China's new NGO law: part of a growing trend

With their April 2016 NGO law the Chinese government joined a growing list of countries enacting laws restricting the operations of international NGOs.  By its own description, the new law is designed to “regulate and guide activities conducted by foreign NGOs” as well as “safeguard their [the NGOs] rights and interests.” Critics charge that the new law is designed to control the activities of international NGOs and assert greater government power over Chinese civil society. Unquestionably the new law will restrict some activities and likely curtail others.  The legal hurdles imposed by the new Chinese law and similar measures enacted elsewhere add to the complex mix of risks faced by NGOs and development organizations globally.

Of course China’s law is neither a surprise — Beijing has long asserted control over foreign organizations — nor is it unique:  Russia, Azerbaijan, Bolivia and Cambodia amongst other have enacted restrictive laws in recent years that have severely impacted the ability of foreign NGOs to support local civil society groups. Efforts by the Egyptian and Pakistani governments to crackdown on both international and domestic NGOs have made headlines and disrupted activities.  And the pressure has not been confined to traditional NGOs alone:  in Russia educational organizations have faced increased pressure.

In Russia and Azerbaijan pressure became so significant that many international NGOs and development organizations — especially those working on human rights and democracy – withdrew from the country. More often, though, NGOs continue to operate as governments restrict operating space.  But operating in these increasingly closed environments shouldn’t be business as usual.  Considerations for managing the increased risk include:

• Understand how new laws and regulations will impact the organization and ensure close compliance with rules around legal status/registration.  Seek trusted, informed local legal guidance. Obtain proper visas or work permits for international staff and travelers, pay taxes and other required social service benefits for national staff, etc.
• Understand perceptions of the organization from both friendly local partners but also the government and government sponsored groups including media. Watch closely for signs that may signal a change in perception or increased scrutiny – negative press, questions from banks, unusual delays in visa processing, etc.
• Establish triggers or tripwires that would prompt internal review of operations.
• Align external resources including Kidnap, Ransom and Extortion insurance to ensure illegal detention coverage is included and consider the need for Political Risk insurance to protect funds and assets.

Focusing on these types of measures at the expense of programming may well be an intended outcome of restrictive NGO laws. But often authoritarian regimes exploit relatively minor administrative compliance issues in order to disrupt NGO activities. As with so much in today’s challenging global landscape, focus should be on awareness and managing the risk.

China’s new NGO law is another data point in a growing trend wherein operating space for NGOs is constricting in some parts of the world.  NGOs will need to closely monitor developments and adjust activities and operations to manage the risk that closing space may bring.

For more analysis of China’s new NGO law, check out the recent report from the Overseas Security Advisory Council. (Requires OSAC membership…which is free and a good thing for many reasons).

And for more on NGO laws around the world generally, the International Center for Not-For-Profit Law (ICNL) website has a wealth of info.