L’Eggo My NGO!

On April 23, China’s National People’s Congress, its legislature, released the second draft of a new law on “Managing Foreign NGOs.” The impact could be huge. Many foreign non-profits in China have operated in a legal gray area for years. The law would establish procedures for foreign organizations to register formally and conduct activities in China, and places NGOs under the supervision of public security departments. Foreign Policy partner ChinaFile asked experts to comment on whether the law is likely to be enacted, and if it were, what that would mean for foreign and Chinese NGOs, as well as civil society in China.  

Carl Minzner, Professor of Law at Fordham University:

In recent years, Beijing has become increasingly concerned about the perceived “infiltration” of “foreign” values and organizations deemed detrimental to interests of the one-Party state. Official pressure on domestic and foreign civil society organizations has increased as a result. The new draft law is but the next logical step in escalating this pressure.

Those who work on China issues will naturally think of the potential implications of this law on the work of established foreign and domestic NGOs who do work in China on a range of legal, environmental, or societal issues. Many are justifiably concerned that this will lead to a further closing of space for such groups to operate in China. But there is also a much broader range of foreign organizations that could potentially be implicated by the draft law and have not even considered it. Here are some examples:

• The non-profit college alumni organization that organizes educational tours on the Yangtze for its members.
• The international scientific association that wants to rent out a resort in Hainan for their annual conference.
• The American high school band group that plans to go to the southern city of Guangzhou next year to conduct a performance.
• The volunteer medical group that sends individual doctors into China to conduct small training sessions for nurses.

Under the draft law, all of these would be required to either have a sponsor organization (just as if they were seeking to register in China), or to have a Chinese partner willing to go through the temporary permit process to obtain advance approval. Currently, many of these groups rely on Chinese individuals, companies, or associations to provide required letters of invitation for visas, or they simply provide travel booking information and obtain a tourist visa. Both of these are quite different from the quasi-sponsorship requirement envisaged under the draft law (i.e. the temporary registration process).

One of the major risks here is that some foreign individuals and organizations may just decide that it is too much trouble to carry out their activities in China, and simply move to another country instead. That American high school band group, for example, might find locating a partner organization willing to go through the approval process with public security authorities too complicated. Instead, it might decide to go to France or Vietnam. Play such trends out far enough into the future, and people-to-people contacts — one of the core elements that have contributed to building positive, healthy relationships between China and the rest of the world in the reform era — could be seriously damaged.

Teng Biao, Visiting Scholar at Harvard Law School:

The aspect of the draft Law on the Management of Foreign NGOs that merits the most attention is that it would have the public security apparatus replace the Ministry of Civil Affairs as the government body in charge of registering foreign NGOs.

Not only does the draft bill give the police power, it also enlarges that power to encompass supervision of every aspect of foreign NGOs’ work, from registration, permit-granting, annual inspection, and investigation to the seizure of data, sealing of offices, and freezing of assets. One can imagine what a disaster this will be for foreign NGOs.

Despite the critical reaction the draft law’s naked agenda has sparked, there should be little suspense about whether it will pass. The attitudes it espouses and projects are not an aberration. It’s an embodiment of the way the authorities seem to be reverting to class struggle as the lens through which they view civil society. From this perspective, any non-governmental organization becomes an anti-government organization, an instrument of the West’s hostility and determination to subjugate us, and a tool for fomenting a Color Revolution.

The authorities have never let down their guard toward NGOs, whether they’re foreign or domestic. When it comes to registering, receiving funding, and carrying out their work, NGOs in China have always faced layer upon layer of obstruction. Many of the leading Chinese NGOs were never able to register officially with the Ministry of Civil Affairs and instead have been forced to set themselves up as businesses. Many more exist only thanks to gray areas in the law. And many foreign NGOs don’t know where to turn either.

Authorities treat NGOs whose work relates to human rights, the rule of law, and politics differently from other groups. During the period before Xi Jinping came to power, NGOs and think tanks that worked on issues such as poverty alleviation, education, environmental protection, and other politically non-sensitive issues, were able to operate and grow, within certain limits. Groups whose work addressed AIDS, occupational diseases, women’s rights, LGBT issues, and labor rights, as well as rural libraries, were able to carry out their work despite restriction and harassment.

After Xi Jinping came to power, repression of civil society increased markedly. A large number of leading figures in rights were arrested, a number of directives emerged calling for stricter control of ideology, and controls over the Internet intensified further, all of which made it a bad time to be an NGO. The Aizhixing Institute (an AIDS group), the Transition Institute, and the Liren network of rural libaries, as well as a few women’s and LGBT rights organizations that had up to that point maintained the space in which to operate, met with disaster one after another: shutdowns, arrests, imprisonment. The strategy of remaining apolitical ceased to offer effective protection. The authorities’ position on civil society and the human rights movement had shifted from restriction and control to outright repression. The draft bill under discussion isn’t surprising given this context.

But, it’s not hard to see how the fearsome face of the regime, for all its apparent ferocity, covers a weak and paranoid mind.

Zhou Dan, a lawyer based in Shanghai, China:

Over the past decade, in addition to being an openly gay Chinese lawyer working on legal issues related to sexual orientation and HIV/AIDS, I have been an activist persevering in the tumultuous uncharted waters of civil society, where major players are international foundations, domestic charities, and Chinese governmental authorities. In China’s politics, the third sector, another name for civil society, is the third rail. It is no secret that activists are monitored, and advocacy groups – at least those not shuttered – are under surveillance by security authorities. What’s worse, in recent years, a staggering number of activists and advocates have been criminally arrested and sentenced. Of those, a few were, in part or in whole, funded by foreign foundations and other nonprofit institutions.

Now authorities are aggressively marking a boundary and setting a code of conduct for foreign NGOs.

Legislation is a political statement. In that regard, the draft bill designed to regulate foreign NGOs is an unwelcome message to its target audience, presumably because much of the impetus for the intended codification emanates from obsession with national security. In addition to the tone of the bill, the rules as currently drafted are excessively prescriptive, confusing, and cumbersome.

The bill sends a harsh message. Although the stated purpose of the bill is “to normalize and guide activities of foreign NGOs within the territories of China, protect their legal rights and interests, and promote exchange and cooperation,” it seems to be conveying a contrary signal on two fronts. First, the bill provides for a process by which foreign NGOs shall obtain prior approval from designated Chinese sponsors if they plan to carry out any permanent or temporary activity in mainland China. Second, the bill proposes that public security departments are not only registration authorities, but also charged with supervisory, investigative and enforcement authorities and functions specifically targeting foreign NGOs. The proposed approval, registration, and enforcement regime stands in stark contrast to the recently improved system applicable to certain domestic NGOs and foreign chambers of commerce, which makes registration authorities the civil affairs bureaus rather than public security departments and does not require sponsorship unless under exceptional circumstances.

The bill also causes profound confusion and uncertainty. Key concepts in the draft law are fatally ambiguous and vague. For instance, the bill presents a definition of “NGOs” featuring two substantive aspects—nonprofit and nongovernmental, which can be broadly read to cover all entities registered outside mainland China as not-for-profit, tax-exempt nongovernmental institutions. Meanwhile, the bill fails to define essential words and phrases such as “activity” and “public order and good morals.” The text breeds ambiguity and perplexity, thereby hindering, rather than helping, international exchange and cooperation.

The bill also imposes undue financial, administrative, and operational burdens. The proposed complex review, reporting, filing, and approval procedures will lead to a sharp rise in administrative and operating costs. These factors will strain the abilities of foreign nonprofits to engage in activities conducive to public welfare, and hamper efficient responses to civil society needs in China.

Isabel Hilton, a London-based international journalist and broadcaster:

Unless there is a radical, and, at this point, unlikely change of heart in Beijing, this year will see the passage of a draconian new law to govern the activities of foreign NGOs in China. If the draft currently in circulation becomes law, it will have the capacity to impact a wide variety of organizations and activities, Chinese and foreign.

Operating in China has never been straightforward. A majority of Chinese social organizations operate in a gray zone because the requirements of legal registration are too onerous. Some register as businesses; others simply operate without a license, relying on the good will of local officials. Many depend on grants and donations that come from overseas, yet are unable to open and operate official bank accounts. This sector is likely to be hard hit as the foreign organizations that have supported and worked with them find themselves squeezed out.

The Chinese government has long had an ambivalent view of the non-governmental sector. Authorities recognize that civil society organizations — be they development, educational, environmental or health charities, philanthropic foundations, policy, technical, or scientific entities — have contributed immeasurably to China’s development in the past 30 years, through the sharing of expertise, training, and funding.

At the same time, at least some elements of the party-state appear concerned that organizations not directly under their control offer an actual or potential challenge to its authority. Despite decades of trust building and solid achievement, foreign NGOs now find themselves at risk of being seen as Trojan horses — benign on the outside, but tools for Western values and ideas to infiltrate China and to give support to those Chinese citizens who may seek the transformation of the Chinese state into a more open and accountable model.

Even given that these concerns are not new—and appear to be shared by both Vladimir Putin and Narendra Modi—the draft law is unfriendly to a whole range of activities and to the future of independent civil society. Chinese NGOs are regulated by the Ministry of Civil Affairs; should their foreign counterparts, who are often also their partners in joint projects, wish to register legally in China, they will come under the authority of the public security authorities. In addition, they will require the approval of two official sponsors who would be expected to exercise a continuing supervision of their activities.

If a foreign entity does not wish to register, but only to carry out activities—educational or training workshops for example, either alone or in partnership with a Chinese organization—it will require a permit in advance from the public security authorities.

It will no longer be legal for Chinese individuals or organizations to receive funding from non-Chinese NGOs, unless the foreign entity is registered in China. Even if registered, a non-Chinese NGO would not be permitted to recruit volunteers or set up branch offices. It would be obliged to submit its plans and budgets for the year ahead, both to the security authorities and to its legal sponsors. No activities outside the plan would be permitted.

Even with this high degree of supervision, the draft law gives the security authorities the right to enter premises, interrogate individuals and seize materials, without offering firm safeguards against the abuse of these powers.

For Chinese entities that have worked with foreign counterparts, the burden of bureaucracy and potential risk is now much higher. Many organizations already report that longstanding partners are cancelling plans, and once flourishing relationships are cooling off. The impact of the law may well be that organizations that have worked in China for many years decide to pull out, not because they have any ulterior purpose, but because the burden of compliance is too high. The impact on grass roots Chinese organizations that have benefitted from foreign funding could be dramatic.

The draft law manifests a suspicion of the activity of foreign organizations that many will find troubling at this stage of China’s development. How the law will be applied and what kind of organizations it is aimed at is hard to guess.

If the trend of current policy on domestic civil society is a reliable guide, organizations that focus on service delivery in uncontentious areas—child welfare, for example, or care of the elderly—may find their work continues as before. Those that are active in policy, however, even where that policy is not directly concerned with such issues as rule of law or human rights, risk finding themselves in a cold climate indeed. If that is the result, both sides will be the poorer.

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