Guidelines for the European Parliament Elections 2009

B. Statutory requirements of a Third Party with regard to receipt of donations.

Registration

4.4 As soon as possible after the receipt by it of a donation the value of which exceeds €126.97 and before incurring any expenses for political purposes or, as the case may be, before incurring any further such expenses, a third party must furnish to the Standards Commission in writing -

• the name and address of the third party and the name and address of the "responsible person", or each "responsible person", in relation to the third party (a "responsible person" is the person(s) responsible for the organisation, management or financial affairs of the third party),
• a statement of the nature, purpose and estimated amount of the donations to, and proposed expenses of, the third party in any year, and
• an indication of the third party's connection, if any with any political party or candidate at a Dáil, Seanad or European election or referendum or otherwise.

Third parties are not required under the Act to disclose details of donations received by them.

What is a donation?

4.5 A donation is defined in the Act as meaning any contribution given for political purposes by any person, whether or not the person is a member of a political party.

There are a number of important words in the definition of a donation.

(a) Donation

A donation includes:

1. a donation of money;
2. a donation of property or goods;
3. the free use of property or goods;
4. a free supply of services;
5. the difference between the commercial price and the (lower) price charged for property, goods or services; (this can include a loan provided to a third party by a financial institution at terms and conditions which are more favourable than that provided by the financial institution to other individuals or organisations. Details of the Standards Commission's position with regard to the issuing and repayment of loans to third parties can be found at paragraph 4.6 below) and
6. a donation received by way of a contribution made to the net profit from a fund-raising event organised for the benefit of a third party. It should be noted that where an individual or a group organises a fund-raising event for a candidate at an election and the individual/group retains control of the proceeds of the event (i.e. does not pass the proceeds to the candidate) the individual/group may be regarded as a third party. This is explained in more detail in Appendix 2, as is the method of calculating the profit from a fund-raising event.

(b) Political purposes.

The contribution must be given for political purposes. The definition of political purposes is at Appendix 1.

(c) Person.

This can be:

1. an individual;
2. a body corporate (e.g. a public or private company), and any subsidiary thereof. In this regard section 155 of the Companies Act should be applied when determining whether a company is a subsidiary of another company. Where donations are received from associated companies it may be necessary to enquire from the donors whether, under section 155 of the Companies Act, one or other of the companies is a subsidiary of the other;
3. an unincorporated body of persons, e.g. a political party, a partnership, a residents association, a lobby group.

Loans to third parties

4.6 Where a loan is provided to a third party by a financial institution and the normal terms and conditions attaching to such loans apply, the loan is not regarded as a donation to the third party. However, where a loan is provided to a third party by a financial institution in circumstances where either the interest charged is less than the lowest rate available from the financial institution or the loan is not repaid in accordance with the terms and conditions under which the loan was issued or is only partially repaid, the benefit to the third party may be regarded as a donation and may, therefore, be subject to the maximum limit of €6,348.69 applying to the acceptance of donations by third parties.

Where an individual or body, who or which is not a financial institution, gives a loan to a third party, it must be evident that the loan offered is a bona fide loan. In that regard the following would apply:

• As with a loan from a financial institution, the terms and conditions applying to the loan and its repayment must be stated clearly in writing.
• Interest is chargeable on the loan at a rate (whether fixed or variable) which reflects the interest charged by financial institutions on loans of a similar amount and duration. Where the interest charged is less than the lowest rate available from a financial institution, the benefit accruing from the difference in rates is regarded as a donation to the third party.
• The Standards Commission may require sight of the terms and conditions, including the interest charge, applying to the loan and may require confirmation that the loan has been repaid in accordance with these terms and conditions. If the loan is not repaid in accordance with the terms and conditions, or is only partly repaid, the benefit of such non-repayment may be regarded as a donation to the third party and subject to the maximum acceptance limit.

Prohibited Donations

4.7 Acceptance of an anonymous donation exceeding a value of €126.97 is prohibited. A donation is anonymous if a third party does not know the name and address of the donor.

4.8 If an anonymous donation is received by a third party, the Standards Commission must be notified by the third party within 14 days of its receipt. Also, the donation, or its value, must be remitted by the third party to the Standards Commission.

4.9 A third party is also prohibited from accepting a donation, or donations, from the same person in the same calendar year which is valued in excess of €6,348.69. Where such a donation is received, the third party must notify the Standards Commission within 14 days and remit that donation, or that part of a monetary donation which is over the limit, to the Standards Commission. As an alternative, the third party may return the donation, or that part of a monetary donation which is over the limit, to the donor and keep a written record of that return for the purpose of its being furnished to the Standards Commission, if required.

4.10 A third party is prohibited from accepting a foreign donation. A "foreign donation" is a donation from an individual (other than an Irish citizen) who resides outside the island of Ireland or from a company which does not keep an office in the island of Ireland from which the carrying on of one or more of its principal activities is directed.

4.11 Where a foreign donation is received, it must be notified by the third party to the Standards Commission within 14 days and must be remitted to the Standards Commission. As an alternative, the third party may return the donation to the donor and keep a written record of that return for the purpose of its being furnished to the Standards Commission, if required.

4.12 Failure to notify, remit or return, as appropriate, a prohibited donation is an offence.

Opening and maintaining a Political Donations Account

4.13 If a third party receives, in any particular calendar year, a monetary donation for political purposes which exceeds €126.97, it is required to open and maintain an account in a financial institution (a political donations account) and lodge that donation and any further such monetary donations, of whatever value, received by the third party to that account. [It should be noted that a credit union is not regarded as a financial institution for the purposes of the Act].

4.14 If a third party campaigning at the election is already the holder of a political donations account, it is not necessary to open a new account specifically for donations received in relation to the election campaign. In such circumstances monetary donations, of whatever value, received in relation to the election campaign must be lodged to the existing political donations account.

Furnishing of Statutory Documentation in relation to a political donations account

4.15 Where a third party has been required to open a political donations account, the responsible person of the third party will be required to furnish to the Standards Commission a Certificate of Monetary Donations and a statement from the financial institution where the account is held (bank statement). This documentation must be furnished by 31 March each year following the opening of the political donations account. The Certificate of Monetary Donations must be signed by the responsible person stating that all monetary donations received after the account was opened were lodged to the account and that all amounts debited from the account were used for political purposes. The Certificate must be accompanied by a Statutory Declaration.

4.16 The bank statement must specify the transactions that have taken place in relation to the account during the period beginning on the date of opening of the account up to the end of the calendar year, or the date of closing of the account if the third party ceases to exist.

4.17 The Standards Commission Secretariat will be in contact with registered third parties at the beginning of the relevant calendar year and will provide a Certificate of Monetary Donations form for completion.

4.18 Certificates of Monetary Donations and their accompanying bank statements are retained by the Standards Commission and are not put on public display or otherwise disclosed, unless required by court order or an enquiry by the Standards Commission.

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