Thursday saw the passage of a long-awaited law governing the registration, operation, funding, and supervision of foreign NGOs in China. In its own words, as rendered by China Law Translate, it seeks “to regulate and guide activities conducted by foreign NGOs within mainland China, safeguard their lawful rights and interests, and promote exchanges and cooperation.” But the law also has a strong emphasis on China’s national security: Article 5 specifies that NGOs “must not endanger China’s national unity, security, or ethnic unity; must not harm China’s national interests, societal public interest and the lawful rights and interests of citizens, legal persons, and other organizations; […] must not engage in or fund for-profit activities or political activities, and must not illegally engage in or fund religious activities.”

The need for a clearer formal legal framework for foreign NGOs has been widely acknowledged. Given the authorities’ expansive view of national security threats, however, and their tendency to describe even peaceful criticism or opposition as such, the law is likely to exert a severe chilling effect even on organizations whose activities are not frozen completely. China Labour Bulletin’s Shawn Shieh summed up on his personal blog, noting the law’s position amid a broader wave of new regulation including a recent domestic charity law:

Over the past two decades, we’ve seen the rapid growth of both Chinese and overseas nonprofit, nongovernmental social organizations. Yet the large majority of these organizations have operated in a grey legal area due to the lack of regulation. In short, as many experts have noted, these two laws address a serious need to regulate what has largely been an unregulated sector. The real question is whether they will do so in a way that will foster the healthy development of both Chinese and overseas nonprofit, nongovernmental organizations in China. An answer to this question requires taking a close look at the two laws, and more importantly, seeing how they are implemented and enforced over the next few years. [Source]

[Updated at 19:08 PDT on May 2, 2016: Shieh has added a detailed and cautiously optimistic FAQ on the law, highlighting two key points: possible opportunities for foreign NGOs to help shape implementation in their favor, and the likely effects on domestic organizations that rely on their support. “Some people may not agree with me on this point,” he comments, “but I think it’s more productive for us in the long run for us to think about how we can improve the law’s implementation, instead of seeing the law as the state’s weapon to shut INGOs out of China.”]

The University of Wisconsin-Madison and International Center for Not-for-Profit Law’s Mark Sidel provided an overview of the law’s requirements at Foreign Policy:

[…] In most respects, it retains the draconian nature of the earlier draft, with some minor revisions. Foreign nonprofits and foundations must still be registered and authorized through the [Ministry of Public Security]. They still must find a Chinese partner organization to take responsibility for all the foreign entity’s work in China before the latter can apply for registration with the MPS. Chinese partner organizations must be vetted in advance. Preferred or approved project lists will be issued by the MPS and other agencies; it is not clear whether projects not listed will be permitted. Groups that don’t plan to have offices in China, but only intend to conduct what the law calls “temporary activities,” must still register (albeit with less paperwork) and must still have a domestic partner.

Even after a foreign NGO jumps these hurdles, serious restrictions on its activities will remain. Overseas nonprofits will be allowed only to work in certain enumerated fields that include the economy, education, science, culture, health, sports, and the environment. (An “et cetera” at the end of this list indicates that additional fields might be approved.) They can generally only work within the geographic area for which a given activity has been approved.

There will also be ongoing headaches. Each year, foreign NGOs will be required to furnish a report outlining all aspects of their planned work, and must then report when and where it occurred after the year has ended. Their offices and bank accounts will be subject to inspection. Penalties, including detention, will apply for violations — and Chinese organizations or individuals that take funding or other benefits from unregistered foreign groups will also be punished. […] [Source]

See also China Law Translate’s explanation of changes from previous drafts reported earlier in the week by Xinhua, and an analysis from Chinese Human Rights Defenders focusing on the “alarming” expansion of police powers. At the state-owned Global Times, Li Ruohan reported earlier in the week on the controversial choice of the Public Security Ministry as the supervising body:

“The engagement of police departments is unlikely to change as the law was designed for national security,” Huang Haoming, deputy director of the China Association for NGO Cooperation, told the Global Times.

Chinese authorities are aware and concerned that foreign NGOs can be used by states to promote their objectives and values, or achieve other political agenda.

[…] Many overseas NGOs reached by the Global Times said they are confused about why public security involvement was specifically included in this law.

Caspar Welbergen, chief representative of the Beijing office of Stiftung Mercator, a German foundation, told the Global Times that currently there are already laws about what police or security forces can do if there are violations.

Huang said that the understanding of such articles is different when read with the perspective of national security and with the view of social development. Experts also pointed out that some overseas NGOs have brought national security concerns to China.

[…] Other concerns come from the ambiguity of the law, which NGOs said might leave their activities open to interpretation by law enforcers.

For example, article 5 says the activities of overseas NGOs should not harm national interests or good customs. “However, there’s no list of what would be considered as harming national interests, and I think it’s impossible to clarify what are good customs and bad customs,” Caspar said.

[…] Huang noted that if the law is passed, judicial interpretations from the Supreme People’s Court might be needed. [Source]

The suspicion of foreign interference underlying the law has manifested on several other fronts recently, from warnings against Western media bias and espionage to a broad campaign against Western influence in education last year. In January, Swedish legal aid NGO worker Peter Dahlin was detained in Beijing, and confessed on national TV to endangering national security and hurting the feelings of the Chinese people.

In his report on the new law at The Guardian, Tom Phillips highlighted the reaction of one prominent Chinese campaigner, who warned that political organizations would not be the only ones to suffer:

Lu Jun, a well-known social activist who was forced to move to the US last year after his organisation was targeted by law enforcement, described the decision to give greater powers to police as a disaster.

“The real purpose of the foreign NGO law is to restrict foreign NGOs’ activities in China and to restrict domestic-rights NGOs’ activities in China by cutting the connection between [the two],” he said.

Lu, whose group, Yirenping, has campaigned on health and employment issues, claimed Beijing was attempting to use the new legislation to neutralise foreign-supported groups that it suspected were attempting to destabilise the government. “They consider foreign NGOs and some domestic NGOs as a threat to their regime,” he said.

[…] “I assume many foreign NGOs will withdraw their offices from China and will cancel their grants in China. And it will affect many, many domestic NGOs’ budgets because it is very hard for NGOs to raise funds inside China because the government has set up many, many restrictions on funding raising for domestic NGOs.”

[…] However, Lu predicted the law would cause most damage to groups involved in social issues such as HIV and Aids, poverty relief and education. [Source]

Reuters’ Megha Rajagopalan and Michael Martina reported further complaints:

“I think this definitely gives the government the legitimate channels and the excuse to kick out civil society organizations if they want,” said Shen Tingting, a China-based advocacy director for Asia Catalyst, a group that trains domestic NGOs.

Shen said a pervasive atmosphere of sensitivity for NGOs had already driven the group to move many of its training sessions for local charities to Bangkok instead of holding them in China, particularly after one of its partner organizations faced questioning by police.

The law could only make the situation worse, she said.

[…] The American Chamber of Commerce in China expressed disappointment with the law, saying it would have a detrimental impact on a “huge number of NGOs” as well as the companies they collaborate with.

“Treating foreign NGOs as primarily a security threat undermines not just the ability of those organizations to benefit China, but also the ability of companies to do business here,” said James Zimmerman, the chamber’s chairman. [Source]

U.S. National Security Council spokesperson Ned Price said in a statement:

The United States is deeply concerned that China’s new Law on the Management of Foreign NGO Activities will further narrow space for civil society in China and constrain contact between individuals and organizations in the United States and China. Recognizing that a vibrant civil society is a cornerstone of stability and prosperity, the Administration has expressed strong support at every level for the role of civil society in China. We urge China to respect the rights and freedoms of human rights defenders, journalists, business groups, development professionals, and all others who make up civil society, including by protecting the ability of foreign NGOs to operate in China. [Source]

South China Morning Post’s Zhuang Pinghui quoted similar concerns from Germany:

“Despite a number of improvements, the law does not dispel our concern that it could make cooperation with German partners more difficult in the future,” said the German ambassador to China, Michael Clauss.

“The law continues to focus strongly on security and contains numerous approval and documentation requirements, as well as other norms restricting ­activities.

“For this reason, Germany would have welcomed … another opportunity for consultations.” [Source]

Prompted to respond to American comments at a press conference on Friday, Chinese Ministry of Foreign Affairs spokesperson Hua Chunying said:

The NPC Standing Committee deliberated and passed the foreign NGO management law, meeting China’s requirement of pursuing law-based state governance and building a country under the rule of law. It is also an important measure which will guide and regulate foreign NGOs in China and safeguard their lawful rights and interests. While making the law, China has solicited opinions from all sectors both in and outside China, and amended some provisions in the law accordingly. Different countries have different practices in managing and serving foreign NGOs, as their national conditions vary. Only when it meets the national conditions and realities in China, can the relevant legislation play its due role. It is hoped that relevant countries would respect China’s legislative sovereignty, and view the legislation in a positive and objective manner. [Source]

Western human rights organizations have also protested. From Human Rights Watch:

“Beijing hardly needs more ammunition to crack down on civil society groups,” said Sophie Richardson, China director at Human Rights Watch. “The NGO Law is like many others of the Xi Jinping era: ever-stronger tools to legalize China’s human rights abuses.”

[…] Regulations on nongovernmental organizations should not undermine the rights to freedom of association, expression, and peaceful assembly, which are protected under the Chinese constitution and international law, Human Rights Watch said. Registration requirements should also be minimal and free of surveillance.

[…] “Civil society groups have been one of the only human rights success stories in China in recent years, and their survival is crucial for the country’s future,” Richardson said. “So long as repressive restrictions are imposed on some parts of civil society in China, all organizations remain at risk.” [Source]

At Quartz, Richardson added that the law “will cast a pall on a high-profile event Beijing considers key to cementing its reputation as a global power: the G20 summit in Hangzhou.”

As diplomats, business leaders, and various luminaries confirm their participation in the September event, invitations to independent Chinese and some international civil society organizations aren’t likely to turn up in the mail.

With just four months to go before the summit, China has quietly agreed to make a bit of room for some civil society—but only that which is palatable to the authorities, unlike past G20s, which welcomed or tolerated considerably more diverse views. This risks shutting out the people G20 governments are supposed to be representing. But it also risks making other G20 participants, most of whom routinely interact with civil society, appear accepting of Beijing’s hostility toward independent, critical voices. [Source]

Amnesty International also condemned the new law:

“The authorities – particularly the police – will have virtually unchecked powers to target NGOs, restrict their activities, and ultimately stifle civil society,” said William Nee, China Researcher at Amnesty International.

“The law presents a very real threat to the legitimate work of independent NGOs and should be immediately revoked.”

The law is the latest in a raft of legislation aimed at bolstering government power under the guise of national security and at the cost of human rights. A sweeping National Security Law, passed in July 2015, defines “national security” in such broad and vague terms that the authorities are essentially given carte blanche.

[…] Later this year the authorities may also pass a Cyber Security Law. The most recent public draft also contained vague and imprecise terms relating to national security and “maintaining social order” that could be used to restrict freedom of expression even further. [Source]