This Practice Note presents alternatives to re-registration and practical tips to ameliorate problems in those cases where re-registration is necessary.

Not all Changes Require Re-registration. As an initial matter it is important to note that not all legislative changes give rise to re-registration issues. For example, a tax might be imposed on the unrelated business activities of NGOs or they might be required to file new reports on public solicitation and activities. Re-registration does not come up as an issue with changes in the law that do not require a change in governing documents.

Shifting the Burden. Even when substantial changes in governing documents are required, legislation can be drafted to put the onus on the registration authority. For example, the draft framework law for one Middle Eastern country allows NGO founders to prepare governing documents, proclaim the NGO as a legal entity, and send copies to the registration authority. The NGO acquires legal personality automatically unless the Ministry of Social Affairs successfully brings a court proceeding to challenge the validity of the governing documents. As noted below, this same approach could be used when re-registration issues arise.

Permissive Changes. Some changes in legislation require changes to governing documents only if the NGO wants to take advantage of a newly permitted activity, such as the right to engage in economic activities or to invest in shares of stock or other equity investments. Alternatively, the change could release an NGO from a restriction in the law, such as a requirement that all directors be citizens. Only those seeking to engage in these new activities, or to free themselves of restrictive provisions, should be required to modify their governing documents. A preferable approach, however, might be to require no re-registration but to allow the NGO to seek an opinion from the registration authority that the changes it has made in the governing documents are acceptable.

Default Provisions. In a variant to the foregoing approach, the law could contain default provisions that would apply unless the NGO modified its governing documents. For example, the law could state that upon dissolution, the court would distribute assets to an NGO with similar purposes, unless the organization modified its governing documents to name a specific NGO.

Mandatory Changes. The more usual and difficult cases involve mandatory changes. In some cases, the law adds mandatory provisions. For example, some laws introduce conflict of interest rules, limit partisan political activities, or require that the board of directors meet at least annually. In other cases, the law removes old provisions. For example, the change could eliminate restrictions on economic activities or require all legal entities, including NGOs, to adopt provisions prohibiting discrimination based on race, religion, or ethnicity. As discussed below, there are several ways to achieve these sorts of mandatory changes.

Nullification. The law could simply declare offending provisions null, void, and unenforceable. For example, the law could require that NGOs abstain from partisan political activities, notwithstanding any contrary provision in the governing documents. If this approach is taken, however, one winds up with the anomaly that the governing documents of some NGOs will have provisions that are unenforceable. This is exactly the case with many land titles in the United States. Many continue to have provisions forbidding sale to African Americans or Native Americans, but such conditions are void and unenforceable. Everyone knows that, so such conditions are simply disregarded.

Weighing Benefits and Burdens. In the case of a relatively minor provision that is no longer allowed to be included in the governing documents of an NGO, however, it is not clear that public knowledge of the unenforceability of the provision will be so widespread that the continuing presence of such a condition in the governing documents will be known by all to be unenforceable. In such situations, there needs to be a careful weighing of the costs and problems, on the one hand, of re-registration, and, on the other hand, the possible harm caused by the persistency of the unallowable provision in the governing documents of some NGOs.

Resubmission of Documents. Sometimes, such as when there are extensive changes in the framework legislation, the best option is to require the NGO to submit amended governing documents to the registration agency. In such cases, we have found that problems are mitigated if (1) NGOs are given ample time to prepare and submit documents, (2) NGOs are notified of legislative changes and requirements, (3) the law imposes a limited document burden on NGOs, and (4) the registration authority has limited discretion to reject new documents. Specific suggestions follow:

• Because most governments are hopelessly optimistic about how quickly re-registration of all existing NGOs can be accomplished, allow ample time (e.g., at least one year) for re-registration.
• Give the registration agency the power to extend the time for compliance for all NGOs, for specified groups, or on a case by case basis.

• If amended documents have been filed by the due date, defer loss of legal status until all administrative actions and court appeals have been completed.

• Give the registration agency the power to restore legal personality retroactively to an NGO that has lost it because of failure to amend in time, if adequate cause is shown.

• Require the registration agency to mail to all registered NGOs a plain language explanation of (i) the changes in the law and (ii) the amendments to governing documents that will be required.

Limited Burden

• Do not require re-registration. Require each NGO to file, with its next annual report, a copy of the provisions that have been added to its governing documents in order to comply with the new law. If the provisions are inadequate, the registration agency can discuss with the NGO how to bring them up to snuff. If the issue is not resolved, the parties can place it before a court of competent jurisdiction.
• Require the registration agency to issue model language within a stipulated period of time and mail it to all registered NGOs along with the plain language description mentioned in the section above on notification. If the model language is added to the governing documents by the deadline for such amendments, it will be deemed to have met the requirements of the new law, and the NGO can simply send a letter to the registration authority stating that this is what it has done. NGOs would be allowed to modify the language to suit their peculiar situation (e.g., the special terminology of their governing documents), in which case the modified language would have to be approved on a case-by-case basis.

• Consider funding legal assistance to NGOs for re-registration. In some countries, ICNL and other organizations working on NGO law reform have arranged for lawyers to work with NGOs to revise or prepare governing documents.

• Eliminate or reduce fees for re-registration.

• Limit the power of the registration agency in cases of re-registration so that it can pass only on whether amendments to the governing documents adequately meet the new legal requirements, thereby hoping to prevent refusals to re-register for political reasons.
• Require the registration agency to state its reasons in writing for refusing to accept proposed amendments and provide that the organization will not lose its legal personality until the time for filing a legal action or an appeal from one has expired.

These various approaches can be combined in interesting ways, and there no doubt are other approaches that can also be used.