Charities Bill [HL]

moved Amendment No. 55:"Page 100, line 38, after ““applicants”” insert ““subject to its liabilities””" The noble Lord said: The amendment concerns Schedule 6, which inserts a new Part 8A to the 1993 Act which details the nature and constitution of charitable incorporated organisations. Subsection (3) of Clause   59F provides for the vesting of assets but not the associated liabilities of the CIO. The Charity Law Association has recommended the amendment, which provides for the transfer of responsibility for liabilities on the registration of a CIO. That is necessary for clarity and to ensure that applicants are appropriately protected on vesting. Similarly, assets should be passed on with any conditions attaching to them—including, for example, any permanent endowment conditions. If this were a commercial arrangement, such liabilities would be likely to be covered by the provision of an indemnity by the vendors. If such a statutory indemnity were provided, the promoters would still be responsible for the liabilities they originally incurred if, in the event, it proved that the CIO could not meet them. Our argument is that that is likely to inhibit the development of CIOs and that our amendment offers proper protection to all parties. I beg to move.