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International Investment Treaty Protection of Not-For-Profit Organizations176 and Protection of U.S International Journal of Not-for-Profit Law Volume 17, Number 1 March 2015 A Publication of The International Center for Not-for-Profit Law www.icnl.org Publisher International Center for Not-for-Profit Law 1126 16th St., NW, Suite 400 Washington, DC 20036 (202) 452-8600 www.icnl.org Editor: Stephen Bates The International Journal of Not-for-Profit Law, ISSN 1556-5157, www.ijnl.org, is a forum for the discussion of civil society, philanthropy, nongovernmental organizations, and the law, published by the International Center for Not-for-Profit Law, www.icnl.org. Based in Washington, D.C., the International Center for Not-for-Profit Law promotes an enabling environment for civil society and public participation around the world. Views expressed here do not necessarily reflect those of the International Center for Not-for-Profit Law, its affiliates, or its funders. The International Journal of Not-for-Profit Law is featured in the EBSCO research database. Except where otherwise noted, all contents copyright 2015 by the International Center for Not-for-Profit Law. International Journal of Not-for-Profit Law Volume 17, Number 1 March 2015 Letter from the Editor ………………………………….………....………....................... 4 Cross-Border Philanthropy Aid Barriers and the Rise of Philanthropic Protectionism Douglas Rutzen .................................................................................................................. 5 Allies or Adversaries? Foundation Responses to Government Policing of Cross-Border Charity Dr. Oonagh B. Breen ........................................................................................................ 45 States, Public Space, and Cross-Border Philanthropy: Observations from the Arab Transitions Barbara Lethem Ibrahim .................................................................................................. 72 Article Legislation on Financing Public Benefit Activities from Tax Designation in Poland Grazyna Piechota, Ph.D. .................................................................................................. 86 Letter from the Editor In this issue, the International Journal of Not-for-Profit Law focuses on challenges to cross-border philanthropy. Douglas Rutzen, President and CEO of the International Center for Not-for-Profit Law, analyzes the rise of “philanthropic protectionism”: restrictions on cross- border philanthropy that governments have tried to justify in the name of state sovereignty, national security, civil society organization (CSO) accountability, and aid efficacy. Dr. Oonagh B. Breen, Senior Lecturer in Law at the Sutherland School of Law, University College Dublin, examines legal and policy aspects of the crackdowns on cross-border philanthropy and proposes ways in which CSOs can respond. Another perspective comes from Barbara Lethem Ibrahim, Senior Advisor and Founding Director of the John D. Gerhart Center for Philanthropy and Civic Engagement, American University in Cairo. Focusing on the Arab transitions, she assesses obstacles to cross-border philanthropy and outlines steps for ameliorating them. This issue also features a summary of the tax provisions for supporting public benefit activities in Poland, written by Grazyna Piechota, Ph.D., of the Faculty of Management and Social Communication, Andrzej Frycz Modrzewski Cracow University. We gratefully acknowledge Professor Harvey P. Dale and Professor Jill Manny of the National Center on Philanthropy and the Law at New York University School of Law, who convened the conference at which the papers on cross-border philanthropy were presented. For help with manuscripts, we also thank Natalia Bourjaily, Emerson Sykes, and Ivana Rosenzweigova. We thank our authors for sharing their expertise, too. And we invite readers to share their own expertise: We welcome manuscripts addressing legal aspects of civil society, philanthropy, and not-for-profit organizations. Stephen Bates Editor International Journal of Not-for-Profit Law [email protected] International Journal of Not-for-Profit Law / vol. 17, no. 1, March 2015 / 5 Cross-Border Philanthropy AID BARRIERS AND THE RISE OF PHILANTHROPIC PROTECTIONISM 1 DOUGLAS RUTZEN A Russian bird group was deemed a “foreign agent.”2 Ethiopian human rights organizations were forced to curtail their activities because of a government-imposed cap on foreign funding.3 In India, the Sierra Club was barred from receiving funding from abroad.4 Around the world, countries are burdening the ability of civil society organizations to receive cross-border philanthropy. This article presents the macro- political context underlying these restrictions. It then categorizes constraints, summarizes governmental justifications, and analyzes restrictions under international law. The final section summarizes conclusions and areas for further scholarship. Background Twenty years ago, the world was in the midst of an “associational revolution.”5 Internationally, civil society organizations (CSOs)6 had a generally positive aura, recognized for their important contributions to health, education, culture, economic development, and a host of 1 The author is President and CEO of the International Center for Not-for-Profit Law (ICNL, www.icnl.org). The author is grateful to Brittany Grabel, Betsy Buchalter Adler, Gabrielle Gould, Nilda Bullain, David Moore, Margaret Scotti, Rebecca Ullman, Dima Jweihan, Katerina Hadzi-Miceva Evans, Claudia Guadamuz, Jocelyn Nieva, and Emerson Sykes for their guidance and comments on this article. An earlier version of this article was presented at the 2014 Annual Conference of the National Center on Philanthropy and the Law, New York University, on “Regulation or Repression: Government Policing of Cross- Border Charity,” October 26, 2014. 2 “Russian Bird Support Group Branded ‘Foreign Agent,’” RIA Novosti, March 5, 2013, accessed September 25, 2014, http://en.ria.ru/russia/20130503/180967677/Russian-Bird-Support-Group-Branded-Foreign- Agent.html. 3 Amnesty International, “Ethiopia: The 2009 Charities and Securities Proclamation as a serious obstacle to the promotion and protection of human rights in Ethiopia,” Amnesty International’s written statement to the 20th Session of the UN Human Rights Council, June 11, 2012, http://www.amnesty.org/fr/library/asset/AFR25/007/2012/en/5b3d4e94-56c5-4044-9b73- 93b55cd13e61/afr250072012en.pdf. 4 “RBI Imposes Curbs on 4 American NGOs,” India West, January 6, 2015, accessed January 12, 2015, http://www.indiawest.com/news/india/rbi-imposes-curbs-on-american-ngos/article_520532b6-9599-11e4-84b9- 33473a4b2e33.html. 5 Lester Salamon, “The Rise of the Nonprofit Sector,” Foreign Affairs 74(109) (July – August 1994), http://www.foreignaffairs.com/articles/50105/lester-m-salamon/the-rise-of-the-nonprofit-sector. 6 For purposes of this article, the term “civil society organization” or “CSO” encompasses not-for-profit, nongovernmental organizations, whether or not they are eligible for tax benefits in a particular country. International Journal of Not-for-Profit Law / vol. 17, no. 1, March 2015 / 6 other publicly beneficial objectives. In addition, political theorists associated civil society with social justice, such as the civil rights movement in the United States, the dissident movement in Central Europe, and the anti-apartheid movement in South Africa. As the 20th century closed, commentators noted the fall of the Berlin Wall, the rise of the Internet, and the renaissance of civil society. Political, technological, and social developments were weaving themselves together into an era of civic empowerment. Reflecting this era, in September 2000, the United Nations General Assembly adopted the Millennium Declaration. Among other provisions, the Declaration trumpeted the importance of human rights and the value of “non-governmental organizations and civil society, in general.”7 One year later, the zeitgeist changed. After the terrorist attacks of September 11, 2001, discourse shifted away from human rights and the positive contributions of civil society. President Bush launched the War on Terror, and CSOs became an immediate target: Just to show you how insidious these terrorists are, they oftentimes use nice-sounding, non-governmental organizations as fronts for their activities…. We intend to deal with them, just like we intend to deal with others who aid and abet terrorist organizations.8 President Bush then launched a “Freedom Agenda” to advance democratic transitions in the Middle East.9 In many circles, the Freedom Agenda was greeted with skepticism because of the increased militarization of U.S. foreign policy, concerns about U.S. unilateralism, and the decline of U.S. “soft power” after the human rights abuses at Abu Ghraib. On the one hand, the sector was targeted under the War on Terror. On the other, the Bush Administration embedded support for civil society into the Freedom Agenda. For both reasons— the association of civil society with terrorism and the association of civil society with Bush’s Freedom Agenda—governments around the world became increasingly concerned about civil society, particularly CSOs that received international support. Concern heightened after the so-called “color revolutions” that occurred shortly after the Freedom Agenda was announced. The 2003 Rose Revolution in Georgia roused Russia, but the turning point was the 2004 Orange Revolution in Ukraine. President Putin viewed Ukraine as a battleground state in the contest for geopolitical influence between Russia and the West. President Putin also seemed to have
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