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UPDATED: October 30, 2014 NO. 31 AUGUST 4, 2011
A New Dawn for NGOs
Registration requirements relaxed for charity work

MAKING FRIENDS: A visitor seeks advice from the Friends of Nature, an environmental NGO, about garbage classification at a promotion activity for youth organizations in Beijing on May 22, 2010 (CHEN XIAOGEN)

Breaking the ice

As there has been a steep increase in the number of independent non-profit organizations working in communities, some local governments have already drawn up new regulations to make their registration easier.

In September 2008, Shenzhen in south China's Guangdong Province adopted a policy that allows NGOs in the fields of social welfare and charity to register directly with civil affairs departments after passing a set of pre-approval requirements.

"We have seen how some organizations have been bottlenecked in their development and are looking at tackling some of the systemic difficulties in moving from a dual management system to direct registration," said Ma Hong, Director of the Social Organization Administration Office under the Shenzhen Municipal Bureau of Civil Affairs.

Ma said the requirements are an NGO applying to be registered should have a regular operating location, full-time staff members and at least 30,000 yuan ($4,392) in registered capital.

In July 2009 the Shenzhen Municipal Government was granted the power to approve the creation of public fundraising foundations. In the past, only the Ministry of Civil Affairs had this authority.

Thanks to this new policy, the One Foundation, which was founded by Hong Kong movie star Jet Li, ended its cooperation with the Red Cross Society of China and registered as an independent public fundraising foundation in Shenzhen in January this year.

"It's a cornerstone of China's charity development," Deng said. "For the first time, we have seen the successful transition of a private charity attached to a public organization into a formal public foundation."

Since its establishment in 2007, the One Foundation had been running as a private charitable project under the Red Cross Society of China and encountered legal problems when it tried to fundraise as an independent organization.

In February 2010, Beijing also amended its regulations to allow social organizations in Zhongguancun Science Park to register directly.

In February this year, the new policy was extended to the whole city, allowing social organizations operating in the fields of charity, welfare and social services to register directly with civil affairs departments.

Now the Ministry of Civil Affairs is determined to expand the direct registration policy to the whole country. On July 8 the ministry issued draft guidelines in which it pledged to provide preferential tax treatment to individuals, enterprises and organizations that make charity donations.

"This is a good sign and reflects the fact that the government attaches great importance to existing problems and is willing to solve them," Deng said. But he added NGOs are still underdeveloped in China.

"China has witnessed rapid growth in the number of NGOs since the middle of the 1990s," Deng said. "But compared with some developed countries, especially the United States, we lag far behind in terms of scale and capabilities."

There have also been extensive complaints about the fact government-associated NGOs in China have a virtual monopoly of resources for charitable programs, such as funding, while NGOs without government backing have limited support and are unable to benefit from favorable government policies.

Staff workers at government-associated organizations are widely blamed for lacking incentive to carry out public service, as their salaries remain the same however well they perform. But a large number of NGOs created by individual citizens or businesses are often unable to meet social needs due to a lack of support and funding.

"We need both reform and development," Deng said. "A competitive mechanism should be introduced to help break the monopoly while more support should go to grassroots organizations."

"The government should cultivate more talented people for the development of NGOs while the public needs to become more aware of the importance of NGOs and support their development by donating money and materials and serving as volunteers. Spreading the spirit of volunteerism and supervising the performance of NGOs are the government's role," Kang said.

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