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Management And Internal Organisation

International Standards


      Recommendation CM/Rec(2007)14 on the legal status of NGOs in Europe, Paras. 1, 2, 6, 10, 19,  20, 22, 23, 42, 43, 46, 47, 48, 49, 68, 70 and 71

I. Basic principles
  1. For the purpose of this recommendation, NGOs are voluntary self-governing bodies or organisations established to pursue the essentially non-profit-making objectives of their founders or members. They do not include political parties.
  2. NGOs encompass bodies or organisations established both by individual persons (natural or legal) and by groups of such persons. They can be either membership or non-membership based. (...)
  6. NGOs should not be subject to direction by public authorities
  10. Acts or omissions by public authorities affecting an NGO should be subject to administrative review and be open to challenge by the NGO in an independent and impartial court with full jurisdiction.

III. Formation and membership
 B. Statutes
  19. The statutes of an NGO with legal personality should generally specify: (...)
  d) the highest governing body;
  e) the frequency of meetings of this body;
  f) the procedure by which such meetings are to be convened;
  g) the way in which this body is to approve financial and other reports;
  h) the procedure for changing the statutes and dissolving the organisation or merging it with another NGO.
  20. The highest governing body of a membership-based NGO should be the membership and its agreement should be required for any change in the statutes. For other NGOs the highest governing body should be the one specified in the statutes.
  22. The ability of any person, be it natural or legal, national or non-national, to join membership-based NGOs should not be unduly restricted by law and, subject to the prohibition on unjustified discrimination, should be determined primarily by the statutes of the NGOs concerned.
  23. Members of NGOs should be protected from expulsion contrary to their statutes.

IV. Legal personality
 C. Branches; changes to statutes
  42. NGOs should not require any authorisation to establish branches, whether within the country or (subject to paragraph 45 below) abroad.
  43. NGOs should not require approval by a public authority for a subsequent change in their statutes, unless this affects their name or objectives. The grant of such approval should be governed by the same process as that for the acquisition of legal personality but such a change should not entail the NGO concerned being required to establish itself as a new entity. There can be a requirement to notify the relevant authority of other amendments to their statutes before these can come into effect.

V. Management
  46. The persons responsible for the management of membership-based NGOs should be elected or designated by the highest governing body or by an organ to which it has delegated this task. The management of non-membership-based NGOs should be appointed in accordance with their statutes.
  47. NGOs should ensure that their management and decision-making bodies are in accordance with their statutes but they are otherwise free to determine the arrangements for pursuing their objectives. In particular, NGOs should not need any authorisation from a public authority in order to change their internal structure or rules.
  48. The appointment, election or replacement of officers, and, subject to paragraphs 22 and 23 above, the admission or exclusion of members should be a matter for the NGOs concerned. Persons may, however, be disqualified from acting as an officer of an NGO following conviction for an offence that has demonstrated that they are unfit for such responsibilities. Such a disqualification should be proportionate in scope and duration.
  49. NGOs should not be subject to any specific limitation on non-nationals being on their management or staff.

VII. Accountability
  A. Transparency
  62. NGOs which have been granted any form of public support can be required each year to submit reports on their accounts and an overview of their activities to a designated supervising body.

  B. Supervision
  68. NGOs can be required to submit their books, records and activities to inspection by a supervising agency where there has been a failure to comply with reporting requirements or where there are reasonable grounds to suspect that serious breaches of the law have occurred or are imminent.
  70. No external intervention in the running of NGOs should take place unless a serious breach of the legal requirements applicable to NGOs has been established or is reasonably believed to be imminent.
  71. NGOs should generally be able to request suspension of any administrative measure taken in respect of them. Refusal of a request for suspension should be subject to prompt judicial challenge.

Explanatory Memorandum

Paragraph 1

18. There is no universal definition of NGO, a term which can be used to cover a wide range of bodies operating within both states and intergovernmental organisations. The definition adopted for the purpose of this Recommendation emphasises certain qualities regarded as constituting the essential character of these bodies, namely, that their establishment and continued operation is a voluntary act (i.e., a matter of choice for those founding and belonging to them and, in the case of non-membership bodies, those entrusted with their direction), that they are self-governing rather than under the direction of public authorities and that their principal objective is not to generate profits from the activities that they undertake.
Paragraph 2
22. The diversity of NGOs is reflected in the fact that they can be both membership and non-membership-based bodies, echoing the distinction in the explanatory report on Convention No. 124 between “associations” (“a number of persons uniting together for some specific purpose”) and “foundations” (“an identified property devoted to a given purpose”). Furthermore the persons establishing NGOs can be natural or legal, including a combination of these, and NGOs themselves (uniting several such bodies to pursue aspects of their objectives collectively). (...)
Paragraph 6
28. Although subject to the law like everyone else, the freedom from direction by public authorities is essential to maintain the “non-governmental” nature of NGOs. This freedom should extend not only to the decision to establish an NGO and the choice of its objectives but also to the way it is managed and the focus of its activities. In particular there should be no attempts by public authorities to make NGOs effectively agencies working under their control (see the finding of a violation of Article 11 of the European Convention in Sigurdur A Sigurjónsson v. Iceland, no. 16130/90, 30 June 1993 as a result of an attempt to use a taxi association to administer the provision of taxi services) or to interfere with the choice by an NGO of its leaders or representatives (see the finding of violations of freedom of religion under Article 9 of the European Convention, which imposes a similar obligation to Article 11 in this regard, in Serif v. Greece, no. 38178/97, 14 December 1999, Hasan and Chaush v. Bulgaria [GC, no. 30985/96, 26 October 2000 and Metropolitan Church of Bessarabia and Others v. Moldova, no. 45701/99, 13 December 2001 following such interferences).
29. This does not mean that public authorities cannot choose to provide particular assistance to NGOs pursuing objectives that they consider to be of particular importance but the latter should be free to decide whether to accept or continue to receive such assistance. Furthermore neither legislation nor other forms of pressure should be used to make NGOs undertake particular activities considered to be of public importance.
Paragraph 10
33. The Recommendation recognises the need for some regulatory controls over the establishment and continued operation of NGOs. However, it is essential that such controls are not applied in either a mistaken or improper manner. Fundamental safeguards against such a possibility occurring will be provided by the administration being prepared itself to review decisions that it has taken and by the supervisory control of the courts. Indeed in a state governed by the rule of law it is essential that NGOs and their members should be able to challenge acts or omissions affecting them in an independent court which has the capacity to review all aspects of their legality. Without this latter possibility there is likely to be a violation of the right to an effective remedy under Article 13 of the European Convention. (...)
Paragraph 19
49. The requirements set out in this paragraph concern the matters that are most likely to be crucial to establishing the conditions under which NGOs are to operate. Those establishing or belonging to NGOs (as well as those responsible for their direction in the case of non-membership-based bodies) are free to specify additional matters in their statutes but they should not normally be under any obligation to do so. (...)
Paragraph 20
50. The requirement that the membership should form the highest governing body of a membership-based NGO is a manifestation of the exercise of freedom of association by their members. This does not mean that the members cannot delegate the authority to take action to other bodies but they should always be able to revoke that delegation and determine the matter themselves. (...)
Paragraph 22
55. The guarantee of freedom of association in Article 11 of the European Convention and in other human rights instruments is applicable to “everyone” within a State’s jurisdiction and the scope for imposing limitations will thus be quite narrow. Certainly children should not be excluded – particularly since this freedom is also specifically guaranteed to them by Article 15 of the Convention on the Rights of the Child – but that does not preclude the adoption of protective measures to ensure that they are not exploited or exposed to moral and related dangers. Any limitations on their ability to join membership-based NGOs will need to take account of their evolving capacities and, as well as being proportionate and respecting legal certainty, should never be such as totally to exclude them from becoming members.
56. Similarly the freedom should normally be exercisable by persons who are non-nationals and any limitation on this would need to be compatible with the limited authorisation to restrict the political activity of non-nationals allowed under Article 16 of the European Convention; see Piermont v. France, nos. 15773/89 and 15774/89, 27 April 1995. It would thus be hard to justify a bar on political activity in the non-party context and impossible to do so for one where no politics was involved at all (e.g., in the field of sport and culture).
57. It is possible that a prohibition on involvement in NGOs might be a legitimate consequence of having committed certain offences but its scope and duration must always respect the principle of proportionality (see Applic. No. 6573/74, X v. The Netherlands, 1 DR 87 (1974)) and a ban on membership as an automatic consequence of imprisonment would never be justified.
58. The essence of freedom of association is that individuals should be free to choose with whom they associate and so the law should not normally enable someone to join an NGO against the wishes of its members. However, there would be a good justification for constraining the freedom of members of an association to determine whom to admit as new members where this was done in order to fulfil obligations to prevent discrimination on any inadmissible ground and thereby protect the rights of others, as permitted by Article 11(2) of the European Convention.
Paragraph 23
59. As with admission, the expulsion of someone from a membership-based NGO is generally a matter for the organisation itself. However, the rules governing membership in its statute must always be observed and national law should thus ensure that someone facing expulsion or who has been expelled has available an effective means on insisting on such observance; see Applic. No. 10550/83, Cheall v. United Kingdom, 42 DR 178 (1985). Moreover the rules governing expulsion should not be wholly unreasonable or arbitrary; in particular there should be a fair hearing before any decision is taken.
Paragraph 42
86. The establishment or accreditation by an NGO of branches should be a matter for its own internal organisation and thus subject only to the requirements of its statute. The only circumstance in which any official authorisation for the establishment of a branch could be required would be where a discrete legal personality for the branch from that of the NGO establishing it was being sought for this purpose. In such a case the grant of approval could be made subject to the rules generally applicable to the grant of legal personality to NGOs.
Paragraph 43
87. Approval for a change in the statutes of an NGO should only be required where this concerns a matter that might be the basis for a refusal to grant legal personality (see Paragraph 34 of the Recommendation). However, the legitimate interest of members of the public in being able to verify the content of the statute of an NGO with which they have dealings would justify a requirement that other changes are notified prior to their coming into force. Therefore a member state may require that a change in the statutes must be entered in the register before it can be applied. This requirement may be necessary for members, those intending to join as members and creditors, bodies granting subsidies, authorities and other contact groups.
88. Although seeking approval for a change should be governed by the procedure already set out with respect to the initial grant of legal personality, the grant of approval should not involve the NGO concerned first having to establish itself as an entirely new entity. The term “approval” for the purpose of this paragraph does not cover any involvement of a lawyer or notary in preparing the change to the statutes. (...)
Paragraph 46
91. In a membership-based NGO the members should ultimately determine who carries out its management but, while in some cases they might decide this directly, they should be free to delegate the task to an intermediary body which may be especially desirable where the membership is particularly large Nonetheless the status of the membership as the highest governing body must mean that any such delegation cannot be irrevocable.
92. In the case of a non-membership-based NGO the statutes do not have to protect the rights of members and are thus not subject to any particular limitations regarding the choice of management.
Paragraph 47
93. Although the decision-making process of an NGO must always comply with the requirements of its
statutes, the limited requirements as to what these must contain and the principle of self-regulation (see
Paragraphs 1 and 67 of the Recommendation) mean that there should be no other constraints on how they decide to pursue their objectives and manage the organisation.
94. Thus the NGO should be free to adopt organisational arrangements that it considers appropriate and to change them as and when it considers this to be necessary. Such internal matters should not require the approval of anyone outside the organisation concerned.
95. The freedom that NGOs ought to have with respect to decision making should not, however, lead their management to ignore the wide range of persons with a legitimate interest in the way in which the organisations concerned conduct themselves. The taking into account of these interests will require the use of a number of different techniques – notably consultation and reporting – and their precise form and scope will vary according to the character of the interest in question.
Paragraph 48
96. The freedom of NGOs to determine the arrangements for pursuing their objectives also extends to the choice of officers and the admission and exclusion of members.
97. It is possible that, as with the ability to form an NGO (see Paragraph 30 of the Recommendation), a prohibition on acting as an officer in an NGO might be a legitimate consequence of committing certain offences. In all cases the scope of such restrictions would need to be clearly connected with the activities constituting the offences and their duration should also not be disproportionate.
98. The freedom of NGOs to determine the admission or exclusion of members is subject to the  prohibition on discrimination and the right to be protected against arbitrary exclusion.
Paragraph 49
99. Foreign nationals employed by NGOs or involved in their management should be subject to the  generally applicable laws of the country in which they are established or operate as regards entry, stay and departure but there should not be any special limitation on such nationals becoming employees or being involved in the management of such organisations.
Paragraph 62
114. Those NGOs receiving any form of public support should expect to account for the use made of it. It is not unreasonable for NGOs to be required to report each year on the activities that they have undertaken and the accounts for the income and expenditure concerned. However, such a reporting obligation should not be unduly burdensome and should not require the submission of excessive detail about either the activities or the accounts. This reporting obligation is without prejudice to any particular reporting requirement in respect of a grant or donation. This requirement is distinct from any generally applicable requirement regarding the keeping and inspection of financial records and the filing of accounts.
Paragraph 68
122. It should be possible to scrutinise the financial records and activities of NGOs where there are sufficient grounds for inquiry. In most instances this is only likely to be justified where an NGO has failed to comply with reporting requirements, whether because no report has been made or because what has been produced gives rise to genuine concerns, but it is possible that circumstances will warrant an inquiry even before a report is due. Mere suspicion should not be the basis for any such inquiry; there must always be reasonable basis for believing that impropriety has occurred or is imminent.
Paragraph 70
125. Intervention by an external body in the actual running of an NGO should be extremely rare. It should be based on the need to bring an end to a serious breach of legal requirements where either the NGO has failed to take advantage of an opportunity to bring itself into line with those requirements or an imminent breach of them should be prevented because of the serious consequences that would follow.
Paragraph 71
126. The possibility of seeking suspension of administrative action is something expected of all administrative law systems – see Recommendation Rec(2003)16 of the Committee of Ministers on the execution of administrative and judicial decisions in the field of administrative law – but it is especially important that this is available in respect of directions to an NGO to desist from particular activities as these are often tied to particular moments in time and so could not usefully be undertaken at a later date after a challenge to the directions has been successfully pursued.
127. Although there may be good reasons in a particular case for refusing suspension of an order to desist from certain activities or of any other measure taken in respect of an NGO, the significance of so doing is such that there should then be the possibility of this being subjected to a prompt judicial challenge.

     Fundamental Principles on the Status of Non-Governmental Organisations in Europe, Principles 1, 18,  19, 40, 43, 44, 45, 46, 47, 48 and 49

Scope
1. NGOs are essentially voluntary self-governing bodies and are not therefore subject to direction by public authorities. The terms used to describe them in national law may vary, but they include associations, charities, foundations, funds, non-profit corporations, societies and trusts. They do not include bodies which act as political parties. (...)

Content of statutes
18. Every NGO with legal personality should have statutes. The “statutes” of the NGO shall mean the constitutive instrument or instrument of incorporation and, where they are the subject of a separate document, the statutes of the NGO. These statutes generally specify: (...)
– the highest governing body;
– the frequency of meetings of this body;
– the procedure by which such meetings are to be convened;
– the way in which this body is to approve financial and other reports;
– the freedom of this body to determine the administrative structure of the organisation;
– the procedure for changing the statutes and dissolving the organisation or merging it with another NGO.
 19. In the case of a membership-based NGO, the highest governing body is constituted by the members. The agreement of this body, in accordance with the procedure laid down by law and the statutes, should be required for any change in the statutes. For other NGOs the highest governing body is the one specified in the statutes.

Acquisition of legal personality
(...) 40. An NGO whose statutes allow it to establish or accredit branches should not require any other authorisation for this purpose

Management
43. In a membership-based NGO, the persons responsible for its management should be elected or designated by the members or by an organ statutorily delegated this task.
44. The management of a non-membership-based NGO should be determined in accordance with its statutes.
45. The bodies for management and decision-making of NGOs should be in accordance with their statutes and the law, but NGOs are otherwise sovereign in determining the arrangements for pursuing their objectives. In particular, the appointment, election or replacement of officers, and the admission or exclusion of members are a matter for the NGO concerned.
46. The structures for management and decision-making should be sensitive to the different interests of members, users, beneficiaries, boards, supervisory authorities, staff and founders. Public bodies providing NGOs with financial and other benefits also have a legitimate interest in their performance.
47. Changes in an NGO’s internal structure or rules should not require authorisation by a public authority. No external intervention in the running of NGOs should take place until and unless a breach of the administrative, civil or criminal law, insurance obligations, fiscal or similar regulations occurs or is thought imminent. This does not preclude the law requiring particular supervision of foundations and other institutions.
48. An NGO should observe all applicable employment standards and insurance obligations in the treatment of its staff.
49. NGOs should not be subject to any specific limitation on foreign nationals being on their board or staff.

Explanatory Memorandum

33. Subject to generally applicable administrative, civil and criminal law, the conditions under which an NGO operates, as set out in their statutes, are entirely a matter for the NGO itself, in the persons of its members. A decision to amend the statutes accordingly lies with the NGO’s highest governing body, consisting of its entire membership, so as to ensure that the proposed amendment commands sufficient support among members. (...)
52. As regards their organisation and decision-making processes, NGOs must heed the needs of various parties, both internal and external, as pointed out in paragraph 46. It is therefore in the interests of all concerned that NGOs should have clear statutes, as it is this document which defines the organisation’s structure and operating rules.
53. The statutes should comply with the legislation in force, and it is also desirable that it be compatible with any commitments entered into by the NGO vis-à-vis donors or a network of NGOs to which it belongs.
54. The NGO’s organisation and decision-making processes and determination of levels of responsibility and accountability must be consistent with its statutes, but should not be subject to the supervision of any outside authority, except for the requirement of compliance with the law, as mentioned above.
55. This means that an NGO is sovereign in determining the internal organisation it wishes to adopt in pursuit of its objectives, as defined in the statutes. As long as it does not break the law, external legal bodies should have no say in the conduct of its internal affairs. An exception is made here for those provisions governing certain types of NGOs which require special supervision. All NGOs must, however, observe all relevant applicable employment and social security law and they enjoy no exemption from any requirements as regards the membership of their component bodies or with respect to immigration law. In particular, foreign nationals on the board or staff of NGOs are subject to the laws of the host country with respect to their entry, sojourn and departure



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