BIM24225 - Meaning of trade: mutual trading and members clubs: members바카라 사이트™ clubs: temporary membership

Often visitors to members바카라 사이트™ clubs are described as, or become, 바카라 사이트˜temporary members바카라 사이트™. However, this does not alter the commercial nature of their transactions with the club, unless their rights as 바카라 사이트˜temporary members바카라 사이트™ are similar to those of full members. The relevant rights to consider might, for example, include:

  • being able to participate fully in the clubs바카라 사이트™ activities
  • vote at meetings and generally exercise control over the running of the club, and
  • share in any distributions on a winding up.

Similarly, receipts from 바카라 사이트˜associate members바카라 사이트™ for the use of the club바카라 사이트™s facilities will also be trading income, unless they can also show that their rights are equivalent to full members.

The position of associate members was considered by the Special Commissioners (the predecessors to the Tribunal) in the case of Westbourne Supporters of Glentoran v Brennan (1995) SPC 22. The case involved an unincorporated club, which had two classes of member, ordinary, and associate, both of which paid the same entrance fees and membership subscription. However, only the ordinary members had voting rights.

In finding that the clubs activities with its associate members did not give rise to a taxable profit, the Special Commissioner found that the associate members, who significantly numbered about 70% of all members, exercised informal control over the management of the club. Further, their entitlement to participate in any surplus on dissolution was protected by general law relating to unincorporated associations and clubs. The distinction between the ordinary and associate members originated in the Registration of Clubs Act (Northern Ireland), whose prime object was to ensure the proper conduct of clubs supplying alcoholic beverages. Since associate members바카라 사이트™ rights were basically the same as ordinary members, the economic substance of their transactions with the club were also the same. It was accepted that ordinary members바카라 사이트™ transactions with the club did not constitute 바카라 사이트˜trading바카라 사이트™ and it therefore followed that associate members바카라 사이트™ transactions were also not on a commercial basis.

Apart from the fact that this decision is not a legally binding precedent, it should prove possible to distinguish the case on the basis of its particular facts. The decision is of relevance only to unincorporated associations. Incorporated concerns are legal persons separate from their members and different considerations apply - see BIM24240 onwards.

For the text of an article originally published in TB12 discussing this issue see BIM24230.