The CSP provides both voluntary and involuntary dissolution. Charities and Societies may thus be voluntarily dissolved by the decision of the appropriate organ (such as the Boards or trustees or the General Assembly) in accordance with its rules. Freedom of association entails not only the right to associate but also the negative right of the freedom not to associate. Hence, when the members of the association decide to dissolve their association they can appoint a liquidator on whom the property of the organisation vests for the purpose of winding up the dissolution without affecting the rights of third parties.118 CSOs may also be dissolved for a reason of insolvency.119
CSOs may also be involuntarily dissolved by the decision of the Charities and Societies Agency or a court order. According to the constitution the freedom of association may be limited only when CSOs disrupt the constitutional order or an appropriate law. Also as per Article 9 and 13 of the FDRE constitution that qualifies the ICCPR as forming part of the law of the land, the grounds of involuntary dissolution of any charity or society should be guided by three set of principles outlined above. Hence it must be
117United Communist Party of Turkey and others v Turkey ECHR 1998-I, 33. In this case, ECHR provides that ‘the protection afforded by Article 11 [freedom of association] lasts for an association’s entire life and that dissolution of an association by a country’s authorities must accordingly satisfy the requirement of paragraph 2 of that provision’.
118 CSP, Article 94 (1). 119 CSP, Article 93 (1) (c).
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legally prescribed; be limited only to protecting the safety and security of the public and the nation; and be relevant in a democratic society.
In line with the first condition, the CSP prescribes potential grounds for dissolution of charities and societies providing predictability. A charity or society may be dissolved by the Agency where it has become insolvent or where the appropriate organ of the Charity or Society decides to dissolve it in accordance with its bylaws.120 A charity or society may also be dissolved where the Agency cancels its license for a reason of violating the CSP or the penal law; registering fraudulently, failing to renew license; failing to rectify the causes for suspension within the time limit set by the Agency; and for having purposes which are unlawful, and prejudicial to public peace, welfare or security.121
However, beyond the legal prescription, when the grounds of dissolution are assessed against the abovementioned standards of an enabling law that should be fulfilled in concert, not all may be considered justifiable. For instance, fraudulent acts, criminality or the violation of the penal law, and an imminent threat to public peace, security and welfare could be considered reasonable grounds for dissolution, assuming the content of the law is justified as reasonable enough to be relevant in a democratic society. On the other hand dissolution for other non-flagrant grounds such as failure to renew license within two months period or using more than 30% of the income for administrative cost etc. even without taking the degree of deviation into consideration and without a notice that offers a chance to rectify errors is out of all proportion and amenable to abuse. This is particularly true for instance for an organisation that fully complies with all the requirements of the CSP but failed to renew its license within the prescribed time which could be easily rectified as renewal does not serve any significant purpose in the first place. Same holds true for an organisation which uses for instance only 31% of its income for an administrative cost, given the ambiguity of what constitutes administrative cost and the fact that the deviation from the rules of 30% is so minimal, particularly for those having insubstantial amount of annual income.
120 CSP, Article 92 and 93 (1). 121 CSP, Article 93 (1) (b).
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In general, given the contribution of charities and societies for public good, the grounds for dissolution should be strictly in compliance to the requirements of legality, and necessity for a democratic society. Each individual case should be carefully examined to verify the absolute necessity of the dissolution for a democratic society, without however opening loophole for arbitrariness and discrimination.
In sum, an enabling law first of all should facilitate the formation and the attainment of legal personality. Among others an enabling environment requires the right to associate informally; the right to seek and obtain legal personality; the right to have uncomplicated, impartial, inexpensive and speedy registration process before a specialized registering agency; and the right of judicial appeal for any administrative grievance. The more enabling these conditions, the lesser the transaction cost and the greater chances that people would be motivated to form associations which can thicken the social fabric or the social capital. This in turn facilitates the democratization process as CSOs fill that space between the state and citizens and serve as channels or as transmitters of citizens’ interest.
In conclusion, the registration requirements provided under the CSP do not adequately pass the test of enabling legal condition as the process entails cumbersome procedures beyond the constitutional restrictions and thereby increasing the transaction cost of CSOs legal existence. As can be presumed from such taxing procedure that is amenable for the Agency’s discretion, it is reported that organisations and mainly advocacy CSOs were challenged during the registration process due to the subjectivity, unpredictability, rigidity of the application of the law and even imposition of requirements beyond the requirement of the law, by the Agency.122
Hence in general the registration and dissolution process brimmed with numerous vague and subjective requirements that are subject to the application of wider discretionary power of the registering authority with limited control from an
122 Kumelachew Dagne and Debebe Hailegebriel, above n 55 at 7 and 29. In this report that took sample from the different types of CSOs 93% of advocacy CSOs and 47% of development CSOs (among the sample organisations) responded that compliance with the re-registration process were challenging because the officers ‘ were not well versed with the law and did not share a uniform understanding’ of the law; ‘were not willing to have constructive dialogue and to explain unclear matters pertaining to re- registration’; ‘were not adequately trained in appraising projects presented as part of the re-registration requirement’.
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independent judiciary, infringes on the ideal notion of CSOs autonomy. Such threatened autonomy added to the already prevailing state of fear caused by continuous intimidation makes advocacy CSOs role in democratization rather unpromising.
The process also tends to increase the transaction cost and undermine the growth of the sector. The cumbersome procedures of existence and the narrowing of the legal space for operation perhaps partly contributed to a significant decrease of the number of CSOs from 3822 just before the year the CSP was enacted to 1655 in 2010.123 Although the exact reasoning for the extinction of each of these organisations is not precisely known nonetheless there are some evident cases whereby CSOs such as Heinrich Böll Foundation, a foreign charity involved in promoting human rights and democracy pulled out of the country owing to limited space of operation. 124 Hence,
the CSP fails to adequately satisfy the standards of an enabling legal framework for CSOs role in democratization, that we discussed at the beginning of the chapter, as it largely compromises the existence, growth and autonomy of CSOs and thereby deter citizens’ engagement and activism in the democratization process.
123 The Charities and Societies Agency of Ethiopia, 9 months report presented to the FDRE House of Representatives available at <
http://www.chsa.gov.et/web/guest/;jsessionid=E34D984DC7C307B36EC7D97B36E6EA44> accessed 19 April 2015.
124 HeinRich Böll Foundation, ‘Closure of the HeinRich Böll Foundation office in Ethiopia’ Press Release, November 29, 2012 <http://www.boell.org/web/145-Closure-of-HBF-Ethiopia-Office.html>
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Engagement of CSOs in Lawful Purposes 6.1 Introduction
The previous chapter discussed what an enabling law should be in terms of protecting the rights of CSOs for formation and acquisition of legal personality. The mere protection of the bare right to form and to acquire legal existence however has more of a symbolic that a practical relevance. The existence of CSOs is given legal protection mainly because CSOs are formed in order to pursue a particular legitimate purpose that benefits either their own members or the public at large. Thus a legal regime governing the purposes of CSOs is most important as it can significantly influence the sector and the role it can play in society.
The thesis also gives special focus for this chapter and discuss it in length as it is an important pillar of the Ethiopian experience that affects the democratization element of CSOs functions in the country. It also needs comparison to other legal systems, as the Ethiopian government seeks to legitimize the legal approach it has taken in governing the matter by taking the approach from other legal systems and notably the United Kingdom.
Generally speaking, a law is said to be enabling when it recognizes that CSOs can be formed to serve a myriad of purposes. In general, the less legal limitation on the types of purposes the better for the sector. This also has a particular relevance for the democratization of the nation as the permission to pursue diverse purposes would pluralize the public sphere and enhance better representation of ideas and interests of societies. Yet, it would be too simplistic to claim that CSOs can pursue any objective of their own choice as one cannot assume that all CSOs are inherently good and that their purposes are intrinsically good. Thus it is necessary for a law to have clear standards or principles to determine permissible purposes which CSOs can be engaged in. By way of introduction, it may be relevant to point out that this chapter suggests two different sets of tests that can be applied in determining the permissibility of purposes of CSOs: a general test and a supplementary test. The first general test refers to the very minimum condition that must be fulfilled in order for a purpose to be qualified as permissible. This refers to the ‘lawfulness’ of the purpose which the CSO
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aimed at pursuing. All CSOs irrespective of their nature should pass the general test of ‘lawfulness’ of purposes. What constitutes a lawful purpose will be discussed hereunder in section 5.2.
While the rule is that CSOs must be allowed to engage in any ‘lawful’ purpose, nonetheless some specific exceptions can be made to some CSOs by virtue of their unique organisational characteristics or social functions. The supplementary test refers to such additional conditions that must be met to qualify the purpose as permissible. The supplementary condition that is applicable in a number of legal systems is non- partisanship. Charities and Public Benefit Organisations that are deemed to benefit the public at large need to pass the supplementary test and thus are required to prove that their purposes are not only lawful but also nonpartisan. CSOs need to meet this qualifying condition to attain a distinct status that brings with it a social prestige and/or other pecuniary benefits for instance in the form of grants and tax concessions. What constitutes a nonpartisan purpose will be discussed below by way of comparison of the Ethiopian law which is the main focus of this study with other countries.