Measures on the Administration of Public Fundraising by Charitable Organizations (Draft for solicitation of comments)

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So as to regulate the public fundraising activities of charitable organizations, and ensure the smooth implementation of the "Charity Law of the People's Republic of China", our department has drafted these "Measures On The Administration Of Public Fundraising By Charitable Organizations (Draft For Solicitation Of Comments)", hereinafter "Comments Draft", on a the foundation of synthesizig experience from practice, thorough research, widely solicited opinions, and repeated researched and deliberation of evidence. In order to widely hear the views of the public and further increase the quality of legislation, the full text of the draft for public comments and its explanatory note are hereby released, and solicit the views of all aspects of society. If relevant units or persons from any area have comments for the revision of the draft, they may submit the feedback through the following methods:

(1) Log-in to the Chinese Government's legal information network (http://www.chinalaw.gov.CN), and use the "Laws regulations and comment system" on the left hand side of the homepage to submit comments on drafts for solicitation of comments.

(2) Submit comments by email to:zcfgs@mca.gov.cn

(3) Mail comments by letter to: Ministry of Civil Affairs Department of Policy and Regulations, 147 Beihe Avenue, Eastern District of Beijing (zipcode 100721), and clearly write "Solicited Comments on the Measures On The Administration Of Public Fundraising By Charitable Organizations" on the envelope.

The deadline for Comments and Feedback is August 28, 2016.

Measures on the Administration of Public Fundraising by Charitable Organizations

(Draft for solicitation of comments)

Article 1: [Legislative Purpose]These measures are formulated on the basis of the "Charity of the People's Republic of China" (hereinafter Charity Law), so as to regulate the public fundraising activities of charitable organizations,

Article 2: [Scope of Application]These measures apply to the management of charitable organizations' public fundraising credentials and public fundraising activities.

Article 3: [Fundraising Targets]Charitable organizations that have obtained public fundraising credentials in accordance with law may fund-raise from the general public. Organizations and individuals that do not have public fundraising credentials must not carry out public fundraising.

Article 4: [Departmental Duties]The civil administration department of people's governments at the county level or above are responsible for approval of public fundraising credentials for charitable organizations they register and conducting oversight and management of their public fundraising activities, and are responsible for oversight of activities carried out in that administrative region that involve public fundraising.

Article 5: [Approval Conditions]Those that have been registered or designated as a charitable organization for two years may apply to obtain public fundraising credentials.

Non-public foundations registered before the Charity Law takes effect may apply for public fundraising credentials where it has been two years since the date of their registration as a foundation legal person, and upon the civil affairs departments issuance of a registration certificate indicating their character as a charitable organizations.

Applications for public fundraising credentials shall meet the following conditions:

(1) On the basis of laws, regulations, and the organization's charter; establish a complete internal governance structure, clarify duties and the scope of power for areas such decision-making, implementation, and oversight; with the general members (delegates) assembly or board of directors able to effectively make decisions and a responsible persons meeting the relevant provisions;

(2) Not more than 1/3 of the members of the board of directors are from organizations that control or have substantial impact over each other, and persons with close familial relationships must not concurrently serve on the board of directors.

(3) Not more the 1/3 of the members of the board of directors are non-mainland residents, and mainland residents serve as the legally-designated representatives;

(4) the Secretary-General is full-time, and the Chairman of the Board and Secretary-General positions must not be concurrently filled by the same person, and there is necessary full-time staff;

(5) Charitable organizations registered with the civil administration department of the people's government at the provincial level or above have a board of supervisors with at least three supervisors;

(6) Register for taxes and fulfill tax obligations in accordance with law;

(7) follow provisions to participate in social organization assessment and have a positive assessment result;

(8) Not be entered into the irregularities list, and not currently be in the corrections period for violations of laws or regulations; no serious breaches of credit in the preceding 2 years;

(9) Not have had public fundraising credentials revoked, not have received an administrative punishment for violations of law or regulations relating to social organizations, and not having other unlawful conduct in the 2 years preceding the application;

Article 6: [Application Materials]Charitable organizations applying for public fundraising credentials shall submit the following materials to the civil affairs department where they are registered:

(1) the written application, including specific explanations and written assurances of the organization's compliance with the requirements of article 5.

(2) A financial audit report for the two years preceding the application, issued by a certified accountant, including special audit of the annual expenses and management fees for charitable activities;

(3) The decision of the board of directors on the application for public fundraising credentials.

Charitable organizations with professional supervisory unit, shall also submit the approval documents of the professional supervisory unit.

Article 7: [Permit Procedures]Civil affairs departments shall accept charitable organizations' applications for public fundraising credentials after receiving all valid materials, and make a decision within 20 working days of accepting. A public fundraising credential certificate is to be issued to charitable organizations meeting the requirements; the reasons are to be explained in writing where the requirements are not met.

Where the "Administrative Licensing Law" has specific provisions on the acceptance procedures, those provisions are to be followed.

Article 8: [Special Provisions]Public foundations registered before the Charity Law takes effect, and social groups qualified for public interest donation tax deductions, may use registration certificates clearly indicating their status as charitable organizations to claim public fundraising credential certificates from the civil affairs departments.

Foundations and social groups that laws or administrative regulations provide are allowed to publicly fundraise beginning on the day of their registration, use their certificates of registration as a legal person to claim public fundraising credential certificates from the civil affairs departments.

Article 9: [Credential Certificates]Public fundraising credential certificates are valid for three years. Where charitable organizations need to renew their public fundraising credentials certificates, they shall apply to the civil affairs departments where they originally registered at least 30 work days before the completion of it's validity period. Civil affairs departments shall make a decision before the completion of the validity period, re-issuing a new public fundraising credentials certificate to charitable organizations meeting the requirements of article 5 of these Measures; and the reasons shall be explained in writing where the requirements are not met.

Where charitable organizations fail to submit an application in accordance with the preceding paragraph, it is viewed as an automatic forfeiture of public fundraising credentials.

Public fundraising credentials certificates shall clearly indicate the charitable organization's name and uniform social credit number. The certificates of charitable organizations with professional supervisory units, shall also indicate the name of the professional supervisory unit.

Article 10: [post-termination matters]Where charitable organizations have not had public fundraising credentials reissued at the completion of their validity period, they shall notify the information platform operators and make a public announcement.

The civil affairs departments shall promptly inform charitable organizations whose public fundraising credentials have not been reissued at the completion of their validity period, or where the civil affairs departments revoke have revoked public fundraising credentials in accordance with the "Administrative Licension Law", that their public fundraising credentials are cancelled.

In the circumstances provided for in the preceding paragraph, charitable organizations shall immediately stop public fundraising activities. That organization shall continue to follow the fundraising plan to manage and use donated assets acquired through public fundraising, and to perform information disclosure obligations in accordance with law.

Article 11: [Fundraising Plan]The carrying out of fundraising activities shall formulate a fundraising plan. Fundraising plans include information such as the purpose of fundraising, the starting and ending time, geographical regions, the names and business addresses of the responsible personnel, the methods of accepting donations, bank accounts, beneficiaries, the purposes of the funds and materials raised, the cost of fundraising, and the the disposition of residual assets.

Article 12: [Filing Procedures]Charitable organizations shall file their fundraising plan with the civil affairs departments where they are registered at least five working days before carrying out public fundraising activities. Civil affairs departments shall promptly accept, and publicly announce those filed; where the contents of fundraising plan are not complete, the charitable organization shall supplement and correct it for the civil affairs department of its registration within 5 working days.

Public fundraising activities in furtherance of the same fundraising goal may be jointly filed. Where there is a change in matters relevant to the fundraising plan while public fundraising is being conducted, the charitable organization shall promptly supplement and correct it for the civil affairs department of its registration.

Charitable organizations that have a professional supervisory unit shall also submit the fundraising plan to the professional supervisory unit.

Where carrying out a public fundraising activity involves public safety, public order, fire control, or other such matters, approval procedures shall also be performed in accordance with relevant provisions.

Article 13: 【Filing of plans for fundraising during sudden events】Charitable organizations who, amidst sudden events such as major natural disasters, accidents and public health crises, have not filed a plan for fundraising before soliciting donations from the public, shall handle the formalities for filing a supplementary [plan] within five days after the activities soliciting donations commence.

Article 14: 【Filing for non-local public fundraising】Charitable organizations carrying out public fundraising activities in areas other than the region of the civil affairs departments where they registered, in accordance with the first two items of paragraph 1 of article 23 of the Charity Law, are not only to file with the civil affairs departments of their registration, but shall also file with the civil affairs departments for people's governments at the county level or above for the sites of the fundraising activities, and submit the fundaising plan, a copy of the public fundraising credentials certificates, and an explanation of the need to carry out public fundraising activities at that locale.

Article 15: [Regulation and Management]Charitable organizations carrying out public fundraising activities shall follow their charitable purpose to set clear fundraising goals and plans for the use of donated assets, shall perform necessary internal decision-making procedures, shall use that organization's accounts and must not use individuals' or other organizations' accounts, and shall establish a public fundraising information archive, that is properly preserved and convenient to read through.

Article 16: [Information Release at Fundraising Venues]Charitable organizations carrying out public fundraising shall prominently display the name of the organization, the public fundraising credential certificate, the fundraising plan, contact information, and methods of inquiring about fundraising information, and so forth, at the sites of the fundraising activities or on fundraising media.

Article 17: [Public Fundraising through the Internet]Charitable organizations conducting public fundraisising activities through the internet shall disclose fundraising information on the Ministry of Civil Affairs under the State Council's unified or designated charitable information platform; and may simulataneously publish public fundraising information on webportals, official Weibo account, official WeChat account, mobile terminals and other network platforms opened in the name of the charitable organization.

Article 18: [Cooperative Fundraising]Charitable organizations with public fundraising credentials carrying out cooperative public fundraising activities with individuals or organizations that do not have public fundraising credentials shall lawfully sign a written agreement and use the name of the charitable organization to carry out public fundraising activities; all income from the fundraising activities shall be put into the charitable organization's account, with that charitable organization uniformly carrying out accounting and management, and bearing legal responsibility.

Charitable organizations setting up charitable projects to aid groups with special challenges, shall adhere to the principles of openness, fairness and justice when carrying out public fundraising activities, to designate the beneficiaries and supervise the beneficiaries' valuing of the charitable funding, and follow the provisions of the donation plan to reasonable use donated assets.

Article 19: [Management of Fundraised Assets]Charitable organizations shall strengthen management of assets donated through fundraising, using donated assets on the basis of laws, regulations, their charters and fundraising plans. Where it is truly necessary to modify the use of donated property provided in the fundraising plan, it shall be reported to the civil affairs departments to be filed for the record.

Article 20: [Information Disclosure]Charitable organizations shall follow the relevant provisions to periodically disclose information on public fundraising and charitable projects to the public.

Article 21: [Irregularities List]Where charitable organizations with public fundraising credentials have any of the following situations, the civil affairs department where they are registered is to enter them into a list of irregular activities, and announce this to the public:

(1) Where they do not meet the requirements of article 5 of these measures and have not made corrections for over 1 year;

(2) Where they have not carried out public fundraising activities for one continuous year after receiving public fundraising credentials;

(3) Those that have been ordered to stop fundraising activities on the basis of the relevant provisions of article 101 of the Charity Law; and those that have been ordered to stop activities for a period of time on the basis of the relevant provisions of articles 99 and 102 of the Charity Law, and the donated assets involved in unlawful conduct came from public fundraising activities.

Article 22: [Administrative Sanctions]Where charitable organizations have any of the following situations, the civil affairs departments may give warnings or order corrections to be made in a set period of time, and may also give a fine of up to 20,000 yuan to the charitable organization and the responsible persons:

(1) Forged, altered, leased, or lent public fundraising credentials certificates;

(2) Not carrying out fundraising in accordance with the time, period, and regional scope, or methods set in the fundraising plan; or not conspicuously placing public fundraising information;

(3) Failure to carrying out filings in accordance with these Measures.

(4) failure to perform notification obligations where public fundraising credentials have expired without renewal or been revoked;

(5) Carrying out public fundraising without public fundraising credentials;

(6) Use public fundraising to obtain assets, not in accordance with relevant provisions and the fundraising plan;

(7) Not including donated assets obtained through public fundraising in uniform accounting and account management;

(8) Other circumstances in violation of these Measures.

Article 23: [Certificates and Form Texts]Public fundraising credential certificates, public fundraising credential applications, model public fundraising plans, and other form texts, are to be uniformly drafted by the Ministry of Civil Affairs.

Article 24: [Implementation]These Measures take effect on September 1, 2016. The Ministry of Civil Affairs is responsible for interpreting these Measures.

 

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