Foundations and trusts may now set up shop in a legal environment that provides for their own juridical personality, as separate from that of their respective founders and administrators. This was avidly highlighted in the parliamentary debate regarding the Bill amending the Civil Code on Wednesday.

Parliamentary Secretary for the Office of the Prime Minister, Tony Abela focussing his intervention particularly on foundations, stated that they were set up by people who had the Maltese family at heart, and who sought no personal gain out of their establishment.

Mentioning foundations set up for schools as an example, he propagated the fact that not only were these foundations successful in preparing children for the realities of the modern economy, but they were also a fundamental basis for the continuation of these same schools. He proposed that this form of organisation should also be adopted for Church schools, seeing as they are in jeopardy due to the decreasing number of nuns and clergymen.

Continuing to mention certain entities this bill was directed towards, namely the aforementioned foundations, trusts and voluntary organisations, Dr Abela expounded upon the fact that this bill is not only giving opportunities, but it is also protecting the Maltese public from entities that might defraud them. This, he said, is because the bill provides for the entity’s own legal personality as well as makes provision for their registration.

Parliamentary Secretary for the Self-Employed Edwin Vassallo emphasised that this bill, by meeting the needs of changing social circumstances, is setting a legal basis for voluntary organisations, just like shops which have a trading licence. Life is no longer simple, he said, it is thus why this bill, as well as that being proposed by Minister Cristina regarding the voluntary sector, is protecting these entities, voluntary work, the people who do it, as well as those who “benefit” from it.

Claiming he would rather call these bodies “non-profit organisations”, Mr Vassallo highlighted the fact that because they were becoming more commercial, so as to promulgate their activities or fulfil their purpose, there was a sheer need to protect against fraud or standing debts. “This is not futile bureaucracy, but a positive one that provides for this very purpose.”

Giving a rendition of the Maltese jurisprudence on an organisation’s rights and legal personality, Justice and Home Affairs Minister Tonio Borg clearly explained the provisions within the amendment. “With rights come obligations,” he said, pointing out the plus points of registering the organisation – it having separate juridical personality, as well as it being able to receive money by testament; the obligations being the requirement of the nomination of an administrator, who acting in bona fide is not subject to liability; being subject to inspection by the courts or the public ‘lifting the veil’; and if the organisation is dissolved, its effects going to a fund for social purposes.

If deciding not to register in the public registry, Dr Borg continued, the organisation’s property as well as that of its members, will suffice to meet the body’s obligations. The minister also revealed certain provisions for the application of the clauses, as well for the settlement of disputes within the entity.

“Let us name the shelves, but define their content, through the constitutive act,” stated Parliamentary Secretary Carmelo Mifsud Bonnici, winding up the debate. Among other things, he clarified certain amendment clauses that provide for the liquidation of the organisations, as well as advantages entertained from the hand-in-hand effect of the bill’s provisions with the Central Registry Act.

The bill was then given a second reading.