Overview of Law governing Non-Governmental Organizations in Egypt

user Youssry Saleh & Partners calender 3 Apr 2024 views 551 Views
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Egyptian government ratified the bylaws of the new law regarding NGOs after the Law No.70 of 2017 was heavily criticized for imposing hefty restrictions on the work on thousands of NGOs operating within Egypt.

The new governing law is Law No.149 of 2019, the regulations were issued by Prime Ministerial Decree 104 of 2021.  The law guarantees the freedom of civil work and the independence of NGOs, and becomes vital as it promotes the culture of human rights and volunteering within Egypt. The main characteristics of the reformed law is the establishing of an NGO.

For establishing an NGO a simple notification to the competent authority is necessary as per Article 2 of Law 149/2019 which stipulates: “The establishment of a National Association shall be pursuant to a notification submitted to the administrative authority on the form it specifies, and fulfilling all documents stipulated in the following articles. It shall acquire the legal personality upon notification, and every natural or legal person has the right to join or withdraw from it in accordance with the provisions of this law. Any notification that does not complete all the data and documents required in accordance with the form prepared for that purpose shall not be considered a notification that produces any legal effects.”

Some NGOs were worried that the word ‘notification’ meant ‘licensing’,  however, the law means by the word notification, that once the authority is notified, the NGO can immediately begin engaging in its activities without the need to wait on any authoritative decisions. The effect of the notification enters into force as soon as it is received by the administrative body. 

The government has the authority for a period of 60 days to suspend the activity or registration should it find that the objectives or activity of any of the organizations violates the constitution or is prohibited or criminalized by the Egyptian Law, nonetheless, the NGO shall have the right to address the violation or challenge the government’s decision before the relevant court within the 60 day period. 

Pursuant to Article 9 of the abovementioned Law “The administrative authority shall provide the applicant for establishing the association with a receipt indicating receipt of his notification, indicating the time of receipt of the notification, its date, and the person who received it. It is not permissible to refrain from accepting notification papers unless they do not meet the data, information, or documents required by law.

If it becomes clear to the administrative authority within a period of sixty working days from the date of notification that among the association’s purposes is an activity that violates the constitution or is prohibited or criminalized according to the Penal Code or any other law, or that the notification data and its annexes are incomplete or incorrect, it shall suspend the violating activity or registration by a reasoned decision. The representative of the founding group shall be notified by registered mail or by any other means of communication stipulated in the bylaws of the association to take the necessary action. In this case, the representative of the founding group has the right to rectify the fault, complete the data, or appeal this decision before the competent court within sixty working days from the date of being notified of it.”

It is worth noting that under the old law, the registration fee was 10,000 EGP, however, the ratified law granted a privilege as it reduced the maximum fees to register an NGO from 10,000 EGP to 5,000 EGP as per Article 8(6).

Some foreigners may wonder whether it is possible for them to join NGOs or not, yet, as per the new Law, there is no requirement placed by the law that the founder/founders of an NGO whether legal or natural or both must be Egyptians.  Article 5 conveys that the reformed law increases the number of foreign member of any NGO in Egypt from 10% to 25%. 

With due consideration, the law set some requirements under which it forces all NGOs to abide by all principles of transparency and good faith. Article 7 states what NGOs must keep in their headquarters, as the following requirements must be kept up to date at all times: All documents relevant to NGO.

  1. Internal rules
  2. Membership records
  3. Subscriptions
  4. Minutes of BOD meetings
  5. Expenses
  6. Bank accounts
  7. Real estate properties
  8. Records of donations
  9. Data on foreign financing

Nevertheless, there are some prohibited activities that shouldn’t be practiced by the NGOs, inter alia:

  1. Any activity that violates national security, public morals and public order
  2. An NGO cannot be involved in any political activity
  3. Cannot enter into an agreement with a foreign entity
  4. Conduct opinion polls and surveys
  5. Rely on foreign persons as experts, volunteers or employees without the acceptance of the competent authority
  6. Participate in any workshops abroad without the approval of the authorities
  7. Cannot pursue any funding election campaigns.

Noting that, NGOs can engage in any activity that allows them to fulfill their objectives, however, they must take into consideration the national development plans and community needs. For the purposes of engaging in those activities, NGOs are permitted to receive funds from Egyptian natural or legal persons from inside Egypt and from foreign NGOs that have authorization to run in Egypt. The law did not put a cap for cash funds, however, the incoming funds must be relatively compatible with the activity performed by the organization.  Article 30 permits representatives of the Ministry of Social Solidarity to monitor all activities of an NGO by entering the headquarters to sentry their activities and review all documents and data.

It is worth mentioning that NGOs enjoys some benefits that are outlined in Article 17 which stipulates: “Without prejudice to any benefits stipulated in another law, associations, civil society institutions and unions established in accordance with the provisions of this law shall enjoy the following benefits:

  1. Exemption from registration and registration fees, the burden of which falls on the association in all types of contracts to which it is a party, such as property contracts, mortgages, or other real rights, as well as fees for authenticating signatures.
  2. Exemption from taxes and stamp fees currently imposed and imposed in the future on all contracts, agencies, documents, printed papers, records, etc., the burden of which falls on the association.
  3. Exempting built properties owned by the association from all real estate taxes, provided that the association’s right to own real estate is limited to properties that enable it to achieve its purposes only, and it is not allowed to change the activity except with the approval of the competent Minister.
  4. Donations made to associations are considered an obligation on the donor’s income, not exceeding (10%) of his net income.
  5. Exemption from customs taxes and other fees imposed on the equipment, machines, devices, production supplies, and cars imported, as well as the gifts and aid received from abroad, by a decision of the Prime Minister based on the proposal of the competent Minister and the presentation of the Minister of Finance, and on the condition that these things are necessary for its basic activity. It is prohibited to dispose of durable items, including those determined by a decision of the competent Minister in agreement with the Minister of Finance, before the passage of five years unless the taxes and customs duties due on them are paid.
  6. The consumption of water, electricity and natural gas be treated as domestic consumption, provided that a certificate is issued from the competent Ministry not to engage in commercial activity.”

Notwithstanding, the activity of NGO is not limited to Egyptian NGOs only, but also Foreign NGOs can practice any of the NGOs activities on the territory of Egypt. Whereas Article 65 of the aforementioned law states: “Foreign non-governmental organizations may be permitted to practice one or more activities of associations and civil society institutions subject to the provisions of this law in accordance with the rules established therein for a specific period determined by the competent Minister in the same permit. The organization may not undertake any activity in the Arab Republic of Egypt unless it obtains a permit from the competent Minister.”

The abovementioned article outlines the framework of procedures should foreign NGOs want to operate in Egypt and receive a license.  Followed by Article 66 which outlines that foreign NGOs are required to submit a request to be given a license to the Ministry of Foreign Affairs including all necessary data.  Article 67 compels all foreign NGOs to pay a fee of 50,000 EGP which will see a 20% increase on renewal of the license. 

Nonetheless, as per Article 68 foreign NGOs are prohibited from being involved in any political activities including, funding of political parties, religious activities, or any activating violating the law or public order. Moreover, any foreign NGO in Egypt cannot transfer money to foreign entities or individuals from its bank accounts without the permission of the Ministry as per Article 70.  Additionally, to amend, renew or cancel a foreign NGOs license this must be submitted to the Central Unit for Associations and Civil Work as per Article 76. Similar to Egyptian NGOs, Article 74 allows the competent Minister to suspend or revoke the NGO’s license should it violate the law or rules of the licensed activity. If the authority finds a threat to national security or public infringement it has the right to revoke the license.

Penalties impositions:

Articles 94-97 outline all the penalties that would be incurred on an NGO should it violate any of the aforementioned activities. A fine between 100,000 -1,000,000 EGP on an NGO that operates without the permission of the Ministry of Social Solidarity, to transfer or receive any funds without prior approval of the competent authorities.  A fine of 50,000- 500,000 EGP on an NGO that would spend any of their funds on an activity that is seen by the authorities to violate any of the aforementioned laws such as violating public policy or order.  The previously mentioned penalty is incurred on any NGO that declines to provide any requested data or information to the Ministry about the NGO’s activities and finances.  All and any bank accounts, and assets owned by an NGO can be seized by the Egyptian authorities as per Article 97, should it be found guilty by the courts of violating any law.

Conclusively, Law No.149 of 2019 conveys a vast improvement in comparison to Law No.70 of 2017 in the establishment of NGOs, the security measures places, and the penalties incurred on NGOs should they violate any laws. NGOs can be foreign or local and have benefits and prohibited laws that can cause them to shut immediately.  Most importantly, they are exempted from paying customs duties, or import tax on any machine linked directly to their activity, and lastly cannot operate without the prior approval of the Ministry of Social Solidarity.