Internet Watch Foundation

 

1.       Since its formation, the Internet Watch Foundation has consisted of two companies which were registered at Companies House in 1996 and 1997:

 

·         Non-trading not for profit company limited by guarantee

 

·         The owners are the IWF Board and the funding companies

 

·         The directors are the IWF Board

·         A trading company limited by shares

 

·         The owners are Internet Watch Foundation Ltd which owns both issued shares

 

·         The directors are the CEO, the Chair of IWF and the Chair of Funding Council 

2.       All staff are employed by IW Ltd and this is the company which carries out all the commercial activity on behalf of the IWF as a wholly owned subsidiary of IWF Ltd.

 

3.       IW Ltd is registered at Companies House “to carry on a business as a general commercial company”.

 

4.       At the recent EGM of IWF Ltd special resolutions were approved to change the name of the company to Internet Watch Foundation and apply to become a charity on the basis of the revised company Memorandum and Articles of Association.

 

5.       In the event of a successful application the charity would become the employer of staff and carry out the day to day commercial activities of IWF.  The present IWF Board would become the Trustees for the charity.

 

 

6.       Only trading outside the objects adopted by EGM in the revised Memorandum and accepted by the Commission would be carried out by IW Ltd and arrangements will be in place to identify and separate costs associated with such work.

 

7.       The Commission are unlikely to seek further information about the trading company at this stage.  We are advised that although there are no additional regulations with regard to the management of trading companies which are associated with charities, the Commission wishes to see a degree of independence through a separate Board of Directors which is not identical to the Board of Trustees of the charity. 

 

8.         At the Funding Council meeting on 19 November 2004, some funding members expressed the view that the trading company should only offer services which were compatible with the IWF brand and its charitable objects and that a mechanism should exist to enable Funding Council to be confident about the activities and conduct of the trading company.  Some Funding Council members favoured some form of Funding Council Executive Committee to carry out this role.

 

 

9.       Board is invited to consider the management and governance issues with regard to IW Ltd should our application for IWF to become a charity be successful.