NGO Law Monitor: Pakistan

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Last updated 17 May 2012

Update: Senator Tariq Azeem of the Pakistan Muslim League (PML) introduced the Regulations of Foreign Contributions Act 2012, which he says is consistent with the regulations of “many countries in the world,” including Egypt, which recently arrested 27 NGO representatives, and India, which recently banned three NGOs. The Bill will go to the lower house for voting and, if approved, will become an Act of Parliament. Senators Ishaq Dar and Ilyas Bilour are responsible for ensuring that the Bill is properly reviewed and moved to the Senate committee to be formed after Senate elections in March. Senator Azeem argues that NGOs are utilizing foreign aid money for their own agenda and even against the public interest. However, the scope of the bill is extremely broad and could starve numerous NGOs of the funds they need to survive. See Pending Legislative/ Regulatory Initiatives for more details.

Introduction

The nonprofit sector in Pakistan has grown considerably in the recent past, in terms of both its size and its scope of work. Today, Pakistan’s 45,000 citizen organizations employ about 300,000 persons, utilize 200,000 full time volunteers, and engage in a wide set of activities ranging from service delivery to sophisticated financial services to technical advice in areas like agricultural extension, water and sanitation, and housing construction [1]. Increasingly, nonprofit organizations (NPOs) are engaged in lobbying for legal and fiscal reform, and take a pro-active approach in defining issues for the national agenda. This new role is partly derived from the comparatively large volume of resources the nonprofit sector now commands.

A large proportion (38%) of citizen organizations is not registered under any law. Even those that are registered are not necessarily subject to monitoring and evaluation under the regulatory system. To address this issue, the Pakistan Centre for Philanthropy instituted an NPO certification regime for tax exemption and systems evaluation, which has been ongoing since 2003.

There is a discernible trend in Pakistan in which the State is moving away from being the monopoly provider of social services, and is creating an enabling environment for a variety of non-state actors to deliver a wide range of social services. This is a change of paradigm in the true sense of that overused term, and has profound implications for the regulatory role of the State and the nonprofit sector both.

Generally, the legal framework for NPOs may be divided into several categories. Some laws govern the registration, internal governance and accountability of organizations. Other laws govern how they are financed and managed. Still other laws govern the reporting relationship between the State and NPOs with respect to their operations or the manner in which they treat their employees. Taken as a whole, the legal framework can be called generally enabling for civil society and the activities of NPOs.

[1] Dimensions of Pakistan’s Nonprofit Sector: Preliminary Estimates; a Report of the Johns Hopkins University; Comparative Nonprofit Sector Project (Social Policy and Development Centre, Islamabad, May 2002)

At a Glance

Organizational Forms	Associations, Trusts, Voluntary Social Welfare Agencies, etc.	Not-for-Profit Companies
Registration Body	Ministry of Social Welfare; District Governments; Provincial Social Welfare Departments and Department of Industries	Securities & Exchange Commission of Pakistan (SECP)
Approximate Number	45,000	435
Barriers to Entry	Domestic NPOs: Registration under any of the four different laws with registration offices in different provinces. Foreign NPOs: MoU with Economic Affairs Division (EAD)
Barriers to Activities	No legal barriers assuming compliance with constitutional boundaries
Barriers to Speech and/or Advocacy	No legal barriers
Barriers to International Contact	No legal barriers
Barriers to Resources	No legal barriers

Key Indicators

Population	176,242,949 (July 2009 est.)
Capital	Islamabad
Type of Government	Islamic Republic
Life Expectancy at Birth	64.49 years
Literacy Rate	49.9%
Religious Groups	Muslim 95% (Sunni 75%, Shia 20%), other (includes Christian and Hindu) 5%
Ethnic Groups	Punjabi 44.68%, Pashtun (Pathan) 15.42%, Sindhi 14.1%, Sariaki 8.38%, Muhagirs 7.57%, Balochi 3.57%, other 6.28%
GDP per capita	$2,500 (2008 est.)

Source: The World Factbook. Washington, DC: Central Intelligence Agency, 2009.

International Rankings

Ranking Body	Rank	Ranking Scale (best – worst possible)
UN Human Development Index	141	1 – 182
World Bank Rule of Law Index	19.1	100 – 0
World Bank Voice & Accountability Index	19.2	100 – 0
Transparency International	139 (2009)	1 – 180
Freedom House: Freedom in the World	Status: Partly Free Political Rights: 4 Civil Liberties: 5	Free/Partly Free/Not Free 1 – 7 1 – 7
Foreign Policy: Failed States Index	10	177 – 1

Legal Snapshot

International and Regional Human Rights Agreements

Key International Agreements	Ratification*	Year
International Covenant on Civil and Political Rights (ICCPR)	No	--
Optional Protocol to ICCPR (ICCPR-OP1)	No	--
International Covenant on Economic, Social, and Cultural Rights (ICESCR)	Yes	2008
Freedom of Association and Protection of the Right to Organize Convention	No	--
International Convention on the Elimination of All Forms of Racial Discrimination (ICERD)	Yes	1966
Convention on the Elimination of All Forms of Discrimination Against Women (CEDAW)	Yes	1996
Optional Protocol to the Convention on the Elimination of Discrimination Against Women	No	--
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	--
Regional Treaties
SAARC convention on regional arrangements for the promotion of child welfare in South Asia	Yes	2005
SAARC convention on preventing and combating trafficking in women and children for prostitution	Yes	2002

* Category includes ratification, accession, or succession to the treaty

Constitutional Framework

The Constitution of Pakistan (1973) recognizes the right of individuals to associate with others to pursue common goals as an inalienable fundamental right. Relevant constitutional provisions include:

Article 15 [Freedom of movement]: Every citizen shall have the right to remain in, and, subject to any reasonable restriction imposed by law in the public interest, enter and move freely throughout Pakistan and to reside and settle in any part thereof.

Article 16 [Freedom of assembly]: Every citizen shall have the right to assemble peacefully and without arms, subject to any reasonable restrictions imposed by law in the interest of public order.

Article 17 [Freedom of association]:

Every citizen shall have the right to form associations or unions, subject to any reasonable restrictions imposed by law in the interest of [13] [sovereignty or integrity of Pakistan, public order or morality].
Every citizen, not being in the service of Pakistan, shall have the right to form or be a member of a political party, subject to any reasonable restrictions imposed by law in the interest of the sovereignty or integrity of Pakistan [14A] [or public order] and such law shall provide that where the Federal Government declare that any political party has been formed or is operating in a manner prejudicial to the sovereignty or integrity of Pakistan [14A] [or public order], the Federal Government shall, within fifteen days of such declaration, refer the matter to the Supreme Court whose decision on such reference shall be final. [14B] [Provided that no political party shall promote sectarian, ethnic, regional hatred or animosity, or be titled or constituted as a militant group or section.
Every political party shall account for the source of its funds in accordance with law.]
Every political party shall, subject to law, hold intra-party elections to elect its office-bearers and party leaders.]

Article 19 [Freedom of speech]: Every citizen shall have the right to freedom of speech and expression, and there shall be freedom of the press, subject to any reasonable restrictions imposed by law in the interest of the glory of Islam or the integrity, security or defence of Pakistan or any part thereof, friendly relations with foreign States, public order, decency or morality, or in relation to contempt of court,[15] [commission of] or incitement to an offence.

Article 20 [Freedom of profess religion and to manage religious institutions]: Subject to law, public order and morality:

Every citizen shall have the right to profess, practice and propagate his religion; and
Every religious denomination and every sect thereof shall have the right to establish, maintain and manage its religious institutions.

Article 25 [Equality of citizens]: (1)All citizens are equal before law and are entitled to equal protection of law. (2)There shall be no discrimination on the basis of sex alone. (3)Nothing in this Article shall prevent the State from making any special provision for the protection of women and children.

National Laws and Regulations Affecting Sector

Laws governing civil society organizations that either explicitly require registration or implicitly confer recognition include:

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

Pending NGO Legislative / Regulatory Initiatives

Senator Tariq Azeem of the Pakistan Muslim League (PML) introduced the Regulations of Foreign Contributions Act 2012, which he says is consistent with the regulations of “many countries in the world,” including Egypt, which recently arrested 27 NGO representatives, and India, which recently banned three NGOs. The Bill will go to the lower house for voting and, if approved, will become an Act of Parliament. Senators Ishaq Dar and Ilyas Bilour are responsible for ensuring that the Bill is properly reviewed and moved to the Senate committee to be formed after Senate elections in March. Senator Azeem argues that NGOs are utilizing foreign aid money for their own agenda and even against the public interest. However, the scope of the Bill is extremely broad and could starve numerous NGOs of the funds they need to survive.
According to the provisions of the Bill:

NGOs must receive advance governmental permission to receive foreign contributions. “No NGO/person shall accept a foreign contribution unless such NGO/person obtains a certificate of registration from the Federal Government.” (Article 6)
The certificate of registration is valid for only five years. “The certificate granted ... shall be valid for a period of five years and the prior permission shall be valid for the specific purpose or specific amount of foreign contribution proposed to be received, as the case may be.” (Article 7(6))
The grounds for government review of an application for a certificate to receive a foreign contribution are vague. The certificate may be granted if the government, after making such inquiry as it “deems fit,” is “of the opinion that the conditions specified in sub-section (4) are satisfied.” The “conditions in sub-section (4)” include, among others, that the applicant “is not likely to use the foreign contribution for personal gains or divert it for undesirable purposes;” that the applicant “has prepared a reasonable project for the benefit of the society for which the foreign contribution is proposed to be utilised;” and that the applicant “is not likely to affect prejudicially … the sovereignty and integrity of Pakistan,” “the security, strategic, scientific or economic interest of the State,” “the public interest,” or “friendly relations with any foreign state.” (Article 7(3, 4))
Administrative expenses may not exceed 20% of the contribution. “Every NGO/person, who is registered and granted a certificate or given prior permission under this Act and receives any foreign contribution ... (b) shall not defray as far as possible such sum, not exceeding twenty percent (20%) of such contribution, received in a financial year, to meet administrative expenses.” (Article 4)
The government has the authority to cancel the certificate directly. “The Federal Government may, if it is satisfied after making such inquiry as it may deem fit, by an order, cancel the certificate if — … (b) the holder of the certificate has violated any of the terms and conditions of the certificate or renewal thereof; or (c) the holder of certificate has violated any of the provisions of this Act or rules or order made thereunder.” Moreover, “[a]ny NGO/person whose certificate has been cancelled under this section shall not be eligible for registration or grant of prior permission for a period of three years from the date of cancellation of such certificate.” (Article 9)
The government has broad powers of inspection. “If the Federal Government has, for any reason, to be recorded in writing, any ground to suspect that any provision of this Act has been or is being, contravened by— (a) any person; or (b) any organisation; or (c) any association,it may, by general or special order, authorise a gazetted officer under the Federal Government or such other officer or authority or organisation, as it may think fit (hereinafter referred to as the inspecting officer), to inspect any account or record maintained by such NGO, person, organisation or association, as the case may be, and thereupon every such inspecting officer shall have the right to enter in or upon any premises at any reasonable hour, before sunset and after sunrise, for the purpose of inspecting the said account or record.” (Article 15) There seem to be no procedural safeguards, such as requiring the government to receive a court order or provide advance notice to the person/NGO, relating to the inspection process.
Criminal penalties may apply for violations of the law’s provisions. The Bill provides up to three years imprisonment for anyone who accepts or assists an NGO/person to accept a foreign contribution in contravention of a provision of the Bill. Second-time offences can result in up to five years imprisonment. (Article 24) “Where an offence under this Act or any rule or order made thereunder has been committed by an NGO, any person who, at the time the offence was committed, was in charge of, and was responsible to, the NGO for the conduct of the business of the NGO shall be deemed to be guilty of the offence.” (Article 28)

Legal Analysis

Organizational Forms

The legal framework in Pakistan recognizes four primary forms of not-for-profit organization (NPO).

The Societies Registration Act, 1860 states that a society can be formed and registered if its purpose is to promote any one or more of the following activities:

i. Science;
ii. Literature;
iii. Fine arts;
iv. Instruction and the diffusion of useful knowledge;
v. Diffusion of political education;
vi. Foundation or maintenance of libraries or reading rooms for use among members or open to the public;
vii. Public museums and galleries of paintings;
viii. Work of art;
ix. Collection of natural history;
x. Mechanical and philosophical inventions;
xi. Instruments or designs; and
xii. Educational and medical services.

A public charitable trust, under the Trusts Act, 1882,unlike other trusts created for the benefit of specific individuals, is for the benefit of society generally or for certain sections of society. Charitable objectives can be classified under the following divisions:

i. Advancement of religion;
ii. Advancement of knowledge;
iii. Advancement of commerce, health and safety of the public; and
iv. Advancement of any other object beneficial to mankind.

The Voluntary Social Welfare Agencies Registration and Control Ordinance, 1961states that a Voluntary Social Welfare Agency is an organization or undertaking established by people of their own free will for the sole objective of providing welfare services in any one or more of the following fields:

i. Child, youth and women’s welfare;
ii. Welfare of the physically and mentally challenged;
iii. Family planning;
iv. Social education;
v. Rehabilitation and welfare of patients;
vi. Welfare of juvenile delinquents;
vii. Rehabilitation and welfare of released prisoners;
viii. Welfare of socially handicapped;
ix. Welfare for the elderly and destitute;
x. Recreational programmes to ward off people from anti-social activities;
xi. Training in social work; and
xii. Coordination of social welfare agencies.

A nonprofit company may seek registration under the Companies Ordinance, 1984if it is established for furthering the development of:

i. Commerce;
ii. Art;
iii. Science;
iv. Religion;
v. Sports;
vi. Social services;
vii. Charity; or
viii. Any other ‘Useful’ objective.

Public Benefit Status

Depending on the organizational form, NPOs are free to pursue both member benefit purposes and public benefit purposes.

Tax exemptions and certain other fiscal benefits are available to certain NPOs, depending on their purposes and activities. Generally, in order to qualify for tax exempt status, the NPO must confer and be seen to confer benefits to society as a whole and not to any particular segment of society.

Barriers to Entry

Domestic NPOs may register under any of the four different laws with registration offices in different provinces. Foreign NPOs sign a Memorandum of Understanding (MoU) with Economic Affairs Division (EAD) in order to receive recognized legal status for their activities.

Barriers to Operational Activity

There are no legal barriers regarding an organization's operational activity. NPOs are free to operate according to their approved charter.

Barriers to Speech / Advocacy

There are no legal barriers restricting the expressive activities of nonprofit organizations. NPOs are allowed to publish critical material. However, some reasonable limitations are imposed by law in the interest of religion, security and/or defense of the state, friendly relations with foreign states, public order, decency and morality, or incitement to an offence.

In addition, NPOs dedicated to issues of female education and empowerment have faced threats, attacks, and a number of murders by Islamic extremists, particularly in the north. While this is not a legal barrier per se, there is a role for the State in protecting citizens from such criminal attacks. Moreover, this underscores the point that there are cultural barriers, more than legal barriers, which constrain the work of some NPOs in some parts of Pakistan.

Barriers to International Contact

There are no legal barriers to international communication and contacts.

Barriers to Resources

There are no legal barriers to resources for NPOs in Pakistan.

Reports

UN Universal Periodic Review Reports	Pakistan National Report Compilation of UN information Summary of stakeholders' information Report of the Working Group Decision on the Outcome Draft Report on the eighth session of the Human Rights Council
Reports of UN Special Rapporteurs	Protection of human rights and fundamental freedoms while countering terrorism, 2009
U.S. State Department	2008 Country Reports on Human Rights Practices: Pakistan Advancing Freedom and Democracy Reports, 2009
Failed States Index Reports	Foreign Policy: Failed States Index 2009
IMF Country Reports	Pakistan and the IMF
International Commission of Jurists	ICJ: Pakistan
International Center for Not-for-Profit Law Online Library	Pakistan

News and Additional Resources

While we aim to maintain information that is as current as possible, we realize that situations can rapidly change. If you are aware of any additional information or inaccuracies on this page, please keep us informed; write to ICNL at ngomonitor@icnl.org.

General News

Pakistani Prime Minister praises NGOs at conference on the “Role of international NGOs in relief and development in Pakistan” (April 2012)
Muslim Hands International, an NGO with operations in 40 countries in Europe, Africa and Asia, held a conference at which Pakistani Prime Minister Syed Yusuf Raza Gilani said that “NGOs can play a very vital role in achieving the goal of development,” and assured his government's support of welfare-oriented NGOs. Prime Minister Gilani said that for countries like Pakistan, which has been combating militancy and terrorism, and whose economy has been affected due to severe energy shortages and natural disasters, the role of NGOs like Muslim Hands International was crucial to offset these negative effects. His statements are in contrast to members of Pakistan’s parliament who have recently said that NGOs are utilizing foreign aid money for their own agenda and even against the public interest.

Pakistani CSOs urge the Maldives not to follow Pakistan's example after political crisis (April 2012)
Civil society organizations in Pakistan have expressed alarm over the political crisis in the Maldives, urging the country not to make the same mistakes as Pakistan and calling for the Maldives’ suspension from SAARC until democracy is restored. The Pakistani civil society representatives warned that the Maldives was now following the same path of decline that had mired Pakistan in political, religious and economic turmoil.

NGO goes to court seeking witness protection laws (February 2012)
Top government and police officials have been roped in to a petition that takes up the creation of a witness protection programme for Sindh, seen by many as a solution to the low conviction rate. Unlike in other parts of the world, Pakistan does not have a law in this area. Witnesses are loathe to expose themselves to the high risk of giving incriminating testimonies as either they or their families are fatally attacked, many times on the premises of the court as has been seen in karo kari cases. This is the point argued by the person who filed the petition, Syed Muhammad Iqbal Kazmi of the Human Rights Commission South Asia, not to be mistaken for the HRCP. When it comes to heinous offences, or terrorism, prosecution witnesses are often threatened by the parties standing trial or the powerful political groups that support them. Thus, in his petition, he has appealed to the Sindh High Court for it to order the federal and provincial governments to come up with laws to tackle this issue.

Role of civil society in budget process (January 2012)
Since 1990s, civil society organizations have started influencing the budget formulation in few developing countries. The inclusiveness in the budget formulation acknowledges the value due to public oversight and improved commitment towards pro-poor choices. The civil society budget initiatives are also supplemented by the critical media coverage.

Pakistanis' distrust of foreigners impedes aid groups (January 2012)
International aid groups say they're under siege in Pakistan, demonized by hard-line Islamists, viewed as spies by suspicious Pakistanis and, now, increasingly sidelined by the government. The groups report that in the last year, they began to feel unwanted in the country, and in some cases persecuted. Nongovernmental organization visa requests languished or were outright rejected. New travel restrictions hampered aid workers' movement. Some workers were arrested and harassed.

PPP, civil society hold pro-democracy demonstrations (January 2012)
The Pakistan People’s Party (PPP) and civil society organisations on Thursday organised protest demonstrations in favour of the democratic system in Pakistan. They strongly opposed any unconstitutional move from any state institution as well as the “judicial activism” against the PPP-led government, keeping in view the geo-political and socio-economic situation in the country.

News Archive

HRCP presents bleak picture of human rights in 2010-2011 (December 2011)

Corporate sector must strengthen institutional mechanism (December 2011)

Challenges to Pakistan’s democracy (September 2011)

Seminaries prohibit Zakat for celebrity-run organizations (August 2011)

Eight Pakistanis working for US NGO kidnapped (July 2011)

Civil society meeting: Commissioner’s threat to NGOs criticized (July 2011)

Disbursement through NGOs: Pakistan seeks details of US aid (May 2011)

Incentive package: EU links trade concessions to human rights record (May 2011)

A paradox retarding Pakistan’s democracy? (April 2011)

Mukhtar Mai verdict will have ‘negative impact’ on Pakistan’s civil society (April 2011)

NGOs criticise govt’s flood relief efforts (December 2010)

The foregoing information was collected by the ICNL NGO Law Monitor partner in Pakistan, the Pakistan Centre for Philanthropy.