The Charity Law of the People’s Republic of China
Chapter 1. General Principles
Chapter 2. Charitable Organizations
Chapter 3. Charitable Fund-raising
Chapter 4. Charitable Donations
Chapter 5. Charitable Trusts
Chapter 6 Charitable Assets
Chapter 7. Charitable Services
Chapter 8. Disclosure of Information
Chapter 9. Promotional Measures
Chapter 10. Supervision and Management
Chapter 11. Legal Responsibility
Chapter 12. Supplementary Provisions
Chapter 1. General Principles
Article 1. This law is designed to develop charitable causes, promote the culture of charity and standardize charitable activities, as well as to protect the rights and interests of charitable organizations, donors, volunteers, beneficiaries and others who work in the field of charity, while promoting social progress and distributing the fruits of social development.
Article 2. This law applies to natural persons, legal persons and other organizations carrying out charitable activities and related activities. Where there are special provisions in other laws, the special provisions shall apply.
Article 3. ‘Charitable activities’ in this law refers to the following public interest activities voluntarily carried out by natural persons, legal persons and other organizations through the donation of property, the provision of services or other means:
(1) Helping the poor and the needy;
(2) Assisting the elderly, orphans, the ill, the disabled, and providing special care;
(3) Alleviating losses incurred by natural disasters, accidents, public health incidents and other emergencies;
(4) Promoting the development of education, science, culture, health, sports and other causes;
(5) Preventing and alleviating pollution and other public hazards, protecting and improving the eco-environment;
(6) Other public interest activities in accordance with this law.
Article 4. Charitable activities shall abide by the principles of being lawful, voluntary, honest, and non-profit, and must not violate social morality, or endanger national security or harm societal public interests or the lawful rights and interests of other persons.
Article 5. The government encourages and supports natural persons, legal persons and other organizations in legally carrying out charitable activities that represent the core values of socialism and promote the traditional morals of the Chinese nation.
Article 6. The civil affairs departments of the State Council are in charge of charitable work nationwide and the civil affairs departments of the local people’s governments at the county level or above are in charge of charitable work in their respective areas of administration; the relevant departments of the people’s governments at the county level or above complete relevant work within their authority in accordance with this law and other related laws.
Article 7. September 5th of each year will henceforth be “China Charity Day”.
Chapter 2. Charitable Organizations
Article 8. ‘Charitable organizations’ refers to legally established non-profit organizations that are in accordance with this law, that aim to carry out charitable activities catering to society.
Charitable organizations include foundations, social groups, social service organizations and other forms of organization.
Article 9. Charitable organizations shall meet the following requirements:
(1) Aim to carry out charitable activities;
(2) Not have the goal of making a profit;
(3) Have a name and address;
(4) Have an organizational charter;
(5) Have necessary financial assets;
(6) Have an organizational structure and person in charge in accordance with the requirements;
(7) Meet other conditions stipulated by laws and administrative regulations.
Article 10. Those establishing a charitable organization shall apply for registration with the civil affairs department of a people’s government at the county level or above. The civil affairs department shall issue a decision within 30 days of receiving the application; organizations meeting the requirements stipulated by this law shall have their registration approved, and the decision shall be publicly announced; registration shall be withheld from organizations that do not meet the requirements stipulated by this law and the reasons explained in writing.
Non-profit organizations such as foundations, social groups and social service organizations that were established before the publication of this law may apply for identification as a charitable organization with the civil affairs department with which they registered. The civil affairs department shall issue a decision approving the change of registration within 20 days of receiving the application. Organizations meeting the requirements shall be identified as charitable organizations and the decision publicly announced; identification shall not be granted to organizations that do not meet the requirements, and the reasons explained in writing.
Where an extension to the period needed to apply for a registration or identification is required due to special circumstances, a reasonable extension may be approved by the civil affair departments under the State Council, but the extension must not exceed 60 days.
Article 11. The charter of a charitable organization shall abide by the laws and regulations, and specify the following items:
(1) Name and address;
(2) Type of social organization;
(3) Aims and scope of activities;
(4) Sources and composition of financial assets;
(5) Structure and duties of decision-making and implementation bodies;
(6) Internal supervision mechanisms;
(7) Financial asset management system;
(8) Project management system;
(9) Circumstances for ceasing operations and methods of liquidation after operations have ceased;
(10) Other important items.
Article 12. Charitable organizations shall establish sound internal governance structures and clarify the delineation of authority and responsibility for decision-making, implementation and supervision, and carry out charitable activities on the basis of laws and the organizational charter.
Charitable organizations shall implement the unified national accounting system, manage their accounting in accordance with the law, establish a sound accounting supervision system and accept the supervision and management of the relevant government departments.
Article 13. Charitable organizations shall annually submit an annual work report and financial reports to the civil affairs departments that they registered with, which will include annual fund-raising activities, donations received, management and usage of charitable assets, details of the implementation of charitable projects, and the salary and benefits of the staff of the charitable organizations.
Article 14. Founders, major donors and management staff of a charitable organization must not abuse their connections to harm the interests of the organization, the interests of the beneficiaries, or societal public interests.
Where the founders, major donors and management staff of a charitable organization are involved in a business transaction with that organization, they shall not participate in the decision-making of the charitable organization concerning that transaction and the circumstances of the transaction shall be made public.
Article 15. Charitable organizations must not undertake or assist activities that endanger national security and societal public interests or accept contributions that carry additional conditions in violation of laws, regulations and social mores, and must not attach conditions for beneficiaries that are in violation of laws, regulations and social mores.
Article 16. A person shall not serve as the leader of a charitable organization if:
(1) They have limited or no civil capacity;
(2) They have been sentenced in court for intentional crimes and less than five years have passed since the date they were released from their sentences;
(3) They were in charge of an organization that had its registration certificate withdrawn or was banned and less than five years have passed since the day the organization had its registration certificate withdrawn or was banned;
(4) They fail to meet the conditions set out by other laws and administrative regulations.
Article 17. A charitable organization shall be terminated if:
(1) The circumstances for termination as set out in the organizational charter are met;
(2) Termination is required due to division or merger;
(3) It has not engaged in charitable activities for two consecutive years;
(4) It is de-registered or has its registration certificate withdrawn according to the law;
(5) Other conditions set out by laws and administrative regulations under which an organization shall terminate are met.
Charitable organizations that cease operations shall annul their registration.
Article 18. A liquidation shall be conducted upon the termination of charitable organizations.
The decision-making body of the charitable organization shall establish a team for liquidation within 30 days, starting from the date when the circumstances for termination contained in Article 17 are appeared. If the organization does not establish such a team or if the team does not fulfill its duties, the civil affairs department may apply to a people’s court to assign relevant personnel to form a team and to conduct the liquidation.
Financial assets remaining after liquidation shall be transferred, in accordance with the charter of the charitable organization, to charitable organizations with the same or similar aims; where the charter does not specify any requirements, the assets shall be transferred under the leadership of the civil affairs departments to charitable organizations with the same or similar causes and information regarding the transfer made public.
After completion of liquidation, the charitable organization shall apply for deregistration with the civil affairs departments with which they registered, and the civil affairs departments shall announce the results to the public.
Article 19. Charitable organizations may legally establish industry organizations.
Charity industry organizations shall reflect the needs of the profession, promote professional exchange, strengthen professional self-discipline, raise the credibility of the charity sector and promote the development of charitable causes.
Article 20. The State Council stipulates the organizational forms of charitable organizations and the specific methods of their registry management.
Chapter 3. Charitable Fund-raising
Article 21. ‘Fund-raising’ refers to the charity-based collection of financial assets by charitable organizations.
Fund-raising includes public fund-raising activities directed at society at-large and targeted fund-raising activities directed at specific targets.
Article 22. Charitable organizations carrying out public fund-raising activities shall acquire the qualifications for public fund-raising. Charitable organizations that have been legally registered for two years may apply for a public fund-raising certificate with the civil affairs department with which they registered. The civil affairs department shall make a decision within 20 days of agreeing to review the application. Where the organization meets the requirements of having a sound internal management system and operating according to the rule, the civil affairs department shall issue the public fund-raising certificate; where the requirements are not met, the civil affairs department shall not issue the public fund-raising certificate and the reasons shall be explained in writing.
Civil affairs departments shall issue public fund-raising certificates directly to foundations and social organizations that may raise fund publicly from the day of their registration, as set out by the laws and regulations.
Article 23 The following methods may be used for public fund-raising:
(1) Setting up a collection box for donations in a local public space;
(2) Organizing local charitable performances, competitions, sales, exhibitions, auctions and gala dinners directed to the public;
(3) Publicizing fund-raising information through local media such as radio, television, newspapers and journals, and the internet;
(4) Other public fund-raising methods.
Where charitable organizations carry out public fund-raising activities according to the methods set out by provisions (1), (2) of this Article, they shall do so within the administrative area of the civil affairs department with which they registered. Where there is a necessity to carry out public fund-raising activities outside the administrative area of the civil affairs department with which the organization registered, they shall be recorded with the local civil affairs department above the county level. Donors are not subject to geographical limitations when making donations.
Charitable organizations using the internet to carry out fund-raising shall publish the relevant information on the charity information platforms unified or designated by the civil affairs departments, and at the same time may also publish the relevant information on their website.
Article 24. A fund-raising proposal shall be drafted when carrying out public fund-raising. The proposal shall include, among other things, the goals, duration and location of the fund-raising activities, the name and office address of the person in charge, the method of receiving donations, as well as bank details, beneficiaries, use of assets collected, cost of fund-raising activities, and methods of dealing with excess funds.
The fund-raising proposal shall be recorded with the civil affairs department with which the organization registered before the fund-raising activities are carried out.
Article 25. When carrying out public fund-raising activities, information such as the name of the organization carrying out the activity, the public fund-raising certificate, the fund-raising proposal, the contact information and the means of inquiry for further information regarding the activity shall be displayed in a prominent place at the site of the activity or on the medium used for fund-raising.
Article 26. Organizations or individuals that do not have a public fund-raising certificate may cooperate with charitable organizations that have a public fund-raising certificate. The charitable organization shall carry out the public fund-raising and manage the donations collected.
Article 27. Radio broadcasters, television stations, newspapers and journals, as well as Internet service providers and telecommunications operators shall inspect and verify the registration certificate and public fund-raising certificate of charitable organizations using their platform to carry out public fund-raising activities.
Article 28. Charitable organizations may engage in targeted fund-raising activities from the date of their registration.
Charitable organizations engaging in targeted fund-raising activities shall specify the scope of their targets and the period of fund-raising, and provide information on matters such as the purpose of the fund-raising and the usage of the raised funds and items.
Article 29. Targeted fund-raising shall not use or covertly use the methods stipulated in article 23 of this law.
Article 30. In the case of emergencies such as natural disasters, catastrophic accidents and public health incidents that are in need of rapid alleviation, the relevant people’s governments shall establish coordinating mechanisms, provide needed information and orderly and timely guide fund-raising and emergency assistance.
Article 31. Those carrying out fund-raising activities shall respect and safeguard the legal rights of their targets, ensure their rights to be informed, and shall not deceive and mislead the targets into donating.
Article 32. Those carrying out fund-raising activities are not permitted to engage in forcible apportionment or covert forced apportionment and must not obstruct public order, corporate production or the lives of the people.
Article 33. It is forbidden for any organization or individual to obtain financial assets and carry out fund-raising activities by fraudulent means in the name of charity or posing as a charitable organization.
Chapter 4. Charitable Donations
Article 34. ‘Charitable Donations’ as stated in this law refers to the voluntary, non-compensated donation of property by natural persons, legal persons or other organizations for charitable purposes.
Article 35. Donors can donate through charitable organizations or directly to beneficiaries.
Article 36. Property donated by donors shall be legal property that the donors hold the right to dispose of. Charitable donations of property include cash, physical objects, buildings, marketable securities, equity, intellectual property, and other tangible or intangible property.
Donated objects shall have use value, and shall comply with safety, health, environmental and other standards.
Donors donating products from their own enterprises shall provide product certifications or quality inspection certificates.
Article 37. Natural persons, legal persons and other organizations that organize income generating activities, such as performances, competitions, sales, auctions or other commercial activities, and that promise to use all or part of the proceeds for the purposes of charity, shall sign a donation agreement with charitable organizations or other beneficiaries before the event, fulfill their obligations after the event in accordance with the donation agreement, and make public the status of the donation.
Article 38. Charitable organizations that accept donations shall issue to the donors a donation receipt uniformly printed by or printed under the supervision of the finance departments. Donation receipts shall specify the donor, the type and quantity of donations, the charitable organization’s name, the name of the person responsible, the date of the receipt, etc. In the case of donors wishing to remain anonymous or waive the donation receipt, charitable organizations shall record the relevant information.
Article 39. When accepting a donation, charitable organizations shall sign a written donation agreement with the donor if the donor requests so.
Written donation agreements shall include the names of the donor and charitable organization, the type, quantity, quality, purpose and delivery time of the donated property, etc.
Article 40. When agreeing on the purpose and beneficiaries of donated properties, donors and charitable organizations must not appoint interested parties from the donors’ side to act as beneficiaries.
No organization or individual shall use charitable donations to publicize tobacco products in violation of the law, and shall not use charitable donations or any other methods to publicize products and matters prohibited from being publicized by laws.
Article 41. Donors shall fulfill their donation obligations in accordance with their agreements. If donors delay or fail to deliver donated properties in violation of a donation agreement, under the following circumstances, charitable organizations or other beneficiaries may require delivery from donors; charitable organizations and other beneficiaries may apply to the people’s court for an order of payment or bring a prosecution if donors refuse delivery:
(1) Donors have made a public pledge of donation through the radio, television, newspapers, the internet or other media;
(2) Donated properties are for charitable activities specified in terms (1) – (3) of article 3 of this law, and a written donation agreement is signed.
Article 42. Donors have the right to inquire about and photocopy relevant information on the management and use of their donated properties； charitable organizations shall take the initiative to provide relevant updates to donors in a timely manner.
If charitable organizations misuse donated property in violation of the donation agreement, donors are entitled to request correction; donors may report or complain to the civil affairs department or bring a prosecution to the people’s court if charitable organizations refuse to correct.
Article 43. State owned enterprises shall carry out charitable donations in accordance with regulations on the management of state owned assets, and conduct approval and recording procedures.
Chapter 5. Charitable Trusts
Article 44. In this law a charitable trust, which is classified as a public interest trust, refers to the legal arrangement by which a principal (委托人), acting for charitable purposes, entrusts their property to a trustee (受托人), who manages and disposes of the property in charitable activities in the trustee’s name and in accordance with the wishes of the principal.
Article 45. Charitable trusts shall be established, and trustees and supervisors （信托监察人）determined, in written form. Trustees shall file the charitable trust documents within seven days of the signing with the civil affairs departments of the people’s governments at or above the county level where the trustees reside.
Those who do not file the relevant documents with the civil affairs departments will not enjoy tax benefits.
Article 46. Principals can appoint trusted charitable organizations or trust companies as trustees of charitable trusts.
Article 47. In situations where a trustee is in breach of fiduciary duties or unable to perform their duties, the principal may change the trustee. The new trustee shall file the change to the same civil affairs department within 7 days since the change is made.
Article 48. Trustees shall manage and dispose of the trust property in accordance with the purposes of the trust, and fulfill their obligations in good faith and with prudent management.
Trustees of charitable trusts shall provide timely reports to the principals on the handling of trust affairs and the management and use of trust property in accordance with trust documents and the requirements of principals. The trustees of charitable trusts shall report the handling of trust affairs and the trust’s financial status with the civil affairs departments with which they have filed a record at least once a year, and make the report public.
Article 49. If needed, the trustees of charitable trusts may appoint a trust supervisor.
Trust supervisors monitor the actions of trustees, and safeguard the interests of principals and beneficiaries in accordance with the law. Trust supervisors who discover trustees in breach of fiduciary duties or unable to perform their duties shall report to the principal, and have the right to bring a prosecution to a people’s court in their own names.
Article 50. The establishment of charitable trusts, trust asset management, trust parties, the termination and liquidation of charitable trusts, and other items that are not regulated in this chapter shall be governed by other chapters of this law; If not regulated by this law, they shall be governed by the relevant articles of the Trust Law of the People’s Republic of China.
Chapter 6. Charitable Assets
Article 51. The financial assets of charitable organizations include:
(1) Founding capital donated or funded by the founders;
(2) Assets collected from fund-raising;
(3) Other legal assets.
Article 52. The financial assets of charitable organizations can only be used for charitable purposes in accordance with the organizational charter and the donation agreement and must not be distributed among the founders, donors or members of the organization.
Groups or individuals must not privately distribute, misappropriate, withhold or embezzle charitable assets.
Article 53. Charitable organizations shall register donations for the records, strictly manage them and use the funds for specific purposes.
Donated objects that cannot be easily stored, transported or are difficult to use directly for charitable purposes may be legally auctioned or sold by the charitable organization, whereby proceeds remaining after the deduction of costs and other necessary expenditures shall be used entirely for the agreed upon purposes of the donation.
Article 54. Charitable organizations making investments to maintain or increase the value of their financial assets shall abide by the principles of lawfulness, security and effectiveness, and the income made through the investment shall be used for charitable purposes. Major investment plans of charitable organizations shall be approved by at least two-thirds of the members of the decision-making body. Government aid money and assets received under a donation agreement forbidding investments must not be used to make investments. The person in charge and the staff of charitable organizations shall not work part-time with or receive compensations from the enterprises in which the charitable organizations invested.
The civil department of the State Council stipulates specific methods for the matters regulated in the previous paragraph.
Article 55. Charitable organizations carrying out charitable services shall use donated property in accordance with the laws, regulations and organizational charter, and in accordance with the fund-raising proposal or donation agreement. In cases of necessary deviation from the purpose of the donated assets of the fund-raising proposal, charitable organization shall file with the civil affairs department; in cases of necessary deviation from the purpose of the donated assets of the donation agreement, the donors’ consent shall be obtained.
Article 56. Charitable organizations shall employ rational designs for charity projects, optimize implementation processes, lower operating costs, and improve efficiency in the use of charitable property.
Charitable organizations shall establish a project management system and conduct proper supervision of project implementation.
Article 57. Any remaining donated property upon termination of a charity project shall be disposed of in accordance to the fund-raising proposal or donation agreement; where relevant provisions are not specified in the fund-raising proposal or donation agreement, charitable organizations shall utilize the remaining property in charitable projects with the same or similar purposes, and make public this information.
Article 58. Charitable organizations shall adhere to an open, fair and impartial process when determining the beneficiaries of charitable services, and shall not select stakeholders from among the managerial staff of the charitable organization as beneficiaries.
Article 59. Charitable organizations may, as the need arises, sign an agreement with beneficiaries to clearly define the rights and obligations of both parties and to agree upon the purpose and amount of charitable assets, the method of usage and other contents.
Beneficiaries should cherish charitable funds, and use charitable assets in accordance with the agreement. If beneficiaries do not use the charitable assets in accordance with the agreement, or severely violate the agreement in other ways, charitable organizations are entitled to request a correction; charitable organizations have the right to end the agreement and demand the return of the assets if the beneficiaries refuse to make the correction.
Article 60. Charitable organizations shall carry out charitable activities actively, use charitable assets fully and efficiently, apply the most necessary principles regarding management fees, practice frugality, and cut unnecessary expenditures. Annual expenditures for charity activities by foundations with the qualifications for public fund-raising shall be no less than 70% of the total revenue of the last year or 70% of the average revenue of the past three years and the annual management fee shall not exceed 10% of annual expenditures. Where annual management fees cannot meet the previous regulations due to special circumstances, the foundation shall file with the civil affairs department with which it registered and explain the situation publicly.
Standards for annual expenditures and the management fees of charitable activities by charitable organizations other than foundations with public fund-raising qualifications are regulated by the civil affairs departments of the State Council together with the treasury and tax departments of the State Council according to the principles stipulated in the last paragraph.
If the expenditure and management costs of an individual charitable donation activity are specified in the donation agreement, then the agreement should be followed.
Chapter 7. Charitable Services
Article 61. ‘Charitable Services’ as stated in this law refers to uncompensated voluntary services and other non-profit services given to the society or to other people for charitable purposes and provided by charitable organizations and other organizations or individuals.
Charitable organizations carrying out charitable services may provide these services themselves or recruit volunteers to provide them, or engage other organizations with the relevant service expertise to carry out the services.
Article 62. Charitable services shall be carried out with respect for the human dignity of beneficiaries, and shall not infringe upon the privacy of beneficiaries.
Article 63. When carrying out charitable services with specialized skills like medical rehabilitation and educational training, standards and procedures established by the state or industry organizations shall be followed.
If charitable organizations recruit volunteers to carry out charitable services that require specialized skills, they should provide relevant training.
Article 64. Charitable organizations may recruit volunteers to participate in charitable services. When recruiting volunteers, all information related to the charitable service shall be made public, and any risks involved in the course of the voluntary service shall be disclosed.
Charitable organizations may, as the need arises, sign an agreement with volunteers to clearly define the rights and obligations of both parties and agree upon the voluntary service content, method and time.
Article 65. Charitable organizations shall conduct real-name registration of volunteers, and record the time, content, evaluation and other information regarding their services. When requested by volunteers, charitable organizations shall truthfully issue a proof of volunteer service free of charge.
Article 66. Charitable organizations shall engage volunteers in charitable services suited to their age, educational level, skills and physical conditions.
Article 67. Volunteers participating in charitable services under the arrangement of charitable organizations shall be subject to the management of the charitable organization and accept necessary training.
Article 68. Charitable organizations shall provide the necessary conditions for volunteers to carry out charitable services, and protect the legal rights and interests of volunteers.
Before arranging volunteers to participate in charitable services that may incur personal injury, charitable organizations shall purchase appropriate personal accident insurance for volunteers.
Chapter 8. Disclosure of Information
Article 69. The civil affairs departments of the people’s governments at or above the county level shall establish a sound system for collecting and releasing information on charity.
The civil affairs departments of the people’s governments at or above the county level shall disclose charitable information to the public timely on a unified information platform and provide charity information release services for free.
Charitable organizations and the trustees of charitable trusts shall disclose information using the platform described above, and assume responsibility for the authenticity of the information.
Article 70. Civil affairs departments and other relevant departments of the people’s governments at the county level or above shall ensure the timely publication of the following charity information:
(1) Registration information of charitable organizations;
(2) Records of charitable trusts;
(3) The list of charitable organizations with public fund-raising qualification;
(4) The list of charitable organizations qualified for pre-tax deduction receipts for public interest donations;
(5) Details of preferential tax rates, financial aid, subsidies and other promotional measures for charitable activities;
(6) Information regarding purchasing services from charitable organizations;
(7) Results of any inspections and evaluations of charitable organizations and charitable trusts;
(8) Results of any commendations or penalties of charitable organizations or other organizations and individuals;
(9) Any other information required by other laws or regulations.
Article 71. In accordance with the law, charitable organizations and the trustees of charitable trusts are obliged to make information publicly available. The disclosed information should be genuine, complete, and published in a timely manner.
Article 72. Charitable organizations shall disclose to the public the organization’s charter and information on the members of the decision-making, implementation, and supervision bodies, and other information required by the civil affairs department of the State Council. Charitable organizations must ensure the timely disclosure of any major changes to the information mentioned above.
Charitable organizations shall disclose to the public every year their annual work report and financial report. Charitable organizations with public fund-raising credentials shall provide audited financial reports.
Article 73. Charitable organizations with public fund-raising credentials shall ensure the timely disclosure of details regarding publicly raised funds and the operation of charitable projects.
For public fund-raising that lasts over a period of six months or more, details shall be disclosed at least once every three months. And upon completion, full details shall be disclosed within three months.
For charitable projects lasting over six months, the details of the project operations shall be disclosed at least once every three months, and within three months of completion, full details of the project operation and how the funds and property received were used, shall be disclosed.
Article 74. Where charitable organizations carry out direct fund-raising, they shall promptly update donors about the use and management of the funds and property received.
Article 75. Charitable organizations and the trustees of charitable trusts shall inform beneficiaries of the criteria for subsidies, their work processes and standards.
Article 76. Information regarding state secrets, individual privacy, commercial secrets, as well as information such as the names, titles, addresses and contact methods of donors and principals of charitable trustees who do not consent to it being disclosed, must not be disclosed.
Chapter 9. Promotional measures
Article 77. The people’s governments at the county level or above shall formulate plans, policies, and measures for the development of charitable causes in accordance to this law and local economic and social development levels.
Within the scope of their official duties, relevant departments of the people’s governments at or above the county level shall provide charitable organizations and the trustees of charitable trusts with charitable needs information, and provide support and assistance for charitable activities.
Article 78. Civil affairs departments of the people’s governments at the county level or above shall establish a mechanism to share charitable information with other departments.
Article 79. In accordance with the law, charitable organizations and their income are eligible for tax benefits.
Article 80. Natural persons, legal persons or other organizations that donate property for charitable activities are eligible for tax benefits. Charitable donations by corporations exceeding the amount deductible from income tax can be deducted from taxable income over the following three years.
Overseas donations towards charitable activities are eligible for a reduction or exemption from import duties and import value added tax in accordance with the law.
Article 81. Beneficiaries in receipt of charitable donations are eligible for tax benefits.
Article 82. Where charitable organizations, donors and beneficiaries are eligible for tax benefits according to the law, the relevant departments shall deal with the relevant procedures in a timely manner.
Article 83. Physical objects, marketable securities, equity, and intellectual property donated to charitable organizations are exempted from the administrative fees related to rights transfer according to the law.
Article 84. The state provides special benefits to charitable activities that help the poor and the needy.
Article 85. Charitable organizations that conduct charitable activities stipulated in Article 3, item 1 and item 2, which require the use of land for charitable service facilities, may legally use State allocated land or rural collectives’ construction land for their work. The use of land for charitable service facilities must not be altered except through legally prescribed procedures.
Article 86. The state provides charitable causes with financial policy support and encourages financial institutions to provide financial services such as financing and account settlement for charitable organizations and charitable trusts.
Article 87. The People’s Governments at all levels and other relevant departments may lawfully support eligible charitable organizations in providing social services through purchasing their services and other methods, and make public the relevant details according to the relevant laws and regulations on government procurement.
Article 88. The state adopts measures to promote a culture of charity and cultivate citizens’ awareness of charity.
Schools and educational organizations shall incorporate notions of charitable culture within their syllabuses, and the state encourages the establishment of the cultivation of talents for charitable causes, and theoretical research on charity at higher education and research institutions.
Radio broadcasters, television stations, newspapers, the internet and other media channels shall actively promote charitable and public interest activities, spread knowledge of charity and promote a culture of charity.
Article 89. The state encourages corporations, public institutions, and other organizations to provide venues and other favorable conditions for charitable activities.
Article 90. While donors may assign a commemorative name to the charitable projects to which they donate with the consent of the beneficiaries, this is subject to legal or regulatory approval where stipulated.
Article 91. The state establishes a charity commendation mechanism to commend natural persons, legal persons or other organizations that have made outstanding contributions to the development of charitable causes. The commendations should be granted by people’s governments or other relevant departments at the county level or above.
Chapter 10. Supervision and Management
Article 92. Civil affairs departments of the people’s governments at the county level or above shall carry out management and supervision of charitable activities, and provide guidance and supervision of charity industry organizations;
Article 93. The civil affairs departments of the people’s governments at the county level or above have the right to take the following measures over charitable organizations suspected of violating the provisions of this law:
(1) Carry out inspections of charitable organizations’ domiciles or activity sites;
(2) Request clarification from charitable organizations and access to and copy relevant materials;
(3) Investigate work units and individuals involved in charitable activities regarding supervision and management;
(4) Inquire into financial accounts of charitable organizations with the approval of the people’s governments at the same level;
(5) Carry out any other measures provided for by laws and administrative regulations.
Article 94. Where the civil affairs departments of the people’s government at or above the county level undertake an investigation of a charitable organization or related work units and individuals, there shall be two or more inspectors or investigators, and they shall produce legitimate certificates and inspection or investigation notices.
Article 95. The civil affairs departments of people’s governments at the county level or above shall establish charitable credit record systems and make public this information.
Civil affairs departments shall establish a system to assess charitable organizations and encourage and support third party agencies to carry out evaluations and make the results public.
Article 96. Charity industry organizations shall establish and improve charitable industry standards, and strengthen the self-discipline of charitable industry.
Article 97. If a work unit or an individual discovers that a charitable organization or trustee has broken the law, they may complain or report their concern to civil affairs departments and other relevant departments or to charity industry organizations. Upon receiving the complaint or report, civil affairs departments, other relevant departments or charity industry organizations shall promptly follow up with investigations and other measures.
The state encourages the public and media to scrutinize charitable activities, and expose the fraudulent obtaining of assets in the name of charity or under the disguise of a charitable organization and illegal activities by charitable organizations and charitable trusts, giving full play to public opinion and social supervision.
Chapter 10. Legal Responsibility
Article 98. Under the following conditions the civil affairs departments shall order deadlines for amendments; upon a failure to make amendments by the deadline, the civil affairs departments shall revoke registration certificates and make a public announcement:
(1) Not carrying out charitable activities in line with the purposes and working scope of charitable organizations;
(2) Privately distributing, embezzling, intercepting or misappropriating charitable assets;
(3) Accepting contributions with additional conditions in violation of laws and regulations or social mores, or attaching conditions for beneficiaries in violation of laws and regulations or social mores.
Article 99. If a charitable organization is found to have committed one of the following actions, the civil affairs departments shall give warnings, order deadlines for amendments; upon a failure to make amendments by the deadline, the civil affairs departments shall give a deadline to cease operations and make corrections:
(1) Violating article 14 of this law, causing damage to charitable property;
(2) Investing property that must not be used to make investments;
(3) Unauthorized changes in the use of donated property;
(4) Violating the regulated standards of annual expenditure or the management costs of charitable activities stipulated in article 60 of this law;
(5) Not carrying out information disclosure obligations
(6) Not producing and delivering annual work reports and financial reports or not filing fund-raiding plans in line with the law;
(7) Leaking private information about donors, volunteers, or beneficiaries as well as information such as names, titles, addresses and contact methods of donors and principals of charitable trustees who do not consent to it being disclosed.
If charitable organizations violate this law by disclosing state secrets or commercial secrets, they shall be punished in accordance with relevant laws.
If charitable organizations commit violations stipulated in the preceding two paragraphs, and within a year of disposition a violation stipulated in the preceding paragraphs occurs again, or if there are other serious situations, the civil affairs departments shall revoke the registration certificate and make a public announcement.
Article 100. If charitable organizations violating article 98 and article 99 of this law have unlawful gains, the civil affairs departments shall confiscate them; directors and other personnel who are directly in charge shall be fined between 20,000 and 200,000 Yuan.
Article 101. If any of the following situations occurs in fund raising activities, the civil affairs departments shall give warnings and order to cease fund-raising activities; unlawfully solicited assets will be ordered to return to the donor, and where there is difficulty in returning them, the civil affairs departments shall seize and transfer them to other charitable organizations to be used for charitable purposes, and may also impose a fine between 20,000 and 200,000 RMB on the relevant organizations and persons ;
(1) Conducting public fund-raising by organizations and individuals without pubic fund-raising qualifications;
(2) Using false information or other methods to trick or coax fund-raising targets into making donations;
(3) Overtly or covertly engaging in forcible apportionment on units or individuals;
(4) Causing obstruction to the public order, corporate production or the lives of the residents.
If radio broadcasters, television stations, newspapers and journals and network service providers or telecommunications operators do not fulfill their verification duties stipulated in Article 27 of this law, their respective managing departments shall give a warning and order deadlines for amendments; upon a failure to make amendments by the deadline, a notice of criticism shall be issued and circulated.
Article 102. The civil affairs departments may give warnings, order amendments, or, upon the failure to make amendments by the deadline, order a cessation of activities to charitable organizations who disobey the law by failing to issue donors with public interest donations receipts, failing to issue proof of volunteer service records or not promptly and actively giving feedback to donors.
Article 103. Fraudulent claims for tax benefits shall be dealt with and prosecuted by the taxation organs. In serious cases, the civil affairs departments shall legally revoke its registration certificate and make a public announcement.
Article 104. Charitable organizations that engage in or sponsor activities that endanger state security or public interest causes shall be investigated and dealt with by the relevant authorities. The civil affairs departments shall revoke the organization’s registration certificate and make a public announcement.
Article 105. If any of the following situations occurs, charitable organizations, serving as trustees of charitable trusts, shall receive warnings from the civil affairs departments, and be ordered to cease any illegal activities; the civil affairs departments shall seize the illegal gains if there are any; directors and other personnel who are directly responsible shall be fined between 20,000 and 200,000 RMB:
(1) The trusts’ property and proceeds are found to be used for non-charitable purposes;
(2) Contrary to regulations, operations and financial status of the trust are not reported to the civil affairs departments or publicly disclosed.
Article 106. Charitable organizations shall bear liability for damages caused by the negligence of them or volunteers to beneficiaries or third parties during charitable activities, however if the damage is caused by the intentional misconduct or gross negligence of volunteers then the charity organization may seek compensation from them.
Charitable organizations bear liability for compensation for volunteers who suffer harm due to the negligence of the charitable organizations whilst volunteering; however, if the damage is caused by force majeure then the organization shall give appropriate subsidies.
Article 107. The public security authorities shall investigate and punish natural persons, legal persons or other organizations who illegally gain assets in the name of charity or disguised as charitable organizations.
Article 108. When the following situations apply to civil affairs departments and other relevant departments of the county level government or above and their staff, the relevant departments at the higher level or the supervisory organs shall order corrections to their work. Where a sanction is necessary according to the law, the appointment and removal organs or supervisory authorities shall legally bring disciplinary action against the person directly in charge and other directly responsible personnel:
(1) Not carrying out information disclosure obligations;
(2) Overtly or covertly engaging in forcible apportionment of donations, forcing volunteers and charitable organizations to provide services;
(3) Not fulfilling legal supervision and management duties;
(4) Illegal implementation of administrative enforcement measures or penalties;
(5) Privately distributing, misappropriating, intercepting or embezzling charitable assets;
(6) Other abuses of power, dereliction of duty, or behaviors of bribery and fraud.
Article 109. If violations of the provisions of this law constitute a public security administration violation, the public security departments shall give public security administrative sanctions in accordance with the law; if a crime is committed, criminal charges shall be pursued.
Chapter 12. Supplementary Provisions
Article 110. Urban and rural community organizations and units can carry out internal activities of mutual aid.
Article 111. Other organizations that are not charitable organizations can carry out charitable activities within their capacity.
Article 112. This law shall come into force on September 1, 2016.
trans. Note: ‘摊派’ refers to the conduct that compels people or organizations to pay a set portion of a donation
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This law was translated by China Development Brief. A special thanks to Gregor Grossman, Sophie Chadd, and Vanessa Zhang who have contributed to the translation. Also during the process of translating, we consulted various expert opinions and other sources of translations such as the chinalawtranslate.com. For more translated laws and regulations or to suggest a correction to be made to this translation, please visit our English language website at http://chinadevelopmentbrief.org/.