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Document Information:
- Year: 2001
- Country: Romania
- Language: English
- Document Type: Publication
- Topic: Economic Activities
This document has been provided by the
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Comments on Ordinance #26
of 30 January 2000 on Associations and Foundations in Romania
August 2001
The International Center for Not-for-Profit Law (“ICNL”) is pleased to have this
opportunity to provide comm ents on Ordinance #26 of 30 January 2000 on Associations
and Foundations in Romania (“Ordinance”).
ICNL is an international organization that works globally to strengthen the legal
framework for non-governmental organizations (NGOs). We have provided assistance
on NGO law reform projects in over eighty coun tries. In Central and Eastern Europe,
ICNL is working in fifteen countries as pa rt of the USAID Democracy Network Project.
ICNL has worked with UNDP, UNHCR, th e Council of Europe, and other mutlilateral
institutions on NGO law reform. ICNL also wrote the World Bank Handbook on Good
Practices for Laws Affecting NGOs (Discussi on Draft), and the Open Society Institute
Guidelines for Laws Affecting NGOs.
We are aware that the Ordinance has been submitted to Parliament, but are
uncertain about when the Ordinance may be considered by Parliament. Because of the
importance of the Ordinance and its impact on civil society and the non-profit sector, we
prepared comments designed to address weakne sses in the Ordinance and to recommend
improvements. These comments are submitted with an appreciation for the laudable
work performed by the drafters and in rec ognition that the Ordinance represents a
dramatic improvement over the prior lega l framework governing NGOs. We hope that
these comments prove useful and are ready to provide further assistance.
Introductory Remarks
The Ordinance is a great leap forward. It replaces the previous Law #21, which
dates back to 1924 and did not provide adequa te safeguards or a complete framework for
NGO regulation. The new Ordinance accomplishes several significant improvements.
First, it streamlines the registration process for both associations and foundations. The
Ordinance clearly defines the necessary documen ts for registration, sets a short time limit
within which the registering body must act, and allows for an appeal upon denial.
Second, the Ordinance recognizes and extends benefits to public benefit organizations.
Third, the Ordinance allows associations and foundations to engage directly in related
economic activities and to establish subsidia ries to carry out additional (unrelated)
activities. Fourth, the Ordinance estab lishes a national registry of NGOs.
Drafters of the Ordinance should be commended for their work and generally
progressive piece of legislation. Were Pa rliament to pass the Ordinance without
amendment, the new regulatory scheme w ould be a dramatic improvement over the
previous Law #21. Still, there are problems with the Ordinance and provisions in need of
rethinking and revision. ICNL respectfully s ubmits these comments in the hope that the
Ordinance can be further improved and comply more fully with international standards
and regional best practices.
To determine the strengths and weakne sses of the Ordinance, we find the
European Convention on Human Rights (“EC HR”), Article 11 (1953) a useful focal
point. The ECHR provides, in relevant part, that:
1. Everyone has the right to freedom of peaceful assembly and to freedom of
association with others, in cluding the right to form and to join trade unions
for the protection of his interest.
2. No restrictions shall be placed on the exercise of these rights other than
such as are prescribed by law and are necessary in a democratic society in
the interests of national security or public safety, for the prevention of
disorder or crime, for the protecti on of health or morals or for the
protection of the rights and fredoms of others. This Article shall not
prevent the imposition of la wful restrictions on the exercise of these rights
by members of the armed forces, of th e police or of the administration of
the State.
Government legislation or regulation may run afoul of Article 11 of the ECHR
where it places restrictions on the freedom of association which amount to interference.
The question which follows is whether or not that interference is legitimate and necessary
in a democratic society. In deciding whether a particular interference is necessary to
achieve a legitimate aim, we must ask whether the interference was proportionate to the
aim pursued. In holding that Greece had viol ated Article 11 in refusing to register a
specific association, the Eur opean Court of Human Rights said, among other things:
The right to form an association is an inhe rent part of the right set forth in Article
11 … That citizens should be able to form a legal entity in order to act
collectively in a field of mutual interest is one of the most important aspects of the
right to freedom of assciation, without wh ich the right would be deprived of any
meaning … Certainly, States have a ri ght to satisfy themselves that an
association’s aims and activities are in conformity with the rules laid down in
legislation, buty they must do so in a ma nner compatible with their obligations
under the Convention.
Sidiropoulos and Others v. Greece , European Court of
Human Rights (Chamber decision, July 10, 1998).
The general comments address five broad i ssues: (1) registration requirements; (2)
organizational structure; (3) modification requirements; (4) the definition of public
benefit status and the conditions for obtai ning public benefit status; and (5) the
recognition of foreign civic orga nizations. Remaining issues are addressed in the section-
by-section analysis, which follows the general comments.
General Comments
I. Establishing and Registering Associations (Chapter 2, Section 1)
A) Statement of Issue:
Do the registration requirements, as contained in Chapter 2, provide for a quick, easy
and inexpensive registration process?
B) Discussion:
The registration requirements contain specific provisions, discussed below, which are
unnecessary and can only hinder a quick, easy and inexpensive registration process.
Most critical to the registration of civic organizations is ensuring a quick, easy and
inexpensive process. It follows that regist ration laws should require the filing of only a
small number of clearly defined documents. Generally required are the constitutive act of
the organization and the statut e (or by-laws). These documen ts should state the nature
and purpose of the organization, set up an ad equate governance structure, identify the
founders, board members and managers, state th e location of the principal headquarters,
and identify general representatives of th e organization. Requiring information beyond
these basic essentials may unnecessarily co mplicate the process and place burdens on
both the civic organization and the registering authority. Failing to require any of these
basic essentials may, on the other hand, cr eate operational difficulties for the civic
organization and monitoring problems for the registering authority.
Article 6(2) defines what info rmation must be contained in the constitutive act (the
basic founding document). In addition to re quiring the purpose of the organization
(A.6(2)(b)), the headquarters (A.6(2)(d)), the founders and adminstrative governing
bodies (A.6(2)(g)), and the general representative (A.6(2)(h)), the Ordi nance also requires
the “identification data of all associates” (A.6(2)(a)) and the “initial patrimony of the
association” (A.6(2)(f)). Both requirements are problematic.
To require civic organizations to file identification data for each and every member,
along with the signatures of all members (A .6(2)(i)), is unduly burdensome for civic
organizations. More significant, however, may be the burden such a requirement places
on the registering authority. Questions arise regarding the consequences of changes in
membership: what happens when a member resign s, dies or joins the organization? Must
the civic organization modify the constitutive act and register the modification in the
Registry every time such an event occurs? Is this efficient for either the civic
organization or the registeri ng body? A critical distinction lies between including the
names of founders, board members and managers in the constitutive act and including the
names of all members. Changes in board members and managers will be relatively rare
and infrequent, meaning that modification will not turn into a significant burden.
Changes in membership, however, may well be commonplace.
More striking is requiring organizations to list the “initial patrimony of the
association”(A.6(2)(f)). Neither in the Unite d States, Western Europe, nor in any other
country in Central or Eastern Europe is capitalization requ ired for an association.
Associations should not be requi red to declare or have any assets during the registration
phase or at any other time. Financial requirements or “assets” requirements are particular
to foundations, not to associa tions. Traditionally, associations are membership-based
organizations (universitas personarum ) formed to serve the public interest or the mutual
interest of their members, without any requirement for a minimum amount of assets.
Foundations, by contrast, traditionally require property dedicated to a specific purpose
( universitas rerum ); nonetheless, even for foundations, the trend is to require only a
nominal amount of property. A requirement of capitalization for associations can only
hinder and frustrate the growth of civil society.
Recommendation:
Based on the foregoing, we recommend that the Ordinance simplify the filing
requirements for civic organizations. To reduce unreasonable burdens on both the civic
organization and the registering bodies, the Or dinance need not require that registration
documents contain identification data of all members. To remove unreasonable barriers
to registration, the Ordinance need not requ ire that registration documents contain the
initial assets of the association; indeed, there should be no property requirement for
associations at any time.
II. The Organization and Operation of A ssociations (Chapter 3, Section 1)
A. Statement of Issue:
Does the Ordinance provide for an adequa tely flexible organizational structure?
B. Discussion:
No, the Ordinance establishes an excessivly rigid organizational structure, which will
hinder many civic organizations in their operations.
The laws governing formal civic organizations should require th at certain minimum
provisions necessary to the ope ration and governance of the orga nization be stated in the
constitutive act of the organi zation. Certainly, the constituti ve act should set forth the
basic governance structure (for example, the highest governing body, the minimum
number of times it must meet each year, it s basic powers, and any restrictions on its
ability to delegate power to others). In addition, the law should also state whether
additional governing bodies such as a s upervisory board, an audit commission, and a
management body must be specified in the constitutive act.
Beyond outlining basic matters of governance, the laws should preserve some room
for flexibility on nonessential matters. Orga nizations should be able to set up the
governing bodies that most effectively lead to the realization of the organization’s
purposes. For example, as an organization grow s in size, it may wish to create a finance
committee to manage its assets; the orga nization should not have to amend its
constitutive act to make such a change in its governance structure. Such a procedure
would prove burdensome both to the civic organization and to the registering body.
Rather, the highest governing body should be able to adopt rules and resolutions
governing details in its operation mo re easily, as its needs change.
More importantly, provisions mandating a spec ific internal governance structure run
afoul of international guidelines. Freedom of association encompasses the freedom of
founders to regulate the or ganization’s internal govern ance, beyond the fundamental
issues mentioned above. Undue interference on i ssues which can be left to the discretion
of founders are likely to be viol ations of Article 11 of the ECHR.
1
Several provisions within Chapter 3 fail to provide sufficient flexibility in the
organization of NGOs. First, Article 20 of the Ordinance lists the required governing
bodies of the association: “(a) the general assembly; (b) the board of directors; (c) the
censor or, if such be the case, the committee of censors.” By requiring all associations to
use this governance structure, the Ordinance establishes an unreasonably rigid governing
structure for many organizations. Small associa tions especially may not need to create a
board or censor. Membership associations ofte n operate without a board of directors. By
insisting on a uniform governan ce structure, the Ordinance fails to recognize the variety
of civic organizations and the variety of governance approaches that may fit an
organization’s needs.
Second, Article 27 is problematic for the same reasons. In seeking to regulate
internal financial control, th e provision lays down unnecessarily rigid requirements. As
mentioned above, it will not always be neces sary for associations, especially small
associations, to employ censors to handle the finances. It is also unclear why censors
should have the authority to participate in mee tings of the board of directors, as specified
in A.27(3)(c). The question of independen ce from the board arises; is the provision
actually accomplishing what it seeks to accomplish?
Similarly, one might raise the same objecti ons against Articles 28 and 31, relating to
the governance of foundations.
C. Recommendation:
In light of the need for and benefit of granting associations and foundations flexibility
in what kind of governing bodies may be appr opriate to their needs as organizations, we
suggest amending Articles 20 and 28 so th at they set forth a less rigid governance
structure. While recognizing the need for defining the highest governing body and its
authority, we recommend simply allowing orga nizations to create other governing bodies,
like the board of directors or auditing comm ittee, where organizations feel it necessary
and appropriate to do so. In addition, we recommend eliminating Articles 27 and 31 to
give civic organizations increased flexibility.
1 The Croatian Constitutional Court confronted this issue in their decision of February 3, 2000, (published
in the Official Gazette No. 20 of February 16, 2000). There the Court held that §11(3) of the Croatian Law
on Associations, which prescribed the mandatory cont ent of the by-laws, was unconstitutional because it
failed to meet the proportionality test. In particular, the Court referred to mandatory provisions regarding
membership fees, members’ liability, comprehensive in ternal governing structure, the liability of the
members of the governing bodies and the decision-making procedure as provisions “which could have been
left to the discretion of founders or addressed in other acts of internal governance.”
III. Modifying the Constitutive Act and the Statute of the Association or
Foundation (Chapter 4)
A. Statement of Issue:
Does the Ordinance establish reasonably flexible procedures for modification?
B. Discussion
No, the Ordinance, through Chapter 4, creates a burdensom e modification procedure,
requiring organizations to re-reg ister rather than simply to file notification papers.
Moreover, Chapter 4 fails to distinguish betw een amendments of significant issues and
amendments of non-essential matters.
A civic organization should be allowed to amend provisions in its constitutive act and
statute without having to enti rely re-register the organization. The law should make a
distinction between significant matters, requi ring notice to the registering authority, and
technical issues, requiring no notice. Si gnificant matters include, for example, the
address of the organization, the names of genera l representatives, or the purposes of the
organization. Where such matters are modifi ed, organizations should simply be required
to file papers indicating the na ture of the change to the registering authority. Of course,
some restrictions on the ability of an orga nization to change purposes are appropriate,
depending on the nature of the change. If, however, the change in purpose does not
amount to a change in status (i.e., from non- profit to for-profit status, or from PBO to
MBO status), then the organi zation should be able to make the change easily, through
notice and not through re-registration.
Technical matters include, for example, inte rnal operational issues commonly left to
the discretion of the organization, such as vo ting requirements, the number of directors,
or the creation of officerships. These opera tional details should be subject to change
without amending the constitutive act or statute. In this way, civic organizations remain
flexible in their operation a nd registering authorities are no t overly burdened with notices
of modification.
Article 33 is troublesome in that it requires organizations to register all modifications
in the Registry by submitting a petition and following registration procedures outlined in
Articles 8-12. A preferable alternative w ould be for organizations to file papers
indicating the change and submitting an am endment to its statute where that is
appropriate. Furthermore, Article 33 ma kes no distinction between significant and
technical changes to the founding papers of an organization. While it makes specific
requirements for changes in the address of an organization, it seems to treat all other
potential changes in the same bureaucratic way. This will inevitably prove burdensome
to both civic organizations and registering authorities. Furthermore, because of the
significant burden, civic orga nizations may well seek to avoid compliance for minor
changes, raising the issue of monitoring by the registering authority and increasing
burdens on the government.
C. Recommendation
To simplify the modification of the constitutiv e act and statute, we suggest drawing a
basic distinction between significant and technical changes, requiring a
mendment of the
founding papers for significan t changes only. With this change, civic organizations
would have more operational flexibility and registering authorities less administrative
burden.
IV. Associations and Foundations with Public Benefit Status (Chapter 6)
A. Statement of Issue:
Does the Ordinance adequately define pub lic benefit status and set appropriate
conditions for obtaining such public benefit status, as outlined in Article 38?
B. Discussion
No, Article 38 defines public be nefit status too vaguely and establishes conditions for
recognition which are potentiall y too restrictive and burdensome. The article sets four
conditions which civic organizatio ns must meet to be recognized as an organization with
public benefit status. The first, containe d in 38(1)(a), is certainly a legitimate
requirement; the remaining three, contained in 38(1)(b,c,d), are potentially problematic.
Generally, the issue of public benefit status is decided by using a primary purpose
test. Simply put, the registering authority focuses on the primary purpose and activities
of the organization and extends public bene fit status to those organizations whose
primary purpose and activities directly bene fit the public or a significant portion of the
public. Generally, regulatory systems defi ne a limited number of acceptable purposes
which qualify for public benefit recognition; it is also common to find on such lists a
catch-all category such as “or any other orga nization formed primarily for the benefit of
the public.”
Article 38 contains no list of acceptable public benefit purposes, but instead limits its
definition to activity “carried out for general or community interest”. The vagueness of
the definition opens the door to varying and inconsistent criteria being promulgated by
the respective administrative authorities authorized to determine public benefit status.
This problem is compounded by the fact that such questions as – who is the competent
reviewing authority and where should the NGO apply – will not always be clear to
potential PBOs or to public authorities. Conflicts of competence between public
authorities (Article 39) could prove comm on, with NGOs facing varying public benefit
criteria at multiple reviewing authorities. The Ordinance would benefit from a clearer,
more specific definition of public benefit activity.
In addition, Article 38 lays down thr ee conditions which may prove overly
burdensome to NGOs: the requirement of at least three years of operation, a program
report and financial report, and the maintena nce of the same value of founding assets.
All three pose significant barr iers to obtaining public benefit status. Certainly, public
authorities will be able to ensure – through a three-year period – that an NGO’s activities
fall within its proclaimed public benefit purpose. But is such a lengthy period truly
necessary? Organizatio ns whose primary purpose is clearly for the benefit of the public
will be unable to apply for public benefit stat us for three years, and afterwards, only by
clearing the necessary re porting hurdles. Such restrictions will hinder the vibrant growth
of PBOs, the vary category of civic organizations regulatory systems should most
strongly support.
C. Recommendation
The importance of this issue cannot be ove rstated. We strongly recommend that
Article 38 be amended by more specifically de fining public benefit activity in sub-section
(a) and by eliminating or modifying sub-secti ons (b), (c) and (d). The decision by the
Government of Romania on granting public benefit status should depend on the primary
purpose of the organization, as most n early stated in sub-section (a).
V. Special Provisions (Chapter 11)
A. Statement of Issue:
Does the Ordinance improperly interfere with the ability of foreign civic
organizations to register and operate in Romania?
B. Discussion
Yes, Article 76(1) restricts th e ability of foreign civic organizations to register and
operate in Romania. Specifically, the Article conditions recognition of foreign
organizations on the basis of reciprocity a nd on prior approval from the Government.
Neither condition is supportable under international guidelines.
At issue, under Article 11 of the ECHR, is whether the restrictions imposed by Article
76(1) are legitimate and necessary in a democratic society. The presumed aim of the
restrictions is to protect Romanian citizen s from harm by legal entities operating within
Romania, certainly a legitimate aim. Foreign NGOs must certai nly be subject to
Romanian court jurisdiction in case of br each of contract or acts of negligence or
criminality. But are the means prescribed proportionate to the aim pursued?
The answer is certainly no. Fi rst, reciprocity is a clear violation of Article 11. There
seem to be no legitimate reasons connected with the actions of the home state, which
would justify restrictions on foreign organizations.
2 In other words, the actions or laws
2 In their decision of February 3, 2000, (published in the Official Gazette No. 20 of February 16, 2000), the
Croatian Constitutional Court struck down a provision in the Croatian Law on Associations, which allowed
foreign citizens to be founders of a registered association only under the condition of reciprocity. The
reciprocity requirement also extended to foreign lega l persons. These provisions were challenged on the
ground that they did not satisfy the proportionality test under Article 11 of the ECHR. The Court found
that the reciprocity requirement violated Article 11 and the Croatian Constitution, which guarantee the
freedom of association to “everyone” and “citizens” respec tfully without further reference to the country of
citizenship or other conditions. The Court held that “there are no legitimate reasons which would justify
restrictions imposed on foreign domestic and legal persons in exercising the freedom of association …
which are attached to the actions of their respective states.”
of one’s state should not have any impact on one’s ability to associate in a foreign
country. Secondly, the requirement for prio r approval from the Government is not
justifiable. No standards are prescribed in the Ordinance to guide the Government’s
decision, creating opportunity for arbitr ary governmental actions which might
discriminate against foreign organizations.
To meet the legitimate interest of protecting Romanian citizens (through the
jurisdiction of the country’s c ourts over the foreign organization), it is sufficient if the
organization itself is properly formed unde r the Ordinance. Registration provisions
require all civic organizations to identify a specific address, legal representative and
governing bodies. Through the locally-based legal representative, other parties have
adequate means for redressing legal claims against the organization.
C. Recommendation
It is generally accepted that the law should provide a level playing field for foreign
and domestic organizations, permitting the former to participate actively in another
country’s civic activities. Article 76(1) instead creates an unbalanced playing field,
making the establishment of foreign organizations burdensome to both foreign
organizations and registering authorities alike. We therefore suggest revising Article
76(1) and eliminating the illegitimate restric tions for recognition of foreign entities,
thereby allowing both foreign and domestic or ganizations to operate on equal footing.
Section by Section Analysis
Article 1 The term “non-patrimonial” or “not-for-profit” is not clearly defined by
the ordinance. While the force and clarity of the term “non-patrimonial”
may be somewhat lost in translation, it may also deserve more attention.
The principle of nondistribution is the single most important feature
distinguishing formal civic organiza tions from for-profit entities and
cannot be overemphasized in setti ng the scope of the ordinance.
Article 6(2) Information required to be includ ed in constitutive act – the identification
data of all associates (a), the initial patrimony of the association (f), and
the signatures of all associates (i) – are overly burdensome requirements.
See Section I above.
Article 6(3) The statute or by-laws should contain more internal governance
requirements. The statute should id entify the highest governing body of
the organization and stipulate the mini mum number of times it must meet
each year. The basic powers of the highest governing body should be
spelled out, together with any restric tions on its power to delegate duties
to others. Any restrictions on the po wers of the organization, such as a
prohibition on the distribution of any profits, should be stated in the
statute. Admittedly, these issues are later addressed by the ordinance in
Articles 21, 24 and 27. Still, there is benefit to leaving such governance
issues to the discretion of the organization and requiring that the issues be
covered in the governing documents.
Article 8 We commend the drafters for se tting a short time limit within which the
registering judge must act (three days). Our only concern is whether three
days is practically sufficient time fo r the judge to review the petition for
registration and issue a written “summa tion”. It may also be useful to
clarify whether the three days referr ed to are three calendar or business
days.
Article 12 According to the Article, re gistration certificates are only issued upon
request. We would recommend elimin ating that bureaucratic step and
requiring that registration certificates issue automatically to streamline the
process.
Article 13 It is commendable that the ordinance contemplates the creation and
establishment of local branches of associations. Article 13, however,
apparently requires the branch to follow a registration process nearly
identical to that required of the associa tion itself. If so, this article serves
no discernible purpose. If a branch organization must follow similarly
restrictive registration procedures, what benefit is there in registering as a
branch organization? A branch, unlik e a subsidiary, does not constitute a
separate legal entity.
Article 15 The minimum required amount to create a foundation will vary considerably from country to country . The trend is to require only a
nominal amount of property. Is th e required minimum amount (100 times
the minimum gross salary) too high?
Article 20 Article 20 lists the governing bodies of the association. Assuming the
listed bodies are intended to be mandat ory, this is troublesome. The only
mandatory operating body should be th e general assembly; associations
then should retain the aut hority to create other bodies , if necessary to their
needs. Many organizations, such as mutual benefit organizations, will
need only the general assembly to r un its affairs. See Section II above.
Article 22 This provision, relating to conflicts of interest, is too narrow; it does not
prohibit the full range of potential conflic ts of interest. Of course, it is
nearly impossible to anticipate with specificity all kinds of conflict that
should be avoided; still, Article 22 only addresses a limited number of
potential conflicts. It makes no refe rence, however, to avoiding conflicts
arising from indirect private benefit or self-dealing. To more effectively
prohibit the full range of abuses that can arise from conflicts of interest,
the ordinance could alternatively prohib it conflicts of interest in general
terms and allow courts to determine whether there has been a violation on
a case-by-case basis.
Article 27 This provision, in dealing with internal financ ial control, probably lays
down requirements that are too harsh. Tw o questions arise. First, will all
associations, regardless of size and ac tivities, need a censor to ensure
appropriate financial control? Second, should the censor sit in on board
meetings? By so doing, the censor, who will want to be independent of
the board, may instead find his independence undermined.
Article 29(6) Article 29(6), which limits the ability of the foundation to change
purposes, is unduly narrow and severe . A change in purpose is only
allowed if the original purpose “has been totally or partially accomplished
or if it cannot be accomplished anymore.” On the contrary, it should be
possible for civic organizations, in cluding foundations, to amend their
statutes easily to change their activit ies or purposes. Certain restrictions
on the ability to change purposes are, of course, appropriate; for instance,
organizations which have obtained public benefit status should not be able
to change their purpose to that of another type of organization not
providing a public benefit. But organizat ions should not be restricted from
changing one public benefit purpose to another public benefit purpose;
A.29(6) will only frustrate th e operation of foundations.
Article 31 The same questions which arose under Article 27 arise here. Is a
committee of censors always necessary? Won’t it depend on whether or
not the foundation is treated as a public benefit organization or not?
Chapter 4 See Section III above.
Chapter 5 Chapter 5, by allowing for the creation of federations, makes no
meaningful contribution to the regula tion of associations and foundations.
Generally, the ability of associations to form a separate association, or
federation, is clear without specifically addressing the issue. In other
words, most laws governing the crea tion of associations and foundations
specify that such organizations may be formed by natural and legal
persons pursuing a non-profit purpose. Clearly, associations, as legal
persons, have the right to form sepa rate associations. Thus, specific
provisions allowing for federations add little.
Chapter 5 (Articles 35-37) of the Ordinance specifies the right of two or
more associations or foundations to establish a federation. For the
aforementioned reasons, Chapter 5 is at best redundant. At worst, the
provisions confuse rather than clarify the registration of federations.
Regardless, the Ordinance adequately a ddresses the right of associations to
form federations in Article 1 (“Natural and legal persons … may establish
associations and foundations …”).
Chapter 6 See Section IV above.
Chapter 7: Article 46 defines the potential sources of revenue, including membership
fees, interests from passive investments, revenues from direct economic
activities and “(f) other revenues stipulated by law.” Subsection (f) raises
concerns; as a catch-all category, it is unduly restrictive. It seems to limit
potential sources of revenue to thos e revenues specifically provided by the
law. It should instead be phrased to include any reve nue not prohibited by
the law. By broadening the provisi on accordingly, it can then properly
fulfill its function as a catch-all category.
Chapter 11 See Section V above.