Introduction
Bangladesh
is endowed with a rich tradition and culture of philanthropy. Religions
that attempted to overcome social stratification and seclusion
flourished there in past centuries. The civic tradition was reinforced
following the devastating war for liberation in 1971, when a host of
“self-help groups” emerged to provide relief and rehabilitation, and to
support development. At the same time, however, given the legacy of
colonial and authoritarian military administration, civil society
remains in a formative stage.
Today in
Bangladesh, mainstream civil society organizations (CSOs) are mostly
philanthropic groups, citizen coalitions, and private voluntary
agencies. Many CSOs seek to serve under-served or neglected
populations, to expand the freedom of or to empower people, to engage
in advocacy for social change, and to provide services. The exact
number of CSOs in Bangladesh is unknown. According to one estimate,
the number of CSOs registered with various governmental authorities
totals 250,000. Among these, it is estimated that less than 50,000
organizations are active.
Bangladesh has a
unitary government with a Westminster-style parliamentary system,
governed by a Constitution that is the supreme law of the Republic.
At a Glance
| Registrar of Companies |
Registrar of Trusts |
Registrar of Companies |
| At least 21 members |
At least 15 members |
At least 11 members |
Foreigners, non-citizens, and minors prohibited from serving as founders.
Bureaucratic hurdles delay the registration process |
Foreigners, non-citizens, and minors prohibited from serving as founders.
Bureaucratic hurdles delay the registration process |
Foreigners, non-citizens, and minors prohibited from serving as founders.
Bureaucratic hurdles delay the registration process |
All forms of CSOs are subject to termination for the non-submission of reports.
Annual reports are mandatory.
Government representatives may attend internal CSO meetings. |
All forms of CSOs are subject to termination for the non-submission of reports.
Annual reports are mandatory.
Government representatives may attend internal CSO meetings. |
All forms of CSOs are subject to termination for the non-submission of reports.
Annual reports are mandatory.
Government representatives may attend internal CSO meetings. |
| No legal barriers |
No legal barriers |
No legal barriers |
| No legal barriers |
No legal barriers |
No legal barriers |
| A CSO seeking to receive or use foreign donations must obtain approval, known as FD Registration, from the NGOAB |
A CSO seeking to receive or use foreign donations must obtain approval, known as FD Registration, from the NGOAB |
A CSO seeking to receive or use foreign donations must obtain approval, known as FD Registration, from the NGOAB |
Key Indicators
| 161,083,804 (2012 est.) |
| Dhaka |
| Parliamentary Democracy |
Male: 68.21 years
Female: 71.98 years (2011 est.) |
Male: 54%
Female: 41.4% (2008) |
| Muslim 89.5%, Hindu 9.6%, others 0.9% (2004) |
| Bengali 98%, other 2% (includes tribal groups, non-Bengali Muslims) (1998) |
| $1700 (2011 est.) |
International Rankings
Legal Snapshot
International and Regional Human Rights Agreements
| International Covenant on Civil and Political Rights (ICCPR) |
Yes |
2000 |
| Optional Protocol to ICCPR (ICCPR-OP1) |
No |
-- |
| International Covenant on Economic, Social, and Cultural Rights (ICESCR) |
Yes |
1998 |
| Optional Protocol to ICESCR (OP-ICESCR) |
No |
-- |
| International Convention on the Elimination of All Forms of Racial Discrimination (ICERD) |
Yes |
1979 |
| Convention on the Elimination of All Forms of Discrimination Against Women (CEDAW) |
Yes |
1984 |
| Optional Protocol to the Convention on the Elimination of Discrimination Against Women (OP-CEDAW) |
Yes |
2000 |
| Convention on the Rights of the Child (CRC) |
Yes |
1990 |
| International Convention on the Protection of the Rights of All Migrant Workers and Members of their Families (ICRMW) |
No |
-- |
| Convention on the Rights of Persons with Disabilities (CRPD) |
No |
-- |
| South Asian Association of Regional Cooperation (SAARC) |
Yes |
1985 |
| South Asian Free Trade Area (SAFTA) |
Yes |
1994 |
* Category includes ratification, accession, or succession to the treaty
Constitutional Framework
The
Constitution of Bangladesh was adopted by the Constituent Assembly of
Bangladesh on November 4, 1972. Relevant clauses corresponding to
fundamental rights enunciated in the Constitution include:
- 37.
Freedom of assembly: Every citizen shall have the right to assemble and
to participate in public meetings and processions peacefully and
without arms, subject to any reasonable restrictions imposed by law in
the interests of public order health.
- 38.
Freedom of association: Every citizen shall have the right to form
associations or unions, subject to any reasonable restrictions imposed
by law in the interests of morality or public order.
- 39.
Freedom of thought and conscience, and of speech: (i) Freedom of
thought and conscience is guaranteed. (ii) Subject to any reasonable
restrictions imposed by law in the interests of the security of the
State, friendly relations with foreign states, public order, decency or
morality, or in relation to contempt of court, defamation or incitement
to an offence (a) the right of every citizen to freedom of speech and
expression; and freedom of the press, are guaranteed.
National Laws and Regulations Affecting Sector
Two broad categories of legislation – laws of incorporation and
regulatory laws – make up the legal environment within which civil
society organizations (CSOs) operate in Bangladesh.
Laws of incorporation, enabling organizations to function with a management structure and legal status, include the following:
- The Societies Registration Act, 1860;
- The Trust Act, 1882; and
- The Companies Act, 1913 (amended in 1994).
Regulatory laws have been introduced to encourage
CSOs to register with government agencies irrespective of their legal
status. A CSO that is denied registration under these regulatory laws
remains a CSO, if it is duly incorporated under any of the previously
mentioned Acts. Relevant “regulatory laws” include the following:
- The Voluntary Social Welfare Agencies Ordinance, 1961;
- The Foreign Donations (Voluntary Activities) Regulation Rules, 1978; and
- The Microfinance Regulatory Law, 2006.
A brief description of each law follows below.
Societies Registration Act, 1860
During British rule, CSOs were regulated as “literary, scientific and
charitable societies” through the Societies Registration Act. The Act
provides for registration with the Registrar of Joint Stock Companies
under the Ministry of Commerce for the following types of societies:
- charitable societies;
- societies established for the promotion of science, literature or the fine arts;
- societies established for instruction, the diffusion of knowledge and political education;
- societies established for educational and medical services;
- societies
established for the foundation or maintenance of libraries or reading
rooms for use by members of the public; and
- public museums
and galleries of paintings and other works of art, and collections of
natural history, mechanical and philosophical inventions.
The Trust Act, 1882
This Act was
designed to accommodate private trusts without affecting the already
existing Muslim and Hindu laws for religious endowments. It is
administered by the Registrar of Trusts and allows for autonomy of the
organization as long as the trustees honor the terms and conditions of
the Deed of Trust.
The Companies Act, 1913 (amended in 1994)
This Act provides legal status to non-profit companies. Some CSOs and
foundations seek registration under the Act for the sake of
convenience. The Registrar of Joint Stock Companies under the Ministry
of Commerce is the registration authority.
Voluntary Social Welfare Agencies Ordinance, 1961
The Voluntary Social Welfare Agencies (Registration and Control)
Ordinance was promulgated in 1961 “to expedite the registration and
control of voluntary social welfare agencies and for matters ancillary
thereto.” A “voluntary social welfare agency” is defined as an
“organization, association or undertaking established by persons of
their own free will for the purpose of rendering welfare services in
any one or more of the fields mentioned in the schedule and depending
for its resources on public subscriptions, donations or government
aid.” The Director of the Department of Social Services (DOSS) under
the Ministry of Social Welfare is the registration authority.
Foreign Donations (Voluntary Activities) Regulation Rules, 1978
This was promulgated in 1978 to regulate the receipt and expenditure of
foreign donations by CSOs. CSOs are required to submit certain
information to the government in a prescribed form to obtain approval
for undertaking projects with donations received from outside of the
country or from aid-giving agencies of foreign origin working inside
the country. Prior approval is also required if a CSO wishes to use the
services of a volunteer from outside the country.
Microfinance Regulatory Law, 2006
CSOs involved in micro-credit operations are to be registered with the
Microfinance Regulatory Authority (MRA) under this law.
Pending NGO Legislative / Regulatory Initiatives
New Proposal of the Microcredit Regulatory Authority. In
October 2012, the Microcredit Regulatory Authority (MRA) submitted a
proposal to the Ministry of Finance of the Government of Bangladesh,
requesting executive power to appoint administrators within
microfinance NGOs. The MRA also wants the power to abolish the
governing body, re-constitute a new governing body, and appoint the CEO
of microfinance NGOs. The MRA is proposing that the administrator
would initially be appointed for six months and, if necessary, for an
additional six months. Mr. Abdul Awal, Executive Officer of the Credit
and Development Forum (an association of microfinance institutions) has
expressed concern about the proposal, saying that the MRA may abuse its
power.
New Government Regulatory Commission? In late August 2012,
the government initiated the process of establishing a new 11 member
commission, which, according to government officials, would be
responsible for “bringing all non-governmental organizations under a
single authority to hold them accountable and ensure transparency in
their financial transactions.” The proposal to establish the
commission, which came from the Ministry of Social Welfare, has been
approved by the secretary-level Committee for Administrative
Development and received support from the Ministry of Law. This
commission would, reportedly, investigate any allegations of
“anti-state” activities or “terror financing” carried out by NGOs and
voluntary organizations registered under the various ministries and the
NGO Affairs Bureau under the Prime Minister’s Office.
Draft Foreign Donations (Voluntary Activities) Regulation Act.
The NGO Affairs Bureau, which is a regulatory body authorized to
coordinate and regulate the activities of CSOs operating with foreign
funding, released the Foreign Donations (Voluntary Activities)
Regulation Act 2011 in January 2012 and has invited comment. The goal
of the draft Act is to amend the 1978 Foreign Donations (Voluntary
Activities) Regulation Ordinance and to integrate the 1982 Foreign
Contributions (Regulation) Ordinance into it. The draft Act preserves
many of the existing barriers to the receipt of foreign donations and
contributions. In particular, the draft Act, if enacted, would:
- Prohibit
individuals and organizations from receiving foreign
donations/contributions for the purpose of carrying out any voluntary
activity without prior government approval.
- Require all organizations wishing to receive and use foreign donations/contributions to register with the NGO Affairs Bureau.
- Require all organizations seeking to carry out activities with foreign donations to secure advance project approval.
- Require
every NGO registered with the Bureau to establish a board of directors
(consisting of at least 7 members) and a general board (consisting of
21 members).
- Penalize NGOs if the
Director General of the NGO Affairs Bureau believes that NGOs are
engaged in activities which are "illegal or harmful for the country".
Two
NGO umbrella bodies, the Association of Development Agencies in
Bangladesh (ADAB) and the Federation of NGOs in Bangladesh (FNB),
submitted written comments on the draft Act to the NGO Affairs Bureau
(NGOAB) in March.
On May 16, 2012 the NGOAB
hosted a discussion with representatives of NGOs. NGOs shared their
views and concerns with the draft Act. The Act is currently in the
Prime Minister’s Office and will be placed before the Cabinet and
Parliament after a review by the Ministry of Law.
Legal Analysis
Organizational Forms
Civil
society organizations (CSOs) in Bangladesh may be either membership
organizations or non-membership organizations. Membership organizations
include indigenous and community-based organizations (CBOs), such as
village-level clubs, mass organizations, religious organizations, and
trade organizations. Many of these organizations are not registered.
Registered membership organizations are generally registered under the
Co-operative Societies Act. Non-membership organizations may be
organized as a trust or as a non-profit company.
All CSOs can be grouped into three categories corresponding to regulatory laws, source of funds, and sphere of activities.
- (a)
The overwhelming majority of CSOs are recognized as voluntary social
welfare organizations (VSWO). Typically, VSWOs are small and operate
locally with funds mobilized from local donations and government
grants. Activities are primarily implemented by local volunteers. As of
December 2009, 56,966 VSWOs were registered with the Department of
Social Services.
- (b) Organizations that operate with
grants from external sources are generally perceived as “development
NGO(s)” and are registered with the NGO Affairs Bureau. Of the 2,535
organizations that were registered as of June 2010, 2,305 CSOs are of
local origin and 230 are foreign/international organizations operating
with an office in Bangladesh. VSWOs that receive donations from
external sources are registered with the NGOAB as well. As of February
28, 2013, there are 2,209 NGOs registered with the NGOAB. The NGOAB had
cancelled the registration of 525 NGOs as of January 11, 2012.
- (c)
As of July 2010, there were 527 CSOs working as microfinance
institutions (MFIs). MFIs may also fall into either or both of the
above categories.
Public Benefit Status
All CSOs are
exempt from corporate tax under the provision of the Income Tax
Ordinance of 1984. Income generated from profit-earning activities
must be spent for charitable purposes and not appropriated by any
individual in the form of dividends.
Both
corporations and individuals are able to claim a tax deduction for
donations made for 22 designated public benefit purposes, including
donations for old age homes, forestation, waste treatment plants, care
for the disabled, potable water supply, education for orphans and
street children, specialized hospitals for treatment of the extreme
poor, public universities, etc. Corporate donors may deduct the amount
of the donation up to 10% of their taxable income. Individual donors
may deduct the amount of the donation up to 20% of their taxable
income, but not exceeding Taka 100,000 (approximately US $1,380).
Claiming a tax deduction requires prior approval from the National
Board of Revenue (NBR) under the Ministry of Finance. The NBR gives a
tax exemption certificate if the concerned donor fulfills all
obligations as per the provisions of the labor law and pays all other
taxes.
Barriers to Entry
Several barriers to the formation, establishment and registration of CSOs are worthy of mention.
First,
the required number of minimum members is inordinately high. To
register under the Companies Act as a non-profit company, an
organization must have a minimum of 11 members. To register under the
Societies Registration Act (SRA) as a society, an organization must
have at least three times the number of members in the Executive
Committee (EC); since CSOs registered under SRA must have an EC of at
least seven members, it follow that a society must have at least 21
founding members. For organizations registered under the Trust Act,
the minimum number of members (Trustees) is five, and the number of
general members must be at least three times more than the number of
Trustees, that is at least 15.
Second,
membership of CSOs, irrespective of where they register, is limited to
adult citizens of Bangladesh. Thus, non-citizens and minors are
excluded from founding or belonging to CSOs. In addition, government
employees are barred from becoming office bearers (members of executive
committees).
Third, the organization must
possess a furnished office with proper address and signboard to be
eligible for registration. This amounts to an asset requirement and
acts as a substantial barrier to registration.
Fourth,
for registration under the SRA and the Companies Act, an organization
must pay a registration fee of Taka 2,000 (approx. US $28) and Taka
15,000 (approx. US $207) respectively. For trusts with assets of Taka
20,000 (approx. US $276) or less, the trust must pay a fee of Taka
2,540 (approx. US $35) for registration under the Trust Act. The fee is
higher for higher levels of the value of assets.
Fifth,
CSOs that seek funding from external sources must register,
additionally, with the NGO Affairs Bureau (NGOAB), which operates
within the Ministry of Establishment. Banks do not allow the opening
of an account by any organization that does not possess valid
registration and will not disburse any foreign funds without prior
approval from the NGO Affairs Bureau (NGOAB) and a letter of intent
from the donor. For registration with the NGOAB, the organization must
submit, in addition to an application, particulars of their bank
account, a letter of intent from the donor, a copy of an annual
activity report, and a copy of a financial audit report. NGOAB has to
approve it within 90 days (60 days in case of renewal of registration)
or may seek further clarification. The registration fee is Taka 10,000
(approx. US $138).
Sixth and finally, the registration process itself is complicated by bureaucratic hurdles and delays. Notably:
- Registration
requires clearance from the Ministry of Home Affairs, which must be
accomplished within 60 days, though in practice it takes longer.
- Registration
is sometimes delayed on the pretext of police verification, and
registration is sometimes denied due to an adverse police report
corresponding to “prejudicial activities.” Prior clearance from
National Security Intelligence (NSI) was recently made mandatory for
registration under the SRA. It is an “open secret” that organizations
pay bribes to officials of the registration authority in different
forms to avoid delay and harassment.
- Regarding
registration with the NGO Affairs Bureau, the NGOAB reserves the right
to reject an application if it is not “satisfied” with the objectives,
constitution, or plan of operation; CSOs do not have a right to
appeal. Moreover, the registration is valid only for five years.
During this period, the NGOAB has the power to cancel the
registration. To renew the registration, a fresh application for
registration for another five year period must be submitted six months
prior to the expiration date.
Barriers to Operational Activity
The
government tends to see itself as the sole organ responsible for
development and often makes stringent rules and regulations for CSOs in
the field of development that burden their operational activities. CSOs
are often under attack by the government bureaucracy and are criticized
for the “privatization of development.” CSOs that are critical of
government policies are sometimes branded as anti-state and are
harassed in many ways, including the blocking of disbursement of
foreign funds, delays of project approval, and even cancellation of
registration.
While the facilitating role of
the government was manifested with the creation of the NGOAB for
one-stop service and easing of regulatory measures, the general
attitude of some in the bureaucracy toward the voluntary sector remains
largely passive and hostile. The government often perceives CSOs as a
competitor for scarce overseas development assistance (ODA).
The
government can suspend activities of a CSO or even cancel its
registration for the non-submission of reports to its respective
registration authority. So far, the NGOAB has cancelled the
registration of 334 CSOs for alleged "unlawful activities" and
cancellation for another 90 CSOs is being processed. Punitive measures
can also be taken if the CSO is accused of a criminal offence. The wide
scope of crimes punishable by death under the Anti-Terrorism Act,
including "financing terrorist activities," carries a tremendous risk
of irreversible miscarriage of justice, which may chill CSO members
from engaging in certain economic activities.
Internal Affairs
Detailed
requirements apply to the internal structure and affairs of all CSOs.
Members of all CSOs, except cooperative societies, as per provision of
their article of association, elect an Executive Committee (EC) or
governing body comprising seven to 11 members, including a Chair, a
General Secretary, and a Treasurer. This is applicable to all
organizations irrespective of where they are registered.
An
annual financial audit by a recognized firm is mandatory. At present,
there are 71 audit firms registered with the NGOAB, from which a CSO
has to choose for its audit.
Officials from
the registration authority may attend EC meetings or the Annual General
Meetings (AGMs), especially if invited in case of disputes among
members. In case of a dispute, the registration authority may replace
the existing EC with a new one of its choice. The EC is responsible for
financial management through designated staff, and must function within
the budget limits approved by the registration authority. Any change in
the program and the budget requires prior approval from the authority.
The
CSO is free to open an account in any scheduled bank. Only one bank
account can be maintained for receiving foreign donations. Separate
bank accounts for separate projects may be maintained for internal
transactions after the donations are received.
The
1961 Voluntary Social Welfare Agencies Ordinance gives the government
power to intervene in the management structure of a voluntary social
welfare organization (VSWO). The DOSS, as the registration authority,
is empowered to suspend the Executive Committee (EC) of a VSWO without
giving any right to appeal, but the governing body of a VSWO cannot
dissolve itself without the approval of the DOSS.
Reporting Obligations
CSOs
must submit activity reports and audited financial reports of the
preceding year, and activity plans (programs) and the budgets of the
coming year to their respective registration authority on an annual
basis. The government can suspend activities of a CSO or even cancel
its registration for non-submission of reports to its respective
registration authority.
Government Harassment
CSOs
are sometimes subject to government harassment (e.g., frequent
inspections, requests for documents, etc.) for political reasons (for
example, where the government feels threatened by the advocacy work of
a CSO). The affected CSO may find it difficult to access legal
remedies, since the justice system is cumbersome, time consuming, and
expensive.
Involuntary Dissolution
In
case of involuntary dissolution, the government assumes ownership of
the remaining assets and may re-constitute the Executive Committee for
running the CSO.
Barriers to Speech / Advocacy
While
there are no legal barriers limiting expressive or advocacy activities,
CSOs are sometimes subject to government harassment in the form of
frequent inspections or requests for documents (for example, where the
government feels threatened by the advocacy work of a CSO). The
affected CSO may find it difficult to access legal remedies, since the
justice system is cumbersome, time consuming, and expensive. In other
cases, the government may brand certain CSOs as “partisan” where these
CSOs are critical of governmental actions and practices, such as ethnic
discrimination, anti-poor labor law and wage policy, commercial
extraction of natural resources, degradation of environment, or
corruption.
Barriers to International Contact
CSOs
are free to interact and cooperate among themselves and with donor
agencies at home and abroad through any means of communication. There
is no bar to attending conferences inside or outside the country. CSOs
participate in UN and other international conferences as important
stakeholders.
Barriers to Resources
The key legal
barrier to CSO resources in Bangladesh relates to foreign funding. As
mentioned previously, the government established the NGO Affairs Bureau
(NGOAB) within the Ministry of Establishment to coordinate and regulate
the activities of CSOs operating with foreign funding. A CSO seeking to
receive or use foreign donations must obtain approval, known as the FD Registration, from
the NGOAB. Separate approval for all projects is required from the
NGOAB, irrespective of prior registration by any other authority. The
NGOAB is now located in the Prime Minister’s Office and is responsible
for all contact with CSOs under the Foreign Donations Regulation Rules,
1978.
Reports
