Law chokes Chinese NGOs' foreign funding

Rules unclear

Not all NGO’s have been hurt by the new rules. Some receive their grants through Chinese banks that have not yet begun enforcing the regulations. Others, registered with the Civil Affairs Bureau, have had their grant agreements certified by Chinese notaries.

But Yirenping, like almost every other activist group in China working on politically sensitive issues such as Aids or citizens’ rights, has not been able to register with the Civil Affairs Bureau and functions instead as a private company. Nor has it been able to find a Chinese notary ready to certify its grant agreement with the NED.

The rules do not specify how or where grant agreements should be notarized, and SAFE has not clarified the question. (The agency did not respond to questions this reporter put in a fax to them.)

“I’ve put in untold numbers of hours of research” trying to work out what the regulations demand, says an NED official working with Chinese grantees, who asked not to be named because of the sensitivity of the issue. “These are loosely written rules with multiple interpretations possible.”

The NED, taking legal advice in China and the US, has concluded that its agreements with Yirenping and other Chinese grant recipients should be notarized by the Chinese embassy in Washington, and is still gathering the required documentation.

“This route is open and transparent and dictated by law,” says the NED official. “We will follow every step necessary to see where that takes us.”

One problem with this approach, however, is that “legally speaking,” it gives the Chinese embassy control over which NGOs receive funding by choosing which grant agreements it will notarize, points out Anthony Spires of the Centre for Civil Society Studies at the Chinese University of Hong Kong.

Yu has his doubts too. “We are still not close” to getting notarization agreed, he points out. “And we are still unsure whether they will actually be able to do it.”

Related stories:

• China snares NGOs with foreign funding
• China guts budding civil rights movement
• China news coverage

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