Q&A Regarding Fundraising for Charity Purpose in China?

Q1. Is Fundraising for Charity Purpose Allowed in China?

A: Any people or entity wanting to carry out charitable activities need to set up a charitable organization in line with related laws.  The main law regulates charitable activities in China is the Charity Law of the PRC (“Charity Law”).

"Charitable organizations" as used in Charity Law refers to non-profit organizations established in accordance with the law, with the purpose of carrying out charitable activities oriented to society.

Charitable organizations may take organizational forms such as foundations, social organizations, and social service entities.

Q2: What department is the competent authority in charge of the charitable work?

A: The civil affairs departments and it’s local branch. The establishment of charitable organizations shall apply for registration with the civil affairs departments of people's governments at the county level or above, and the civil affairs departments shall make a decision within 30 days of accepting the application.

Nonprofit organizations such as foundations, social groups, and social service entities that have been established before the promulgation of Charity Law may apply to the civil affairs departments where they are registered for recognition as charitable organizations, and the civil affairs departments shall make a decision within 20 days of accepting the application.

Q3: What’s the requirements for establishing a charitable organization?

A: To establish a charitable organization, the following requirements need to be met:

(1) For the purpose of carrying out charitable activities;

(2) Not for profit;

(3) Have their own name and domicile;

(4) Have an organizational charter;

(5) Have the necessary property;

(6) Have qualified organizational bodies and responsible persons;

(7) Other requirements.

Q4: What does the Law say regarding management over Charitable organizations?

A: Charitable organizations shall establish and complete internal governance structures in accordance with related laws, clarifying responsibilities on issues such as decision-making, implementation, and oversight, etc.

Charitable organizations shall implement a national unified accounting system, conduct accounting in line with law, establish and complete accounting supervision systems, and accept supervision and management by relevant government departments.

Charitable organizations shall submit annual work reports and financial reports to local civil affairs departments each year. Reports shall include information about annual fundraising and acceptance of donations, the management and use of charitable assets, the implementation of charitable projects, etc.

Q5: What does the Law say regarding “Charitable fundraising"?

A: According to the Charity Law, Charitable fundraising includes public fundraising among the public and targeted fundraising among specific people.

Charitable organizations carrying out public fundraising shall obtain public fundraising credentials. Charitable organizations that have been lawfully registered for two years may apply for public fundraising credentials from local civil affairs department.

For foundations and social organizations that may raise funds publicly from the date of registration according to related laws and regulations, are to be directly issued by local civil affairs departments with public fundraising qualification certificates.

Q6: What does the Law say regarding fundraising?

A: * Public fundraising. To raise fund in public, a fundraising plan shall be prepared and be reported to local civil affairs department for the record in advance.

* Public fundraising methods. The following methods may be used to carry out public fundraising:

(1) Setting up donation boxes in public places;

(2) Organizing charity performances, charity competitions, charity sales, charity exhibitions, charity auctions, charity evenings, etc. for the public;

(3) Publishing fundraising information through radio, television, newspapers, the Internet, and other media;

(4) Other public fundraising methods.

Where charitable organizations use the above-mentioned method (1) and method (2) to carry out public fundraising, they shall do so within the jurisdiction of the local civil affairs department. There are no geographical restrictions on the donation.

Where charitable organizations carry out public fundraising online, they shall publish fundraising information on the unified or designated charity information platform of the civil affairs department, and may simultaneously publish fundraising information on their website.

* Cooperated fundraising. Organizations or individuals that do not have public fundraising credentials may, for charitable purposes, cooperate with charitable organizations with public fundraising credentials, and the charitable organization is to carry out public fundraising and manage the funds and materials raised.

* Targeted fundraising. Charitable organizations may carry out targeted fundraising from the date of registration.