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China’s New Laws on Foreign and Domestic NGOs

Operating in China just became a bit more complex for foreign nongovernmental organizations (NGOs). China’s new “Law on the Management of Foreign Non-Governmental Organizations’ Activities within Mainland China”, which was passed at the 20th meeting of the Standing Committee of the 12th National People’s Congress on April 28, 2016, centralizes the regulation of the registration, management and reporting requirements for foreign NGOs with the Chinese Ministry of Public Security (MPS). The law applies to “foreign NGOs”, which are defined in the law as social organizations including foundations, social groups and think tanks. The law allows foreign NGOs to operate in the areas of economics, education, science, culture, health, sports, environmental protection and poverty and disaster relief while expressly forbidding them from funding or engaging in any for-profit, political or religious activities or engaging in any activities that “endanger state security” or “damage the national or public interest”.

Foreign NGOs that want to conduct long-term activities in China must obtain the consent of a Chinese professional supervisory unit to register a representative office. The specifics of this process are unclear, but the MPS is expected to issue a list of approved professional supervisory units with which foreign NGOs may partner before January 1, 2017, the effective date of the new law. Foreign NGOs that wish to engage in temporary activities without an office or staff in China will not need to obtain such consent, but will need to enter into arrangements, including a written agreement, with a Chinese Partner Unit, defined in the law as a state organ, mass organization, public institution or social organization, and will be subject to certain reporting requirements. In addition to the list of approved professional supervisory units, the law also requires Chinese authorities to issue “draft catalogs of foreign NGOs' activity areas and projects”. It remains to be seen how the catalog (which will presumably list approved activities) will compare to the list of approved activities that appears in the law itself and whether the catalog will be exhaustive. It is expected that regulations outlining the implementation of the law will be issued, but it is not yet clear whether or not there will be an opportunity for comment on such regulations.

The final version of the law addresses some, but not all, of the critiques received in response to two previously issued drafts, which drew a great deal of criticism for being overly restrictive and for threatening the continued growth of China’s civil society. Certain widely criticized provisions in earlier drafts were removed, such as provisions limiting foreign NGOs to having one office in China, requiring re-registration every five years and having to obtain police permits for temporary activities. However, the final version of the law gives China’s domestic security forces even greater power than it has ever had to restrict the activities of groups thought to be working against government interests. Under the law, the MPS has the explicit right to enter an NGO’s domicile to conduct on-site inspections, question representatives of foreign NGOs and their Chinese partner organizations, examine and seal documents and seize venues, facilities or assets. The new law also has a broad prohibition on foreign NGOs fundraising in China and on any organization or individual in China accepting funding from an unregistered foreign NGO.

The MPS has acknowledged that some foreign NGOs are already operating in China, having registered under previous regulations, and has indicated that these organizations will be given an opportunity to submit additional documentation and register under this new law.

The new law comes on the heels of the passage of China’s first charity-specific law on March 16, 2016, the “Charity Law”, which provides domestic NGOs with some clarity in an environment that has historically lacked accountability and predictability. The Charity Law allows domestic NGOs to register and raise funds, and even permits organizations and individuals who are not registered to raise funds by cooperating with a registered charitable organization that has obtained a public fundraising certificate. However, the Charity Law places additional restrictions on the ability of domestic NGOs to fundraise without the approval of the government, and organizations that fundraise without receiving governmental approval could face criminal investigation. This could have serious implications for the many independent organizations that rely on crowd-funding in order to carry out activities promoting labor, health, women’s rights and the rights of people with disabilities. Public interest groups also anticipate the new law will take an immediate toll on their ability to provide legal services.

Many in the international community have criticized these two new laws as merely the latest examples of China’s ongoing efforts to curb political discourse and reduce foreign actors’ influence on China’s domestic affairs. While the extent of its impact is yet to be seen, the new law regulating foreign NGOs seems to reflect the Chinese governing authorities’ complicated relationship with foreign NGOs, many of which bring important aid and relief to the country but are also viewed as a potential source of disruption.