If you’re a business that sells products online and you work with a charity or nonprofit to help them raise money, you’re probably in a legal status known as a commercial co-venturer, or CCV.
A common way of helping charities and nonprofits is facilitating donations online, such as “rounding up” your purchase at checkout.
And it's a great thing!
Everyone benefits from donations – the cause, the donor, and the business that shows its customers it cares.
But some businesses have abused this method of donations.
They take donations and…keep them.
So, as always, a few bad apples have made it harder for everyone else.
That’s why there’s a raft of regulations and rules that are put in place that likely affect you.
Most of the rules relate to sales in specific states.
If you solicit donations from people in those states (including California and New York) through online sales, you are subject to the regulations in those states.
Who sells online and doesn’t sell to those states?
Well – no one, right?
So, if you are wondering if you are a CCV, here is a list of general characteristics that establish you as a CCV.
You're likely a commercial co-venturer if you...
1. Have a working partnership between a for-profit and a nonprofit
If you are in an agreement, written or verbal, formal or implied, between a commercial, for-profit entity and a nonprofit organization.
2. Fundraise for a charitable cause
If you are working with a nonprofit to raise funds for a charitable cause supported by the nonprofit organization, including linking sales of the for-profit company's products or services to contributions to the nonprofit. This includes round-ups at checkout and percent-of-sale campaigns.
3. Use the nonprofit's name and likeness in advertising
If you leverage the arrangement in your marketing efforts, promoting the fact that purchases will support a charitable cause.
4. Operate in states that have CCV requirements
If you operate in any of the 20+ states that require legal registration and compliance, including selling online to any customers in those states.