Article 6 Charities and not-for-profit advice agencies

(1)

Section 4(1) of the Act does not prevent the provision of a regulated claims management service by a not for profit body, that is, a body that, by or under its constitution—

(a)

is required to apply the whole of its net income, and any expendable capital, after payment of outgoings for charitable or public purposes; and

(b)

subject to paragraph (2), is prohibited from distributing, directly or indirectly, any part of its net income by way of profits, or its assets, among any of its members.

(2)

A body is not prevented from being a not-for-profit body for the purposes of paragraph (1) if its constitution permits:

(a)

the payment, out of the body’s funds, of reasonable and proper remuneration for goods or services supplied to the body by a member;

(b)

in the case of a not-for-profit body that is a charity, the payment to a member of a benefit to which he is entitled because he is a beneficiary of the charity; or

(c)

the purchase, out of the body’s funds, of indemnity insurance for trustees of the body.