Business

Non-profits have two-week grace period before facing hefty fines

Non-profit organizations (NPOs) have been granted a two-week grace period to register and become compliant with the Non-Profit Organizations Act, 2019, Attorney General Carl Bethel said yesterday, during which time they won’t be subject to a $10,000 fine or imprisonment for operating without being registered.

Charities, churches and foundations had 90 days since May 25 – when the notice was posted by the Registrar General’s Department – to register, however, few did.

“We agreed to forebear any enforcement measures for two weeks. We held webinars over the past three days with NPOs and financial and corporate services providers to familiarize them with the ease of registration and the necessary details as well,” Bethel told Guardian Business.

The act was passed last year in an effort to help The Bahamas meet international obligations with respect to financial transparency, as required by the Financial Action Task Force (FATF).

Civil Society Bahamas (CSB), an umbrella organization representing the interests of all the non-profit and non-governmental organizations, organized a conclave this week along with the Organization for Responsible Governance (ORG), to help mitigate the frustrations experienced by NPOs in registering.

CSB Secretary Mark Palmer said now time is of the essence for organizations to come into compliance.

“The whole registration process is now gathering steam and it looks like registration is starting to happen now in much greater numbers than it was before, it just needed that push from the conclave. So, I’m happy that any frustrations that people may be having with the system have now been dealt with and that they have clear instructions on how to go and it’s actually very simple to register and it can be done very quickly,” he told Guardian Business.

“The most important thing is people get registered. The deadline actually was on the 23rd of August, which is 90 days after the bill was enacted, but I understand that there has been two weeks’ grace to allow organizations to register themselves under the act. So, we encourage them to do that.”

For smaller unincorporated NPOs, Palmer said the One Eleuthera Foundation has offered legal support and CSB is also seeking a partnership with the Bahamas Bar Association to assist small organizations to meet the deadline.

He said what’s most important is that organizations meet the target date.

“Well first of all it’s a legal requirement and they have to register, otherwise they will be subject to fine. But I think it’s very good for the sector because it raises the sector. Organizations now have to have a documented mission, of which many may not have. I think it’s good that they should have some sort of a declaration that they are keeping financial records. I think that improves the sector,” he said.

“I think that strengthens the sector that we’re going to be more responsible from the government’s point of view. It will give donors more confidence in the sector, because we are years behind other jurisdictions. In the United States they’ve been registering non-profit organizations for 50 or 60 years and they have this system in place. This is our first official system and I think it’s beneficial for the sector and we’ll get a good idea of who is working in it now, because anyone that is working for charitable purposes has to declare themselves.”

In addition to the hefty fine, non-registered NPOs are also banned from opening bank accounts, account ledgers or any other type of account.

Registering NPOs, whether incorporated or not, must fully disclose a declaration of purposes of the NPO; proof of the identity of the controller and other members of the NPO; copies of particulars of the organizational documents; and evidence of the board structure.

There are approximately 300 civic NPOs, more than one thousand churches and at least 500 other organizations that would fall under religious, charitable, educational, scientific, environmental, historical, cultural, fraternal, literary, sporting, artistic, athletic or promoting health purposes.

“We don’t actually have a figure, but we know that just the churches alone, there are over a thousand churches. Again we’ve reached out to our contacts at the Bahamas Christian Council to advise them and I hope that the churches will start registering en masse, because they do make up a significant portion of civil society. I would say if you look at churches we could potentially have 2,000 organizations in The Bahamas that are involved in charitable purposes,” Palmer said.

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Paige McCartney

Paige joined The Nassau Guardian in 2010 as a television news reporter and anchor. She has covered countless political and social events that have impacted the lives of Bahamians and changed the trajectory of The Bahamas. Paige started working as a business reporter in August 2016. Education: Palm Beach Atlantic University in 2006 with a BA in Radio and Television News

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