The Gazette 1995

GAZETTE

P R A C T I C E

N O T E S

APRIL 1995

In summary, in considering whether a proposed investment is authorised, the trustees of a charity should first refer to their trust deed; if this does not give them the required authority, they should next refer to the investments authorised by statute, and then to the Form of Authorisation issued by the Charity Commissioners. If the proposed investment is not authorised by any of the above, the trustees can still apply to the Charity Commissioners for authority to invest in a specific investment under Section 32 of the Charities Act 1961 as amended. Text of Revised Form of Authorisation of Investment Section 32 of the Charities Act, 1961 as amended by Section 9 of the Charities Act, 1973. This form of authorisation supersedes all previous authorisations as and from the date hereof, but does not in

The Commissioners DO HEREBY ORDER that trustees of Charity Funds be and are hereby authorised:-

Cha r i t i es and I nve s tment

Introduction

To invest the funds of the Charity in any or all of the following ways:-

The Commissioners of Charitable Donations and Bequests for Ireland ("The Charity Commissioners") have recently issued a "Revised Form of Authorisation of Investments", the text of which follows this introduction. This comprises a global authorisation for trustees of charities to invest in specified categories of securities, without the need for any application to be made to the Charity Commissioners. This is a very significant extension of the investment powers available to such trustees where their trust instrument does not already confer on them wide investment powers. governed by the terms of the trust instrument. If the trust instrument is silent, then the trustees have to rely on statute and are restricted to the trust securities authorised by the Trustee Act 1893 as amended by the Trustee (Authorised Investments) Act 1958. These securities basically consist of Irish Government stocks, Bank of Ireland stock, AIB shares and deposit accounts with various institutions. Section 32 of the Charities Act 1961 as amended by Section 9 of the Charities Act 1973 enables the Charity Commissioners to confer on charitable trustees power to invest their fund in such manner as the Charity Commissioners may think proper. It is on foot of these provisions that the Charity Commissioners have issued this form of authorisation. The power of trustees, whether charitabla or not, to invest is primarily

1. The whole or any part of the fund may be invested in Government Stocks or other Trustee Investments as authorised from time to time by the Minister for Finance. 2. Up to 60% of the funds may be invested in the equity of Irish registered companies with a listing on the Irish Stock Exchange where the market capitalisation of the company exceeds IR£100 million at the time of the investment, limited to not more than 10% of the funds in any one such qualifying company. 3. Up to 25% of the funds may be invested in the equity of Irish registered companies with a listing on the Irish Stock Exchange where the market capitalisation of the company exceeds IR£50 million at the time of the investment, limited to not more than 5% of the funds in any one such qualifying company. 4. Up to one third of the funds may be invested in any Unit Trust which is authorised under the Unit Trusts Act, 1972 as amended by the Unit Trusts Act, 1990.

any way affect the validity of transactions carried out under previous authorisations.

Trustees of charities may:-

(a) invest in any investment

authorised by the Trust Instrument constituting their trust;

(b) avail themselves of this authorisation without any

application to the Commissioners; (c) continue to hold an investment not sanctioned by this authorisation if acquired under any previous authorisation. If Exchange Control or other permissions are required, it is the duty of the trustees to apply for such permissions. The Commissioners will not answer any queries about any such permissions.

5. Up to 50% of the funds may be invested in the equity of companies

which are part of the FTSE 100 index in the United Kingdom, limited to not more than 10% of the funds in any one such qualifying company.

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