Based on The Law of the People’s Republic of China on the Administration of Activities of Overseas Nongovernmental Organizations in the Mainland of China (FNGO Law), any non-profit and non-government organizations legally established outside of China (“foreign NGO”) that intend to conduct activities in mainland China, will have to register as a legally registered representative office or complete a temporary activity filing prior to conducting any activities in China.
Challenge
IAEE is a non-profit organization that has members from 50 countries, with China being one of the primary ones. Considering IAEE’s long-term strategy in China, it was important for IAEE to navigate the requirements of FNGO Law for compliance. IAEE needed a trusted expert to advise on the application of the Law, the processing of registration, as well as coordination with the Professional Supervisory Unit (PSU), Public Security Bureau (PSB). FNGO Law remains ambiguous for associations in many aspects and is evolving as the Ministry of Public Security (MPS) is learning more about activities for FNGOs.
Solution
Kellen guided IAEE through the entire process for compliance with the FNGO Law, helping IAEE to understand the legal requirements, facilitating meetings with PSU and local PSB, and helping coordinate the submission of the required materials. As IAEE’s trusted team on the ground, Kellen managed the requirements of the evolving Law, additional requests, and communications with both PSU and PSB, and acted as a bridge to help communicate and interpret the objectives and goals of all stakeholders involved.
Outcome
Under Kellen’s guidance, IAEE successfully confirmed a Shanghai-based PSU, and registered its China FNGO Representative Office in October 2019. Kellen helped to facilitate high-level meetings with senior leadership of the PSU, and coordinated a visit of IAEE leadership to meet with senior representatives from PSU, PSB, tax bureau to finalize the formalities.
FNGO Law Background
The Law of the People’s Republic of China on the Administration of Activities of Overseas Nongovernmental Organizations (FNGO Law) came into effect on 1 January 2017, for the purposes of regulating and guiding overseas NGO activities in the mainland of China. The law was created to address the concern over religious/political groups and funding; the terminology does cover all professional and trade associations.
Some of the associations had activities for years in China, although they might already have registered as a Wholly Owned Foreign Enterprise (WOFE) operating in China, it is recommended to file NGO status as well.
Overseas NGOs that apply to register and establish a representative office require approval from aa PSU. A directory is listed is managed by the MPS. Local PSB is under the MPS and is the registration and administration authority for foreign NGOs. All aspects of the application process will be going through the PSB FNGO office. There are other supervisory authorities as well, such as government agencies responsible for national security, finance, foreign affairs, customs, tax, etc.
