It has now been half a year since the implementation of China’s Charity Law, and many in the sector are wondering how things are moving forward with the recognition of charitable organizations across China. A recent report by the China Non-Public Foundations Development Forum focuses on the situation in Guangdong province. As some of the first ones to obtain recognition by the Civil Affairs Bureaus, charitable organizations in Guangdong can act as a point of reference for others across the country. The report found that there are twenty-one registered charitable organizations in the province. Out of these, there are fourteen social organizations that were directly established as charitable organizations when registering, all of which are foundations. An additional seven were recognized as charitable organizations, including six foundations and one social group.
According to statistics from the Municipal Civil Affairs Bureau of Guangzhou, by the end of February 2017 there were fourteen social organizations in the city that had been directly established as charitable organizations when registering. Out of these fourteen, five were social groups and nine were foundations. Meanwhile, there were four social organizations recognized as charitable organizations, including two foundations and two social groups.
However, many are wondering if the threshold for establishing a charitable organization has lowered. According to a staff member at the Guangzhou Municipal Civil Affairs Bureau, the threshold has most certainly not got lower since charitable organizations now have to meet an increased number of requirements. After the implementation of the Charity Law, organizations have to adhere not only to municipal and provincial registration guidelines, but also to special regulations outlined in the Law. Aided by the fact that requirements for Guangzhou and Guangdong as a whole are the same, some of the first organizations to receive recognition have been in Guangzhou. One of them, the Orphan Education Society of Guangdong, claims that despite municipal and provincial requirements being the same, successfully registering wasn’t easy.
Others are wondering if the main goal of being recognized as a charitable organization is to obtain fundraising qualifications. The executive vice president of the Orphan Education Society of Guangdong Zhu Xiaohong points out that achieving fundraising qualifications is just the first step in the process; the second step is to apply for public fundraising qualifications, which can begin two years after charitable organizations register. However, not all charitable organizations wish to apply for this. Guangdong Harmony Foundation’s Deputy Secretary General Li Miaoting claims that many charitable organizations are still considering whether to apply for public fundraising qualifications depending on their individual situations, which include many factors. She goes on to say that it may even come down to whether an organization has pre-tax deductible qualifications, as people are more willing to donate to these organizations.
Then there are those who are asking “if annual inspections are cancelled, how will charitable organizations’ behaviour be regulated?” The answer is that there will still be on the spot checks, special examinations, public supervision and required reports. The Charity Law requires charitable organizations to provide an annual work report and financial accounting report to the Civil Affairs Bureau that they registered with. In addition to that, the Civil Affairs Bureau published their “Interim Measures for the Examination of Social Organizations”, which emphasizes that charitable organizations will still need to perform mandatory information disclosure. In addition to this, the public is encouraged to report on illegal activities, acting as an additional supervisory unit.
Zhu Jiangang, Zhongshan University professor and Vice President of the Guangdong Harmony Foundation, states that while in cities like Shenzhen and Guangzhou civil society and charity are already quite strong, the general environment for charity necessitates further rules on social organizations, as well as the full implementation of the Charity Law.
