Part 5: Charity Mergers Section 35: Vesting permanent endowment following a merger
Section 35(a) changes the reference in section 306 of the CA 2011 to a charity which has "a permanent endowment" to a charity which has "permanent endowment" in order to create consistency with the revised definition of permanent endowment in section 9.
	Ordinarily, a merger will only be a "relevant charity merger" if all property of the merging charity is transferred to the new charity, and the original charity ceases to exist. Section 306(2) modifies the definition of a "relevant charity merger" in the case of a charity with permanent endowment, such that permanent endowment does not have to be transferred to the new charity, and the original charity can continue to exist. That modification previously only applied if the "trusts do not contain provision for the termination of the charity". Section 35(b) of the Act removes those words, which were difficult to understand and unnecessary. The result is that, in a rare case where the governing document of a charity with permanent endowment contains provision for the termination of the charity, a merger can still be a "relevant charity merger" even if the original charity continues to exist.