Those who have been following (or who were involved in) the submissions made on the ‘Octopus Bill’ will be interested to know that:
Parts of these draft regulations will affect all organisations which are already voluntarily registered as Non Profit Organisations (NPOs) as well as that group of organisations for whom NPO registration will become compulsory with effect from 1 April 2023; and then there are parts which will apply only to those who fit the definition of organisation for whom registration is now compulsory.
Organisations for whom registration as an NPO is now compulsory are those SA-based organisations which:
(Those who have been following the saga will recall that the initial plan was to make registration compulsory for all organisations of a non-profit nature in South Africa. As the proposed changes were intended to deal with the risks highlighted by the Financial Action Task Force, our legislators were persuaded to dial back the requirement and focus on organisations where the perceived risks were higher. Bottom line: your knitting club need only register as an NPO if the knitting is a cross-border project! For a bit more detail on the process so far see the opening part of our previous newsletter https://ngolawsa.co.za/last-quarter-2022-ngolaw-in-brief/ )
Those who take the time to read the draft Regulations will soon detect that parts of them are in language not appropriate for regulations and seem to be informative, rather than enforceable.
This is because those who laid the Regulations out included the explanatory notes within the main text of the Regulations. This appears to have been done in error and we suggest that those submitting detailed comments merely reflect, for each of these portions, that they are not part of the Regulations.
For those wanting a shortcut, our list of the probably purely explanatory parts is:
The following summary of Regulations is only our snapshot of what each of them contains and then what we think they mean. We have tried to restrain ourselves from actual commentary, where possible, so as not to constrain the creative and independent engagement which will be so useful. For each of the draft regulations, think through the practical impact on the organisation you serve. In your commentary we advise that you give examples and illustrations of any negative or inacceptable practical impact and also, if possible, come up with alternative suggestions for the relevant part of the draft regulation. As we did in the comments on the Octopus Bill. We have provided an easy-to-use tabulated version of the proposed regulations, with a blank column for your own comments and alternate suggestions.
In December 2022 a new Section 25A was added to the main NPO Act and contains a list of sorts of status or behaviour which will bar people from service on governing bodies of NPOs. This is the first time the NPO Act has had such a list. This list includes disqualifications/ineligibility standards already applicable to directors of NPCs and trustees of trusts, but adds convictions or sanctions for fraud, dishonesty, money laundering or terrorist financing (amongst others) to the list.
This regulation 7A deals with the register of disqualified persons which the Directorate of NPOs must now maintain, the details required to be kept, and a right of public inspection of this list (limited to inspection of a physical list, kept in Pretoria and during office hours only – not terribly useful).
Regulation 7A also seems to place the burden upon registered non-profit organisations to assemble and populate this public list. It requires that a registered NPO having a disqualified person serving on their governing body must provide the necessary details to the NPO Directorate.
This Regulation adds to the list of information on persons serving on the governing body (referred to as ‘office bearers’) which must now be supplied to the Directorate in two categories:
This Regulation stipulates that:
This Regulation deals with an issue which was hotly debated during submissions on the Octopus Act as it was initially proposed that criminal convictions could result from contravention of the amended NPO Act. The ardent rejection of this proposal resulted in an undertaking that sanctions would be ‘administrative’ in nature only and the amended Section 29 of the NPO Act refers to ‘prescribed administrative sanction’.
This Regulation is where it is ‘prescribed’ and the list of possible ‘administrative sanctions’ includes:
Our initial take on this is to wonder about the enforceability of (d) and also the powers it confers on the Director to (once the proper notification procedure has been followed). We still need to research and confer on this aspect before we draft our own submissions.
These introductory notes are provided to assist the navigation of the draft Regulations and to submissions being made. The sector is encouraged to make their own investigation of the Regulations and make independent submissions on their content.
As before, the NPO Working Group will also be making a joint submission on behalf of the sector. To add your points to these, please email them to
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