NGOs Registration and Regulatory Compliance
Creating and establishing an NGO is a rather time-consuming task. It requires a lot of passion, strong vision, and dedication from people that possess a common goal. One cannot simply create and run an NGO as it requires a lot of legal work, such as, registration, taxation, tax exemptions, reports, trusts, and incorporation etc.
What laws in Pakistan deal with NGOs?
-
The Societies Registration Act, 1860
-
The Religious Endowments Act, 1863
-
The Trusts Act (II OF 1882)
-
The Charitable Endowments Act (Vi Of 1890)
-
The Mussalman Wakf Validating Act, 1913
-
The Charitable and Religious Trusts Act, 1920
-
The Mussalman Wakf Act, 1923
-
The Cooperative Societies Act, 1925
-
The Mussalman Validation Act, 1930
-
The Voluntary Social Welfare Agencies (Registration and Control Ordinance 1961)
-
The Companies Ordinance 1984
-
The Local Government Ordinance, 2001
-
Income Tax Ordinance 2001
How to start an NGO?
To start an NGO, you need to follow the steps provided below:
-
Decide upon the vision, goals, and purpose of your NGO
-
Hire an initial board of directors
-
Avail the services of a legal expert
-
Draft the Articles of Incorporation
-
Draft the Bylaws
-
Get the NGO incorporated
-
Hold the first meetings with the board of directors to discuss their functions and responsibilities
-
Set up its accounts system
-
Come up with fundraising strategies
-
Execute your plans
What is the easiest way of starting an NGO at a small scale?
The easiest way to start an NGO at a small scale is by the way of trusts. A trust requires a creator who creates the trust for the purpose of benefitting the beneficiary through the help of the trustee. It is easier, irrevocable, offers more control over the NGO, and no interference from third parties.
Is registration of an NGO compulsory?
Not always, however there are certain policy decisions in field which are stringent on requirement of registration. It is generally recommended that the NGO be registered.
Why should I get my NGO registered?
Getting your NGO registered provides a lot of benefits and saves you from hassles in the longer run. The following are some reasons as to why you should get your NGO registered:
-
You can legally enforce your bylaws.
-
It improves the legal status of the NGO.
-
You can start a bank account in the name of your NGO.
-
You can enter into contracts.
-
Founders will not be held personally liable.
-
It provides ability to insure the employees.
-
You can qualify for tax exemptions or financial assistance.
Is it compulsory for international NGOs to get registered?
Yes, it is compulsory and the international NGOs are also supposed to sign a Memorandum of Understanding (MoU) with the Economic Affairs Division of Pakistan.
What is the process of NGO registration?
The process of registering an NGO is as follows:
-
Draft the bylaws, and get the Memorandum approved by the Board of Directors
-
Prepare list of members along with their CNIC
-
Prepare list of office bearers
-
Obtain rent agreement/ certificate of ownership of the office building
-
Prepare an Affidavit stating that the NGO is not involved in any unlawful or illegal activities
-
Apply to the Registrar of the concerned province with Rs. 50 as fee.
What are the particulars of a Memorandum of Association?
The Memorandum of Association of an NGO must contain the following:
-
Name of the NGO
-
Location of the NGO
-
Object and aims of the NGO
-
Particulars of the governing body of the NGO (such as their names, addresses, qualification, and other important description)
-
Signatures of the governing body
What is to be kept in mind while drafting the Rules and Regulations?
The following points must be present in the Rules and Regulations of an NGO:
-
The structure of the governing body.
-
Requirements regarding the meetings.
-
Requirements of notifying about the meetings.
-
Procedure of election and removal of the officers and member of the NGO.
-
Procedure for audit and accounting.
How will a lawyer help in establishing an NGO?
A lawyer will make the task of establishing an NGO a lot easier for you by providing assistance in the following legal matters:
-
Registration of the NGO
-
Filing of Articles of Incorporation
-
Drafting Bylaws of the NGO
-
Dealing with tax related matters
-
Obtaining licenses for the NGO
What is the purpose of Articles of Incorporation?
Articles of Incorporation provide a legal explanation of the NGO. Moreover, it provides powers to the board of director for its approval.
What should I include in the Articles of Incorporation? How to draft Articles of Incorporation?
The following information is typically found in the Articles of Incorporation of an NGO:
-
Name and Particulars of the NGO
-
Purpose and Mission
-
Declaration of the NGO being nonprofit
-
Address of its main office
-
Size and names of the board of directors
-
Personal liabilities of the NGO
-
Does the NGO have capital stock?
-
Expected tenure of the NGO
What roles do bylaws play?
The bylaws will set the laws within the NGO. It creates and determines the responsibilities of the NGO and how it should function. Bylaws mainly play the role of a ‘rule book’ as it states the powers, structure, operations, and organization of the NGO. A copy of these bylaws is typically provided to all the important member of the NGO and is used for resolving disputes within the NGO.
How to draft bylaws? What should I include?
The following should be included in the bylaws of an NGO:
-
Purpose and Mission of the NGO
-
Registered Offices
-
Members of the NGO along with their particulars
-
About the board of directors, such as, their strength in numbers, structure, and responsibilities
-
Rules regarding the meetings of board of directors
-
Structure of the Committee
-
Duties of the officers and other members of the NGO
Caution:
Information contained in the above FAQs is for general understanding purposes only and may have altered or have become incorrect owing to variation in factual aspects and evolving laws, therefore, should not be treated as an alternate to professional legal advice.