Legislation

The new CSOs law has introduced new measures regarding protection against state interference. In general, state institutions are prohibited to engage in any activity that limits freedom of association. They are expected to create an enabling environment that stimulates CSOs to fulfill and advance their mission and activities.

Even though that there are no official data for 2019, a year before 20 CSOs have been suspended by the NGOs Department. Legal base constitutes the Administrative Instruction GRK – No: 02/2014 on Registration and Functioning of NGOs, on the reasoning of “endangering the security and working against the constitutional order of Kosovo” based on the request of the “competent security body”. There is no information who this body is while prior investigation on the matter was not conducted. This makes the fifth consecutive suspension of CSOs, while KCSF data tell that from 2014 to the date, a total of 70 CSOs were suspended. Twenty – four organizations remain suspended since their suspension decisions are renewed from year to year. There is no enough evidence to conclude that there is persecution against CSOs in Kosovo since number of suspensions as well as organizations suspended each year are the same. The DNGO has begun the process of drafting the secondary legislation for the implementation of the NGO Law. Although civil society is represented in the working group so far only one joint meeting has been held while the rest of the work has continued without civil society participation. It is important that this process is well administered and that the secondary legislation remains within the margins of main principles set by primary legislation.

The law protects against any form of interference when organizations determine their activities and objectives, also when they regulate their internal structures to determine the scope of activities as well as level of governance to work with. Contrary to the previous law the new one contains specific provisions on CSOs protection from third parties’ interference. State institutions are obligated to not violate in any form freedom of association and to allow operation of CSOs, but also to provide protection to CSOs in cases of interference by third parties.

0 – 20 Fully disabling environment20 – 40 Disabling environment
40 – 60 Partially enabling environment60 – 80 Enabling environment
80 – 100 Fully enabling environment

Legislation on financial reporting and accounting rules does not take into account the specific nature of CSOs. Financial reporting requirements are twofold: reporting to Tax Administration of Kosovo on financial transactions and annual financial statements, as well as reporting the following tax payments where applicable; payroll tax, corporate tax, property/rent tax and pension contribution tax. Reporting to the NGO Registration Department is mandatory for organizations with Public Benefit Status. Reporting requirements to Tax Administration as well as sanctions for failing to fulfill these reporting requirements do not take into account peculiarities of CSOs but are identical/proportionate to businesses. Reporting of PBOs (184 PBOs until the end of 2018) is both narrative and financial, and PBOs with an income higher than 100,000 EUR are required to submit an external audit report.

Legislation on the prevention of money laundering and combating terrorist financing is not in line with Financial Action Task Force (FATF) Recommendations and the EU Directive 2015/849, thus it is restrictive for CSOs. The law regards all CSOs as reporting entities and subjects them to burdensome requirements. Such requirements ask that each CSO must have a certified staff on anti-money laundry legislation also to keep track of all CSO beneficiaries. In line with FATF recommendations a risk assessment of the civil society sector was conducted in 2018, that presented a long list of problematic issues. If adopted, they would result in further monitoring and inspecting for CSOs from municipalities and other institutions. Civil society organizations provided detailed comments and recommendations, which were almost entirely accepted by the working group. On the other hand, the Government delayed approval of the risk assessment report, and made it impossible for its recommendations to be considered for the National Strategy on Prevention and Fighting the Informal Economy, Money Laundering, Financing Terrorism and Financial Crimes 2019 – 2023. As a result, the Strategy adopted in May 2019, enlists the CSOs sector among the few sectors that are vulnerable to terrorism financing. The working group on amending the law on AML/CFT held a few meeting during 2019, as well as a series of workshops on proposing ideas for solutions were organized between civil society representatives and civil servants. CSOs may be subject to material sanctions in case of failing to notify the NGO Department within 30 days when changing their organizations’ name, address, mission and vision, or contact information. In such cases fines prescribed by the CSO law include EUR 250 to the organization itself as well as EUR 80 to the authorized person. Nevertheless, these fines are considered proportionate to the circumstances of civil society sector in Kosovo. An organization can decide to terminate its operation on the following circumstances; a voluntary decision is taken by the highest governing body in accordance with the statute, according to the legislation in place the CSO turns insolvent, at the moment of establishment has been set a termination deadline in statute or in the founding act, or based on a court decision. Within the Law on Freedom of Association in NGOs, legal provisions on dissolution of CSOs are in line with the international principles and standards. Despite the existence of an administrative instruction on the establishment of the Committee for Distribution of Remained Assets of the terminated NGOs, the specific procedures and criteria on decisions from this Committee are not in place.

Practice

In general, CSOs in Kosovo operate without state interfering into their internal matters. The survey showed that no organization has been subject of government harassment because of their critics. Neither have been reported cases of invasive oversight in terms of excessive audits. At the other end of the scale, no CSO has committed breaches of law during last year, hence no sanctions were imposed. A limited number of four organizations answered to have experienced state’s interference in their internal matters either through unannounced state visits, unreasonable limitations of their activities, illegitimate attacks against their CSO, or discriminatory administrative measures were applied against their organizations. Several CSOs have reported difficulties accessing banking services. A number of banks have set additional requirements to CSOs, such as the physical presence of organization’s founders when opening or closing a bank account. An organization interviewed[4] stated that “additional requirements to open a bank account caused difficulties for a few NGOs complying with our deadlines therefore a few beneficiaries endangered receiving the grant at all”. Different banks have set different maintenance fees for CSOs accounts. They are not linear ranging from EUR 1-20, decided individually by each bank without coordination with the Central Bank. These discrepancies infer that banks are deliberately denying access to their services because of the civil society sector categorization as vulnerable to terrorist financing.

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