Addressing the Need to Create a Single Market for Philanthropy in the EU

There are more than 186,000 philanthropic organizations in the EU, the largest number of any continent. Despite this, and the fact that the European Union emphasizes free trade and a single market economy, cross-border philanthropy in the EU continues to face serious challenges. Donors and beneficiaries often run up against significant administrative and tax barriers.

Unfortunately, the legal requirements and costs involved for NPOs to prove “comparability” or to become registered as a foreign-based NPO often prove insurmountable. This can be a deciding factor in whether a donor supports beneficiaries outside of their tax jurisdiction, which has serious consequences for the non-profit sector and the European citizens it serves.

With this in mind, the King Baudouin Foundation (KBF), with the support of every Lex Mundi member firm in the EU, published a groundbreaking report, “Guide Towards a Single EU Market for Philanthropy – How to become a true European foundation in a (not yet) single market for philanthropy.” It provides clear guidance on the process of becoming a registered NPO in each member state, as well as a snapshot of the philanthropy landscape in Europe. A summary of the report, as well as the report in its entirety, is available here.

Lievin De Wulf and the team at Liedekerke (member firm for Belgium) led the efforts of 27 Lex Mundi member firms as each provided an overview of the main legal and tax regulations for philanthropy in their jurisdiction. Using the research and guidance provided, KBF has now launched a project to register or establish comparability in every EU member state. By undertaking this process, KBF will be able to test the guide and share their experience with other NPOS, law firms, philanthropists, and policymakers.

To date, the guide has already been presented in the framework of the Belgian EU Presidency and serves as a testament to the need for a unified process to allow cross-border philanthropy in the EU and EEA. It will undoubtedly provide invaluable guidance to NPOs across Europe and move the needle towards a single market for philanthropy. We want to thank and congratulate the 27 Lex Mundi law firms that participated in creating this groundbreaking report.

Budgeting for Equity and Economic Mobility

In the United States, 84 percent of children born in poverty will live in poverty for the rest of their lives. Faced with this staggering statistic, Dr. Omolara Fatiregun felt compelled to make a difference. In 2021, she founded THRIVE!, a social impact organization that helps local governments budget for equity and economic mobility with community input.

Notably, the organization has developed an equity audit software which evaluates the allocation of resources across government entities such as schools, parks, and child welfare agencies. The software assesses whether funding is directed towards interventions proven to break cycles of poverty in communities of color and evaluates whether these communities have a voice in local decision-making. Ultimately, the THRIVE! team uses the data to make equity-centered budget recommendations.

Dr. Fatiregun approached the Foundation soon after creating THRIVE!, seeking assistance contracting with impact investors and drafting template agreements critical to developing the organization’s tech platform. Foley Hoag LLP (member firm for USA, Massachusetts) and Morrison & Foerster LLP (member firm for USA, California) quickly offered to assist with each project respectively.

Dr. Fatiregun expressed her gratitude, stating, “Foley Hoag really went above and beyond drafting our note purchase agreement. As a first-time entrepreneur and CEO, they helped me understand every step of the process and made sure my company’s best interests were served. We also still use Morrison & Foerster’s NDA and Professional Services Agreement to this day! The support they provided was top-notch.”

The legal support from Foley Hoag and Morrison & Foerster has been instrumental in THRIVE!’s growth, particularly in school districts. Public schools have huge disparities in achievement, attendance, and discipline, particularly with respect to race.

To address this issue, THRIVE! uses its algorithm to compare a school district’s actual spending with an index of best practices that would produce the most equitable outcomes. Participating school districts then receive scores and recommendations to improve budgeting.

In just a few short years, the organization has already redirected $600 million in spending in schools. As a result of this impactful work, THRIVE! was selected as the winner in the Social Justice category for Fast Company’s 2024 World Changing Ideas Awards.

The early support from Foley Hoag and Morrison & Foerster has been crucial in setting THRIVE! up for success. By leveraging their skills and expertise for good, the volunteer attorneys are helping to break the cycle of poverty!

2024 Lex Mundi Pro Bono Foundation Awardees

Isis Bous, Managing Director of the Foundation, had the privilege of recognizing the winners of the 15^th Annual Lex Mundi Pro Bono Foundation Awards during the 2024 Lex Mundi Annual Conference in London. These awards honor Lex Mundi law firms that have provided critical pro bono support to some of the world’s leading social entrepreneurs.

The five winners are:

• Day Pitney LLP, Lex Mundi member for USA, New Jersey
• Deacons, Lex Mundi member for Hong Kong
• Dudley Newman Feuerzeig LLP, Lex Mundi member for U.S. Virgin Islands
• Shalakany Law Office, Lex Mundi member for Egypt
• Wardyński & Partners, Lex Mundi member for Poland

With high caliber legal support, social impact organizations can scale faster, serve more people, and ultimately have greater impact. This year’s winners supported a wide array of clients with diverse missions ranging from creating trust in policing to improving the livelihoods of smallholder farmers. You can learn more about their work here.

Although each client addressed a different problem, all greatly benefitted from the pro bono assistance provided by Lex Mundi attorneys. On behalf of the Lex Mundi Pro Bono Foundation and the countless people touched by your support, thank you!

Mayora & Mayora, a Leading Light in Latin America

Mayora & Mayora, S.C. is a leading firm in Latin America, renowned for their legal expertise and dedication to pro bono work. Every year, the firm’s attorneys provide hundreds of hours of free legal assistance to communities, non-profits, and individuals across Guatemala, El Salvador, and Honduras.

The firm’s commitment to pro bono work is evident not only in the number of projects its attorneys undertake, but also in their leadership roles within nonprofits and pro bono organizations across the region. Notably, Mayora & Mayora’s Guatemala office is a founding member of the Pro Bono Foundation of Guatemala, which aims to expand and enhance the quality of pro bono services in the country. Partners Claudia Pereira and Paola Galich are active members of the Association, with the firm providing both financial and non-financial support.

In El Salvador, Partner Manuel Telles is an active member of the Board of Fundación Heroes-Telus Community Board. This organization is a charitable arm of Telus, one of the largest BPOs in the world, and their work ranges from building schools in low socioeconomic areas to funding female entrepreneurs. Additionally, Partner Odín Guillén is Secretary of the Board of Caehro Foundation, an organization focused on restoring the environment and infrastructure in Trujillo, Honduras. Under the leadership of these two partners, attorneys at Mayora & Mayora provide free legal services to both organizations, thus advancing their important missions.

Because of the firm’s unwavering commitment to volunteerism, they have been recognized for several years as a “Leading Light” in Latin America. This prestigious award is given by Latin Lawyer and the Vance Center, and recognizes firms for their exceptional pro bono contributions.

Of the countless organizations and individuals that Mayora & Mayora supports, some notable examples of recent clients include the following:

• Counteract International (formerly Orphan Helpers), a non-profit organization based in the United States working to educate abandoned, abused, and incarcerated youth to help them succeed in life. The firm constituted its Guatemalan non-profit organization and has continued to provide ongoing pro bono support including assisting with their name change.
• Junkabal, an organization that offers a personalized, comprehensive, education aimed at the intellectual, human, and spiritual development of girls from low-income backgrounds. Attorneys at Mayora & Mayora have assisted with a variety of projects ranging from labor matters to dealings with the Ministry of Education.
• Asociación AM-AMATI ONG de Incidencia, Medio Ambiente y Fortalecimiento Institucional, an NGO committed to conserving the environment by protecting, preserving, and restoring the Amatitlán Lake basin and mitigating the effects of pollution. The firm assisted with the incorporation and registration of the non-profit entity.

Mayora & Mayora exemplifies how a law firm can have a meaningful impact. Their pro bono support has touched countless lives, and they will undoubtedly continue to uplift communities across Latin America for years to come. We would like to express our heartfelt gratitude to the attorneys at Mayora & Mayora for their incredible work!