Federation of BiH Law on Associations and Foundations

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BOSNIA AND HERZEGOVINA
LAW ON BIH ASSOCIATIONS AND FOUNDATIONS
(Official Gazette of BiH, No. 32 of December 28, 2001)

PART I: ASSOCIATIONS AND FOUNDATIONS

I.1. GENERAL PROVISIONS

Article 1

This Law shall regulate the founding, registration, internal governance and dissolution of
associations and foundations which elect to regi ster or are required to register pursuant to
this Law.

Article 2

1. An association is created by a common agreement in which a group of three or more
physical or legal persons, in any combination, voluntarily associates to further a
common interest or public interest, and who do not intend to gain profit. An
association becomes a legal person when it is registered as provided in this Law.

2. A foundation is a legal person without its ow n members, intended to manage specific
property for the public benefit, or for charitable purposes. A foundati
on becomes a
legal person of Bosnia and Herzegovina when it is registered as provided
in this Law.

Article 3

1. Physical and legal persons who are either citizens or residents of Bosni
a and
Herzegovina, or who are registered therein, shall be free to voluntarily associate into
associations or foundations for any purpose in compliance with the Constitution and
the laws of Bosnia and Herzegovina.

2. Associations and foundations shall be free to carry out their activities
in the entire
territory of Bosnia and Herzegovina regardless of where they have been r
egistered.

3. The goals and activities of a registered a ssociation or foundation shall not include
electioneering, fundraising for candidates, or financing of candidates or political
parties.

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Article 4

1. An association or foundation can perform economic activities only if the principal
purpose of such activities is pursuing of statutory goals.

2. An association or foundation may pe rform unrelated economic activities (economic
activities that are not directly related to the realization of main statutory goals of an
association or foundation) only through a separately established legal
person.

3. The annual revenue, reduced for expenses, from such unrelated economic activity of an
association or foundation, including that of separate legal persons established pursuant to this
Article, shall not exceed one-third of th e organization’s annual budget, or 10,000 KM,
whichever amount is higher.

4. Profit generated from an association’ s or foundation’s unrelated economic activities can
only be used for advancing statutory goals.

5. The following persons shall not directly or indirectly obtain profits or other financial
benefits gained through the activities of asso ciations or foundations: founders, association
members, members of managing bodies, responsible persons, employees or donors.

6. The limitation set out in the previous paragraph does not exclude reimbursing such
persons for work or for expenses related to th e realization of lawful aims and activities as
determined by the statute of the association or foundation.

7. The limitations set out in this Article shall not limit the property of the association
or foundation as referred to in Article 46 of this Law.

Article 5

1. Associations and foundations shall be inde pendent in determining their goals and
activities in compliance with the Constitution and the law.

2. The program and activities of an associa tion or foundation may not contravene the
constitutional order of Bosnia and Herzegovina, nor may they be directed at its
violent destruction, stirring of ethnic, racial or religious hatred, or any discrimination
prohibited by law.

Article 6

1. An association or foundation can be entruste d, by law or by delegation of the competent
authorities, to perform public competence within its activities.
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2. This assignment shall not be made against the will of an association or foundation.
3. If an association or foundation has agreed to perform public competence, it is obliged
to ensure lawful and undisturbed performance of public competencies.

4. Unless its statute provides to the contrary, th e operation of a registered association or
foundation shall be public.

Article 7

1. Every registered association or foundation shall have its full name and seat.

2. In performing their activities, registered a ssociations and foundations may use only their
registered names.
3.
1. The name of a registered asso ciation or foundation must be in the three official languages
of Bosnia and Herzegovina.
4. An association or foundation may have a logo.

5. The name, abbreviated name or a logo of a registered association or foundation must
be clearly distinguishable from the name or logo of other registered associations or
foundations.

6. Along with its full name, an association or foundation may also use an abbreviated
name.

Article 8

The Ministry referred to in this Law sha ll be the Ministry of Civil Affairs and
Communications of Bosnia and Herzegovina.

I. 2. ASSOCIATIONS

I. 2.1. The Founding of Associations

Article 9

1. An association qualified for registration may be established by at least three physical
persons or legal persons of Bosnia and Herzegovina, in any combination, who are
either citizens or residents of Bosnia and Herzegovina, or who are registered therein,
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but it may not be established by the state of Bosnia and Herzegovina, entities,
cantons, cities, municipalities, local communities, state organs, state companies and
funds.

2. An association qualified for registration mu st be established by the enactment of a
founding act.

3. Unless ratified by the association, acts committed in the period between the
establishment and registration of an associ ation may create obligations only for those
persons who actually performed those acts. Only the association’s highest managing
body may ratify acts committed on behalf of the association prior to its registration.

4. Unless otherwise specifically provided in its stat ute, it shall be deemed that an association
is established for an unlimited period of time.
Article 10
An association may be registered only if its inaugural assembly adopts a founding act and
the statute, and appoints the managing bodies in accordance with this Law.
Article 11

1. The founding act of an association shall include:

a) Full names of the founders, their abbrevia ted names (if there are any), and the
addresses;
b) The name, seat and the address of the association;
c) The goals and objectives of the association; and
d) The name of the person authorized to represent association in the process of
applying for entry in the registrar of associations..

Article 12

1. The statute of an association shall include:

a) Full name of the association, its abbreviated name (if there is any), and its address;
b) The goals and objectives of the association;
c) The procedure for admission and dismissal of members;
d) The organs of the association, the method of their election, their competencies, their
quorum and voting rules, the duration of th eir mandates, the person authorized to
convene sessions of the assembly, the c onditions and modalities of dissolution or
cessation of operation;
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e) The rules for obtaining, use and disposal of assets of the association,
as well as the
body authorized to supervise the use of these assets;
f) The publicity of operations;
g) The procedure for amending the statute, competency and method of enactment of
other general acts;
h) A description of the shape of the seal and its contents;
i) The representation of the association;
j) The conditions and procedures for merger , separation, transformation or dissolution
of the association, or the cessation of its operations, including any specific rules on
quorum or qualified majority in the voting procedures;
k) The procedure for disposition of remaining property and any other assets in the case
of dissolution of the association or cessation of its operations.
Article 13

1. A registered association may have the stat us of a public benefit association if its
activity exceeds the interests of its member s and if it is aimed primarily for the
benefit of the public, or some segment th ereof, in areas such as: healthcare;
education; science; social care; civil society; human rights and minority rights;
assistance to the poor and socially vulnerable; assistance to the disabl
ed, children and
elderly; environmental protection; tolerance; culture; amateur sports; religious
freedoms; and assistance to the victims of natural disasters.

2. A registered association shall be deemed to act for charitable purposes if it is
established with the primary purpose to help persons and groups in need of
assistance.

3. Public benefit status is determined by the Ministry. The specific procedures for
granting and revoking the status of the associ ation of public interest will also be set
out in a separate regulation of the Ministry.

4. Applications to receive the status of a re gistered public benefit association can be
submitted at any time, in a manner prescribed by the regulations of the Ministry.
Denial of such application is subject to review in accordance with law.

5. A registered public benefit association is entitled to receive tax breaks, custom
exemptions and other benefits.

Article 14

1. A registered association can only merge, sepa rate or transform into another registered
association or foundation.

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2. A registered public benefit association can only merge, separate or transform into
another registered public benefit association or public benefit foundati
on.

I.2.2. Membership
Article 15

A registered association may set forth its ow n membership criteria, subject only to the
prohibition of discrimination set out in the Constitution and laws of Bosnia and
Herzegovina.

I.2.3. The Organs of an Association

Article 16

In addition to a founding act and a statute, or their substantial equivalents, an association
must have an assembly and it may also have a managing board.

Article 17

In the case of a foreign or international association, it is sufficient
for the association to
have documents and bodies, however named, th at perform the functions defined by this
law.
Article 18

The assembly, as the highest body of an asso ciation, shall be competent to perform the
following acts:
a) Enactment of the statute, its amendments, and other acts determined in the statute;
b) Decision on the merger, separation, tran sformation, dissolution and cessation of
operation of the association, as well as other changes in the status of the
association;
c) Appointment and removal of the members of managing board, if the association
has such an organ;
d) Adoption of the reports prepared by the managing board, if the association has
such an organ;
e) Decision on all other issues that are not w ithin the competence of other organs of
the association.
Article 19

1. If the association has a managing board, the managing board shall:

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a) Prepare the sessions of the assembly;
b) Prepare the drafts of the statute and other acts to be enacted by the as
sembly;
c) Implement the policies, conclusions and other decisions made by the assembly;
d) Manage the property of the association;
e) Submit annual or other periodic reports on its work to the assembly for approval;
f) Perform other duties as determined in the Statute.

Article 20

Members of the organs of an association may not vote on issues in which they, their
spouses or those related to them either by blood or by marriage up to the third degree,
appear as interested parties, in issues relating to the matter that is under the control of the
member in question, or in issues where the member in question has an economic interest.
In addition, members of the organs have an obligation to ensure that all financial
transactions of the association are concluded at fair market value, or under conditions that
are more favorable to the association.

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I.3 FOUNDATIONS

I.3.1 The Establishment of Foundations

Article 21

1. A foundation shall be deemed to act for the pub lic benefit if it is established with the
primary purpose to advocate, provide services or promote programs for the
advancement of health-care, education, science, social care, civil society, human
rights and minority rights, assistance to the poor and socially vulnerable, assistance to
the disabled, children and elderly, environmental protection, tolerance, culture,
amateur sports, religious freedoms and assistance to the victims of natural disasters,
or other similar objectives.

2. A registered foundation shall be deemed to act for charitable purposes if it is
established with the primary purpose to he lp persons and groups in need of such
assistance.

3. Public benefit status is determined by the Ministry. The specific procedures for
granting and denying the status of the f oundation as one for the public benefit will
also be set out in a separate regulation of the Ministry.

4. Applications to receive the status of a registered public benefit foundation can be
submitted at any time, in a manner prescribed by regulations of the Ministry. Denial
of such an application is subject to review as hereinafter provided.

5. A registered public benefit foundation is entitled to receive tax breaks, custom
exemptions and other benefits.

6. A registered public benefit foundation can only merge, separate or transform into
another registered public benefit foundation.
Article 22

1. A foundation qualified for registration may be established by one or more physical or
legal persons (hereinafter the “Founders”), but it may not be established by the state
of Bosnia and Herzegovina, the entities, cantons, cities, municipalities, local
communities, state organs, state companies or funds. The Founders need not be
citizens or legal persons of Bosnia and Herzegovina.

2. A foundation may be established by unilateral declaration, by contract, will, legacy or
other appropriate legal act.
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3. A registered foundation must have an act of establishment, a statute, and a managing
board, or their substantial equivalents. In the case of a foreign or international
foundation, it is sufficient for the foundation to have documents and bodies, however
named, that perform these functions as otherwise described in this law.

Article 23

1. The act of establishment of a foundation shall include:

a) The names and addresses of the founders;
b) The name, abbreviated name (if there is one) and the address of the foundation;
c) The goals and objectives of the foundation;
d) A statement of the amounts and sources of the initial capital assets of the foundation,
in a form prescribed by regulations of the Ministry; and
e) The name, surname and address of a person w ithin Bosnia and Herzegovina who is an
represents the foundation and is authorized to apply for registration of
the foundation.

Article 24

1. The statute of a registered foundation shall include:

a) The full name and, if such exists an abbreviated name and the seat of the
foundation;
b) The goals and objectives of the foundation;
c) The organs of the foundation, the method of their election, their competencies,
quorum and voting rules, the conditions and procedure of their dismissal;
d) The rules for management and use of the property of the foundation;
e) Procedures for amending the statute, as well as the authority and procedures for
enactment of other general acts;
f) Conditions and procedures for the merger , separation, transformation or cessation
of the operation of the foundation, including all rules for voting that needs special
quorum or qualified majority votes;
g) Criteria for disposition the property of th e foundation in the case of cessation of
its operations;
h) The description of the form and the content of the foundation’s seal.
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I.3.2. The Organs of Foundation
Article 25

1. The managing organ of a foundation is the managing board.

2. The Statute of a foundation may also provide for other organs of the foundation.

Article 26

1. The managing board of a foundation is respons ible for implementation of the goals
and objectives of the foundation, and it may al so perform other tasks as determined
by the statute and in accordance with law.

2. The managing board of a foundation shall have at least three members.

3. The members of the managing board of a re gistered foundation need not be citizens
of Bosnia and Herzegovina.

4. The managing board of a foundation is competent for:

a) Enactment or recognition of the act of esta blishment, the statute, its amendments,
and other acts determined in the statute;
b) Decision on merger, separation, transforma tion or cessation of operation of the
foundation, as well as other changes in the status of the foundation;
c) Receipt, approval and filing of documents, information and any other reports or
material required by this Law or in accordance with it; and,
d) Decision on all other issues that are not in the competence of other bodies of the
foundation.

Article 27

Members of the organs of a foundation may not vote on issues in which they, their
spouses or those related to them either by blood or by marriage up to the third degree,
appear as an interested party, in issues rela ting to the matter that is under the control of
the member in question, or in issues where the member in question has an economic
interest. In addition, members of the organs have an obligation to ensure that all financial
transactions of the foundation are concluded at fair market value, or under conditions that
are more favorable for the foundation.

I.4. REGISTRATION OF ASSOCIATIONS AND FOUNDATIONS

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Article 28

1. Registration of associations and foundati ons is voluntary, except as provided in
Article 29 of this Law, but registration must be accomplished in order for an
association or foundation to gain the cap acity of a legal person of Bosnia and
Herzegovina.

2. Registration, the filing of documents, and th e cessation of operation of an association
or foundation shall be done in accordance with this Law, other applicable laws of
Bosnia and Herzegovina, regulations of the Ministry, and the Statute of the
association or foundation.

3. Where those laws and regulations contain conflicting provisions, the Minis
try shall
interpret the laws and regulations in a way that:

a) Promotes the policy of transparency and public disclosure; and,
b) Reduces the administrative burden for organizations and individuals, to the extent
that this can be done while promoting transparency and disclosure.

4. If the applicable laws are in conflict and cannot be reconciled, the provisions of this
Law shall prevail.

5. The registration of an association is entere d into the Registry Book of Associations.
The registration of a foundation is entere d into the Registry Book of Foundations.
Both of these registry books shall be kept by the Ministry.

6. The registry books shall be kept in accord ance with the provisions of this Law and
regulations prescribed by the Ministry.

7. The registry books shall be open for public scrutiny. Inspection of any document or
information filed in the registry books shall not conditioned on the approval
by the
Ministry. No document or information filed pursuant to this law shall be designated
as “confidential” or as a “business secret”.

8. Every individual, either in person, or by mail, may request a copy of any entry from
the registry or any document from the appli cation file of a registered association or
foundation. Fees for such copies shall not exceed normal amounts. The copies must
be issued within fifteen working days from the day the request has been submitted.
Article 29

All associations or foundations referred to in the Article 1 of this Law which intend to
obtain public benefit or charitable status from the Ministry, all associations or
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foundations which perform public competences of Bosnia and Herzegovina, and all
associations or foundations with any office or activity in Bosnia and Herzegovina and
which receive grants or other disburse ments from or through any governmental
institution of Bosnia and Herzegovina in an aggregate amount exceeding 5,000 KM per
year, shall:

a) Register in accordance with the law; and,

b) Annually file a report with the Ministry for filing in the Registry books, in form
prescribed by regulations of the Ministry; provided , that the annual report must
generally describe the activities of the a ssociation or foundation and those of any
separate legal persons established pursuant to Article 4, and furthermore, that the
annual report must also contain a balance sheet listing the income and
expenditures of the association or foundation, as well as those of any
separate
legal persons established pursuant to Article 4 of this Law.

Article 30

1. The name of an association or a foundation, if so envisaged by its statute, may be
entered into the registry book in one or more foreign languages, provided that the
name in the official languages of Bosnia and Herzegovina is entered first. Foreign
associations or foundations may only use their registered names.

2. When two or more associations or foundations register essentially the same names or
logos, the Ministry shall issue a decision directing the subsequently registered
association or foundation to apply for amendment to its registration within thirty days
to change its name or logo. If such an association or foundation fails to proceed
according to the decision, the Ministry shall suspend or revoke the regi
stration,
dissolve the association or foundation, a nd impose any other sanction provided by
this Law. The provisions of Article 34 sha ll apply to proceedings set forth in this
Article.

Article 31

1. An application for registration of an association or foundation shall in
clude:

a) The founding act or act of establishment;
b) The Statute of the association or foundation;
c) A list of the founders and the members of managing organs;
d) The names and addresses of the persons authorized to represent the association
or the
foundation in Bosnia and Herzegovina;
e) The information required by Article 45 of this Law, if the registration is of a foreign
association or foundation;
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f) The name or abbreviated name (if there is any)of the association or foundation;
g) An exemplar of the logo, if any, of the association or foundation;
h) The goals and objectives of the association or foundation;

2. The form and manner in which the applicati on is to be submitted shall be established
by regulations of the Ministry.

Article 32

1. Upon receipt of an application for regist ration or amendment of registration, the
Ministry shall issue a receipt to the f ounders of an association or foundation. The
Ministry has the duty to issue a decision on registration within 30 days after an
application has been submitted.

2. If the Ministry fails to issue a decision within 30 days after an application for
registration or for amendment of registra tion has been submitted, such failure shall
have the effect of denying the registration or amendment of registration.

Article 33

Ministry’s decision to allow registration of an association or foundation shall include:

a) The date of the entry;
b) The registry number of the entry;
c) The full name and, if there is any, abbreviated name, and the address of the
association or foundation;
d) The logo of association or foundation, if there is any;
e) Goals and objectives of the association or foundation; and
f) The names and addresses of persons author ized to represent the association or
foundation.

Article 34

1. If, during the registration process, the Ministry establishes that the Statute of the
association or foundation does not fulfill the requi rements laid out in this Law, or that
the application for registration is not complete, the Ministry shall notify the applicant
to that effect and shall state the reasons fo r not effecting registration. If the applicant
fails to remove these deficiencies within the prescribed period, the Ministry shall
issue a decision rejecting the application for registration and shall state the reasons
for rejection.

2. If the Ministry finds that the goals and obj ectives of the association or the foundation
are contrary to the provisions of Article 3, paragraph 3 of this Law, or Article 5 of
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this law, the Ministry shall issue a decision refusing the application for registration
and shall state the reasons for refusal.

3. Proceedings under this Article shall be c onducted according to rules and procedures
established by regulations of the Ministry and other applicable laws.

Article 35

1. A decision of the Ministry refusing, rejecting, suspending or revoking any
registration or amendment thereto pursuant to this Law, or imposing any sanction
pursuant to Article 53, or denying an application pursuant to Article 13
, or
automatically dissolving an associati on or foundation pursuant to Article 30,
Paragraph 2 or Article 51, or imposing a distribution of assets pursuant to Article 52,
shall, at the instance of the applicant, registrant, or person upon whom
a sanction has
been imposed, or any other party as provided in this Law, may be appealed against.

2. The appeal shall be lodged within 15 days of the receipt of the decis
ion.

Article 36

The appeal provided for in Article 35 of this Law may be lodged against:
– breach of procedural provisions,
– erroneous or incomplete assessment of facts,
– breach of substantive provisions of the law.

Article 37

Appellate Commission (hereinafter: Commission) shall decide on appeals provided for in
Article 35 of this Law. Commission shall be appointed by the Council of Ministers.
Commission has three members and is of permanent character.

Article 38

1. Appeals provided for by Article 35 of this Law are lodged to the Ministr
y.
2. Upon receiving the appeal, the Ministry sha ll examine the timeliness of the appeal
and it shall examine whether it has been lodged by an authorized person.
3. If the Ministry establishes that the app eal has not been submitted within the time
limits prescribed or that it has been lodged by an unauthorized person, it
shall make a
decision to reject the appeal.

Article 39

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1. If the Ministry does not reject the appeal on grounds set out by Article 38 (3) of this
Law, it shall forward the appeal to the Commission together with the case materials.
2. When deciding on the appeal, the Commission may:
– reject the appeal;
– deny the appeal and affirm Ministry’s decision,
– quash Ministry’s decision partially or in its entirety,
– reverse the decision.

Article 40

1. The Commission shall reject the appeal if it the Ministry failed to do so pursuant to
Article 38(3) of this Law.
2. The Commission shall deny the appeal if it de termines that the procedure before the
Ministry had no deficiencies and when the appeal is ungrounded.
3. The Commission shall quash the decision fully or partially when it establishes some
of the irregularities listed in the Article 36 of this Law and will refer the case back to
the Ministry for another deliberation.
4. The Commission shall reverse the decision if the facts of the case merit a decision
different from the one brought by the Ministry.

Article 41

The Commission shall decide on the appeal within 30 days of receiving the appeal.

Article 42

Appeals against the decision of the Co mmission shall not be allowed, but the
administrative appeal may be brought before the Court of Bosnia and Herzegovina.

Article 43

1. Registered associations and foundations ha ve a duty to apply to the Ministry for
amendment of registration whenever there is a change in any of the information
specified in Article 33(1) under subsections c) , d) and f) of this Law, within thirty
days of the day the change has occurred.

2. The Ministry shall issue a decision on the application in accordance with Article 32(1) of
this Law.
Article 44
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Decisions allowing, rejecting, denying, suspending or revoking the registration of any
association or foundation, and any decision di ssolving any association or foundation shall
be published in the Official Gazette of Bosnia and Herzegovina.

Article 45

1. Except as provided in this Article, registra tion rules and procedures set forth in this
Law shall apply also to foreign and intern ational associations, foundations and other non-
profit organizations as well as their branch offices located or conducting activities in
Bosnia and Herzegovina.

2. Foreign and international associations, foundations and other non-profit organizations,
as well as their branch offices, which are re gistered pursuant to this Law, may operate
throughout the territory of Bosnia and Herze govina, as well as legal persons of Bosnia
and Herzegovina.

3. At the time it applies for registration in the territory of Bosnia and Herzegovina, a
foreign or international association or f oundation, or other non-profit organization shall
submit to the Ministry an application for registration containing the follow
ing:

a) Proof that the organization has a status of a legal person in another ju
risdiction;
b) A statement describing the activities of the organization to be undertaken in
Bosnia and Herzegovina;
c) The name, address and telephone number of its home office and its main office in
Bosnia and Herzegovina, if any;
d) The name and title of the person in charge of the organization’s main office in
Bosnia and Herzegovina; however, if the organization does not have a main office
in Bosnia and Herzegovina, then the name, address and title of the person
responsible for the organization’s operations in Bosnia and Herzegovi
na; and
e) The name, address, title and telephone number of a person in Bosnia and
Herzegovina who is authorized by the organization to be its legal repres
entative in
Bosnia and Herzegovina.

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1.5 THE PROPERTY OF ASSOCIATIONS AND FOUNDATIONS

Article 46

1. The property of an association or foundation may include:

a) Membership fees for associations;
b) Voluntary contributions and gifts from public institutions, physical and legal
persons, both domestic and foreign, in cash, services or property of any kind;
c) Subventions from and contracts with th e state, public institutions, physical and
legal persons, both domestic and foreign;
d) Revenue from interest, dividends, and prof its generated from the capital, rents,
fees and similar sources of passive revenue, and
e) Revenue acquired from the realization of the goals and objectives of an
association or foundation, as defined by its Statute.

Article 47

1. A registered association or foundation is obliged to keep its business records in
accordance with generally accepted accounting principles and to prepare financial
reports in compliance with this Law and other applicable laws.

2. A registered association or foundation may dispose of its property in compliance with
its Statute and this Law.

Article 48

Organs of a registered association or founda tion have a duty to manage the property of
an association or foundation in a responsible, diligent and lawful manner, and in the best
interest of the association or foundation.

I.6 VOLUNTARY AND INVOLUNTARY DISSO LUTION OF ASSOCIATIONS
AND FOUNDATIONS
Article 49

1. An association or foundation may dissolve voluntarily or, under conditions set out in
this Law, may be dissolved involuntarily.

Article 50

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1. A registered association or foundation can dissolve voluntarily by decision of its
competent body.

2. Unless otherwise provided by its Statute, a decision to dissolve voluntarily requires a
qualified majority of two-thirds of the votes of association’s members, or two-thirds
of the votes of foundation’s managing board.

3. In case of voluntary dissolution of a re gistered association or foundation, the
association or foundation shall adopt a liquida tion plan consistent with its Statute and
this Law.

Article 51

1. A registered association or foundation may be involuntarily dissolved by decision of the
Ministry as hereinafter provided, if the a ssociation or foundation acts contrary to the
provisions of this Law or if, without jus tified reason, it does not perform activities to
implement its goals and objectives during a period of at least two full calendar years, or as
a result of conditions described in the Article 50 of this Law.
2. Involuntary dissolution should be ordered onl y in cases of recurring or aggravated
irregularities in operation, and may only be ordered after the association or
foundation concerned has been notified of the matter and has been given an
opportunity to be heard.

3. Sanctions and cessation of operation, and invol untary termination of an association or
foundation shall be made by a request of th e Ministry. Prior to a decision imposing
sanctions, cessation of operation or involuntary termination, the Ministry shall give
notice of the violations to the associati on or foundation. The notice shall describe the
possible sanctions laid out in Article 53. The Ministry may allow the association or
foundation to remedy the violation and/or may provide for sanctions as set out in this
Law.

Article 52

1.
2. An association or foundation that does not have a public benefit status shall, upon
dissolution and cessation of operation and af ter its debts are settled, distribute any
remaining property and assets as determined in its Statute, or to another registered
association or foundation which has been granted a public benefit status
.

A registered association or foundation that has been granted the status a public
benefit status shall, upon dissolution and after its debts are settled, distribute any
remaining property and assets to another registered association or foundation of
public benefit, whose aims and objectives are similar to those of the dissolving
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organization. This rule shall also apply to any association or foundation which has
received state funds, public donations, or ta x or fiscal benefits under any laws.

3. In case of involuntary dissolution, the Mi nistry shall determine the distribution of
any remaining assets, according to the principles of this Article.

4. Publication in the “Official Gazette of Bo snia and Herzegovina” of a decision of the
Ministry on involuntary dissoluti on and distribution of assets shall constitute notice to
all potential beneficiaries for purposes of seeking review of the Minist
ry’s decision.

PART II: PUNITIVE PROVISIONS

Article 53

1. The Ministry may impose a fine of at least 300 KM, but not exceeding 3,000 KM,
against an association or foundation for:

a) Failing to register, if registration is required by this Law;
b) Failing to file an annual report, if filing is required by this Law;
c) Performing activity that substantially depa rts from the goals and objectives of the
association or the foundation concerned;
d) Failing to use one of its registered names in legal transactions with the intention to
deceive another legal or physical person, or a government organ;
e) Changing its founding act or its Statute wit hout lodging a request to amend it (Article
43(1) of this Law);
f) Using its profit or assets contrary to its Stat ute or any applicable law, intentionally or
with a gross negligence;
g) Providing any information to the Ministry in connection with any application for
registration, amendment of registration, or dissolution pursuant to any provision of
this Law, which is materially and intentionally false and misleading.

2. The Ministry may also impose a fine agai nst a responsible representative of an
association or foundation who is found to ha ve committed any of the acts described in
this Article, provided the responsible representative had previous knowl
edge of the
acts causing the violation and acted with a wrongf ul intent. The fine shall be at least
100 KM but shall not exceed 1,000 KM.

3. Penalties provided in this Article may be imposed only after the responsible person
has been notified about the proceedings and its basis, and has been given an
opportunity to be heard. Proceedings pursu ant to this Article shall be conducted
according to regulations prescribed by the Ministry.

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PART III: TRANSITIONAL AND FINAL PROVISIONS

Article 54

1. Associations and foundations, registered prio r to enactment of this Law which want
to register under this Law, have a duty to harmonize their acts with the provisions of
this Law and, within six months from the da y of entry of this Law into force, submit
harmonized acts on the registration of the a ssociation or foundation to the Ministry.

2. Associations and foundations that register according to the provisions of the previous
paragraph are exempt from paying administrative fees.

Article 55

1. Any association or foundation required to register under this Law which have
commenced but has not completed a procedur e for registration under before any other
governmental authority in Bosnia and Her zegovina until the date on which this Law
enters into force, shall be allowed to withdraw from the procedure previously
commenced, and proceed instead with the registration in accordance with the
provisions of this Law.

2. Associations and foundations referred to in th e previous paragraph shall be allowed to
recover any fees already paid during registration proceedings before other
governmental authorities.

Article 56

1. Ministry shall enact all regulations required by this Law within sixty days of the date
upon which this Law comes into force.

2. All regulations of the Ministry enacts pursuan t to the provisions of this Law, and any
amendments thereto, shall be published in the Official Gazette of Bosnia and
Herzegovina.

Article 57

This Law shall enter into force on the eighth day following its publication in the “Official
Gazette of Bosnia and Herzegovina”.

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