Knowledge (XXG)

Community interest company

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asks for confirmation that the company is not a charity or that permission has been obtained from the Charity Commission to convert from a charity to a CIC). The Registrar will conduct the normal checks for registration and pass the papers to the Regulator of Community Interest Companies, to determine whether the company satisfies the community interest test.
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Formation and registration are similar to those of any limited company. New organizations can register by filing the Form IN01 and memorandum and articles of association together with a Form CIC36 signed by all their directors, explaining their community credentials, to the Registrar of Companies for
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CICs must file a "community interest company report" (form CIC34) as part of their annual submission to Companies House. This includes confirmation of directors' remuneration and some explanation of their social impact or evidence of the social benefit that they have provided over the last financial
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The "asset lock" refers to provisions in the company's articles that ensure the assets of the company are, at least mainly, applied for the benefit of the community. The precise terms are specified in legislation. Assets not applied directly for the benefit of the community may only be exchanged for
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Members of the board of a charity may only be paid where the constitution contains such a power, and it can be considered to be in the best interests of the charity. It means that, in general, the founder of a social enterprise who wishes to be paid cannot be on the board and must give up strategic
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CICs have proved popular, with some 10,000 registered in the first ten years of the status being available. CICs tackle a wide range of social and environmental issues and operate in all parts of the economy. By using business methods to achieve public good, it is believed that CICs have a distinct
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Existing companies can convert to a CIC by passing resolutions which make changes to their name and their memorandum and articles of association and by delivering to the Registrar of Companies copies of these documents, together with a fee of £35, and a form CIC37 (which is similar to a CIC36, but
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The community interest company emerged from many sources, often citing the absence in the UK of a company form for not-for-profit social enterprises similar to those in other countries. A first significant proposal for a new company form in the UK was advanced in 2001 in "The case for the Public
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that do not have charitable status find it difficult to ensure that their assets are dedicated to public benefit. Before the CIC regime was introduced there was no simple, clear way of locking the support of such a company to a public benefit purpose, other than applying for charitable status.
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not a charity, even if in all other respects it meets the requirements of charitable status. They are more lightly regulated than charities, which can be advantageous. On the other hand they do not have the benefit of charitable status, such as a favourable tax treatment: CICs are liable to
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In order for a company to be registered as a CIC, the Regulator must be satisfied that that "a reasonable person might consider that its activities are being carried on for the benefit of the community", or at least a section of the community. This
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full value or transferred to another "asset-locked body". The only exceptions are distributions to the company's members for the purpose of returning paid-up capital, or paying dividends and interest (which are subject to caps).
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The 2004 act created the officer known as the Regulator of Community Interest Companies, who is appointed for a term of up to five years by the relevant Secretary of State – from 2016 to 2023 the
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A CIC is expected, though not absolutely required, to specify an "asset-locked body" in its articles of association, to which any surplus assets will be transferred when the company is
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in the United Kingdom intended "for people wishing to establish businesses which trade with a social purpose..., or to carry on other activities for the benefit of the community".
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They are looking to work for community benefit with the relative freedom of the non-charitable company form to identify and adapt to circumstances, but with a clear assurance of
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When a CIC is requested, the CIC regulator considers whether the application meets the criteria to become a CIC. If satisfied, the regulator advises the Registrar in
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Interest Company", by Paul Corrigan, Jane Steele and Greg Parston of the Public Management Foundation. This proposal was based on research funded by the
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England and Wales, or the Registrar for Scotland, with a fee of £35. Since 11 March 2019, CICs can be registered online for a reduced fee of £27.
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Louise Smyth was appointed as Regulator in September 2020; she is also (since 2017) Chief Executive and Registrar for England and Wales at
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CICs are identified explicitly with social enterprise. Some organizations may feel that this is more suitable than charitable status.
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The articles of a CIC must also provide that its assets cannot be used except for the benefit of the community. This is known as the
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Paul Corrigan, Jane Steele, and Greg Parston (2001). "The case for the public interest company". Public Management Foundation.
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control of the organization to a volunteer board, which is often unacceptable. This limitation does not apply to CICs.
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a CIC as a subsidiary, in which case (exceptionally) there are no restrictions on distributions to the shareholder.
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Office of the Regulator of Community Interest Companies: Information and guidance notes. Chapter 6: The Asset Lock
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Office of the Regulator of Community Interest Companies: Information and guidance notes. Chapter 1: Introduction
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The definition of community interest that applies to CICs is wider than the public interest test for charity.
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who, provided that all the documents are in order, will issue a certificate of incorporation as a CIC.
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and valuable role to play in helping create a strong, sustainable and socially inclusive economy.
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be a political party, a political campaigning organisation or a subsidiary of a political party
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is met primarily by including a suitable objects clause in the articles of association.
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Parliamentary Under-Secretary of State for Employment Rights, Competition and Markets
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entrepreneurs who want to do good in a form other than charity. This may be because:
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Office of the Regulator of Community Interest Companies: Leaflets. Information Pack
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Parliamentary Under-Secretary of State for Services, Small Business and Exports
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CICs are diverse. They include social and community enterprises, social firms,
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CICs were introduced by the UK government in 2005 under Part 2 of the
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Companies (Audit, Investigations and Community Enterprise) Act 2004,
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Companies (Audit, Investigations and Community Enterprise) Act 2004,
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Companies (Audit, Investigations and Community Enterprise) Act 2004
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Office of the Regulator of Community Interest Companies (2016).
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Secretary of State for Business, Energy and Industrial Strategy
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Charitable incorporated organisation (England and Wales)
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UK company using their profits and assets for the public good
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provides oversight, which is intended to be "light touch".
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Parliamentary Under-Secretary of State for Legislation:
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Minister of State for Trade Policy and Economic Security
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Department for Business, Energy and Industrial Strategy
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Office of the Regulator of Community Interest Companies
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Office of the Regulator of Community Interest Companies
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A charity can convert to a CIC with the consent of the
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Those who may want to set up a CIC are expected to be
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Companies House. 1 August 2017. 49:it lacks sufficient corresponding 25: 2693:Department for Business and Trade 1738:Competition and Markets Authority 1572:Department for Business and Trade 1184:Brindle, David (29 August 2014). 2634: 2625: 2624: 2614: 2199: 2106:Extended producer responsibility 1962: 1961: 1634:The Baroness Jones of Whitchurch 1047:Community Contribution Companies 624:Société à responsabilité limitée 113: 34: 2315:Eco-Management and Audit Scheme 2587:Socially responsible marketing 2582:Socially responsible investing 1449:. Part 2, s27 and Schedule 3. 1146:Bounds, Andrew (9 July 2013). 896:carry out unlawful activities. 1: 2577:Socially responsible business 1850:Central Arbitration Committee 1041:B Corporation (certification) 2673:Community interest companies 2522:Environmental pricing reform 2053:environmental responsibility 1908:Office of Manpower Economics 506:Massachusetts business trust 2552:Market governance mechanism 2408:Global Reporting Initiative 2378:standards and certification 2285:Social return on investment 1855:Competition Appeal Tribunal 1835:Regulatory Policy Committee 1810:Small Business Commissioner 1805:Financial Reporting Council 1795:British Hallmarking Council 1730:Non-ministerial departments 1127:. Third Sector. 1 June 2015 693:Piercing the corporate veil 389:Community interest company 364:UK / Ireland / Commonwealth 352:Economic interest grouping 2709: 2688:United Kingdom company law 2492:Community interest company 2436:Community-based monitoring 2270:Genuine progress indicator 1903:Groceries Code Adjudicator 970:Formation and registration 851:public benefit corporation 801:community interest company 462:Limited liability company 2610: 2517:Environmental degradation 2366:Sustainability accounting 2230:Ethical positioning index 2197: 1959: 916:Comparison with charities 673:Internal affairs doctrine 668:and estoppel corporations 2678:Types of business entity 2547:Health impact assessment 2418:Sustainability reporting 2387:Toxics Release Inventory 2181:Transparency (behavioral 2156:Social impact assessment 2045:Corporate accountability 1815:Trade Remedies Authority 1186:"Stephen Lloyd obituary" 929:like any other company. 97:This article is part of 2602:Supply chain management 2542:Global justice movement 2341:profit-and-loss account 1702:Bidesh Sarkar (interim) 1065:Social entrepreneurship 875:community interest test 343:Societas unius personae 205:General corporate forms 64:more precise citations. 2567:SDG Publishers Compact 2329:Environmental conflict 2136:Organizational justice 655:Business judgment rule 2557:Product certification 2356:Life-cycle assessment 2275:Performance indicator 2166:Social responsibility 2131:Organizational ethics 2061:social responsibility 1939:Preceding departments 1918:Pubs Code Adjudicator 1898:Certification Officer 1893:British Business Bank 1693:Beatrice Kilroy-Nolan 1655:Permanent Secretaries 1606:Minister for Industry 1043:– a global initiative 847:Gulbenkian Foundation 599:Naamloze vennootschap 589:Kabushiki gaisha 406:Limited company  2562:Public participation 2497:Conflict of interest 2087:inequality in the UK 2079:in the United States 2071:Environmental racism 1061:in the United States 980:Registered Societies 951:distribution status. 863:mutual organizations 723:Beneficial ownership 660:Corporate governance 496:Delaware corporation 323:Societas cooperativa 2532:Ethical consumerism 2482:Benefit corporation 2374:metrics and indices 2176:Sullivan principles 2091:injustice in Europe 1877:Post Office Limited 1869:Public corporations 1800:Competition Service 1713:Departmental Chief 1152:. Financial Times. 1059:Benefit corporation 738:Corporate registers 698:Rochdale Principles 452:Benefit corporation 278:Sole proprietorship 2620:Environment portal 2392:Triple bottom line 2320:Emission inventory 2225:Double bottom line 2171:Stakeholder theory 1831:Low Pay Commission 1761:Insolvency Service 1748:Executive agencies 1715:Scientific Adviser 1447:legislation.gov.uk 960:Charity Commission 539:Aktiengesellschaft 511:Nevada corporation 2655: 2654: 2572:Social enterprise 2477:Bangladesh Accord 2337:management system 2333:impact assessment 2310:Carbon accounting 2240:Impact assessment 2191:UN Global Compact 2083:in Western Europe 2035:Aarhus Convention 1975: 1974: 1863: 1862: 1724: 1723: 1675:Directors General 1666:Crawford Falconer 1601:Douglas Alexander 1592:Jonathan Reynolds 1020:, since 2023 the 976:limited companies 809:social enterprise 797: 796: 678:Limited liability 640: 639: 549:Ansvarlig selskap 436:Unlimited company 273:Shelf corporation 268:Shell corporation 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886: 883: 882: 881: 878: 876: 870: 868: 867:co-operatives 864: 856: 854: 852: 848: 842: 839: 836: 829: 827: 823: 821: 817: 812: 810: 806: 802: 790: 785: 783: 778: 776: 771: 770: 768: 767: 762: 759: 757: 754: 753: 752: 751: 744: 741: 739: 736: 734: 731: 729: 726: 724: 721: 720: 717:Related areas 714: 713: 706: 705: 701: 699: 696: 694: 691: 689: 686: 684: 681: 679: 676: 674: 671: 669: 667: 663: 661: 658: 656: 653: 652: 646: 645: 634: 631: 629: 625: 621: 619: 616: 614: 610: 606: 604: 600: 596: 594: 590: 586: 584: 580: 576: 574: 570: 566: 564: 560: 556: 554: 550: 546: 544: 540: 536: 534: 529: 525: 524: 523: 522: 517: 512: 509: 507: 504: 501: 497: 493: 491: 490:S corporation 488: 486: 480: 478: 475: 471: 468: 467: 466: 460: 458: 457:C corporation 455: 453: 450: 449: 448: 447: 444:United States 442: 437: 434: 430: 427: 425: 422: 420: 417: 415: 412: 411: 410: 403: 401: 395: 393: 387: 385: 379: 377: 371: 370: 369: 368: 361: 356: 350: 348: 344: 340: 338: 334: 330: 328: 324: 320: 318: 313: 309: 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