The Office of the Scottish Charity Regulator (OSCR) has today granted charitable status to the first Scottish Charitable Incorporated Organisation or SCIO, a new legal form unique to Scottish charities.

The SCIO is a legal entity able to enter into contracts, employ staff and own property, and which provides protection against personal liability for charity trustees. SCIOs must also have their principal office in Scotland.

South Seeds, based in Govanhill, Glasgow, has been entered into the Scottish Charity Register, and is expected to be the first of a large number of applications by new organisations seeking charitable status as well as existing charities seeking to convert from their current legal form.

OSCR's chief executive, Jane Ryder, welcomed the news and highlighted the specific features of SCIO status.

"The SCIO legal form allows a charity to own property and enter into contracts in its own name, without becoming a company or having to rely on charity trustees carrying out transactions on its behalf," she said.

"It therefore provides a high degree of protection against personal liability for its charity trustees.

"It also provides reassurance for those entering into contracts with the SCIO and for its creditors. Regulation is simpler for SCIOs, as, unlike charities that are also companies SCIOs look to OSCR as a single regulator.

"Clearly the SCIO provides an attractive option for many existing charities and those new organizations applying for charitable status. We therefore expect to receive a large number of applications in the coming months," she added.

"However, there are important differences between the SCIO and other types of charity, with implications that must carefully be considered.

"I would therefore recommend that those considering SCIO status and their advisers should read our guidance and ensure that they are familiar with the requirements."

The new legal form has been introduced on a phased basis.

Existing charitable companies and charitable industrial and provident societies will be able to apply to convert to SCIO form from 1 January 2012, but existing Scottish charities which are any other type of legal form, and new applicants for charitable status, have been able to apply for SCIO status since 1 April 2011.

South Seeds, Scotland's first Scottish Charitable Incorporated Organisation, will work with Glasgow residents in Govanhill, Strathbungo, Crosshill and surrounding areas to reduce carbon emissions by undertaking home energy checks, providing energy saving devices, and encouraging food growing and composting in gardens and back courts.

The project also intends to mobilise the community, including local schools and community groups, through running workshops, courses and events and working to create local community gardens.

Kirstie Penman, one of South Seeds SCIO's charity trustees, said that SCIO status allowed the charity to be more ambitious in pursuing its purposes.

"SCIO status offered us an opportunity to set our sights higher and to take on more ambitious challenges than we would have been comfortable with as an unincorporated association, especially in terms of entering into contracts and employing staff," she said.

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