China’s draft Foreign NGO Management Law released in May 2015 would, according to an Opinion piece in the New York Times (Will China Close its Doors?), require foreign nonprofits to be vetted by China’s security police before conducting activities in China and subject them to penalties for vaguely defined offenses such as subverting state power, destroying ethnic harmony, and damaging the national interest. Such penalties could apply regardless of whether the offenses occurred in China. Accordingly, if this law passes, the Chinese authorities could penalize a nonprofit and its agents operating in China for any criticism of the Chinese government or Chinese policy even if such criticism was made in the United States.

According to Reuters:

The draft law “governing foreign NGOs”, which has triggered a storm of criticism since it was made open for public consultation last month, requires foreign non-profits to find an official sponsor, typically a government-backed agency, and gives broad latitude to the police to regulate activities and funding.

 

In a confidential diplomatic document seen by Reuters, the European Union said China was using the law to “silence dissenting voices”.

American nonprofits operating in China will need to be very cautious about operating in China, particularly if they are involved in any type of human rights or social justice advocacy efforts. And it will be particularly important for such nonprofits to make their employees and volunteers aware of the additional personal risks they may face and to mitigate such risks to the extent possible.  It is unfortunate that such a law will very likely result in much less charitable support going to the residents of China and significantly more corruption.

See also China Asserts More Control Over Foreign and Domestic NGOs (Wall Street Journal).