Equality Australia Ltd and Commissioner of the ACNC [2023] AATA 2161 (30 June 2023)
Equality Australia Ltd v Commissioner of the ACNC [2024] FCAFC 115 (5 September 2024)
Equality Australia Ltd v Commissioner of the ACNC [2024] FCAFC 115 (5 September 2024) (Equality Australia v ACNC) looks at a key but often overlooked decision in Australian charity law that continues to shape how Public Benevolent Institutions (PBIs) are assessed today. Although the case is not recent, it remains foundational in clarifying the distinction between advocacy-based charitable work and activities that amount to benevolent relief. By examining Equality Australia Ltd’s attempt to obtain PBI status, the decision introduced, and firmly endorsed, the now-central requirement that a charity’s activities must have a sufficient connection to relieving distress.
Background
Equality Australia Ltd is a national LGBTIQ+ rights organisation. It was already registered as a charity under the subtype advancing public debate. Wanting access to broader tax concessions (and recognition of its work as benevolent), it applied to be registered as a Public Benevolent Institution (PBI).
It argued that LGBTIQ+ people face serious distress caused by discriminatory laws and social practices, which is supported through expert evidence set before the Tribunal. Additionally, Equality Australia’s work, such as law reform advocacy, policy development, and some direct support, was all aimed at relieving that distress. Therefore, it claimed it was organised for benevolent relief.
However, the ACNC disagreed. Relying on the Commissioner’s then-current PBI Guidance, it refused to grant PBI status. Equality Australia challenged the decision at the Administrative Appeals Tribunal (AAT, now the ART), and eventually made its way to the Full Federal Court.
The Tribunal Decision: Not PBI
The Tribunal majority accepted that LGBTIQ+ people are a class experiencing recognised forms of distress, including minority stress, stigma, and harm caused by discriminatory structures. However, the crucial question wasn’t whether LGBTIQ+ people are ‘in need’ – it was whether there was a sufficiency of connection between the applicant’s activities and the benevolent ends it pursued.
The majority conducted a detailed, holistic analysis of the nature of Equality Australia’s programs, the skills and backgrounds of its staff, the proportion of its time and resources devoted to particular activities, and the extent of direct support vs systemic advocacy. They found that advocacy, particularly for law reform, was the overwhelming focus, and any direct assistance was incidental, not central. The core activities were directed at changing laws and social norms, not delivering immediate, practical relief to individuals experiencing distress. Importantly, the majority acknowledged two points that often arise in PBI cases: A PBI does not have to deliver relief directly – it can work through intermediaries – and that an organisation can aim to prevent future distress.
The ART emphasised a third principle too in their findings, that a PBI’s activities must have a sufficient connection to actually relieving distress. This is where Equality Australia fell short, as in the majority’s view, large-scale advocacy for law and social change was too removed from traditional concepts of benevolence; it was more aimed at broad systemic outcomes rather than targeted benevolent relief, and morealigned with public debate and human rights advocacy. The majority therefore concluded that even though advocacy can, in theory, lead to reduced distress in future, the connection here was too attenuated.
Senior Member O’Connell disagreed, as she saw a wider range of the organisation’s work as directly geared toward relieving distress, not merely advocating for structural change. Looked at in totality, she believed Equality Australia did meet the ordinary meaning of a PBI. However, as a minority judgment, her view did not affect the Tribunal’s outcome.
Full Federal Court: Appeal Dismissed
When the matter reached the Full Federal Court, the question was not whether Equality Australia should be a PBI, but did the Tribunal make a legal error in deciding it was not?
The Court emphasised the following:
- Whether something is a PBI is largely a question of fact.
- Appellate courts cannot redo factual findings unless there is an error of law.
The Full Court examined two main arguments from Equality Australia:
- Did the Tribunal invent a new legal test by requiring “sufficient connection”?
Equality Australia argued that this requirement effectively smuggled in a “directness” test that had been rejected in earlier Federal Court decisions (The Hunger Project Australia v Federal Commissioner of Taxation [2013] FCA 693). The Full Court firmly rejected this, Hunger Project dealt with delivery of relief; whether it had to be delivered personally or could be delivered through another body. It did not remove the requirement that activities must be apt to achieve benevolent purposes.
The Court held that High Court cases have always implied that activities must bear a real and appropriate relationship to relieving distress, and so the Tribunal’s “sufficiency of connection” was simply a way of evaluating that relationship, not a new or unlawful test. In other words, ‘are these activities sufficiently connected to achieving the relief the charity claims?’
- Was the Tribunal’s conclusion unreasonable?
Equality Australia argued that once the Tribunal accepted that LGBTIQ+ people experience distress, and law reform may relieve that distress, then it had to conclude that the connection was sufficient. The Full Court disagreed, however. It found that the ART had concluded that the group was in need, Equality Australia’s purpose was to address that need, it pursued that purpose through advocacy and law reform efforts, that those efforts might relieve distress, however this connection was not strong enough to meet the PBI threshold. This was a factual conclusion, not a legal error.
Implications
“Sufficient connection” is now clearly endorsed. This case confirms that decision-makers assessing PBI status may examine how closely the actual activities line up with the benevolent purpose, ask whether the activities are genuinely apt to relieve distress, and determine, as a matter of fact, that advocacy is too remote from benevolent relief in a particular case.
Advocacy-focused charities face a high PBI threshold. This does not mean advocacy organisations cannot ever be PBIs. But it does mean they cannot rely on a broad or theoretical chain of causation, and they must show a clear, demonstrable, operational connection between what they do and the relief they claim to deliver.
The decision reinforces a holistic assessment. There are no rigid rules, no single determinative activity, and no automatic disqualification for advocacy, but the organisation must show more than a conceptual link between its work and the relief of distress.
Charity law is an ever-updating field of law, and the guidelines for Public Benevolent Institutions is constantly changing. Please get in touch with Warlows Legal today with any queries regarding charities, or getting yours registered today.
