Charities Bill [HL]

House of Commons

Session 2005 - 06
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Other Bills before Parliament

Charities Bill [HL]

Charities Bill [HL]
Schedule 7 — Charitable incorporated organisations
Part 1 — New Part 8A of and Schedule 5B to 1993 Act
116

(2)
In subsection (1)(d), “conveyance” means any instrument creating,
transferring, varying or extinguishing an interest in land.
(3)
Subsection (5) applies if the name of a CIO does not include—
(a)
“charitable incorporated organisation”, or
(b)
“CIO”, with or without full stops after each letter, or
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(c)
a Welsh equivalent mentioned in subsection (4) (but this
option applies only if the CIO’s constitution is in Welsh),

and it is irrelevant, in any such case, whether or not capital letters are
used.
(4)
The Welsh equivalents referred to in subsection (3)(c) are—
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(a)
“sefydliad elusennol corfforedig”, or
(b)
“SEC”, with or without full stops after each letter.
(5)
If this subsection applies, the fact that a CIO is a CIO shall be stated
in legible characters in all the documents mentioned in subsection
(1).
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(6)
The statement required by subsection (5) shall be in English, except
that in the case of a document which is otherwise wholly in Welsh,
the statement may be in Welsh.
69D
Offences connected with name and status
(1)
A charity trustee of a CIO or a person on the CIO’s behalf who issues
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or authorises the issue of any document referred to in paragraph (a),
(b), (d) or (e) of section 69C(1) above which fails to comply with the
requirements of section 69C(1), (5) or (6) is liable on summary
conviction to a fine not exceeding level 3 on the standard scale.
(2)
A charity trustee of a CIO or a person on the CIO’s behalf who signs
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or authorises to be signed on behalf of the CIO any document
referred to in paragraph (c) of section 69C(1) above which fails to
comply with the requirements of section 69C(1), (5) or (6)—
(a)
is liable on summary conviction to a fine not exceeding level
3 on the standard scale, and
30
(b)
is personally liable to the holder of the bill of exchange (etc.)
for the amount of it, unless it is duly paid by the CIO.
(3)
A person who holds any body out as being a CIO when it is not
(however he does this) is guilty of an offence and is liable on
summary conviction to a fine not exceeding level 3 on the standard
35
scale.
(4)
It is a defence for a person charged with an offence under subsection
(3) to prove that he believed on reasonable grounds that the body
was a CIO.
Registration
40
69E
Application for registration
(1)
Any one or more persons (“the applicants”) may apply to the
Commission for a CIO to be constituted and for its registration as a
charity.

Charities Bill [HL]
Schedule 7 — Charitable incorporated organisations
Part 1 — New Part 8A of and Schedule 5B to 1993 Act
117

(2)
The applicants shall supply the Commission with—
(a)
a copy of the proposed constitution of the CIO,
(b)
such other documents or information as may be prescribed
by regulations made by the Secretary of State, and
(c)
such other documents or information as the Commission
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may require for the purposes of the application.
(3)
The Commission shall refuse such an application if—
(a)
it is not satisfied that the CIO would be a charity at the time
it would be registered, or
(b)
the CIO’s proposed constitution does not comply with one or
10
more of the requirements of section 69B above and any
regulations made under that section.
(4)
The Commission may refuse such an application if—
(a)
the proposed name of the CIO is the same as, or is in the
opinion of the Commission too like, the name of any other
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charity (whether registered or not), or
(b)
the Commission is of the opinion referred to in any of
paragraphs (b) to (e) of section 6(2) above (power of
Commission to require change in charity’s name) in relation
to the proposed name of the CIO (reading paragraph (b) as
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referring to the proposed purposes of the CIO and to the
activities which it is proposed it should carry on).
69F
Effect of registration
(1)
If the Commission grants an application under section 69E above it
shall register the CIO to which the application relates as a charity in
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the register of charities.
(2)
Upon the registration of the CIO in the register of charities, it
becomes by virtue of the registration a body corporate—
(a)
whose constitution is that proposed in the application,
(b)
whose name is that specified in the constitution, and
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(c)
whose first member is, or first members are, the applicants
referred to in section 69E above.
(3)
All property for the time being vested in the applicants (or, if more
than one, any of them) on trust for the charitable purposes of the CIO
(when incorporated) shall by virtue of this subsection become vested
35
in the CIO upon its registration.
(4)
The entry relating to the charity’s registration in the register of
charities shall include—
(a)
the date of the charity’s registration, and
(b)
a note saying that it is constituted as a CIO.
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(5)
A copy of the entry in the register shall be sent to the charity at the
principal office of the CIO.

Charities Bill [HL]
Schedule 7 — Charitable incorporated organisations
Part 1 — New Part 8A of and Schedule 5B to 1993 Act
118

Conversion, amalgamation and transfer
69G
Conversion of charitable company or registered industrial and
provident society
(1)
The following may apply to the Commission to be converted into a
CIO, and for the CIO’s registration as a charity, in accordance with
5
this section—
(a)
a charitable company,
(b)
a charity which is a registered society within the meaning of
the Industrial and Provident Societies Act 1965.
(2)
But such an application may not be made by—
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(a)
a company or registered society having a share capital if any
of the shares are not fully paid up, or
(b)
an exempt charity.
(3)
Such an application is referred to in this section and sections 69H and
69I below as an “application for conversion”.
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(4)
The Commission shall notify the following of any application for
conversion—
(a)
the appropriate registrar, and
(b)
such other persons (if any) as the Commission thinks
appropriate in the particular case.
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(5)
The company or registered society shall supply the Commission
with—
(a)
a copy of a resolution of the company or registered society
that it be converted into a CIO,
(b)
a copy of the proposed constitution of the CIO,
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(c)
a copy of a resolution of the company or registered society
adopting the proposed constitution of the CIO,
(d)
such other documents or information as may be prescribed
by regulations made by the Secretary of State, and
(e)
such other documents or information as the Commission
30
may require for the purposes of the application.
(6)
The resolution referred to in subsection (5)(a) shall be—
(a)
a special resolution of the company or registered society, or
(b)
a unanimous written resolution signed by or on behalf of all
the members of the company or registered society who
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would be entitled to vote on a special resolution.
(7)
In the case of a registered society, “special resolution” has the
meaning given in section 52(3) of the Industrial and Provident
Societies Act 1965.
(8)
In the case of a company limited by guarantee which makes an
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application for conversion (whether or not it also has a share capital),
the proposed constitution of the CIO shall (unless subsection (10)
applies) provide for the CIO’s members to be liable to contribute to
its assets if it is wound up, and for the amount up to which they are
so liable.
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Charities Bill [HL]
Schedule 7 — Charitable incorporated organisations
Part 1 — New Part 8A of and Schedule 5B to 1993 Act
119

(9)
That amount shall not be less than the amount up to which they were
liable to contribute to the assets of the company if it was wound up.
(10)
If the amount each member of the company is liable to contribute to
its assets on its winding up is £10 or less, the guarantee shall be
extinguished on the conversion of the company into a CIO, and the
5
requirements of subsections (8) and (9) do not apply.
(11)
In subsection (4), and in sections 69H and 69I below, “the appropriate
registrar” means—
(a)
in the case of an application for conversion by a charitable
company, the registrar of companies,
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(b)
in the case of an application for conversion by a registered
society, the Financial Services Authority.
(12)
In this section, “charitable company” means a company which is a
charity.
69H
Conversion: consideration of application
15
(1)
The Commission shall consult those to whom it has given notice of
an application for conversion under section 69G(4) above about
whether the application should be granted.
(2)
The Commission shall refuse an application for conversion if—
(a)
it is not satisfied that the CIO would be a charity at the time
20
it would be registered,
(b)
the CIO’s proposed constitution does not comply with one or
more of the requirements of section 69B above and any
regulations made under that section, or
(c)
in the case of an application for conversion made by a
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company limited by guarantee, the CIO’s proposed
constitution does not comply with the requirements of
subsections (8) and (9) of section 69G above.
(3)
The Commission may refuse an application for conversion if—
(a)
the proposed name of the CIO is the same as, or is in the
30
opinion of the Commission too like, the name of any other
charity (whether registered or not),
(b)
the Commission is of the opinion referred to in any of
paragraphs (b) to (e) of section 6(2) above (power of
Commission to require change in charity’s name) in relation
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to the proposed name of the CIO (reading paragraph (b) as
referring to the proposed purposes of the CIO and to the
activities which it is proposed it should carry on), or
(c)
having considered any representations received from those
whom it has consulted under subsection (1), the Commission
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considers (having regard to any regulations made under
subsection (4)) that it would not be appropriate to grant the
application.
(4)
The Secretary of State may make provision in regulations about
circumstances in which it would not be appropriate to grant an
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application for conversion.
(5)
If the Commission refuses an application for conversion, it shall so
notify the appropriate registrar (see section 69G(11) above).