Commercial imperatives and public benefit: Recognising commercial purposes as charitable purposes

Abstract

The Non-Charitable Purpose (NCP) trust has stood as a challenge to the concept of the traditional charitable trust through its rejection of the charitable purpose and public benefit requirements. Yet various jurisdictions have seen the economic benefits of adopting such structures or legislating in their favour. Meanwhile, in common law jurisdictions such as Australia, the law of charitable purposes has been undergoing significant, albeit subtle, changes, the result of which is a growing recognition of commercial purposes as being valid charitable purposes. The result is that the law of charitable trusts in Australia stands on the conceptual precipice of recognising the kinds of commercial purposes offshore NCP trusts facilitate. This article shows how such a change has occurred and why. In doing so it also offers a proposed legislative means of advancing the charitable trust further along this path so as to potentially promote greater international investment in Australia.