The International Journal
of Not-for-Profit Law

Volume 1, Issue 3, March 1999

A quarterly publication of the International Center for Not-for-Profit Law

Table of Contents

Articles

Creative Uses of Program Related Investments
Milt Cerney

Redes y Redes de Redes
Miguel Angel Itriago Machado and Antonio L. Itriago Machado

The Katz Report - Finally a Reality
Sangoco

Recent Experiences with Re-Registering Foundations in the Czech Republic
Lenka Deverová and Petr Pajas

Canadian Developments
Arthur Drache

Creating an Enabling Environment for Private Philanthropy: the Role of Charity Law in Northern Ireland
Kerry O'Halloran

Establishing New Interactive Forms of Collaboration Between Non-Profit Organizations and Enterprises.- Competitive vs. Collaborative Relationships
Maria Beatriz Parodi Luna

Reflexionando sobre Consolidación de Organizaciones Cúpula de la Sociedad Civil en Venezuela
Charo Méndez

Reviews

Studies of – and prospects for the revision of the tax laws governing non profit organizations 
By Fondazione Italiano per il Voluntario

Protecting Human Rights Defenders - Analysis of the newly adopted Declaration on Human Rights Defenders
By the Lawyers Committee for Human Rights

Las Asociaciones Civiles en el Derecho Venezolano (Qué son y cómo funcionan)
By Miguel Angel Itriago and Antonio L. Itriago
Reviewed by Caroline L. Newman

Philanthropy and Law in Asia
Edited by Thomas Silk

Case Notes

India:
CIT v Sri Gujarathi Mandal | CIT v Nagi Reddi Charity

France:
Association Eglise de Scientologie
| Albert & others v Association club du chien-guide d'aveugles d'Ile de France

United Kingdom:
Varsani v Jesan | Singh v Bhasin | The Zoological Society of London v Customs & Excise / Dean & Canons of Windsor v Customs & Excise | National Trust v Hoare

United States:
United Cancer Council v Commissioner | In Re Bishop Estate

Country Reports

Asia Pacific:
Regional | Australia | China | New Zealand | Papua New Guinea | the Philippines | Singapore | Vietnam

Central and Eastern Europe:
Albania | Bulgaria | Croatia | Czech Republic | Hungary | Latvia | Lithuania | Macedonia | Romania | Slovakia

Latin America and the Caribbean:
Brazil | Columbia | Falkland Islands/ Malvinas | Peru | Venezuela

Middle East and North Africa:
Regional | Egypt | Kuwait | Morocco

Newly Independent States:
Armenia | Azerbaijan | Belarus | Georgia | Kazakhstan | Kyrgyzstan | Moldova | Russia | Tajikistan | Turkmenistan | Ukraine | Uzbekistan

North America:
Canada | the United States

Sub-Saharan Africa:
Cameroon | Ethiopia | Ghana | South Africa

Western Europe:
Regional | Belgium | France | Germany | Republic of Ireland | Italy | Malta | Sweden | Switzerland | the United Kingdom

Self-Regulation Initiatives

Code of Conduct for NGOs In Ethiopia- A Review Article
Eddie Adiin Yaansah

International Grantmaking

What’s Behind the Foreign Public Charity Equivalence Affidavit?
Betsy Buchalter Adler and Ingrid Mittermaier

International Developments

International Fiscal Association Congress 1999

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Editorial Board

Subscription Information

Previous Issues

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Code of Conduct For NGOs In Ethiopia - A Review Article

Eddie Adiin Yaansah

Introduction

The past decades have witnessed important changes with regards to attempts by nongovernmental organisations (NGOs) to improve their general performances and accountability. Currently, many NGOs in Africa are seeking to achieve these objectives through self-regulation arrangements. In Africa, the attempt by NGOs to regulate themselves through self-regulation is, however, a relatively new field for the NGO sector.1

There are many forms of self-regulation schemes, that is, schemes that are designed to enable NGOs to play a role in regulating themselves. In general, however, NGOs have tended to rely on codes of conduct/ethics (often referred to as "norms," "core values" or "standards' of behaviour"), as the preferred means of regulating themselves.

At the heart of the current debate, is the issue of how to adapt and develop these "norms" or "core values" into meaningful standards that would govern the behaviour of NGOs, both in their dealings with outsiders and among themselves. What values should the Code contain? What form should they take? How should they be enforced? How high should the standards be set? What is the most appropriate machinery for enforcing those standards? Should enforcement be through penal consequences or persuasion, or a combination of both these? These are just some examples of the sort of issues that self-regulation schemes (including this Code of Conduct for NGOs in Ethiopia (the Code)), seek to address.

The foundations of this Code were laid by the workshop organised in early 1997 (the third in a series of six such workshops, organised by the Inter-Africa Group (IAG), on the theme of self-regulation and a code of conduct for the NGO sector (e.g. NGO Networking Services, Monthly Update 1996).2 Building on this and other national workshops, over 200 people, representing both local and international NGOs, met on 11 February 1998 in Addis Ababa to consider a draft Code of Conduct for the NGO sector (Monthly Update : ibid). Thus, the Code of Conduct, which has emerged, is the result of extensive discussions and consultations between NGOs, government, donors, and other interested parties. It has been designed (as the Preamble makes clear), to enable NGOs to cooperate with government, but from a position of autonomy.

The Code of Conduct

The Code has been defined as a "set of norms, principles and values to standardise the conduct, action and behaviour of NGOs." It is in two parts. The first sets out the standards of conduct, which NGOs must observe. The second part entitled, "Code Observance," deals with the mechanisms and procedures for ensuring compliance.

An underlying assumption of the Code is that the beneficiary community is the raison d'etre for NGOs. The Code therefore seeks to ensure that the activities of NGOs are "people-centred," that is, that NGOs adopt strategies that would promote effective participation by the intended beneficiaries in development projects.

The notions of "a people-centred" and "participatory" development are, of course, not new. Development "from below," "bottom-up" development, "grass-roots" development, and "development as if people mattered" have been some of the slogans that social scientists, planners and international donor institutions coined in the 1970s to advocate an alternative development model, that would shift the emphasis away from the state to the people (e.g. Pugwash Symposium 1977; 1981; Sanyal 1994). The assumption was that (with the assistance of NGOs), these activities would empower the people, culminating in a system of self-governance (Bhatt 1989; Frantz 1987).

An ethics, which puts respect for life and the intrinsic worth of all human beings foremost, is central to this development thinking and practice. It requires the democratisation of decision-making and the articulation of peoples' voices at all levels and within all structures of civil society (e.g. Korten 1990; Heyzer 1995: 4). It also encourages (as this Code makes clear), the fullest participation of the people in the conceptualisation, implementation and [monitoring] and evaluation of NGO projects and programmes.

More recently, the World Bank has also been seeking to involve NGOs in Bank-supported programmes as a way of achieving "participatory" development, which is said to be intrinsic to "good governance" (World Bank 1994: 42). The Bank has used the term participation to describe "the process by which stakeholders in development - the Bank, the borrower, and those who are directly or indirectly affected by a development project, influence and share control over development initiatives, and the decisions and resources that affect them." (Clark 1997: 2). But the tensions that underlie World Bank-NGO relationships are nicely encapsulated in an article by Everjoice Win entitled, "To engage or not to engage: What relationship with the new World Bank?",3 which seeks to examine among other issues, the terms on which NGOs can engage with the Bank.

By formulating a code in which the beneficiaries would have an effective participatory role (as this Code does), a new and important dimension in NGO-beneficiary relationships has been established.4 The Code is the first explicit attempt by NGOs in Africa, to re-define their relationships in a way, that not only engages government, bilateral and multilateral donors and the private sector, but seeks to articulate the voices of beneficiaries at all levels and within all structures of civil society. To this extent therefore, the Code represents a tool for the enhancement of the integrity and credibility of the NGO sector.

The measure of any good self-regulatory scheme is how, it ensures among other things, openness and accountability; public confidence; statements of values and standards of behaviour; beneficiary participation; and above all, mechanisms for monitoring and updating the scheme in the light of changing expectations and circumstances. Accordingly, this Code does contain provisions that would promote fairness and equity in NGO activities; moral and ethical integrity; transparency and accountability in their dealings with government; sound financial policies and systems; NGO autonomy and independence; communication and collaboration; the promotion of gender equity; environmental consciousness; mechanisms to monitor and evaluate NGO programmes and activities (The Code uses the phrase "clear and measurable impact indicators").

While some key terms of the Code are defined and expanded upon, many others remain undefined. For example, the terms "fairness and integrity" are undefined. So also, is the term "moral and ethical integrity." Perhaps because of the desire to maintain flexibility in the formulation of the standards of conduct, these terms have been deliberately left vague. This, however, means that they are open to different interpretations. For example, with regard to the concepts of transparency and accountability, the Code states the commitment of NGOs in these terms: "We [NGOs] shall be transparent and accountable in our dealings with the Government, community partners, the public, donors and other interested parties using all available opportunities to inform the public about our work and about the origin and use of our resources."

A criticism, which is often leveled against NGOs. is that they are insufficiently (or not at all) accountable to their beneficiaries or host governments. In general, NGOs are also said to regard themselves as primarily accountable only to their donors (e.g. Edwards and Hulme 1995; Sogge 1996). This Code marks a radical departure from this perception. By formulating a code in which NGOs have explicitly imposed upon themselves the obligation to account not only to funders, but specifically to the beneficiaries, it marks the beginning of a promising relationship between NGOs and beneficiaries for fashioning the developmental process (e.g. Sanyal 1994).

A problem, however, remains. The concepts of transparency and accountability are much broader than the Code implies. The concepts also imply notions of structures that would enable the stated principles to be implemented. For example, a scheme that provides not only for clear public access to NGO Annual Reports, but also one linked to some form of "public approval" procedure, and a strong representation by the beneficiary community in the operation and control of the scheme. Moreover, to be effective, transparency and accountability also require structures that would enable NGOs to consult regularly and widely (at least, with their beneficiaries), before and after decisions are taken. The Code does not specifically address these practical issues.

The same comments can be made with regard to the provisions dealing with "good governance," a concept now explicitly identified with "liberal" democratic political notions without critical analysis of either the concept itself or its applicability to NGOs, particularly local NGOs (e.g. Green 1997: 51-57; Frischtak 1997: 105-118). While formal structures, such as, a "constitution" or "memorandum of association," which set out the aims and objectives of NGOs, are no doubt, important features of "good governance," nevertheless, as formal requirements, these are by themselves inadequate. Transparency and accountability are not concerned with form alone, but also with substance. Fundamentally, "good governance" also requires appropriate structures and institutions that would enable the principles to be implemented. The failure of the Code to further elaborate on these issues is, perhaps one of its weaknesses.

Enforcing the Code

The second part of the Code is concerned with the implementation of the standards of conduct, including, the composition of the Code Adherence Committee (the Committee) and its functions; how complaints about NGO activities are to be dealt with; the jurisdiction of the Code Adherence Committee; the Appeal structure; the procedures for amending or revising the Code; the scope of the application of the Code and the mechanisms for publicising the Code among NGOs.

Two bodies are central to the Code's implementation: (a) the General Assembly, which is [to be] the supreme (Code Observance) body; and (b) the NGO Code Adherence Committee, which is ultimately answerable to the General Assembly for the exercise of its functions. The General Assembly comprises all the NGO organisations that have agreed to bind themselves to the Code. On the other hand, the Code Adherence Committee is to be made up of seven members: five members are to be from the NGO organisations that are signatory to the Code and who constitute the General Assembly; the two remaining members are to be drawn from "civil society" institutions. But given the diversity of "civil society" institutions, this implies that the beneficiaries of NGO programmes and projects need not be directly involved in the operation and management of the scheme. This would undercut the underlying theme of the Code that it be "people-centred."

The Committee has three broad functions. The first is an administrative function; that is, to act as a guardian of the Code, to educate NGOs who are signatories to the Code, to negotiate, persuade and liaise with other interested parties (e.g. the public, government, donors, NGO community and the beneficiaries) on the Code. The Committee also has responsibility to review and to recommend to the General Assembly any change to the Code that the Committee considers appropriate.

The Committee's second function is that of an adjudicative one - to adjudicate over petitions or complaints from staff, government, donors, community partners and other NGOs, involving breaches or violations of the Code. The Committee's power here includes one to review all instances of "significant" breaches of the code. This provision was presumably intended to confer on the Committee, a power of review, independent of whether or not, any specific petition or complaint has been made to it. This can be a useful tool, for example, in cases of generalised and significant non-compliance, where the interested parties (eg. the beneficiaries), may be ignorant of the breach, unwilling or simply unable to invoke the complaints procedure. Finally, the Committee has responsibility to create among the NGO signatories, an awareness of the Code of Conduct. Although this provision is limited to an internal management of the Code, it is nevertheless, a significant power. To the extent that education can promote among NGOs, understanding, respect, and tolerance of the culture and values of the beneficiary community, it can enhance the development efforts of NGOs.

Although not clearly articulated, two models of "conflict" resolution can be seen at work within the Code: (a) a conciliation model and (b) an adjudication model. As regards conciliation, the intention of the Code is that the Code Adherence Committee would be primarily concerned to act as a "bridge of harmony and understanding" between NGOs, government, donors and the beneficiaries. This requires that where a complaint is made to the Committee, it would seek to resolve the complaint in an amicable manner; that is, through discussion with a view to mediation between the parties (i.e., the complainant and the NGO against whom the complaint has been made). A long term implication of this procedure is that compliance with the Code would be through the education of the offending NGO.

Education is a broad notion, but includes the promotion of understanding, tolerance and friendship among NGOs and the beneficiary community. Clearly, unless NGOs know what the Code requires of them, they cannot realistically be expected to comply with its provisions. This is particularly important, given the large number of NGOs operating in the country. But while education alone would not necessarily prevent breaches of the Code, it can be useful in generating moral pressure for compliance with it and thus, lead to the creation of a climate in which disregard of its provisions (i.e., the Code), would be unacceptable (e.g. Meron 1984).

The second model is the "adjudicatory" or "trial-type" model. Again, although not clearly articulated, it is implied that complaints utilising this model would be resolved in an adversarial manner. "Trial-type" procedures vary from country to country and within self-regulatory schemes. In general, however, "trial-type" procedures include several features: a timely and specific notice of the issues to be resolved; the right of the parties to the proceedings to appear personally or through representatives for purposes of presenting their case; the right of the parties to call evidence (oral and/or written), and to examine witnesses who have been called in support of the other side's case; public hearing of the complaint (although as the Kenya NGO Council's Code of Conduct illustrates, a public hearing is by no means an invariable requirement);5 an assumption that the decision-maker will be impartial;6 that the decision will be based solely on the evidence and arguments put before the decision-maker; and that the decision-maker will act fairly in the process (eg. Mashaw and Merrill 1985: 174; Baldwin and McCrudden 1987: 73).

The Code applies to all the NGOs who are signatories to it. It also applies to NGO officials, individuals or groups who act for and/or on behalf of NGOs who are signatory to the Code. It requires complaints to the Committee to be in writing and in a specified form. The application should include the remedy sought. The rationale for requiring applications to be in writing is unclear. Given that a large proportion of the beneficiary community is illiterate, is it really sensible to require complaints to be in writing? By seeking to formalise complaints in this way regardless of the nature of the complaint or wishes of the complainant, may unwittingly undercut the Code's underlying assumptions, especially those relating to the need for NGO activities to target the "disadvantaged" and the "marginalized."

People may complain against an NGO for any number of reasons: they perceive that the NGO is not carrying out its intended objectives; the NGO has discriminated against them; the NGO or its employees have treated them rudely; they are trying to gain a personal advantage or settle "old scores"; or, they are simply being malicious and so forth. Complaints can also be broadly categorized into "minor" and "serious" ones. While serious complaints (e.g. complaints raising implications for NGO policy or aspects of it), may require formal treatment, minor complaints, on the other hand, can usually be dealt with on an informal level. The provision requiring complaints to be in writing may therefore need to be re-examined. Depending on the nature and reason(s) for the complaint, it should be possible for complainants who cannot meet these formal requirements for any number of reasons, simply to come into the office of the Committee to make a verbal complaint.7

Equally, the requirement for the complainant to state the remedy sought is somewhat odd, given the nature and of the measures available to the Code Adherence Committee for securing compliance with the Code. There are four options available to the Committee where it finds a complaint established. It can: (a) provide for the education of the NGO, on the requirements of the Code; (b) advise the NGO signatory to take corrective measures against the NGO official or employee who is directly responsible for the breach of the Code; (c) admonish the NGO signatory; and (d) recommend the suspension of the NGO or the cancellation of its membership as an NGO signatory.

There is also provision in the Code for an appeal from the Committee to the General Assembly, although the procedures to be used by the General Assembly in the resolution of such an appeal are not stated.

The measures, which the Committee can take in the case of proven violations of the Code, indicates that the Code intended to give the Committee discretion to decide on the most appropriate measure or measures that best secure compliance with its provisions. For example, having found an NGO "guilty" of a breach of the Code, the Committee must then decide in the exercise of its discretion, whether education rather than suspension will achieve the objectives of the Code. This means that the fact that a complainant has, for example, sought the suspension of the guilty NGO rather than its admonition or education, in no way obliges the Committee to grant the complainant that relief

The real point here is that given the lack of provision for monetary compensation, it is misleading to create the impression in the minds, of complainants that the stipulation of the remedy, which they seek, would have any real impact on the exercise of the Committee's discretion in the matter. This is clearly not the case.

Conclusion

This article has sought to offer just a "bird's eye view" of the Code of Conduct, which will serve as a basis for further discussion. As is typical of Codes of Conducts in general, this Code contains a number of provisions, which are arguably unenforceable. For example, the provision declaring that NGOs will devote the maximum possible proportion of available resources to their beneficiaries (section 1.7), may be problematic. Who can complain about a breach of this provision? To whom is an NGO to be held accountable for breach of this provision - the Committee or the donors? How is this requirement to be monitored or verified? These are just some examples of the problems of implementation that can arise under the Code.

However, as Ato Kebede Asrat has commented, "a code of conduct is best understood as a statement of principles, and as such not a document of legal requirements" (The Ethiopian Herald, 25 September 1998). Admittedly, a code may be designed (as this Code has been), to achieve a number of objectives. It may aim, for example, to set standards, (which if not followed, will be enforced through persuasion and education rather than through penal consequences); to promote, educate and raise consciousness; and to facilitate negotiated compliance and so forth. Equally, as the Code makes clear, its key terms may possess different qualities that correspond to the objectives stated above, for example, generality, flexibility, accessibility and so forth. In other words, it may well be the case that in order to deal with issues of fairness and equity, the standard has to be cast in very vague and wide terms than would be the case if one were dealing with standards relating, for example, to good management practices.

Despite the limitations, which have been noted above, there are many positive aspects to the Code: it seeks to involve the beneficiary community in the "conception, implementation and evaluation of projects and programmes;" it has been made subject to periodic review and update in the light of developments or the Committee's operational experience; it imposes an obligation on NGO signatories to ensure that employees are adequately acquainted with its provisions; it requires NGOs to respect indigenous institutions and culture; that NGOs undertake only environmentally friendly and need-oriented programmes; to coordinate and cooperate with government, the public and other partners (without seeking to compromise NGO autonomy/independence); it incorporates flexibility in the resolution of complaints between the parties, and specifically, avoids determining an exclusive mode of compliance by the establishment of a body, which will principally be responsible: (a) to educate; (b) mediate; and (c) arbitrate over compliance with the Code; promote gender and minority equity; promote affirmative action in recruitment, hiring, training, professional development and advancement; and to ensure that NGO projects and programmes are sustainable.

Equally, the fact that NGO-government relationships are defined in the Code, in non- confrontational terms, and that beneficiaries are to play an active role in the conceptualisation, monitoring and evaluation of NGO projects and programmes, is a testimony to the growing awareness by NGOs that the relationships between NGOs, government, donors and beneficiaries have to be based on mutual respect and good faith.

Clearly, it is too early to assess how the Code will work. Ultimately, however, its success will depend on a number of factors: the success of the Code's education programme, the willingness and ability of NGOs to abide by the Code; and above all, the ability to enforce compliance with the Code.

Notes

1 Although a number of NGOs in Africa (eg. the NGO Consultative Forum (NGO CF) and the NGO Coordinating Committee (NGOCC) (both in Zambia)), have formulated voluntary codes of practices for their own internal governance, these codes remain in a state of relative underdevelopment. Today in Africa, the only exception remains the experiment in statutory self-regulation by the Kenya NGO Council's Code of Conduct. This model has been examined in detail by the author in a forthcoming book (see Adiin Yaansah (1997) An Experiment in NGO Self-Regulation in Kenya.

2 Between 1996 and 1998, a series of six workshops were held by Ethiopian NGOs. The workshop on self regulation and a code of conduct for NGOs was held in the town of Nazareth in January 1997. It was conducted in Amharic, thus underscoring the need for NGO regulatory frameworks (including codes of conducts), to be communicated in a language, which is readily understood by NGOs and their beneficiaries (see IAG (NGO Networking Services), Monthly Update, vol 5. No. 2, Addis Ababa. December 1996).

3 Everjoice Win "To engage or not to engage: What relationship with the new World Bank?", Policy Alert, May/June 1996.

4 For example, the British Red Cross is developing a Beneficiaries Charter to protect the interests of the recipients of aid (British Red Cross, News Release, 17 June 1997).

5 The Kenya NGO Council's Code of Conduct provides for a hearing in secret.

6 In the context of NGOs, the issue of whether self-regulation arrangements can be impartially administered by NGOs themselves, is a controversial issue. Concern has centred on the issue of whether it is appropriate to entrust the power of regulation, administration and enforcement in the same body given the danger of the orgamsation being "captured" by its organisational self-interest. For a discussion of these issues, see AdiinYaansah, supra note 1.

7 For criticisms of a similar provision in the Kenya NGO Council's Code of Conduct 1995, see Adiin Yaansah (1997) An Experiment in NGO Self-Regulation in Kenya (with publishers).

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Source

CODE OF CONDUCT FOR NGOs IN ETHIOPIA, Consultation Meeting, September 24, 1998

 
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