Community Interest Company (C.I.C)

Eastwood Hanley FC has adopted a new approach to running a football club and become a Community Interest Company (CIC).
 
Eastwood Hanley Football Club was established in 2014. It started as a club to support the development of young children in the community preparing them for the world of football, giving them the opportunity of playing competitive matches and feeling part of a club enviroment.
 
The club works in the community and is looking to expand more and more as time goes by, by committing to the development of the community. The legal structure of this CIC does not allow any shares and is limited by guarantee.
 
Eastwood Hanley FC has always ensured that we are here for the benefit for the children and parents of the community and is increasing its work load year on year.
 
To demonstrate its continual commitment to the local community, open up possibilities for the provision of grants of new community sports facilities, and safeguard its assets and future of the club, Eastwood Hanley FC has become a CIC
 
What is a C.I.C?
 
A few years ago a new type of company structure was established by the government and called a ‘Community Interest Company’ (CIC) adds an ethical dimension to corporate law. A CIC is similar to a normal company and Eastwood Hanley FC CIC will therefore run by directors who will employ people, and trade as a normal company.
 
A CIC is subject to normal company law, but it must additionally act for the good of the community, and has other restrictions that prevent it’s profits and assets being diverted away from its supporters and the community. More information about CIC can be obtained at www.cicregulator.gov.uk
 
What are the advantages of a CIC?
 
The advantages of a CIC over a normal company is that:
 
1. It has an ‘asset lock’ that prevents the assets of the company being stripped from the company.
2. The company is limited by guarantee.
3. The company must work for the good of the community.
 
Because of these restrictions people and investors will be attracted for the right reasons, and willing to put money in the club for the good of the club, are very welcome.
What is an asset lock?
 
Any assets that are collated over time ensures that they will remain the property of the company and directors would not be able to sell on assets for a profit.
 
Grants
 
Ordinary limited companies do not normally get grants to provide community facilities, as grant–awarding bodies understand that grants are likely to be used to increase the profitability of the business and increase the profits distributed to shareholders or owners. However, social enterprises such as charities, CIC’s and not-for-profit groups can receive such grants.
 
Can a CIC revert to its original status?
 
Once a company becomes a CIC it cannot return to its original status as a normal company; its only options is to become a full Charity

© 2019 Eastwood Hanley FC

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