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Last month, China’s first comprehensive charity law was passed by the National People’s Congress. Critics argue that the law aims to co-opt civil society to support the government’s interests and that it constrains broader civil engagement, and thus will restrict China’s civil society development. On the other hand, the law will make it easier for nonprofits to register and raise funds, and for both natural and legal persons to give, and thus improve the charitable giving environment.
If implemented well – a big IF – the new law should yield an improved operating environment for MNCs working with local nonprofits on community engagement and other CSR programs. Specifically, for MNCs, the law shows promise of providing a larger pool of qualified partner and recipient organizations, clearer donation and tax procedures, and more transparency and better financial management practices of nonprofits.