Creation, registration, support of charitable foundations and organizations.

Charitable foundations are non-profit organizations established to collect and distribute charitable contributions to support social, medical, educational, cultural, environmental and other charitable initiatives. The main purpose of such foundations is to help the needy, develop society and implement various charitable programs and projects. They operate on the principles of voluntary contributions, donations and support from the state, business and other business structures. The activity of charitable foundations is regulated by the Law of Ukraine on Charitable Activity and Charitable Organizations.  

Registration of the Charitable Foundation is carried out in accordance with the requirements of the legislation of Ukraine on public associations and non-profit organizations. In more detail about the conditions for the creation of such funds and the peculiarities of their functioning we will talk in this article.

Choice of type – charitable society, charitable institution, charitable foundation

The choice of the type of nonprofit organization depends on the specifics of its activities and the goal set. Each variety has its own features and responsibilities. Let’s consider a brief description:

• Charitable society. This type of organization is aimed at helping and supporting certain groups of people, social events or solving certain problems. It can engage in charity in certain areas, such as medicine, education, social assistance, etc.

• Charitable Institution. Established to provide long-term charitable activities or support for specific projects and programs.

• Charitable Foundation. A foundation is a legal entity that is formed from charitable contributions from citizens or businesses to provide social, humanitarian, medical and other assistance. 

Procedure for registration of a charitable organization

Registration of a Charitable Foundation, institution or organization is carried out as follows:

• Preparation of necessary documents. It is necessary to collect all the documents for the registration of the CF. The package includes: the charter, minutes of the constituent meeting, a package of applications, a message of intentions to create a charitable organization, etc.
• Holding a constituent meeting. To make decisions on the creation and approval of the charter it is necessary to hold a meeting of founders (members) of the organization.
• Registration in the state registration body. For official registration it is necessary to submit all necessary documents to the appropriate state registration body.
• Obtaining a certificate of registration. After checking the documentation and meeting the requirements of the legislation, the state registration authority issues a certificate of registration of the charitable organization.
• Obtaining the status of a charitable organization. In order to obtain the relevant status, an application must be submitted to the taxation authority and confirmation must be obtained.

If the Registration of the Charitable Organization is successful and all necessary documents are received, the institution can carry out its charitable activities and attract donations in accordance with the established rules and legislation.

Reporting

Reporting by a charitable organization is the process of preparing and submitting information on the financial status, activities and achievements of the organization. Such reporting is mandatory for nonprofit institutions because it is an important means of ensuring transparency and accountability to the public and donors.

Generally, reporting includes the following elements:

• a financial statement, which shows the organization’s income and expenses, movement of funds, and other financial indicators;

• an activity report, which describes the organization’s charitable activities, implemented projects and achievements;

• other documents required by law or by the specific terms of funding or grants.

Reporting is usually submitted to the relevant state bodies or charitable foundations that control and register the activities of charitable organizations. It is important to comply with legal deadlines and to ensure that the information provided is correct and accurate.

Election of the governing bodies of a charitable organization

The governing bodies of a charitable organization are elected in accordance with the provisions of its charter and legal requirements. The governing bodies include the board, supervisory board, general meeting (conference) of the organization’s members, and other committees or working groups that may be established to carry out specific tasks.

Usually, the process of electing management bodies includes the following stages:

1. Candidate selection. Potential candidates for positions in the management bodies are nominated by members of the organization or other interested parties.
2. Conducting the election. Elections take place at a general meeting (conference) of the organization’s members, where candidates present their programs and activity plans, and members vote for candidates.
3. Voting. Voting can be secret or open, depending on the charter of the organization and adopted regulations.
4. Election. The candidates with the highest number of votes become members of the governing bodies.
5. Registration. Elected members of the governing bodies are registered in accordance with the law and the statutes of the organization.

Elected governing bodies are responsible for strategic direction and making important decisions in the activities of the charitable organization. Their work should be transparent, responsible, and directed toward achieving the organization’s purpose and goals.

Responsibilities

A charity has a number of responsibilities associated with its status and activities. Key aspects of responsibility include:

• Responsibility to donors and the public. Nonprofit organizations have a duty to use donations received in an efficient and transparent manner and to ensure that their goals and objectives are met. The organization must comply with agreements with donors and ensure accounting and reporting on the use of funds.
• Responsibility to beneficiaries. Charities must ensure that the charitable services or assistance provided are aimed at achieving useful results for their beneficiaries.
• Responsibility to legislation. Legal requirements regarding operations, taxation, reporting and other legal responsibilities must be strictly adhered to. The organization must have a clear understanding of its rights and obligations under applicable laws.
• Internal accountability. It is important to establish effective internal control and management procedures to avoid possible shortcomings or abuses. Internal controls help to ensure transparency and responsible management of the organization.
• Responsibility to employees and volunteers. It is important to take care of your employees and volunteers by providing them with safe working conditions and adequate compensation for their activities.

Inclusion in the register of volunteer organizations

Being listed on the register of voluntary organizations grants the charity the status of a voluntary organization. This increases public trust and provides more opportunities for development and collaboration with other organizations and government agencies.

1. The basic steps for a charity to be included on the register of voluntary organizations may include:

   1. Familiarizing yourself with the requirements. One should familiarize oneself in detail with the requirements and criteria for inclusion in the register of volunteer organizations, which are usually set by the relevant authorities or government agencies.
2. Preparation of documents. Documents required for registration: charter of the organization, decision on establishment, certificate of registration of the relevant body, information on the activities of the organization, etc.
3. Filing an application. After preparing the package of documents, the organization submits an application for inclusion in the register of volunteer organizations.
4. Consideration of the application. The relevant authorities check the documents and carry out a review of the institution’s activities to ensure that it meets the requirements for inclusion in the register of volunteer organizations.
5. Decision making. After verification and review of the application, the body responsible for registration makes a decision to include the organization in the register of volunteer organizations.
6. Obtaining the status. If the decision is positive, the institution receives the status of a volunteer organization and is included in the relevant register.

Registration in the Shlach system

The Шлях system or the Unified State Register of Volunteers and Charitable Organizations is a special electronic platform created to register and coordinate the activities of volunteers and charitable organizations in Ukraine.

This system allows to register charitable organizations and volunteers, create a profile, specify the types of assistance or services they provide or need, and provides communication between them.

To register in the Шлях system, a charitable organization should apply to the relevant state authorities or companies administering the system. When registering, it is usually necessary to submit documents confirming the legal status of the organization, information about its activities, and contact details.

The Шлях system helps to collect and process information about the activities of charitable organizations and volunteers, as well as facilitates effective coordination of aid and charitable events in Ukraine.

Our advantages

If you have decided to create a Charitable Foundation but do not know where to start, please contact our law firm DextraLaw, whose experts will provide professional support at all stages of the establishment of the institution. Our experienced attorneys and lawyers will provide you with the necessary information, help you in preparing documents, registration and filing reports. We guarantee a qualitative and individual approach to each client, helping to make the process of creating a Charitable Foundation as simple and understandable as possible. Entrust your business to professionals and ensure a successful start of your charitable activities together with DextraLaw.

Other advantages of cooperation with us:

• full range of services;
• individual approach;
• convenience and efficiency;
• trust and confidentiality.

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