Loosening of rules for foreign CSOs in China coming


Karla Simon

Karla Simon

Karla Simon

A front-page headline in 19 July’s China Daily proclaims: ‘Foreign NGO registration rules eased.’ While something of an overstatement, it is nonetheless good news and the move is to be applauded. 

At the current time only foreign foundations are permitted to register representative offices at the national or local level. Only in Yunnan Province, where foreign CSOs are permitted to be ‘recorded’ (a procedure called bei’an), are other types of CSO given a quasi-legal status. While they are not ‘full legal entities’ in Chinese parlance, they are allowed to open foreign currency and RMB bank accounts, etc. Now these rules will be extended nationwide, according to an announcement made in Yunnan by Wang Jianjun, the new director of the non-governmental organizations management department in the Ministry of Civil Affairs (MCA). The new framework will allow them to be recorded in provincial-level bureaus of civil affairs.

According to the newspaper, this status will give them an ID number, and they will receive help with registration for tax exemption and residence permits for foreign employees, in addition to the banking privileges listed above. The head of the Yunnan bureau of civil affairs said at a conference held in Yunnan that such organizations ‘are no longer regarded as demons!’ At present more than 100 international organizations are helping with Yunnan’s development.

Most of the CSOs working in Yunnan focus on health, education and poverty alleviation – all of which are needed in the province. Wang Zhenyao, head of the China Philanthropy Research Initiative (CPRI) at Beijing Normal University, praised the Ministry for moving ahead with the reforms. Wang Ming from Tsinghua University also praised the changes, saying that other provinces can learn from Yunnan.

It is not entirely clear whether the new rules are effective immediately or whether they go into effect on 1 January 2014, at the same time that the other CSO ‘direct registration’ rules are expected to do.

Karla W Simon (西 门 雅) is Research Professor of Law at the Catholic University of America’s Columbus School of Law. She splits her time between Beijing and the Washington, DC area.

Tagged in: China Cross-border philanthropy Foreign funding Legal developments

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