2009/3/19 Michael Bimmler <mbimm...@gmail.com>:
> On Thu, Mar 19, 2009 at 2:38 PM, Thomas Dalton <thomas.dal...@gmail.com>
> wrote:
>> Yes, I think WMF has handled it all in the past, but I think it might
>> be easier if we do it. The WMF won't get the same charitable benefits
>> that we do.
> Understood and I defer to the judgment of others on whether it would be
> easier for WmUK (through a subsidiary) or WMF to handle it. I would just
> advise to actually take this up with the WMF (Cary Bass and Mike Godwin)
> before relying on this for strategic planning - it might be that the WMF
> objects to *not* being the formal organiser. I'm not saying they will, I
> just think that this should be confirmed with them before you act according
> to a "We will be Wikimania 2010 organisers" scenario (all of course
> contingent upon whether Oxford actually succeeds in the bid, but this should
> be known rather soon and I actually do not have many doubts ;-)

Indeed. I am sure that, whoever wins, there will be lots of talks
between WMF and the local team before anything happens.

>> Opening a trading subsidiary may become necessary at some
>> point even if we don't need it for Wikimania - for example, if we sell
>> more than £5000 worth (that's income, not profit) of chapter
>> merchandise in a year (that's a lot of merchandise, I know, I think
>> big!) we would be taxed if it didn't go through a subsidiary.
> Hm. Well, think big, yes, but I doubt whether Wikimedia France and Wikimedia
> Germany have ever exceeded this sum in a year, and they're both more
> established chapters with a larger country to serve. But then, I'm all for
> optimism...just do make sure to check whether the expenses (time and money)
> for setting up and registering a new subsidiary will not actually exceed the
> profit (or even the income) made in the end. It would be a pity if we paid
> twice as many registration fees than we get from selling merchandise!

Absolutely - it's unlikely to be worth it for merchandise alone, but
that was the first example that came to mind!

>> We also
>> have plans for annual UK conferences (combined with our AGMs) - if
>> those get big enough to involve significant business risk, they would
>> need to go through a subsidiary as well.
> But is this really common practice? I can again only speak for Switzerland
> here, but I'm familiar with the practices of a few largish NGOs (Amnesty
> International, WWF etc.) and they never open a subsidiary for their annual
> conferences or indeed any other large event. They just take the risk qua
> charity.
> Do you know how this is usually handled in the UK? Do other big UK NGOs
> often create subsidiaries for such and other purposes?

In the UK, charities aren't legally allowed to take significant
business risks. How familiar are you with the internal workings of
these NGOs? Trading subsidiaries are just a technicality, they rarely
get mentioned to the general public. They probably wouldn't open a new
subsidiary for each event, they would just have one for all their
trading activities. "Amnesty International (Trading) Ltd." or similar.
Unless you were closely involved with the inner workings of the NGO,
you probably wouldn't notice anything. If you did business with them
you might receive letters with a few lines of small print at the
bottom, part of which would say "X (Trading) Ltd. is a wholly owned
subsidiary of X", and that's all you would know of it! Trading
subsidiaries don't even need to have separate bank accounts to their
parent (although they need separate accounts in the accounting sense),
so you wouldn't even need to write cheques out to a different name.

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