Heart of Lapford Development Limited (HOLD) is a Community Benefit Society (CBS) with Charitable Status. It is governed by the ‘Co-Operative and Community Benefit Societies Act 2014’. This imposes very clear constraints on a CBS - that it cannot operate as a commercial entity or provide profits or financial benefits to its members. It can only use its funds in accordance with its objectives as le
gally agreed in its Rules with the Financial Conduct Authority, and for the benefit of the community. HOLD cannot amend its Rules or change its objectives without the sanction of the FCA. The Rules of HOLD therefore specifically preclude its Members deriving any financial benefit as profit or in kind from the Society. Rule 81 states:
81 The Society's income and property shall be applied solely to the promotion of the objects of the Society and no portion shall be transferred directly or indirectly by way of dividend, bonus or otherwise whatsoever by way of profit to the Members of the
Society
Although HOLD has ‘Limited’ in its title, this is solely to protect its Trustees and Members from any financial liability beyond what they have already contributed to the Society. Despite the use of the term ‘shareholders’, these contributions are
effectively charitable donations, not an investment. Hence Rule 86 states:
86 The liability of a Member is limited to the amount of their shareholding. The Charitable Status of HOLD is through registration with HMRC. This is a parallel route for organisations like a CBS who are not governed by the Charity Commission, and HOLD is governed by the FCA. HOLD is not a commercial or profit-making organisation. Its Rules require the use of all its resources for the benefit of the Parish of Lapford. Rules 87 and 91 state:
87 The Society shall not trade for profit. Any profits generated by the Society shall be applied solely to the continuation and development of the Society.
91 If on the winding up or dissolution of the society any of its remain to be disposed of after its liabilities are satisfied, these assets shall not be distributed among the Members but shall be transferred instead to some other charitable body or charitable bodies with objects similar to or compatible with those of the Society as may be decided by the members at the time of or prior to the dissolution. Many CBS across the UK have been successful in reinvigorating community shops, pubs, sports spaces, parks, allotments and other public facilities – even a cinema. HOLD’s primary objective is and always was to secure a piece of land in the heart of the village, prevent it being over-developed in an inappropriate way, and make it available to the community for public use and possibly for the provision of additional built facilities at some point in the future. A full copy of the Rules can be obtained by contacting the Company Secretary via this page.
