Sun Yat-Sen university’s Ma Hua explains the changes and challenges of Guangdong’s new registration policy for social organizations.
Over the past 20 years, the “dual management” system has gone from being perceived as a breakthrough policy that would facilitate the establishment of social organizations to one that is a serious obstacle to their development [editor’s note: social organizations are an official term for NGOs in China. There are three official categories of social organizations in China: membership based social organizations (社会团体)， privately operated non-enterprise unit（民办非企业单位）, and foundations(基金会)]. By looking in practical terms at how social organizations have registered in Guangdong using the new registration policy, this paper attempts to explore and understand the logic behind registration policy reform across Guangdong, examine deficiencies encountered in the process, and suggest policy recommendations based on its findings.
Since Guangdong brought the new system of direct registration for social organizations into full force in May 2012 – a system, it should be clarified, that does not apply to organizations engaged in the provision of private education, healthcare and training that are required to go through pre-registration inspections and audits by government departments based on relevant laws and administrative regulations – all other social organizations can now apply to register directly with the Civil Affairs authorities. This new system has in fact been actively encouraged by the Guangzhou city government from the beginning of 2012. Specifically, this change means that social organizations in the following categories – professional associations, chambers of commerce , charities, and other organizations that provide social, economic, scientific, technological, sporting and cultural services – can apply to register directly with the appropriate Civil Affairs bureau without a professional supervising unit.
The new registration policy was extended across the whole of Guangdong Province from July 2012, meaning that social organizations that want to register there can do so directly with Civil Affairs, rather than first seek permission from the department which most closely matches their area of service delivery.
In fact, policy experimentation relating to the registration of social organizations began in Guangdong much earlier. In 2009, the Shenzhen government signed a national-level agreement with the Ministry of Civil Affairs (MoCA) to “Promote the Reform of Civil Affairs Undertakings”. Since then, the growth of social organizations and non-enterprise units has been continuous, rising from 3,759 to 4,661 over three and a half years – an increase of nearly one thousand. With the change to the new registration system province-wide, the pattern of registration displayed some remarkable trends: during a two-months period leading up to July 2012, 18 social organizations registered at the city-level throughout Guangdong while a further 15 were poised to begin operations, following official approval of their names.
Despite the liberalization of certain aspects of Guangdong’s “lenient, but also strictly implemented” registration policy (which generally makes registration easier than ever) there are no guarantees that the process will always be plain sailing. In fact, organizations that have registered under the new policy still report the following problems:
(1) The conceptual definition of “public interest charity”
Name registration is the first step for social organizations, at which point Civil Affairs departments will (i) take the opportunity to make a preliminary assessment of whether the applicant meets the conditions of registration and (ii) assess whether the applicant needs to be assigned an advisory units (业务指导单位)(editor’s note: it is a transitional policy to replace a supervisory unit with an advisory unit, in order to relax restrictions of social management in Guangdong). Guangdong’s “Program for Further Fostering the Development and Standardization of Management Practices for Social Organizations” (hereinafter referred to as the “Program”) clearly allows any organization that falls into the category of a public interest charity to use words that reflect the characteristics of the organization. This is an important means of breaking through the monopoly of GONGOs in the past and distinguishing a charitable entity from other entities, as well as a means by which organizations can continue to build on their branding and image after registration.
However, many social organizations still encounter problems during registration because Civil Affairs departments lack a clear definition of the term “public interest”. In practice, Civil Affairs departments at all levels across the country adopt their own definitions to the extent that even Civil Affairs staff working in the same building have differing interpretations, meaning that some less “progressive” parts of the administration may reject applications at first. Indeed, many organizations report that the process for obtaining a name is very technical, and this can become costly, particularly for those that are unfamiliar with registration techniques.
From the end of 2011 Guangzhou Huangpu Shenxin Feixiang Psychological Aid Service Center (hereafter Shenxin Feixiang) began to keep an eye out for information on the registration process via all channels, also consulting with the authorities at provincial and city-level in Guangzhou. They initially hoped to register as a membership based social organization (社团) under the name of “Guangdong and Guangzhou Youth Psychological Aid Center” and therefore started consulting with the provincial authorities during September 2011. However the authorities provided no specific feedback, other than telling them to seek out the Provincial Communist Youth League to be its “supervising unit” (主管单位) because its work involved young people. Thereafter, Shenxin Feixiang re-consulted with the city-level authorities and submitted an application, but were concurrently advised (as part of the name registration process) to seek out under the Guangzhou Youth League. In the end they decided to abandon the process in order to retain their independence, however city-level officials did provide detailed feedback on the difference between membership based social organizations and non-enterprise unit, also advising Shenxin Feixiang that it would be better to try to register as either a public interest non-enterprise unit (公益类民非) or as a social work organization (社工机构). Shenxin Feixiang subsequently decided to attempt to register at district level.
Unfortunately, at the end of 2011 details of the new policy changes had still not been disseminated at district-level in Guangzhou, leaving staff from Shenxin Feixiang running between civil affairs offices in three different districts – Haizhu, Yuexiu and Panyu – right up until they contacted the Huangpu District Civil Affairs Bureau who had received formal notification of the policy change. While they told Shenxin Feixiang that the requirement for social organizations to find a sponsor unit (主管单位) had been removed, details of implementing the new policy had yet to be worked out. The director of the Huangpu District Civil Affairs Bureau responsible for registration even paid a visit to the municipal bureau inquiring about the new policy and got the same answer. In the end, Shenxin Feixiang then went through the old rules for registration and gained approval on November 23rd 2011, after which a further fortnight was spent on the naming process – opting to register as a non-enterprise unit (民非机构) required the word “youth” to be removed and replaced with ” Shenxin Feixiang ” (身心飞翔) – before moving onto the next step. Then in February 2012, when all of the registration documents were finally in place, local-level officials from MoCA informed Shenxin Feixiang that a new application process was in place, rendering the old obsolete, further saying that they should re-submit their application afresh.
By contrast, Guangzhou Green Point Environmental Promotion Association (广州市绿点公益环保促进会, hereinafter referred to as “Green Point”) did not encounter the same kind of registration difficulties, but nonetheless expended much effort on the naming process. Initially, Green Point wanted to use “education center” within their official title to register as a social organization, however relevant officials of the civil affairs department considered such language to be too similar to names used by governmental institutions (事业单位), therefore Green Point had to choose “Promotion Association” (促进会) instead.
As far as some less experienced, policy-critical organizations are concerned, the registration process remains as difficult as ever. For example, A Qiang, the executive director of PFLAG China (同性恋亲友会), an association that represents the interests of gay relatives and friends (hereinafter referred to as “PFLAG”), made seven visits to the provincial-level Bureau for the Management of social organizations to go over the process, meeting variously with team officials, team heads, the divisional head, deputy director general and director general, before finally receiving a letter which advised PFLAG to “take up your case with the city-level Civil Affairs department.” Having done so, the later responded verbally to say that “There is no law that states that homosexuality is legal, therefore we cannot, for the moment, deal with your application.” “On the contrary”, responded A Qiang, “China has no law that states homosexuality is illegal; and, moreover, no law that states heterosexuality is legal. If you are unable to assist us in the registration process, please provide a clear explanation in writing.” With both sides at loggerheads, PFLAG did not manage to make further progress with its registration application.
(2) Finding suitable premises
Finding suitable premises in which to conduct operations is a frequently raised issue among social organizations. Official guidelines from MoCA stipulate that applicants must provide documentation that proves they have the right to use the premises where they are based. Equally, although there is no explicit provision within the guidelines that precludes applicants from using a residential address to register, some civil affairs departments have insisted on a commercial address for the purposes of registration.
Although well-resourced social organizations can meet the above requirements fairly easily, the same cannot be said for those just starting out. For instance, Bike Guangzhou (拜客广州), having registered its name, now faces the even bigger challenge of finding suitable premises. Previously, Bike Guangzhou shared an office with another organization, however because their co-tenant had already registered at this address, Bike Guangzhou could not use the same address on their application. Currently, Bike Guangzhou is unable to afford its own premises, due to its low funding base and small staff capacity, and is therefore hoping to secure free office space, simply so that it can provide a commercial address for the purposes of its application.
Green Point circumvented this issue by setting up a company that provided it with the necessary ‘right of use’. However, this method cannot be relied upon in the future since there is no guarantee that future policy will continue to allow a social organization to register using the same address with an institution of different status such as a company. Actually, current policies do not explicitly preclude organizations from using a residential address to register, but rather merely require proof that premises have passed relevant safety and fire safety inspection tests, which are not always easy to provide in respect of residential buildings. Moreover, MoCA’s position is also fairly vague, stating that “Providing that no training activities or group gatherings take place, the relevant leading official will exercise his or her discretion in making a final judgment.”
(3) The discretionary powers of the civil affairs departments at all level are too great
“Guangzhou’s policy of direct registration for social organizations” was included on the Social Affairs Committee’s list of special social innovation projects. The responsibility to register non-enterprise unit now falls on district (and county) authorities. In other words, restrictions on the registration of non-enterprise units have essentially been lifted within the city’s boundaries. Such a change represents a positive development for social organizations, since they can now choose to register with the MoCA bureau nearest to their base. However, those wanting to register should be aware that further problems may arise due to inconsistent application of the new policy by different Civil Affairs departments.
Firstly, different Civil Affairs departments apply different standards to decide who can register as a “public interest” (公益) organization. For instance, Bike Guangzhou reported that, despite signing up with the social organization incubation project in Yuexiu District, staff at the corresponding Civil Affairs bureau advised that organizations originally formed within universities should either register as a bike club or become a volunteer-led organization under the Communist Youth League, rather than register as a fully independent and privately run non-profit organization. Since this clearly was not the outcome desired by Bike Guangzhou they subsequently abandoned plans to register in Yuexiu. However, there was a more open attitude from officials in Haizhu District who said that while they could not guarantee success, they would do all they could to provide the correct documentation. In the end, the naming process (in Haizhu) turned out to be very smooth and was soon approved.
Secondly, different civil affairs bureaus have different levels of understanding of operational procedures, bringing no end of trouble to organizations wanting to register. When Chi Heng Guangzhou LGBT Center (智行广州) tried to register for the second time, management approval authority for their application was delegated to the district-level bureau in Yuexiu. However, because this bureau was not well acquainted with the new policy – in itself still in the process of constant amendment – both district officers (and the applicant) needed to consult upwards to clarify whether the (ever-changing) application documents were current. At the same time, the applicant was asked to provide further background information in respect of the organizer, leaving the overall impression that civil affairs information requirements at district-level are even stricter.
Some organizations also experienced the inconvenience of having to provide the same registration information twice. For example, when the Guangzhou Sunflower Women Workers Center (广州向阳花女工活动中心， hereinafter referred to as Sunflower) tried to register, one of the application forms required the inclusion of a project description. Following a series of amendments made by Civil Affairs officials to the original draft, the form had to be rewritten three times, taking up much valuable time and energy. Moreover, having opted to register as a social work organization, Sunflower were initially told the process would only require one legal representative to have either a qualification or background in social work, but later this was expanded to include a number of conditions, including one which stipulated that at least one third of the personnel (defined as the founder, the management board and staff) should have a social work qualification in order to register. In the end, Sunflower resolved the issue by asking its staff to seek accreditation.
(4) Registration capital
Securing registration capital is also an issue for emerging social organizations. Current policy requires organizations that want to register as a non-enterprise unit at sub-provincial level to submit registration capital worth CNY 30,000. However, Sunflower points out that project fundraising is the main form of income generation for organizations in their situation and that, conversely, it is difficult to find donors willing to provide funds for registration. Subsequently, the burden of finding this considerable sum of money will most likely fall upon the founder.
An additional problem relates to expenses incurred during the registration process. Bike Guangzhou says that, in addition to the CNY 30,000 registration capital, the organization needed to pay related expenses, including CNY 700 to open a bank account, CNY 1,200 for a capital verification report, as well as other fees needed to authenticate documents which makes the additional costs an NGO has to pay for registration the same as the one has to pay when registering a company. In addition the CNY 30,000 (taken as a proportion of the total capital requirement) an organization has to provide, represent up to 10% of its registered capital while the CNY 300,000 required to set up a company represents just 1%. Such a situation is deeply unreasonable for non-profit organizations.
(5) Foreign organizations
Although Guangdong’s “Program” was clearly intended to show that the registration process was open to foreign organizations, the emphasis placed on promoting “service providers in Hong Kong and Macao to establish privately run enterprise units that offer welfare services targeted at the elderly and those with disabilities” appears narrowly focused.
More importantly, civil affairs departments have yet to publish their specific registration management approach regarding foreign institutions, and China still has no law to govern the activities of INGOs based in China. As a result, besides from a few social organizations, the majority of non-enterprise units and foundations remain unregistered. According to data from 2009, the total number of international organizations registered across China came to just 18 foundations and 56 non-enterprise units, all of which are basically registered with the Ministry of civil affairs at national level.
“Organization M” (hereinafter referred to as “M”) has been working in China for more than 20 years and was encouraged when it heard that Guangdong had introduced a new, liberalized registration policy for foreign organizations. Because of internal policies, M does not want a Chinese national to act as its legal representative. However, with the new regulations, it is now possible for an overseas resident to become a legal representative.
Because M is unable to register in an official way, it is not recognized as a legal entity in the mainland, and therefore has to rely on individuals to bring foreign currency into the mainland to support its operations. However, this complicates the delivery of larger, more costly projects since Chinese citizens can only exchange foreign currency worth CNY 50,000 per year. Even if M registered as an industrial and commercial entity, the organization would still need to pay a 5% tax on each sum of money received. Further, since civil affairs departments have issued new policies aiming at reinforcing the support and management of public interest organizations, the Department of Industry and Commerce has become particularly cautious over the registration as companies by public interest organizations.
Despite its long-standing relationship with Chinese governments in project implementation, M still aspires to having its own legal status. In this regard, Yunnan’s relatively open attitude towards foreign organizations is illustrative of how foreign organizations can be attracted to set up base: as of August 2010 13 INGOs had signed agreements with and has been put in official record（备案）by the Yunnan provincial government ; and by December the number reached 140. In Guangdong, where the level of international exchange is greater due to proximity to Hong Kong and Macao, the demand is even greater.
(6) Post-registration difficulties
Some have likened the registration process for social organizations to “being under siege” – with those on the outside wanting to get in and vice-versa. Such an expression is symbolic of the various problems that organizations face post-registration.
The most significant difficulty faced by Shenxin Feiyang was financial. For instance, organizations are required to pay taxes following registration, which accounts for a huge slice of expenditure. Moreover, social organizations still face great difficulties to be eligible for corporate income tax exemptions and acquiring qualification to deliver invoices for their company donors to deduct the donation as expenditure before paying tax. Additionally, all of Shenxin Feiyang’s organizational costs are presently divided between volunteers and staff, which places a significant strain on volunteers.
Social organizations have also generally maintained their own methods and standards in relation to financial record keeping, making financial disclosures in line with donor requirements. Conversely, most have only a partial understanding of the Ministry of civil affairs’ compliance requirements and therefore have adopted a “move slowly” approach to give themselves time to feel their way around the new system.
Lastly, organizations are also reporting that time spent on compliance has increased dramatically post-registration. For instance, Guangzhou Gold Ribbon Special Children Parents Centre (金丝带互助中心) says that it has had to sign vouchers for disbursement almost every day since registration. Meanwhile, the introduction of more complex processes has also put greater pressure on its team of volunteers, upon which it relies heavily to deliver services.
(7) Policy recommendations
Based on the above analysis, the following specific policy recommendations are proposed:
(i) Continue to relax and clarify the scope of what constitutes a public-interest charity. Following the introduction of the new system of direct registration, organizations already known by the public, such as some environmental and social work organizations may still encounter certain challenges (e.g. in terms of registered capital and premises), those challenges can be overcome through hard work. However, for those organizations that are not publicly recognized by society, such as the PLFAG example quoted above, registration remains as tough as ever. Research now shows that the number of gay people in China may have reached as many as 50 million, up from around 5-10 million when figures were first published in 2004. Therefore, the authorities should include the organizations that support and help gay people and there families in “public-interest” organizations. Further, the scope of what constitutes a “public-interest charity” should also continue to be broadened.
(ii) There should be greater consistency between civil affairs departments at different levels of the administrative system. As mentioned above, there are currently competing definitions of a “public interest charity” as well as operational procedures that need to be streamlined. Guangzhou’s city level civil affairs bureau should maximize efforts to streamline policy implementation through better coordination and delivery of standardized training to counterparts at district-level.
(iii) The requirements in relation to finding acceptable premises should be reduced. Many fledgling social organizations do not require large premises, so sharing venues and office space is actually a very practical approach. Civil affairs officials should acknowledge the situation on the ground and make appropriate adjustments to the current policy, which restricts different organizations from registering with the same address.
(iv) The Ministry of civil affairs needs to work with greater care and be sensitive to the fact that some seemingly minor issues may actually place a significant strain on some social organizations. For example, when Shenxin Feixiang was issued with its certificate the character “district” had been omitted which, so far as the civil affairs department was concerned, did not cause any concerns. However, Shenxin Feixiang’s application for a bank account was nonetheless turned down, since the bank was unable to reliably verify the identity of the organization. In the end, it was only after representatives from Shenxin Feixiang had liaised with staff from both sides that the organization was finally able to convince civil affairs to issue a further confirmation of proof that finally allowed them to successfully open a bank account.
(v) The Ministry of civil affairs should coordinate with other parties to reduce the overall cost of registration. Currently, the various fees charged to social organizations and commercial organizations are the same when in fact fees to the former should be reduced.
(vi) Since Guangdong’s blueprint has already made reference to the registration of foreign organizations, specific regulations for these entities should therefore be released as soon as possible, in order to avoid accusations of another false dawn. This would also assist the large number of INGOs already working in Guangdong that would like to secure their legal status in China.
(vii) Coordinate and approve the tax-exempt status of social organizations as soon as possible after registration. In July 2012 research conducted by the Sun Yat-sen University Philanthropy Research Center revealed that social organizations found it difficult to obtain such exemptions, leading to a corresponding increase in their administrative costs, when in fact government should be supporting social organizations through effective tax relief measures. Moreover, MoCA should coordinate with the tax department to ensure that tax exemptions are obtained as soon as possible after registration.
(viii) Civil affairs departments should develop more training for social organizations in respect of registration, finance, and annual compliance checks so that they can begin to work in line with standardized practices more quickly. Since MoCA began to deliver annual compliance training to registered organizations, the feedback from many has been that such training is essential while others complain that they were unaware of such provision, due to ineffective advertising. Civil affairs departments should therefore increase both training provision and communication efforts, in order to reach out to organizations that would like to register.
但是，很多社会组织在注册的时候还是遇到了麻烦，因为民政部门对于“公益”并没有明确的定义。各地、各级民政部门对此解读不一，甚至是同一民政部门内部工 作人员对此的解读也不一样，所以一些相对来说不那么开放的民政部门可能在第一道程序上就会拒绝社会组织的申请。很多社会组织反映说取名是非常有技巧的，很 多组织也因为一开始不熟悉这些技巧而吃亏。
广州市黄埔身心飞翔心理援助服务中心（以下简称“身心飞翔”）从2011年底就开始留意关于注册的各方面信息，也先后咨询了广东省与广州市民管局。一开 始，身心飞翔希望能够注册为“广东省/广州市青少年心理援助中心”，以社团的形式登记。因此，2011年9月，其负责人首先咨询了广东省民管局，但是省局并没有具体的意见，只是说因为其业务范围涉及青少年，所以应该找团省委作为主管单位。后来他们又到市民管局询问，并已经提交申请，但在核名的阶段同样被建议找“市共青团”作为业务主管单位，但是因为不想丧失机构的独立性，他们决定放弃在市里申请注册。市级民管局的官员给的具体建议是，不如尝试以公益类民非 或者社工机构注册，并耐心地逐条说明社团与民非之间的区别。随后身心飞翔的工作人员决定寻求区一级民政注册。
“广州市社会组织直接登记”被列入了市社工委的社会创新观察项目，将民办非企业的登记下放到区（县级市）一级。也就是说，对于民办非企业单位来说，基本上取消了市内地域上的限制。这对于社会组织的登记是一件好事，因为它们可以选择在机构所在地附近的民政机构进行登记，实施起来非常方便。可是，各个区的民政局对登记政策的具体执行标准不一，为希望注册为民非的社会组织带来了诸多不便。 首先，不同的民政局对谁可以注册“公益”组织的标准并不一致。拜客广州的负责人说，尽管进入了越秀区的孵化基地，可是越秀区民政局的工作人员说，像它们这类大学生组成的组织，要不注册成为自行车俱乐部，要不直接挂靠在团委下面成为一个志愿者团体，并不需要独立注册成为一个公益性的民非。这显然不是拜客广州所愿，因此拜客广州放弃了在越秀区民政局注册的打算。海珠区民政局的态度较为开放，窗口的工作人员说虽然不保证能够成功，但会尽力帮他们将材料递上去。事 实上，拜客广州在海珠区民政局的核名非常顺利，很快就得到了批准。
一些机构也体验到了政策的反复给注册工作带来的不便。例如，广州向阳花女工活动中心注册时发现，需要提交的表格中的一些项目细则，民政方面都一直在修改， 因此表格被发回重写了3次，每次重新填写都会耗费他们的大量精力。向阳花希望注册为一家社工机构，最初的政策只需要法人代表具有社工资格或背景即可，后来 新增了一些条件，如发起人以及理监事会和工作人员中至少1/3具有社工资质才能注册为社工机构。他们的解决办法是，考取社工证以达到这一指标。
其二，也是最重要的一点，民政部门现在还未就涉外组织登记出台具体的登记管理办法，我国对境外非政府组织在华活动的管理尚无法可依， 涉外社会公益组织除少数社团外，民办非企业单位和基金会基本上未开展登记工作。据2009年中国社会组织统计数据表明，全国登记的国际及涉外组织只有18 家基金会和56家民办非企业单位，而且基本上都是在国家民政部登记的。
2. 各区（县级市）民政部门之间需要协调一致。如上文提到，各区民政部门对于“公益慈善类”的定义不一，对于操作上的具体实施标准也不一样，这致使本来应该是 “标准化”的程序呈现出各自为政的一面。广州市民政局须协调各区的民政部门，进行统一的培训与协调，尽量在政策的实施过程中“标准化”。
4. 民政部门的工作需要更加细致。一些问题看似小，却会给社会组织带来极大的困难。以身心飞翔为例，在其名称核准文件中写的是“广州市黄埔区身心飞翔心理援助服务中心”，而在发证的时候写的却是“广州市黄埔身心飞翔心理援助服务中心”。后来身心飞翔到银行办对公账户时，银行因为这个“区”字的差别而不予办理。 民政方面表示有无“区”字都表示同一家机构，而银行方面则认为中间可能会有差异。最后身心飞翔的工作人员与两方进行多次沟通之后，终于能说服民政部门出具一份相关证明，然后才在银行成功办理账户。
8. 民政部门应多开展社会组织注册、财务、年审方面的培训，使社会组织更快地走上规范化的道路。现在民政部门已经有为注册机构提供年审等主题的培训，很多社会组织反映说这类培训十分必要，但也有已注册的社会组织表示根本不知道有这类培训，也没有收到过任何的通知。因此，民政部门应该加大开展培训的力度和宣传， 同时扩展培训的对象，如推广到希望注册的组织当中，让其对注册有更深入的了解。 (本文由中山大学中国南方公益慈善研究院供稿，马骅研究员主笔)