By WILLIAM MAEMA
Tucked somewhere in one of the schedules to the
new Non-Governmental Organisations Act is the requirement that all the
8,500 NGOs currently registered in Kenya must seek re-registration
within one year after it comes into force.
We understand that the rationale for this
provision is to clean up the official register by weeding out the so
called “bogus” or “brief case NGOs” that have given the sector a bad
name.
In my opinion, this reason, while valid, does not
provide sufficient justification for the re-registration of all NGOs.
The implications of such a requirement are far-reaching, draconian and
disproportionate.
In law, the process of re-registration creates a
brand new legal entity, separate and distinct from the previous NGOs
registered under the repealed law. Apart from the cost of registering
the new entity, there will be the cost of winding up the previous
entity.
All commercial contracts entered into by the
previous organisation with suppliers, contractors, and partners will
have to be terminated since they cannot be taken over automatically by
the new entity without a formal process involving the consent of the
other party to the contract. Such termination may entail substantial
financial implications.
All the assets and liabilities of the previous
entity will have to be formally transferred to the new entity. The
transfer of some assets like motor vehicles and land will require
registration at the relevant government registries upon payment of the
relevant charges and taxes.
The employees of the existing NGOs will have to be
transferred to the new entity (subject to their consent) or be declared
redundant by the current employer.
The employees who, for any reason, refuse to take
up employment with the new entity would have to be paid their redundancy
dues in accordance with the Employment Act. The cost of redundancy can
be substantial unless the employees waive the right to their dues.
Work permits are not transferable. Accordingly,
all the permits held by the expatriate staff of the existing NGOs will
automatically expire and new ones obtained by the new entity.
Because these will be lodged as new applications,
there is no guarantee that they will all be granted. Besides, until the
new work permit is issued, the relevant expatriate will not be entitled
to work for the new entity.
There will also be adverse implications on donor
funding and projects funded by specific donors. There should be no
assumption that the new entity would be entitled to use such funding or
to implement the projects initiated by the previous entity without the
donor’s express consent.
Leases for office space currently occupied by
existing NGOs would have to be transferred to the new entity subject to
the concurrence of the landlord, which might not necessarily be
forthcoming ,especially if the tenant-landlord relationship has not been
a happy one in the past. The registration of a new lease has cost
implications in terms of legal fees and stamp duty.
All statutory registrations in force such as PIN,
PAYE, NHIF, NSSF, and VAT will fall away and the new entity will have
to reapply for them.
The requirement for re-registration is also
susceptible to abuse by the registering authority, which might decline
to re-register NGOs perceived to have been “unfriendly” to the
government or the NGO Board itself.
The cost implications, loss of valuable management
time, operational and administrative difficulties and the inconvenience
arising from the requirement for re-registration, all call for a
re-thinking of the justification for this odious requirement.
In my opinion, it should be enough to require
existing NGOs to simply furnish the authorities with an updated set of
information or documents.
Another contentious revision is that all NGOs,
which had been exempted automatically lose that status and must seek
registration (not exemption) within three months after the commencement
of the new law.
Indeed, save for international NGOs, which have a
narrow window for applying for exemption, there is no room under the Act
for any Public Benefit Organisation (PBO), to seek exemption under any
circumstances.
So, in the event of a disaster in Kenya requiring an immediate response, there is no room for a PBO to seek exemption from registration to enable it to lawfully undertake the emergency function.
So, in the event of a disaster in Kenya requiring an immediate response, there is no room for a PBO to seek exemption from registration to enable it to lawfully undertake the emergency function.
Nothing short of amending the above provisions will save the Act
from being judged, on the whole, a bad law. Let’s not kill a fly with a
sledge-hammer.
Mr Maema is an advocate of the High Court of Kenya and a partner at Iseme, Kamau & Maema Advocates.
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