Foreign NGOs in China Look Ahead with Uncertainty

A client inquired this week about the new Law of the People’s Republic of China on the Administration of Domestic Activities of Overseas Non-governmental Organizations, (The Foreign NGO Law). This new law will come into force on January 1, 2017, and the State Ministry of Public Security (PSB) has already published guidance to local Public Security Bureaus for registering the Representative Office of the overseas non-governmental organizations and for filing the records temporary activities in China according to the specific articles in the new law.

Per the new law, foreign NGOs which would like to perform activities within the territory of China shall match the several requirements indicated in the new law which includes an examination of their legitimate existence in other countries, their purposes for business and business scope, even a consideration of the organizations persistence and methods in carrying out activities in other countries. Then, Foreign NGOs will have to apply to the PSB to establish their representative offices. Those foreign NGOs which do not have the representative office will have to file a report of their “temporary” activities with the PSB.

A representative office for a Foreign NGO will be required to have a qualified Chief Representative for, an official operations space, adequate funds and will be required to meet other conditions as set forth in the new law. In order to officially register a representative office with the PSB, each foreign NGO will be required to submit an activity plan and application to relevant authorities, including official registration information of foreign NGO, the appointed chief representative, the source of funds for the NGO, and the location of the NGO’s business operations.

During the review of the applications, the PSB may call for specialists and professionals to evaluate the necessity for approving the establishment of any representative office for certain NGO. The question that frequently asked by the public is why the Ministry of Public Security in charge of the registration and record-filing works for foreign NGOs and supervising their activities?

The Ministry of Civil Affairs (MCA) is responsible for registering and filing works of domestic charity organizations and associations. The level of PSB’s administration and supervision will likely be much more strict than the level of review at the MCA.

The most important functions of the PSB are to maintain the national unity, security and solidarity and guarantee the national interests, social public interests and the legitimate rights and interests of citizens, and organizations. Such functions make the PSB the most appropriate organ for managing and supervising the activities of foreign NGOs, which the government often sees as acting as agents of foreign governments.

Without proper registration or record-filing, foreign NGOs in China shall be banned or suspended, property and “illegal gains” will be confiscated, and the personnel directly assisting in carrying out the foreign NGO’s activities in China shall be warned and potentially detained by the PSB.

If you are a Foreign NGO operating in China, the time to worry is now. You need a plan in place on January 1, to demonstrate compliance with the law, and to initiate establishment of an appropriate representative office to maintain legal compliance for your organization. If you haven’t done so already, contact your China Lawyer. Now.

Published by Crys Zheng on December 7th, 2016 tagged Uncategorized

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