance with any instructions of the Regulator shall
not be interpreted as a renunciation of the right to seek review of the
Regulator’s determination.
Part VIII
Offences
Where any person acts in breach of any of the provisions
of this Act or any regulations or any guidelines made thereunder, and
a specific penalty is not provided for the offence under this Act or
any regulations or guidelines made thereunder, such person shall, on
conviction, be liable to a fine (multa) of not less than one hundred
and twenty euro (€120) but not more than two thousand five hundred
euro (€2,500).
The provisions of this Act establishing offences and
penalties in respect thereof shall not affect the operation of any other
law establishing offences and penalties in respect of the same acts or
omissions and shall not affect the application of any higher penalty
under any other law.
Any person who, in any manner, forges or alters a
certificate of registration of a social enterprise organisation so as to
give the impression that he acts on behalf of a social enterprise
organisation, or that an organisation is a social enterprise
organisation when it is not, shall be guilty of an offence and shall be
liable to the same punishment as provided for in article 183 of the
Criminal Code.
Any person who knowingly acts or purports to act as an
administrator of a social enterprise organisation without having been
duly appointed or elected as an administrator of such organisation,
shall be guilty of an offence punishable as a contravention unless the
actions of the said person constitute a more serious offence under any
other law, in which case he shall be punishable accordingly.
Any person who -
(a)
makes abusive use of a certificate of recognition
or of a social enterprise label;
(b)
acts or purports to act in the name of a social
enterprise organisation which does not exist; or
(c)
without reasonable excuse prepares any
incorrect statement or gives any incorrect information in
relation to any matter falling under this Act,
shall be guilty of an offence under this Act.
(1)
Any person who, with the intent of obtaining any
benefit under this Act or any regulations or guidelines made
thereunder, or who assists any person in doing so -
(a)
omits from an annual return or any other
document or statement made for the purposes of this Act or as
may be prescribed, any matter which should be included
therein; or
(b)
makes any false statement or entry in any annual
return or other document or statement made for the purposes
of this Act or as may be prescribed; or
(c)
gives any false answer, whether verbally or in
writing, to any question or request for information made in
accordance with the provisions of this Act or as may be
prescribed; or
(d)
prepares or maintains or authorises the
preparation or maintenance of any false books of accounts or
other records or falsifies or authorises the falsification of any
books of accounts or records; or
(e)
makes use of any fraud, art or contrivance or
authorises the use of any such fraud, art or contrivance,
shall be guilty of an offence under this Act.
(2) Upon any person admitting to or being found guilty of
any of the above offences, the Regulator shall on conviction revoke
any Certificate of Registration issued to the social enterprise
organisation.
(1)
The Regulator may investigate the affairs of any
social enterprise organisation at any time and may demand from any
person, in writing, any relevant information and documentation
relating to the operation of a social enterprise organisation or any
person involved in the activities of a social enterprise organisation, if
he receives what he considers to be a valid compliant in writing or if
he has cause to believe that such information is necessary in order to
establish whether a social enterprise organisation is acting in
compliance with the provisions of this Act or any regulations or
guidelines made thereunder.
(2) Any person who fails to provide information and
documentation as aforesaid, and destroys or defaces documents, or
attempts to destroy or deface documents, required by the Regulator
pursuant to this article shall be guilty of an offence.
(3) The Regulator may issue directives demanding
compliance with any of the provisions of this Act or any regulations
or guidelines made thereunder and failure on the part of any person to
comply with such directives shall constitute a breach of duty.
(4) The Regulator may set a period for compliance with any
directives he may give or for compliance with any of the provisions
of this Act or any regulations or guidelines made thereunder and may
impose penalties for non-compliance within such period
Provided that such penalties shall not exceed two
thousand five hundred euro (€2,500) for the breach of a directive and
one hundred twenty euro (€120) for each day of non-compliance and
such penalties shall be paid to the Regulator.
(5) A demand under this article may also be sent to a person
who is bound by a duty of professional secrecy under the
Professional Secrecy Act and for the purposes of article 6A of the
said Act, the Regulator shall be considered to be a public authority.
Any information obtained by the Regulator upon such a demand shall
be used exclusively for the purposes of this Act.
(6) Any person or organisation may be subject to further
investigations and in the event that they transpire to be of a criminal
nature, the Regulator shall refer the matter to the Executive Police.
Part IX
General
(1)
The Minister may by regulations prescribe
regulations to properly implement the provisions of this Act, and
may, without prejudice to the generality of the aforesaid, by
regulations
(a)
amend the Schedules;
(b)
further regulate social enterprise organisations;
(c)
establish forms for the notification to the
Regulator of changes to the statute of the social enterprise
organisation or of its administrators or otherwise; and
(d)
further establish the form and content of annual
reports and accounts which are to be submitted to the
Regulator in order to achieve a satisfactory level of
transparency and accountability of social enterprise
organisations.
(2) The Minister may, after consulting the relevant Minister
depending on the type of benefit or incentive granted, make
regulations including different rules for the different types of social
enterprise organisations identified in terms of this Act, and may
establish the criteria for the granting of any exemptions, in whole or
in part, with regards to the activities of social enterprise
organisations. Such regulations may also establish the terms,
conditions and forms of any fiscal certificates, receipts or other
documents which may be necessary for the enjoyment of the above
fiscal status and regulations
Provided that only social enterprise organisations in
possession of a valid certificate of recognition may benefit from the
incentives or grants prescribed by the Minister.