Section 5(2A) of the Charities Act 2005 states that “the promotion of amateur sport may be a charitable purpose if it is the means by which a charitable purpose referred to in subsection (1) is pursued”. So, what sports actually meet these criteria for a charitable purpose?
The purpose of section 5(2A) is to ensure that the promotion of a sport can be a charitable purpose. While promoting a sport is not in itself a charitable purpose, the purpose of a charity could include the promotion of a particular sport for the purposes of promoting health or for the advancement of education, as is established in the section.
Recently, after six years of Swimming NZ being a registered charity, the Charities Registration Board decided to de-register it. The reasoning behind this was that it no longer had charitable purposes due to the competitive and elite nature of the high performance programme. This in itself does not promote a sport but instead promotes sporting success which does not benefit the public. They decided that while there was some promotion to health, the focus on promoting success in the sport outweighed this.
The impact of this decision by the Charities Registration Board is that sporting organisations set up as charities will need to prove that they are existing to promote health as opposed to promoting success in the sport, and ultimately be benefiting the public.
An article which discusses this in more detail was posted by the New Zealand Law Society and can be found here.
So, to answer the question above, any sport can meet the criteria for a charitable purpose as long as it relates to the promotion of health, the advancement of education or anything else that proves to be beneficial to the community, and it will need to be able to prove that it does continue to promote these.
The Charities Services website provides a helpful overview on this topic which can be found here and here.
We offer legal advice on all aspects of charitable trusts and are happy to answer any questions that you might have. Contact Steven Moe at stevenmoe@parryfield.com or 03-348-8480 for more information.
