Further education corporations can enter into joint ventures provided the joint venture is within their powers and charitable purpose. Some points to note are:
- charities must not give assets away to non-charitable bodies
- the Charity Commissioners may consider and consent to an investment of doubtful charitable status
- charitable companies do not make distributable profits and this may be in conflict with a commercial company's requirement to distribute profits according to shares
- an investment of money must be a prudent and safe investment, which satisfies the Trustee Investment Act 1961, amended by the Trustee Act 2000
- the investment must provide tangible benefit
- consent of the Learning and Skills Council for lending may be required
- if your college is considering a joint venture, seek expert legal advice
- acting as a guarantor for a joint venture company would be outside the charitable objects.
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