China: Setting Up A Foreign NGO In China

Last Updated: 20 September 2019
Article by Ari Chernoff and Zoey Zhang

China Briefing summarizes key elements of the Overseas Non-Governmental Organization (NGO) Law and provides step-by-step guidance for setting up foreign NGOs in China.

China's first Overseas NGO Law took effect January 1, 2017. Together with other regulations, the law provides systematic provisions on the management and legal liabilities of foreign NGOs operating in China.

Prior to taking effect, China's Ministry of Public Security (MPS) published guidance on the law November 28, 2016 – for foreign NGOs seeking to register their representative offices (RO) and conducting activities in the country.

In this article, we break down the legal essentials that foreign NGOs must pay attention to when looking to set up in China.

How can foreign NGOs enter China?

According to the Overseas NGO Law, foreign NGOs, including foundations, social groups, think tanks, and other non-profit, non-governmental social organizations from Hong Kong, Macau, Taiwan, and foreign countries, have two ways to operate in China: setting up an RO in China or conducting temporary activities after filing the activities with relevant authorities.

Establishing an RO in China

Criteria for establishing an RO

A foreign NGO must meet the following criteria in order to establish an RO in China:

  • It must be able to undertake civil liability independently, meaning that in the case of a lawsuit, it must be able to pay damages or other court-enforced payments.
  • It must have been established for a minimum of two years before applying to set up an RO in China, and it is required to function substantively.
  • It is a legal entity in its home country.
  • It must have clear objectives, and a business scope that can benefit community projects and development in China. Encouraged fields for foreign NGOs include sport, culture, health, technology, economy, education, and environmental protection.

Application procedures

Once a foreign NGO has concluded that it meets the criteria for establishing an RO in China, it can reach out and apply to the relevant unit for the latter to be its Professional Supervisory Unit (PSU).

A foreign NGO can find its relevant PSU in the List of Fields of Activity, Categories of Projects and Professional Supervisory Units for Overseas NGOs (2017 edition) in light of its scope of operations, area, and purpose of activity.

If the PSU concludes that the NGO meets all the necessary criteria, the NGO can then submit its application documents and materials to the overseas NGO administration office of the Provincial Public Security Bureau (PSB) in the location where they propose to establish an RO – within 30 days.

Once the foreign NGO has submitted its application, the PSB will review it. If necessary, the PSB may call in experts to assess the application in order to come to a final decision.

If the registration is approved by the PSB, the foreign NGO will be issued a registration certificate that includes the name, address, scope of business, name of the chief representative, governing authority, and operating areas of the RO.

The NGO's certified RO will then present its certificate to the tax authorities. Once the organization seal (chop) has been engraved, the RO will be able to open a bank account with a local Chinese bank.

The RO must then give a file containing a photocopy of its seal, bank account number, and tax registration number to the registration and administration authority for record-keeping.

Materials required for submission to establish an RO

In order to establish an RO, the NGO must submit the following documents to the PSB:

  • Application Form for Establishment of RO of Overseas NGO (Form 1);
  • Form for Registration Matters of RO of Overseas NGO (Form 2);
  • Registration Form for Chief Representative of RO of Overseas NGO (Form 3);
  • Authorization for registration of establishment of RO from the overseas NGO;
  • Proof documents and materials showing that the overseas NGO is lawfully established overseas;
  • Articles of association of the overseas NGO;
  • Proof materials showing that the overseas NGO has been established overseas for two years or more and has carried out activities substantively;
  • Identity document and curriculum vitae of the Chief Representative of the proposed RO;
  • Statement of No Criminal Record of Chief Representative of RO of Overseas NGO (Form 4);
  • Proof materials of the address of the proposed RO;
  • Proof materials for source of funding; and
  • Consent document of the PSU.

Documents required to be notarized and authenticated

The RO must submit documents identifying the foreign, Hong Kong, Taiwan, or Macau resident who has been chosen to be the representative for the RO.

Additionally, the NGO should submit its articles of association, provide proof that it has been established overseas for a minimum of two years, and that it functions substantively.

These documents must be notarized by a notary organization in the NGO's home country and authorized by the relevant Chinese embassy or consulate.

Although the process is generally the same, NGOs located in Hong Kong, Macau, and Taiwan face slight differences as to the notarization and authentication process for establishing an RO.

NGOs lawfully established in Hong Kong must submit the same documentation as foreign NGOs; however, they must be notarized by a notary public recognized by mainland China.

For Taiwanese residents, the identification documentation required for the Chief Representative is the Mainland Travel Permit for Taiwan residents. Taiwanese NGOs must be notarized by a notary public in Taiwan.

For residents of Macau, the documentation is the same as for foreign NGOs, but the documents can be notarized by either the notary department of the Macau Special Administration Region Government or another notary public recognized by mainland China.

Determining a name

Overseas NGOs have very little say in the naming of their RO in China. The final name is composed of a number of different components that identify the NGO, which include the following:

  • The name of the overseas NGO;
  • The overseas location (region or country) where it was originally registered;
  • The name of the location in China; and
  • The title 'Representative Office' ('Liaison Office,' etc.).

After registration, the foreign NGO shall clarify their scope of activities in the mainland of China. The area of activity shall be in line with its scope of operations.

Conducting temporary activities

Except for setting up an RO, foreign NGOs are allowed to conduct temporary activities in coordination with a Chinese partner. The Chinese partner can be a state organ, a Chinese people's organization, a public institution, or a social organization.

Procedures

The Chinese partner shall handle examination and approval procedures in accordance with state regulations and submit documents to the overseas NGO management office of the MPS or the provincial PSB for their records – 15 days before temporary activities commence.

However, in emergency situations, such as disaster relief and rescue operations, the overseas NGO doesn't need to obey the 15-day rule.

If the registration authorities believe that the temporary activities on record is not legal, the temporary activities shall be immediately ceased.

After the completion of the activity, the Chinese partner must report in writing about the activity and the use of funds to registration authorities within 30 days.

The duration of temporary activities shall not exceed one year; where there is a need to extend this deadline, documentation and information shall be re-submitted for the record.

Documents required for applying to conduct temporary activities

  • Documents for the Record for Temporary Activities of Overseas NGO (Form 11);
  • Documentary and material evidence of the legal establishment of the overseas NGO;
  • A written agreement between the overseas NGO and its Chinese partner;
  • Evidence of costs and funding sources as well as the bank account details of the Chinese partner; and
  • Approval documents obtained by the Chinese partner.

All the documents concerning the overseas NGO submitted above shall be notarized and authenticated.

Stay on top of compliance

With the implementation of the Overseas NGO Law, foreign NGOs face increased police supervision and scrutiny by the Chinese government.

The law is seen by many as a crackdown on the freedoms of foreign NGOs, as it subjects foreign NGOs to police supervision and demands that they declare the sources of their funding.

Foreign NGOs looking to establish an RO in China must understand the changes in the application process, and the new environment in which they will be operating. Seeking local expertise is advised.

(Editor's Note: This article was originally published in December 2016 and has been updated.)

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

To print this article, all you need is to be registered on Mondaq.com.

Click to Login as an existing user or Register so you can print this article.

Authors
Similar Articles
Relevancy Powered by MondaqAI
 
Some comments from our readers…
“The articles are extremely timely and highly applicable”
“I often find critical information not available elsewhere”
“As in-house counsel, Mondaq’s service is of great value”

Related Topics
 
Similar Articles
Relevancy Powered by MondaqAI
Related Articles
 
Related Video
Up-coming Events Search
Tools
Print
Font Size:
Translation
Channels
Mondaq on Twitter
 
Mondaq Free Registration
Gain access to Mondaq global archive of over 375,000 articles covering 200 countries with a personalised News Alert and automatic login on this device.
Mondaq News Alert (some suggested topics and region)
Select Topics
Registration (please scroll down to set your data preferences)

Mondaq Ltd requires you to register and provide information that personally identifies you, including your content preferences, for three primary purposes (full details of Mondaq’s use of your personal data can be found in our Privacy and Cookies Notice):

  • To allow you to personalize the Mondaq websites you are visiting to show content ("Content") relevant to your interests.
  • To enable features such as password reminder, news alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our content providers ("Contributors") who contribute Content for free for your use.

Mondaq hopes that our registered users will support us in maintaining our free to view business model by consenting to our use of your personal data as described below.

Mondaq has a "free to view" business model. Our services are paid for by Contributors in exchange for Mondaq providing them with access to information about who accesses their content. Once personal data is transferred to our Contributors they become a data controller of this personal data. They use it to measure the response that their articles are receiving, as a form of market research. They may also use it to provide Mondaq users with information about their products and services.

Details of each Contributor to which your personal data will be transferred is clearly stated within the Content that you access. For full details of how this Contributor will use your personal data, you should review the Contributor’s own Privacy Notice.

Please indicate your preference below:

Yes, I am happy to support Mondaq in maintaining its free to view business model by agreeing to allow Mondaq to share my personal data with Contributors whose Content I access
No, I do not want Mondaq to share my personal data with Contributors

Also please let us know whether you are happy to receive communications promoting products and services offered by Mondaq:

Yes, I am happy to received promotional communications from Mondaq
No, please do not send me promotional communications from Mondaq
Terms & Conditions

Mondaq.com (the Website) is owned and managed by Mondaq Ltd (Mondaq). Mondaq grants you a non-exclusive, revocable licence to access the Website and associated services, such as the Mondaq News Alerts (Services), subject to and in consideration of your compliance with the following terms and conditions of use (Terms). Your use of the Website and/or Services constitutes your agreement to the Terms. Mondaq may terminate your use of the Website and Services if you are in breach of these Terms or if Mondaq decides to terminate the licence granted hereunder for any reason whatsoever.

Use of www.mondaq.com

To Use Mondaq.com you must be: eighteen (18) years old or over; legally capable of entering into binding contracts; and not in any way prohibited by the applicable law to enter into these Terms in the jurisdiction which you are currently located.

You may use the Website as an unregistered user, however, you are required to register as a user if you wish to read the full text of the Content or to receive the Services.

You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these Terms or with the prior written consent of Mondaq. You may not use electronic or other means to extract details or information from the Content. Nor shall you extract information about users or Contributors in order to offer them any services or products.

In your use of the Website and/or Services you shall: comply with all applicable laws, regulations, directives and legislations which apply to your Use of the Website and/or Services in whatever country you are physically located including without limitation any and all consumer law, export control laws and regulations; provide to us true, correct and accurate information and promptly inform us in the event that any information that you have provided to us changes or becomes inaccurate; notify Mondaq immediately of any circumstances where you have reason to believe that any Intellectual Property Rights or any other rights of any third party may have been infringed; co-operate with reasonable security or other checks or requests for information made by Mondaq from time to time; and at all times be fully liable for the breach of any of these Terms by a third party using your login details to access the Website and/or Services

however, you shall not: do anything likely to impair, interfere with or damage or cause harm or distress to any persons, or the network; do anything that will infringe any Intellectual Property Rights or other rights of Mondaq or any third party; or use the Website, Services and/or Content otherwise than in accordance with these Terms; use any trade marks or service marks of Mondaq or the Contributors, or do anything which may be seen to take unfair advantage of the reputation and goodwill of Mondaq or the Contributors, or the Website, Services and/or Content.

Mondaq reserves the right, in its sole discretion, to take any action that it deems necessary and appropriate in the event it considers that there is a breach or threatened breach of the Terms.

Mondaq’s Rights and Obligations

Unless otherwise expressly set out to the contrary, nothing in these Terms shall serve to transfer from Mondaq to you, any Intellectual Property Rights owned by and/or licensed to Mondaq and all rights, title and interest in and to such Intellectual Property Rights will remain exclusively with Mondaq and/or its licensors.

Mondaq shall use its reasonable endeavours to make the Website and Services available to you at all times, but we cannot guarantee an uninterrupted and fault free service.

Mondaq reserves the right to make changes to the services and/or the Website or part thereof, from time to time, and we may add, remove, modify and/or vary any elements of features and functionalities of the Website or the services.

Mondaq also reserves the right from time to time to monitor your Use of the Website and/or services.

Disclaimer

The Content is general information only. It is not intended to constitute legal advice or seek to be the complete and comprehensive statement of the law, nor is it intended to address your specific requirements or provide advice on which reliance should be placed. Mondaq and/or its Contributors and other suppliers make no representations about the suitability of the information contained in the Content for any purpose. All Content provided "as is" without warranty of any kind. Mondaq and/or its Contributors and other suppliers hereby exclude and disclaim all representations, warranties or guarantees with regard to the Content, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. To the maximum extent permitted by law, Mondaq expressly excludes all representations, warranties, obligations, and liabilities arising out of or in connection with all Content. In no event shall Mondaq and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use of the Content or performance of Mondaq’s Services.

General

Mondaq may alter or amend these Terms by amending them on the Website. By continuing to Use the Services and/or the Website after such amendment, you will be deemed to have accepted any amendment to these Terms.

These Terms shall be governed by and construed in accordance with the laws of England and Wales and you irrevocably submit to the exclusive jurisdiction of the courts of England and Wales to settle any dispute which may arise out of or in connection with these Terms. If you live outside the United Kingdom, English law shall apply only to the extent that English law shall not deprive you of any legal protection accorded in accordance with the law of the place where you are habitually resident ("Local Law"). In the event English law deprives you of any legal protection which is accorded to you under Local Law, then these terms shall be governed by Local Law and any dispute or claim arising out of or in connection with these Terms shall be subject to the non-exclusive jurisdiction of the courts where you are habitually resident.

You may print and keep a copy of these Terms, which form the entire agreement between you and Mondaq and supersede any other communications or advertising in respect of the Service and/or the Website.

No delay in exercising or non-exercise by you and/or Mondaq of any of its rights under or in connection with these Terms shall operate as a waiver or release of each of your or Mondaq’s right. Rather, any such waiver or release must be specifically granted in writing signed by the party granting it.

If any part of these Terms is held unenforceable, that part shall be enforced to the maximum extent permissible so as to give effect to the intent of the parties, and the Terms shall continue in full force and effect.

Mondaq shall not incur any liability to you on account of any loss or damage resulting from any delay or failure to perform all or any part of these Terms if such delay or failure is caused, in whole or in part, by events, occurrences, or causes beyond the control of Mondaq. Such events, occurrences or causes will include, without limitation, acts of God, strikes, lockouts, server and network failure, riots, acts of war, earthquakes, fire and explosions.

By clicking Register you state you have read and agree to our Terms and Conditions