Tisch Lindsay: Gambling Bill — Instruction to CommitteeCWH In Committee 
Tisch Lindsay: Gambling Bill — Instruction to CommitteeCWH In Committee 
[Volume:611;Page:8465] 
LINDSAY TISCH (NZ National—Piako) 
: 
 In particular I bring the Committee’s attention to clause 4 which includes the definition of a number of things. First I ask the Minister to be prepared to take a call on a very important issue that was sneaked into his Supplementary Order Paper the other day and not debated in the select committee. It relates to the definition of “corporate society”. Page 13 of the bill states that “corporate society means a society that is—” and four subclauses are then listed that relate to “corporate society”. The Supplementary Order Paper states that a corporate society will be “one society” and there is concern about the impact that that will have on the operations of a number of existing businesses with partnerships and companies under the one umbrella. 
My Supplementary Order Paper tidies up the issue the Minister is trying to overcome. I have no difficulty with what the Minister is trying to do—that is stop unincorporated partnerships and Supplementary Order Paper 132 does that. I have no objection to that at all but we need to identify—and certainly I will be asking for the Minister’s response on this—the existing partnerships of entities that have the approval of the Department of Internal Affairs. What is their status? They have a licence to operate now and I have the licence of such a business here. 
Darren Hughes 
: Whereabouts? 
LINDSAY TISCH 
: I have it right here. It is a licence to operate gaming machines and it falls under the category I am talking about. My Supplementary Order Paper adds to the definition of “corporate society” the words “a partnership joint venture or other unincorporated body whose members are all corporate entities within the meaning of paragraphs (a) to (d) and where applicable includes any of those members.” 
Existing operators are now able to operate by way of a partnership or a company under one umbrella. I draw the Minister’s attention to that because if the amendment in respect of “one society” goes through existing operators that form under that umbrella will have to form two separate corporate societies. That is the first thing. Both will be regulated by statute and that means extra work the costs of restructuring additional administrative costs and greater potential for trustee liability which was not thought through earlier on. There will also be increased potential for income tax on non-charitable distributions from those organisations. At the end of the day that simply means that less money will go back to communities. Those organisations were set up specifically to give proceeds back to the community—that is their real reason for existence and why they are there. 
However the Minister’s Supplementary Order Paper is saying no they cannot be grouped together and must operate as two separate entities. I would like to clarify that the department has sent out a letter to organisations stating they cannot operate in that way yet the business I am referring to has a letter—and I have a copy here dated 9 February 2000—that states: “Thank you for the information supplied. If you are able to meet the following criteria”—and there are five—“then we are happy because you meet the requirements under existing statutes—the Charitable Trusts Act and the Companies Act—and you are able to operate.” With that in mind I am prepared to table the licence to operate I have here.