RPN 19 published May 1995

3. NGO legislation : the Sri Lanka case by Koen Van Brabant


NGO legislation has been a controversial issue in Sri Lanka since late 1990, less so as a principle than because of the way the issue is being addressed. In that year, an unpublished government report signalled a growth in the number of NGOs, an increase in the flow of funds to these NGOs and expanding links between NGOs and foreign donors. In response to the report, the then president Mr Premadasa in December 1990 created a `Presidential Commission of Inquiry in Respect of NonGovernmental Organizations', also known as the `NGO Commission'.

The NGO Commission 1991-93

The NGO Commission had very broad terms of reference. It was asked to:

The four principal methods used to gather information were :

These events, which also received significant media coverage, created much unrest among the NGO community. The tone of the open session hearings tended to be interrogative and, overall, often tended towards criminal investigation rather than information gathering.

An independent report published in November 1991 by the Genevabased International Commission of Jurists, following their visit to Sri Lanka, concluded that whereas the intentions and the activities of the NGO Commission as such might be defended as `reasonable', what was being done in its name was not acceptable. The ICJ felt that the government had used the NGO Commission to foster a negative, discrediting and intimidating climate around NGOs. NGOs felt that their rights to freedom of association and privacy were under threat.

The report recognises the government's desire to seek information on NGOs as a prelude to establishing a regulatory framework. It also does not doubt the integrity and impartiality of the members of the NGO Commission, chaired by a former judge of the Supreme Court. However, it questioned:

NGO coordination and input into process

One mechanism through which NGOs throughout 1992 and 1993 discussed concerns with members of the NGO Commission was the `NGODonor Forum'. This is a series of monthly meetings in Colombo, hosted and chaired by UNDP. It brings together mostly international NGOs, UN staff and representatives from mainly Western bilateral donors to discuss issues and exchange information. Government representatives occasionally attend these meetings. The Forum organised a one day workshop on the mandate, nature and scope of the Commission in September 1993. The workshop participants concluded that:

The NGO-Donor Forum, however, only engages in information exchange and is not intended to represent the UN and/or NGOs on policy issues. Similarly, the NGO consortia existing in Sri Lanka are relatively weak and NGOs (with the exception of the human rights agencies) are typically not organised to anticipate and analyse policy developments and proactively to engage government in policy debate. Although Forum members were encouraged to make individual representations to the NGO Commission, the Forum members as a body (donors, UN and international NGOs) in the end decided not to make recommendations before the report was submitted.

The NGO Commission looked at NGO legislation in several other Asian countries and visited India and Bangladesh; in addition, the Sri Lankan Law and Society Trust prepared a report based on a comparative inquiry into the legislative frameworks of India, Pakistan, Nepal, Bangladesh and Sri Lanka. The review of the five South Asian countries revealed different mechanisms to try to regulate the NGO sector. Several countries had enacted potentially very restrictive regulations, although it had to be recognised that in practice their application could not said to have caused a major impediment to NGO activity in general. Some states, such as Bangladesh and India, on the premise that the State has a legitimate interest in monitoring institutions operating with foreign funds, enacted controls over the receipt of foreign donations and contributions. In Sri Lanka the receipt of funds and their applications is only covered by those general laws concerning foreign exchange.

Report of the NGO Commission

The NGO Commission submitted its report to the President in late 1993; the report still has not been published. According to government statements, however, the report recommends compulsory registration, the monitoring of foreign funding, the creation of a post of Commissioner with its own secretariat, an NGO fund and an NGO coordinating mechanism.

An unofficial summary of the main recommendations reveals that the Commission found the NGO sector seemingly `chaotic, anarchic and in disarray'. The report also criticises the undemocratic structure of some NGOs, big overheads and especially `unlawful religious conversions'. To the degree that they seek to advocate the causes of poverty through advocacy and influencing policy with foreign funding, `an alien hand' may directly or indirectly try to exercise power in Sri Lankan society. The report regrets that the NGO community had been uncooperative and seemingly hostile to the deliberations of the Commission. The report rejects the possibility of excessive legislation but acknowledges the State's right to supervise in particular, to supervise the proper use of funds.


The report recommends the creation of a central office of the NGO Commissioner with support staff. Two advisory committees, one on `administrative matters' and one on `State/NGO relations', would support the NGO Commissioner. A few members from the NGO sector would sit on the committees but all would be appointed by the President. The NGO Commissioner's office would be the focal point for all national and international NGOs; it would be authorised to make preliminary inquiries into matters of alleged misconduct or misappropriation but would then refer the case to the proper authorities if so warranted.

The report also recommends compulsory registration for foreign NGOs and national NGOs receiving foreign funding, as well as grassroots or community based organisations directly sponsored or directed by a registered NGO. Both national and international NGOs would be required to disclose very detailed and comprehensive information about the uses of foreign funds.

Significantly, the report states that NGOs would not only have to undertake to comply with the national laws but also not to undertake activities that might upset the balance between communities and religions, or to interfere in political matters. This is of course utterly valid but slightly ironic, given that successive Sri Lankan governments since the Citizenship Act of 1948 have taken constitutional initiatives that have contributed to growing ethnic, political and religious tensions and conflict.

As these considerations were not transformed into public regulations, the work of NGOs working with displaced communities or in the LTTE (Liberation Tigers of Tamil Eelam) controlled areas has not in fact been affected. Indeed, NGOs continue to provide assistance to local government departments in the LTTE controlled north, notably through purchasing and transporting essential supplies for them. In the districts south of the frontline, NGOs provide assistance to displaced and resettled groups of people in ways and for time spans that have led observers to wonder whether they are filling a gap or substituting for government. NGOs primarily working in the north and the east are vulnerable, however, to the unofficial accusation of `Tamillovers' and in the late 1980s the UNP (United National Party) government had an unofficial understanding with at least some international NGOs working mainly in the conflict affected areas that, in proportion to the relative impact of the civil war on the different communities, they would also channel some 25% of their total budget to Sinhalese areas.

Finally the report recommends the establishment of an NGO fund, contributed to by percentage allocations of government grants and foreign aid grants. The stated purpose of the fund would be to help prevent an `uneven and skewed development of the country' and disproportionate funding going to `selected groups'.

Regulations enacted

On 22 December 1993, the new President, Mr Wijetunga, issued the `Emergency Regulation for Compulsory Registration of NGOs and Monitoring of Receipts and Disbursements through Annual Statements of Accounts' under the Public Security Ordinance. The proclamation makes it mandatory for NGOs with an annual income of over Rs 50,000 (approximately US$1,000) to register with the Director of Social Services and, for all those with an annual income of over Rs 100,000, to present an annual, audited statement of accounts with details far beyond the normal requirement.

Response of the NGOs

The first critiques from the NGO sector to this act targetted the non disclosure and debate of the Commission's report in the first place, the enactment of legislation under the emergency regulations (bypassing debate and the scrutiny of the public and lawmaking institutions), the failure adequately to define `NGO', the disrespect for the right to privacy and anonymity of donors and recipients of funds, and the threat to human rights organisations. The NGO sector felt that there was no discernible urgency or threat to the public security that warranted the enactment of legislation under Emergency Regulations.

Throughout the first half of 1994, the dialogue with the government continued through the `NGODonor Forum'. Government representatives stressed their recognition of the good work of NGOs and its role as complementary to that of the government but stated that greater accountability and transparency on the part of NGOs were felt to be desirable.

The NGO sector argued that the thresholds of Rs 50,000 and Rs 100,000 were too low and that the financial details demanded on the whole were excessive. They also expressed the desire to be consulted in further legislative activities. The government admitted that the Department of Social Services did not have sufficient staff to process the applications for registration of all to whom it now applied.

Registration of NGOs had been enacted by Parliament in the `Voluntary Social Service Organizations Act' of August 1980. One reason used by the government to justify the new enactment under emergency regulations was that, in 13 years, few had registered voluntarily: therefore registration was now to be mandatory. Inevitably NGOs argued that the few extra months incurred by a parliamentary process would not have made much difference. They also pointed out that NGOs had been registering in a variety of other ways: through the Companies Act of 1982, the Trust Ordinance, the Societies Ordinance of 1891, as an unincorporated association or under an Act of Parliament; in addition, foreign NGOs usually entered into a Memorandum of Understanding with an appropriate government ministry.

The government's position was that the recourse to emergency regulations had only been taken as an interim measure. Legislation to be introduced by Act of Parliament would be prepared and the Minister of Social Services assured NGOs that the draft legislation would be discussed with national and international NGOs prior to finalisation. Publication of the Commission's report was promised. To date, more than a year later, this has not happened. In August 1994, the opposition coalition of the People's Alliance defeated the United National Party and in November 1994, the PA's Prime Minister, Mrs Chandrika Bandaranaike Kumaratunga, won the Presidential Elections. Since then, the initiation of a peace process and the articulation of economic policy have received the bulk of the government's attention and no known developments have taken place regarding the further articulation and enactment of NGO legislation.

Government and NGOs in Sri Lanka

The fear that the NGO Commission and the prospect of NGO legislation caused in the early 1990s should be understood in the context of a participatory democracy that had become much eroded under recent years of UNP rule. During the civil war, a wide gap had grown between the government and the NGO sector. Some civil servants could be overheard expressing their concerns about NGOs misrepresentating the situation in Sri Lanka, about the growth of an NGO elite out of touch with the Sri Lankan population, about false and fake NGOs and about the abuse of funds and funds being channelled to or falling into the hands of `terrorist groups'.

Currently there is a feeling that the new government of the People's Alliance will be more open, democratic and consultative, allowing space in which NGOs will be able to operate. Although so far no regular consultation is taking place on crucial matters such as a rehabilitation and recovery programme for the wartorn north and east of the country, the previously rather antagonistic atmosphere is no longer there.

It is not clear whether the government has specific views or opinions about international as opposed to national NGOs. International NGOs are granted some concessions, such as duty free import, while national NGOs are not. Both national and some international NGOs have engaged in joint programmes with government institutions or departments. By and large, the dependency of Sri Lanka on foreign aid is likely to lead the government to adopt a pragmatic attitude towards international agencies.

As regards relief for the refugees and the internally displaced, and the resettlement, rehabilitation and recovery programmes for the conflictaffected north and east, the central government in Colombo interacts mainly with the UN and international NGOs, whereas local government in the districts finds itself dealing mostly with Sri Lankan NGOs. There is no framework nor are there any mechanisms as yet through which the NGO consortia in Colombo and the districts coordinate their actions and advocacy, nor do these respective NGO consortia have any close and institutionalised coordination with government departments. The NGOs themselves bear responsibility for this fragmented state of affairs.

Interestingly enough, both international and national NGOs currently feel concern about possible pressure from the LTTE, all the more so since the government is consulting with the LTTE about the reconstruction programme. There are only a handful of international NGOs working in the LTTE controlled north where there is no legal recourse or protection for NGOs outside of LTTE structures. A few of these NGOs are directly operational while others fund a variety of small local NGOs. It is felt that the LTTE prefers to keep the international presence to the absolute minimum and would like international agencies to fund and develop the capacity of local NGOs. The latter however have little potential to negotiate LTTE directives.

Since independence in 1948, the Sri Lankan state has taken on extensive responsibility for the protection and welfare of its citizens, with a large degree of state ownership and state control of the economy. Over the past 15 years, however, privatisation and the importance of the private sector have become official economic policy, a trend that is further strengthened by the Structural Adjustment Programme that Sri Lanka has decided upon. The government currently runs a budget deficit of around 10% of GDP: thus, both for policy and fiscal reasons, it has to retrench. The challenge is to combine economic growth and employment creation with a reduction of government spending. This is only possible if the private sector and the nongovernmental sector expand and take over roles and responsibilities previously exercised by government. Can a government opt to attract foreign investment and increase deregulation in the private sector, while simultaneously increasing its regulation over the civil society sector and controlling that sector's access to foreign funds?

Currently, the political rhetoric and election promises will not yet admit to the reduced role that government will have to assign itself. The Sri Lankan people expect the State to provide and governments are careful not to disillusion them lest they be ousted in the next elections. As long as this admission remains difficult, any debate about a legislative framework for NGOs remains equally difficult, and unease could continue to mark the relationship between government and the nongovernmental sector.


Ekanayake W `Notice to the Public', Presidential Commission of Inquiry in Respect of Non-Governmental Organizations, Colombo, January 10 1991

Government Notifications: Part I, Section I General, Gazette Extraordinary of the Democratic Socialist Republic of Sri Lanka, Colombo, December 22 1993

Inform: `Special Dossier on NGO Commission and Emergency Regulations', Colombo, Sri Lanka Information Monitor, 1993

Neff S Sri Lanka : The Activities of the Presidential Commission of Inquiry in Respect of NonGovernmental Organizations, International Commission of Jurists, Geneva, November 1991

NGO-Donor Forum : Minutes of Meetings (19931994), Colombo, UNDP

Note on the Accountability of Non-Government Organizations, Colombo, Law and Society Trust Paper, no date

Presidential Secretariat of Sri Lanka : news release, Colombo, December 22 1993

Proclamations by the President : Part I, Section I General, Gazette Extraordinary of the

Democratic Socialist Republic of Sri Lanka, Colombo, December 17 1990

Voluntary Social Service Organizations (Registration and Supervision), Colombo, August 1980

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October 1996