Supervisory powers relating to foundations: A comparative analysis of foundation law

Abstract

This paper compares legal approaches to foundations in six economically well-developed democracies (USA, England and Wales, Germany, Austria, France and the Netherlands). ‘Foundations’ refers to ‘non-governmental, non-membership, organisations, recognised as a legal category with a purpose in the general interest’. This covers the common field of the common law's charity and the civil law's foundation as a legal person. The countries organise public supervision of foundations in very different ways. Mostly there is governmental involvement or involvement of an independent body in the establishment and governmental supervision of foundations in action. In a few cases, the supervisory power—concerning the foundations' activities, not their establishment—is with judicial authorities. Access to information of foundations (registration) and possible requests for sanctions by interested parties are also rather different. Not all rules are in accordance with the freedom of organisation and some are less desirable. The conclusion is that a balance between the freedom of the foundation (board), the protection of the public order and the protection of the interests of others can be found in a system with systematic supervision at the establishment- and later practice—by governmental or independent authorities or in a system with good registration and incidental supervision by judicial authorities, also at the request of interested parties. Both have their advantages and disadvantages.