Commentary on the Second Draft of PRC Charity Law

Chinese authorities have invited commentaries on the 2nd Draft of the People’s Republic of China Charity Undertakings Law of the PRC, which they have circulated earlier this year. FLIA is pleased to release to the public its comments on the Charity Law of the People’s Republic of China (Second Draft), as these comments have been offered to the National People’s Congress.

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In commenting on the Second Draft, we took into consideration the broader goal of facilitating the development of the non-profit, non-government sector of the economy, of which charities are an important component. This goal can better be achieved by clearly defining what a charitable organization is; what charitable activities are; who can conduct charitable activities, and how these activities should be conducted.
More importantly, the non-profit sector of the economy must grow coherently with two main obligations, as these befall cadres and state officials. First, in enforcing the Charity Law, cadres and state officials have to remain true to the overall line of the CCP. Second, they have to remain faithful to state policies, as these policies embody goals set by the CCP.
Paragraph 9 of the General Program of the Constitution of the Chinese Communist Party states:
In building socialism, the basic task is to further release and develop the productive forces and achieve socialist modernization step by step by carrying out reform in those aspects and links of the production relations and the superstructure that do not conform to the development of the productive forces.
This means that the country must reform those sectors of the economy that lag behind the “development of the productive forces.” Paragraph 9 also states that:
The Party must respect work, knowledge, talent and creation and ensure that development is for the people, by the people and with the people sharing in its fruits.
This goal to be achieved through a multi-pronged strategy that allows simultaneous progress in economy, culture, society, politics, and the environment “in accordance with the overall plan for the cause of socialism with Chinese characteristics.”
In this respect, we noticed how the Second Draft has made several improvements. Generally speaking, a more proactive approach to legislation has been adopted. Then, the Second Draft has included some of the suggestions that were raised by commentators in China and abroad. Broadening the definition of charitable activities, allowing the public to make donations via the internet, introducing stricter rules on transparency are some of them.
The present comment reviews the changes introduced in the Second Draft, and further discusses them, as these changes relate to: the enforceability of provisions made in the Second Draft; the internal coherence of the Second Draft; consistency between the Second Draft, the legal framework on the non-profit, non-government sector of the economy, as well as other relevant policies, laws and regulations.
We believe our comments will be useful to the community of legal scholars, policy makers, practitioners, academics, as well as journalists, and China scholars. We stand ready to further exchange views with relevant authorities, and all interested parties, and we welcome their feedback and comments…    Continue Reading