There is a long-standing principle that permissible donors are those on the UK electoral register. This principle, along with the UK’s sovereignty and trust in political processes, is upheld by a framework of laws and established standards and enforced by regulators.
The Political Parties, Elections and Referendums Act 2000 establishes, in law, that UK political parties must only accept donations from permissible donors. The Act defines these donors as:
- An individual registered in an electoral register.
- A registered company that carries on business in the UK.
- A registered party.
- A registered trade union.
- A building society.
- A limited liability partnership which carries out business in the UK.
- A registered friendly society.
- An unincorporated association of two or more persons that carries out business or other activities wholly or mainly in the UK and whose main office is in this country.
The Electoral Commission’s - the independent body that regulates political finance in the UK - guidelines make clear that a party that receives a donation that is not from a permissible donor must return this donation within 30 days. Parties that do not comply may be subject to civil sanctions and the party and treasurer responsible may also have committed criminal offences.
Following the Committee on Standards in Public Life’s 1998 recommendations on the funding of political parties in the UK, the Companies Act 2006 requires companies making political donations to obtain the prior authority of their shareholders. This applies to all political donations and expenditure, irrespective of the amount.