Terms & Conditions

[Peter Barker]

Mick, this is a textbook non-profit form of incorporation. It’s a company limited by guarantee as distinct from a company limited by shares: the latter (usually) distributes profit to shareholders in the form of a dividend and the shareholders can trade their shares. The members of a company limited by guarantee cannot do those things.

You might even find an asset lock in the Articles, which prevents the members acquiring any of the company’s assets unless they pay a fair price for them. Whereas the shareholders of a company limited by shares usually receive the company’s assets if it is wound up and after it pays off its debts. A CIC has to have an asset lock, there is no legal requirement for other companies limited by guarantee to have one, but that’s just an extra gloss, the important thing is that the articles prevent payment of dividends to members and that’s what makes it a non-profit body.

EHSL is therefore likely to satisfy the HB definitions of “housing association” and “voluntary organisation”.

If you are thinking that something extra, like RP or registered charity status, would provide greater reassurance about the behaviour and motives of the organisation, I’ll just leave you with two words that rhyme with Pie Face …