The NPO Working Group has been actively monitoring changes in legislation that could lead to the closing of civic space since its inception in 2021 due to misinterpretation and misapplication. We have continued to partner with key stakeholders and will remain informed on any changes that could negatively impact the nonprofit sector.

Anti-terrorism and anti-money laundering (AML) regulations are designed to address serious global concerns but have had unintended consequences for civic space and human rights globally when governments have misinterpreted or misapplied the recommendations set by the Financial Action Task Force (FATF).

The General Intelligence Laws Amendment Bill (GILAB 2023), also known as the “spy bill’, is just one of these proposed changes. The ‘spy bill’ was introduced in the national assembly on Friday, 17 November this year and will be shared for public comments in January next year. Public hearings will start in mid-Feb for the bill to be passed in March. How the bill was initially drafted seemed to specifically target NPOs and churches, since it has been amended however the list now includes other Designated Non-Financial Businesses and Professions (DNFBPs). DNFBPs are entities that can be exploited for money laundering and terrorist financing due to their involvement in high-value transactions, cross-border activities, or the handling of funds and assets. Apart from the subset of NPOs identified in the sectoral risk assessment, other entities include casinos; real estate agents; dealers in precious metals and stones, lawyers, notaries, other independent legal professionals and accountants; and trust and company service providers.
For more information on GILAB see;

• Op-ed, Heidi Swart. New ‘spy bill’: Will businesses be next to face state security vetting?
• Civil society joint statement on the 2023 General Intelligence
• General Intelligence Laws Amendment Bill
• Explanatory Memorandum

Part 1 of the FATF sectoral risk assessment, which is meant to identify the subset of NPOs at risk of being mis-used for terror financing and money laundering, has been completed. Part 1 has been reviewed by the oversight committee, where the NPO Working Group is represented, and comments are being incorporated. The FATF team will be arriving in South Africa in January next year to complete the second part of the assessment. The NPO Working Group commits to keeping nonprofit sector informed of the findings of the assessment.

The technical task team (NTT), made up of representatives from the NPO Sector of which the NPO Working Group is a part of, has been formed to assist with the drafting of the NPO Policy Framework to be completed by March 2024. The team have drafted a six-month work plan and the first draft of the policy should be ready by the 1^st of March 2024. There have been some delays, but the finalisation of the policy has been set for the end of March 2024, DSD’s financial year. The team are strategically looking at what core aspects from the FATF process should be amplified in the policy framework, as well as other good practices employed globally.
For more information see:

• Inyathelo Research Report: A New NPO Act for South Africa: The Implications of the Proposed New Policy Framework for South African Civil Society.
• Draft 3 of the NPO Policy Framework
• Framework Agreement of the Presidential Social Sector Summit 2022

• The NPOWG Fact Sheet that includes the update timeline of activities of the NPO Working Group.
• The NPOWG website for previous Communiques that have links enclosed to key documents.

We would like to take this opportunity to invite you to our upcoming public meeting, scheduled for the 25th of January 2024. This gathering will offer a comprehensive update on our activities and provide a platform for you to engage with the key topics impacting our sector, to click to view a detailed programme [once created the link can be inserted here] for the event. Your participation is invaluable, please register for the event through the following link. 

As we approach the end of 2023, we wish you all a joyous and fulfilling end of year, filled with moments of reflection and anticipation for the positive change we can achieve together in the upcoming year.
 

Kind regards
Feryal Domingo 
Chairperson of the NPO Working Group & Acting Director of Inyathelo