What is the difference between NGO (Non-Governmental Organisation and Voluntary Organisation?

A voluntary organisation is and remains a Non-Governmental Organisation,  even if such organisation is enrolled with the Commissioner as a voluntary organisation.

The definition of a voluntary organisation is that it is an organisation which is created or established:

for a social purpose including that which qualifies as a public purpose or for public benefit;

as non-profit making;

is voluntary; and

independent and autonomous of the Government

What is a Foundation?

A foundation is an organisation consisting of a universality of things constituted in writing, including by means of a will, by a founder or founders whereby assets are destined either:

1. For the fulfilment of specified purpose [Such foundations are known as purpose foundationsJ or
2. For the benefit of a named person or a class of persons [These are known as private foundations].

A private writing or oral stipulation does not suffice to bring the foundation into existence.

What is a Trust?

A Trust exists where a person (Called a “Trustee”) holds, as owner or as vested in him property under an obligation to deal with that property for the benefit of persons (called the “Beneficiaries”), whether or not yet ascertained or in existence, which is not for the benefit only of the trustee, or for a charitable purpose, or for both such benefit and purpose aforesaid.

Trust established or recognized in terms of the Trust and Trustees Act shall qualify as a voluntary organisation only when they are established as a charitable trust.

“Charitable Purpose” means any charitable, social or philanthropic purpose, and without prejudice to the generality of the aforesaid, includes in particular all the requirements as laid down in the Voluntary Organisations Act (Chapter 492 of the Laws of Malta).

Can Foundations, Trust and Associations have members?

Foundations and Trust cannot have members, although may still have volunteers or contributors but without voting rights. All decisions rest upon the Board of Administrators and administrators are appointed or removed by the founder/s or the “Settlor” as in the case of Trust.

The founder/s and/or the administrators have the right to call AGMs or other meetings, but the volunteers or contributors have no right to vote unless the statute provides otherwise and are appointed as Board Members or Co-Founders.

On the other hand, an association may have members and the Committee Members are elected in office through their Annual General Meetings or Extra Ordinary Meetings.

One of the required documents to register the organisation with the Commissioner is a Resolution Letter. What is a Resolution Letter?

A Resolution Letter is based on the agreeable consent achieved during the Executive Board meeting to enroll the organisation with the Commissioner as a voluntary organisation.

Eg: We  the   undersigned,   in   our   official   capacity   of   members   of   the ………………………….., doherby resolve to enroll the said organisation as a ‘Voluntary Organisation’ with the Commissioner  for Voluntary Organisations, in terms of Article 13 of the Voluntary Organisations Act (Chapter.492 of the Laws of Malta).

This document which needs to be dated, must be signed by all Committee/Board Members and should include their Titles, Names, Surnames, and their Designations.

This document which needs to be dated, must be signed by all Committee/Board Members and should include their Titles, Names, Surnames, and their Designations.

What should be written in the statute of the organisation?

The Second Schedule to the Civil Code (Chapter 16 of the Laws of Malta) defines what are the minimum requirements that should be written in the statute, in fact

Article 29 and Article 49 speaks on what should be written in the statute of a Foundation and Association respectively.

As for a Trust, the Trust and Trustees Act defines what are the minimum requirements to be listed in the statute. Obviously, the regulations laid down in the statute must be compatible to the requirements laid down in both laws, namely The Voluntary Organisations Act (Chapter 492) and The Second Schedule to the Civil Code (Chapter 16), to be able to enroll with the Commissioner as a voluntary organisation.

What happens if an issue arises and the statute is silent and Who should take decision in such cases?

It is fundamentally important that each organisation has a good statute, irrelevant to what legal form such organisation is.

Disputes between members of a voluntary organisation or between members and one or more administrators relating the affairs of the voluntary organisation may be avoided if the organisation has a good statute.

If an issue arises and the statute is silent, then the Voluntary Organisations Act and The Second Schedule to the Civil Code shall take preference.

What is an Administrator?

Every organisation shall be managed by administrators who shall be responsible for maintaining possession and control of the property of the organisation, safeguarding such property and ensuring compliance with the statute of the organisation.

“Administrator” is defined  in Article 2(1) of the Voluntary Organisations Act as any person who is appointed to control, supervise or administer an organisation, and includes a governor,  director,  trustee or committee  member or any otherperson who carries out such functions even if under another name but shall not include a manager or an executive while carrying out functions under a contract against remuneration except insofar as s/he is an administrator  and only relating to his function as an administrator.

What is the minimum number of administrators that an organisation can have?

The law is silent when it comes to the maximum number of administrators that an organisation can have, but, is not so silent to when it comes to the minimum requirements. In fact, the law defines that there should be not less than three administrators in an organisation.

The administrators of a voluntary organisation are bound to act autonomously and independently in seeking to fulfil the express purposes of such organisation and must not be subject to control of any other person or authority nor bound in any manner, directly or indirectly, to act under the direction or in the interest of any other person: Provided that administrators shall be vested solely with one administrative role and may not exercise the position of President, Vice President, Treasurer and Secretary concurrently.

Can a voluntary organisation make use of a P.O. Box as its address?

A voluntary organisation cannot use a P.O. Box as its principal address for the address of the organisation has to be a physical address.

The voluntary organisation may though make use of a P.0. Box to receive its mail correspondence.

When an organisation applies with the Commissioner, are there any payments that needs to be done?

Upon application, each organisation shall be required to pay an administration fee (payable only ones) as follows:

1. €40-Enrolment
2. €20 – Enlistment
3. €20 – Temporary Organisation

Our voluntary organisation does not have a premises to use for its address, as such it cannot list the address in the statute. Are there any other possibilities which can help the organisation to have an address on its statute?

The law requires that in the statute of the organisation there shall be a clause stating the address of the organisation.

If the organisation does not have a premises  it can make use of an address of one of the administrators as a care off The only problem here is that every time there are changes in the Committee the statute needs to be amended.

Another long-term procedure is that the organisation applies with the Malta Council for the Voluntary Sector to make use of the address of the Council as the organisation’s care off address.

What is the Registry of Beneficial Owners?

In June 2018, the European Union passed a law throughout all European countries (including Malta), whereas all NGOs had to register themselves in a Registry titled

-Registry of Beneficial Owners. This law is basically in reference to Money Laundering and Terrorism.

The Application to be registered in the Registry of Beneficial Owners is free of charge and the address where to register is Malta Business Registry, AM Business Centre, Triq ii-Labour, Zejtun ZTN 2401 – Malta.

The Malta Business Registry can be contacted on +356 2258 2300

If an organisation is enlisted in the Second Registry of the Commissioner, can such organisation benefit or apply for Government funds or projects?

Organisations that are enlisted in the Second Registry of the Commissioner cannot benefit or apply for Governmental funds or projects.

What is a Temporary Organisation?

A Temporary organisations can be established by anybody, provided, that there is a minimum of three (3) persons and are above age (as laid down in the law), namely 16 years and over.

There is no minimum timeframe for a temporary organisation to follow, but it can never exceed one year from when the Certificate of Enrolment has been issued.

A Temporary organisation can only be established to conduct one activitv. It cannot extend its remit and after it finishes the activity it has to wind up its operation or establish an association or a foundation.

What is the procedure for an organisation to go into dormancy?

The organisation is required to inform the Commissioner of its intention to go dormant. It needs to iriform the Commissioner the reason behind such request and the timeframe required to revive back the organisation.

If the Commissioner accepts the request for the organisation to go dormant (Inactive), then the following procedures will take effect:

1. The organisation will have to surrender their Certificate of Enrolment;
2. Dormancy cannot last more than two (2) consecutive years;
3. The Board of administrators (Executive Committee) will be frozen during the dormancy period. This means that the administrators cannot resign during the dormancy period.
4. Annual Returns must still be submitted to the Commissioner even during dormancy.
5. The organisation shall not be autorised do any type of public collection during such period.

What is the procedure to wind up an organisation?

This depends on the legal form of the organisation:

1. An Association can be dissolved by calling an EGM or AGM to its members and a resolution is passed to dissolve the association. Such resolution must be approved by at least 75% of the Members.

• A Foundation may only be constituted by a public deed, as such it can only wind up (dissolve) through the Public Registry. Afterwards it needs to inform the Commissioner by providing proof that such organisation has been dissolved.

• A Trust may only be dissolved as required by the Trust and Trustees Act

What happens to the assets of the organisation if it winds up?

When a voluntary organisation winds up, all of its remaining assets after all debts have been paid, shall be diverted to other non-profit organisation/s.