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China’s New Realities and the Overseas NGO Law

Under President Xi Jinping’s “new normal,” foreign faith-based organizations serving in China face a new set of realities.

One of these realities is the Overseas NGO Law, which went into effect January 1st.  The law is part of a nationwide emphasis on national security that targets “hostile foreign forces” perceived as trying to destabilize China. The law affects all non-profit organizations engaged in China, regardless of where they are located.

On the positive side, the law takes NGOs out of the gray area in which they had been functioning for the past three decades and creates rational means by which such entities may legally operate in China. This process involves finding a professional supervisory unit or a Chinese partner organization (depending upon whether the organization has a permanent or temporary presence in China) and coming under the authority of the Public Security Bureau (PSB).

There is no “one size fits all” approach for organizations seeking to deal with the new law. Foreign NGOs will likely require a portfolio of approaches depending on the nature of the work, where it is being done, and the degree to which they are willing and able to work with officials at various levels.

Some organizations whose activities fall outside the bounds prescribed by the law will choose to accept the risks and continue with their activities. Others, by making adjustments to their posture in China, how they position themselves outside China, their organizational and legal structures, and the way in which they conduct their activities, will be able to continue to engage in China while not running afoul of the new law.

The experience of organizations that have begun the registration process illustrates the complexity and cost involved, including obtaining professional legal assistance in China and translating and notarizing numerous documents.

There is no guarantee that this lengthy process will result in a successful registration. It is up to the NGO to prove to both its sponsoring or partner organization and to the PSB that it is qualified, positioned to bring benefit to Chinese society, and does not present a political risk. Even if registration is granted, the scope of the NGO’s activities in China may be limited by the sponsoring or partner organization.

During the early stages of implementation many questions remain, including how much tax foreign NGOs will have to pay and how to deal with existing for-profit entities that the NGO may be currently operating in China.

Excerpted from ChinaSource Law and Policy Monitor, part of a new package of services aimed at assisting faith-based organizations as they deal with the implications of the Overseas NGO Law and related policy developments. For further information please contact ChinaSource.

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ChinaSource Team

ChinaSource Team

Written, translated, or edited by members of the ChinaSource staff.          View Full Bio

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