Just Published: "Commentary on the New Charity Undertakings Law: Socialist Modernization through Collective Organizations " The China Nonprofit Review 9(2):273 – 309

I am happy to report the publication of my article: "Commentary on the New Charity Undertakings Law: Socialist Modernization through Collective Organizations."  It appears in the The China Nonprofit Review, Volume 9, Issue 2, pages 273 – 309 (2017). The article considers the new Charity Undertakings Law for its conformity to the Basic Line of the Chinese Communist Party (or in more Western terms, for its conformity to the fundamental political normative principles of the Chinese state).  I thought it useful to consider the conformity of lawmaking within its own system's principles as a necessary foundation for any comparative analysis.

The abstract and introduction follow.  In keeping with Brill Journal Self Archiving Rights policy, I can only provide access to the submitted version of the article: HERE. 

"Commentary on the New Charity Undertakings Law: Socialist Modernization through Collective Organizations."
Larry Catá Backer
The China Nonprofit Review, Volume 9, Issue 2, pages 273 – 309 (2017)
DOI: 10.1163/18765149-12341334); ISSN: 1876-5092 E-ISSN: 1876-5149

Submission version HERE

China’s new Charity Law represents the culmination of over a decade of planning for the appropriate development of the productive forces of the charity sector in aid of socialist modernization. Together with the related Foreign NGO Management Law, it represents an important advance in the organization of the civil society sector within emerging structures of Socialist Rule of Law principles. While both Charity and Foreign NGO Management Laws could profitably be considered as parts of a whole, each merits discussion for its own unique contribution to national development. Moreover, while analysis tends to focus on legal conformity of the Charity Law to the state constitution, little work has been done to analyze the relationship of the Charity Law to the political constitution of China. This essay seeks to fill that gap by considering the role of the Charity Law through the lens of the Constitution of the Communist Party of China. More specifically, the essay examines the extent to which the provisions of the Charity Law, and its underlying policies, contribute to the implementation and realization of the Chinese Communist Party (CCP) Basic Line and in the context of the overall political policy of “socialist modernization which has served as the core of the political line of the CCP since the last decades of the 20th century. The essay is organized as follows: Section II considers the specific provisions of the Charity Law, with some reference to changes between the first draft and the final version of the Charity Law. Section III then considers some of the more theoretical considerations that suggest a framework for understanding the great contribution of the Charity Law as well as the challenges that remain for the development of the productive forces of the civil society sector at this historical stage of China’s development.

 


I Introduction

After almost a decade of discussion,1 the Chinese National People’s Congress enacted its first Socialist Charity Undertakings Law (the “Charity Law”).2 The effort culminated in a consultation of drafts in late 2015 and early 2016. In 2015, Chinese authorities released an initial draft of a Charity Undertakings Law to which Chinese authorities invited commentary from both within China and from foreigners. In January 2016, Chinese authorities circulated a second draft Charity Undertakings Law to which they again invited commentary.3 The Charity Law was thereafter amended and adopted by the NCP in March 201, effective September 1, 2016.4

In announcing this important milestone in the development of the Socialist legal architecture for the People’s Republic of China, Xinhua/China Daily fo- cused on four measures of its importance and three measures of challenges.5 The most significant portions of the new Charity Law touched on its broad definition of charity,6 its efforts to simplify the registration and supervision system for charities,7 its encouragement of public fundraising,8 and certain fa- vorable tax preferences for charities.9 These are meant to meet the challenges of charity in China – providing a means for supervising a growing number of social organizations, with an aggregate budget of over 104 billion yuan, and encouraging individual donations which lag behind those of the United States per capita.10 Additionally, the Charity Law represents a decisive move toward public accountability through state supervision.11

Along with the Charity Law, the NCP also approved a regulation of Foreign Non-Governmental Organizations (FNGOs). But while charity organizations are now subject to local civil affairs departments, except to the extent of na- tional legislation, foreign NGOs will put the supervision of foreign NGOs under the public security organs at the national, provincial or local levels.12 Both rep- resent an effort to organize the productive forces of and better manage the civil society sector in line with the basic national policies of pushing forward the development of Socialist rule of law, Socialist culture and Socialist environ- mental policies. Both seek to ensure that non-economic activity within China serve the state as its government determines and for the ends of state. But each takes a quite distinct approach to regulatory management. Both have received positive and negative comments in China and the West. 13 Despite their relationship, the administrative coordination between these two regulatory frame- works has yet settled.14

These approaches mark both the great strength and the ultimate contradiction of the management of labor in the provision of public goods within a Marxist Leninist foundational conception of law, society and politics. The Foreign NGO Management Law treats foreign actors as a quasi-state actor.15 In contrast, the Charity Law treats charitable organizations as Leninist labor cooperatives.16 While both Charity and Foreign NGO Management Laws could profitably be considered as parts of a whole, each merits discussion for its own unique contribution to national development. It is easy to agree with NCP spokesperson Fu Ying that “the importance of the law ‘cannot be underestimated.’”17

This essay considers the role of the Charity Law through the lens of the Constitution of the Communist party of China.18 That is, the essay focuses on an analysis of the conformity of the Charity Law to the authoritative political rules of the nation;19 it does not attempt the conventional legal analysis of the conformity of the Charity Law to the state constitution.20 More specifically, the essay examines the extent to which the provisions of the Charity Law, and its underlying policies, contribute to the implementation and realization of the Chinese Communist Party (CCP) Basic Line.21 In addition, the essay considers the Charity Law in the context of the overall political policy of “socialist modernization”22 which has served as the core of the political line of the CCP since the last decades of the 20th century. Key elements in the implementation of “socialist modernization” are the political concepts of emancipating the mind, reform and opening up.23 More generally, the CCP Basic Line pro- duces a core set of political objectives to which all administrative expression is expected to conform through the application of the leadership authority of the CCP. “The Party must integrate the reform and opening up policy with the Four Cardinal Principles, carry out its basic line in all fields of endeavor, implement in an all-around way its basic program for the primary stage of socialism and combat all “Left” and Right erroneous tendencies, maintaining vigilance against Right tendencies, primarily against “Left” tendencies.”24 Considered from the perspective of the CCP line the Charities Undertakings Law offers both challenge and opportunity. It offers both a comprehensive approach to legalizing the field and yet presents an unfinished project deeply embedded generally in the political work of socialist modernization. The key areas that merit further consideration include provisions dealing with corruption protec- tion, the voluntary nature of service on charitable organizations and the role of foreign NGOs. “The law’s provisions affect not only domestic and foreign non- profits, but also a wide range of companies and corporate social responsibility (CSR) initiatives.”25

The essay is organized as follows: Section II considers the specific provisions of the Charity Law, with some reference to changes between the first draft and the final version of the Charity Law. Section III then considers some of the more theoretical considerations that suggest a framework for understanding the great contribution of the Charity Law as well as the challenges that remain for the development of the productive forces of the civil society sector at this historical stage of China’s development. The comments assume familiarity with the Charity Law. 

NOTES:
1 Zhiqiang Meng, “Understanding the Core Essence of the Charity Law,” China Journal of Social Work 9.2 (2016): 184-190.
2 «中华人民共和国慈善法» (Charity Law of the People’s Republic of China), enacted March 16, 2016. English translation available http://chinalawtranslate.com/2016charitylaw/ ?lang=en. Please note that the essay considers the Charity Law as enacted. It does not consid- er any supplementary legislation. Nor does it consider the documents released for comment around the time of the enactment of the Charity Law. The author acknowledges the potential importance of the supplementary legislation for implementation, but its development would not change the trust of the analysis here, which is principally a legal-political rather than legal-technical analysis. The author notes as well that there will, as is common when dealing with translated work, for disagreements, sometimes substantial to center of the meaning of words.
3 See, “Charity Law Comparison Between the First and Second Draft” (2016) available http:// www.backerinlaw.com/Site/wp-content/uploads/2015/06/Comparison_CUL1_CUL2_2016 .pdf.
4 Charity Law Article 112. See also, Ashwin Kaja and Timothy P. Stratford, “China Builds New Framework Governing Civil Society Organizations, Part I: Charity Law,” Global Policy Watch (Covington & Burling, May 12, 2016) available https://www.globalpolicywatch.com/2016/05/ china-builds-new-framework-governing-civil-society-organizations-part-i-charity-law/.
5 See, “China’s Charity Law takes effect Thursday,” Xinhua/China Daily (Aug. 31, 2016), available http://www.chinadaily.com.cn/china/2016-08/31/content_26658510.htm. 

1 Zhiqiang Meng, “Understanding the Core Essence of the Charity Law,” China Journal of Social Work 9.2 (2016): 184-190.
2 «中华人民共和国慈善法» (Charity Law of the People’s Republic of China), enacted March 16, 2016. English translation available http://chinalawtranslate.com/2016charitylaw/ ?lang=en. Please note that the essay considers the Charity Law as enacted. It does not consid- er any supplementary legislation. Nor does it consider the documents released for comment around the time of the enactment of the Charity Law. The author acknowledges the potential importance of the supplementary legislation for implementation, but its development would not change the trust of the analysis here, which is principally a legal-political rather than legal-technical analysis. The author notes as well that there will, as is common when dealing with translated work, for disagreements, sometimes substantial to center of the meaning of words.
3 See, “Charity Law Comparison Between the First and Second Draft” (2016) available http:// www.backerinlaw.com/Site/wp-content/uploads/2015/06/Comparison_CUL1_CUL2_2016 .pdf.
4 Charity Law Article 112. See also, Ashwin Kaja and Timothy P. Stratford, “China Builds New Framework Governing Civil Society Organizations, Part I: Charity Law,” Global Policy Watch (Covington & Burling, May 12, 2016) available https://www.globalpolicywatch.com/2016/05/ china-builds-new-framework-governing-civil-society-organizations-part-i-charity-law/.
5 See, “China’s Charity Law takes effect Thursday,” Xinhua/China Daily (Aug. 31, 2016), available http://www.chinadaily.com.cn/china/2016-08/31/content_26658510.htm.  

13 For the Charity Law, see, e.g., Reza Hasmayj, “The Pros and Cons of China’s NGO Laws,” The Diplomat (March 23, 2016), available http://thediplomat.com/2016/03/the-pros-and -cons-of-chinas-ngo-laws/. Jia Xijin, “Legislation for Foreign NGOs; how will the second boot land?” originally in Chinese in Caijing; English version http://chinadevelopment brief.cn/articles/legislations-for-foreign-ngos-how-will-the-second-boot-land/. Western criticism tended to focus on the effects of the new Charity Law on the creation of Western style civil society sectors in China. See, e.g., Josh Freedman, “China’s Charitable Turn?: How Beijing is Redefining the NGO Sector,” Foreign Affairs (July 10, 2016), available https://www.foreignaffairs.com/articles/china/2016-07-10/chinas-charitable-turn.
14 See, e.g., Dong Zijin, “Five Considerations Regarding the Charity Law,” Alliance Magazine (Herman Zheng, trans., June 6, 2016), available http://www.alliancemagazine.org/blog/ five-considerations-regarding-the-charity-law/ (“Thus, in spite of the Charity Law, foreign charitable organizations regarded as charitable organizations cannot be included in the Charity Law management. This would require organic links in the management system in order to achieve the necessary combination, and a delicate balance between the manage- ment of charities and foreign NGOs.”).
15 See Larry Catá Backer, “Walls and the Symbolic Barrier in the Era of Reform and Opening Up” Law at the End of the Day (May 7, 2016), available http://lcbackerblog.blogspot .com/2016/05/larry-cata-backer-on-chinas-new-foreign.html.
16 On the concept of Leninist labor cooperatives as they operate in Cuba, see, Jesús Cruz Reyes and Camila Piñero Harnecker, “An Introduction to Cooperatives,” in Cooperatives and Socialism: A View From Cuba, ed. Camila Piñeiro Harnecker (London & New York: Palgrave MacMillan, 2013). For critical analysis, see, e.g., Larry Catá Backer, “The Cooperative as Proletarian Corporation: The Global Dimensions of Property Rights and the Organization of Economic Activity in Cuba,” Northwestern Journal of International Law and Business 33.3 (2013): 527-618.
17 “The Good – And Bad – About China’s New Charity Law,” supra. 

18 Constitution of the Communist Party of China 《中国共产党章程》 (adopted 1982, as amended).
19 Considered in Larry Catá Backer, “Party, People, Government, and State: On Constitutional Values and the Legitimacy of the Chinese State-Party Rule of Law System,” Boston University International Law Journal 30.1 (2012): 331-408.
20 Constitution of the People’s Republic of China «中华人民共和国宪法» (adopted 1982 as amended). It is important to note that the Charity Law, like many recent legislative efforts, has been the product of a much more open textured and transparent consulta- tion process, both within China and abroad. Indeed, the draft Charity Law was released for online public consultation in 2015. See China Development Brief, “Draft Charity Law released online for public consultation,” 2 Nov. 2015, available http://chinadevelopment- brief.cn/news/draft-charity-law-released-online-for-public-consultation/. The argument could be made, then, that the draft Charity Law represents another example of a new kind of legislative effort in China, one that avoids the top down opaque processes of prior legislative efforts in favor of a more open process sin which the CCP plays a less decisive role. Yet it is important to distinguish between open consultation processes that might be meant to produce technical assistance with legislation (does it hold together, is it inter- nally consistent, was something overlooked, etc.) and those in which the consultation is meant to shift political oversight. In this case, like all others in China, the CCP continues to play a decisive leadership role. And that leadership role must be exercised in accor- dance with the CCP’s Line. To that end, socialist modernization, as it has evolved now into broad programs of developing productive forces in society, politics, law and culture, as well as in economic development, remain critical factors that tend to weigh heavily in the selection among policy choices. Technical matters, on the other hand, are less sensitive and might lend themselves to broader participation. In any case, even Western oriented techniques might eventually produce transpositions with Chinese characteristics. Cf. Adam Chodorow, “Charity with Chinese Characteristics,” UCLA Pacific Basin Law Journal 30 (2012): 1.
21 “The Basic Line of the Communist Party of China in the primary stage of socialism is to lead the people of all ethnic groups in a concerted, self-reliant and pioneering ef- fort to turn China into a prosperous, strong, democratic, culturally advanced and har- monious modern socialist country by making economic development the central task while upholding the Four Cardinal Principles and the reform and opening up policy.” Constitution of the Communist Party of China, supra, General Program ¶ 10. The Basic Line of the Communist Party is elaborated in the General Program of the Constitution of the Communist Party of China, which comprises the first 28 paragraphs of that document. It sets out the basic political principles under which the Communist Party asserts political leadership over the state and its governmental organs, and of which the state constitution serves as an expression. See, Larry Catá Backer, “Towards a Robust Theory of the Chinese Constitutional State: Between Formalism and Legitimacy in Jiang Shigong’s Constitutionalism,” Modern China 40.2 (2014): 168-195.
22 Socialist modernization references the key political principal that “shifted the focus of the work of the whole Party onto economic development and carried out reform and open- ing to the outside world, ushering in a new era of development in the cause of socialism, gradually formulating the line, principles and policies concerning the building of social- ism with Chinese characteristics.” Constitution of the Communist Party of China, supra, General Program ¶ 5. The political principle of “socialist modernization” is elaborated fur- ther: “In building socialism, the basic task is to further release and develop the productive forces and achieve socialist modernization step by step by carrying out reform in those aspects and links of the production relations and the superstructure that do not conform to the development of the productive forces.” Ibid., ¶ 9.
23 “Emancipating the mind” touches on the obligation toward an appropriate working style centered on innovation and progress. “Second, persevering in emancipating the mind, seeking truth from facts, keeping up with the times, and being realistic and pragmatic. The Party’s ideological line is to proceed from reality in handling all matters, to integrate theory with practice, to seek truth from facts, and to verify and develop the truth through practice.” CCP Constitution, supra, General Program ¶25. “Reform” and “opening up” are two related concepts. “Reform and opening up are the path to a stronger China. Only reform and opening up can enable China, socialism and Marxism to develop themselves.” CCP Constitution, supra, General Program ¶ 13. The reform element is centered on eco- nomic reform and the development of national productive forces. These productive forc- es are understood as economic, social, cultural and political. Opening up references the need to consider global innovation and their utility to China, “breaking new ground in reform and opening up, make its reform decisions more scientific, better coordinate its reform measures and blaze new trails in practice.” Ibid.