A bill seeking to monitor the activities of NGOs funded by foreign governments or government-funded donors has been modified [see full text below] and is set to be tabled to the Knesset as a governmental bill shortly.

The original draft of the bill, which passed a preliminary vote in the Knesset as a private bill in February, was more draconian. It sought to redefine Israeli nonprofits as ‘political,’ to revoke the tax-exempt status of NGOs, and to demand that NGOs declare any foreign funding at every public appearance – moves that would have seriously damaged their ability to fundraise from foreign governmental donors as well as damaging their public credibility.

The new draft omits most of these requirements. However, it demands that all Israeli non-profit associations, including NGOs, human-rights organisations and peace groups, as well as charitable corporations such as theatres and cultural organisations, report within 30 days to the Registrar of Associations on every sum of funding they receive from a foreign government or government-funded donor. It requires them to detail not only the sum of money donated, its purpose and the identity of the donor, but also all agreements reached between the donor and the grantee, whether direct or indirect, and whether orally or in writing.

These details will be published on a governmental website and updated monthly, and may be published elsewhere at the discretion of the Registrar of Associations.

Associations are already required by law to report on all funding, and do so regularly as a precondition for the annual renewal of their non-profit status.

Since right-wing and settler groups are not funded by foreign governments or the EU but by private funds, those who will be exposed to increased scrutiny and bureaucratic harassment as a result of this bill are organisations promoting human rights, peace and critical thought.

Israeli right-wing group NGO-Monitor and its director, Prof. Gerald Steinberg of Bar-Ilan University, who have long criticised Israeli NGOs for their opposition to Israeli government policies in the Occupied Palestinian Territory, would benefit from this exposure.

In January, Steinberg filed a Freedom of Information suit against the EU in which he demanded to see all contractual documentation and confidential evaluation criteria for funding of Israeli NGOs.

In a recent interview in a Jerusalem Post blog, Steinberg expressed his opinion that “A detailed public review of European funding practices for these NGOs would be a game changer. This review needs to take place both in the European institutions that provide the money (…) and in Israeli society, which is the object of this activity. I believe that as a result of this process…, most European governments will decide to follow the US and Canada, and get out of the business of NGO funding to achieve political goals in Israel.”

For years, NGO-Monitor has attempted to present foreign funding of left-wing or human-rights organisations as inappropriate meddling in Israeli politics. The new bill, if passed, will answer his efforts to expose foreign funding of Israeli NGOs.

Israeli NGOs, for their part, have expressed fear that the bill will lead to state harassment and increased public hostility against those who express criticism in Israel.

Dr. Ishai Menuchin of Israeli peace group Yesh Gvul, has said that his group opposes this bill “and all other bills that restrict freedom of speech and assembly.”

Hadas Ziv, director of Israeli non-profit Physicians for Human Rights-Israel, said that “although this new draft is an improvement on the original bill, its aims are not clean. Its initiators seek to attack Israeli groups that are critical of government policies.”

“This is not transparency but harassment,” added Ziv. “By demanding that we report all details of our foreign funding arrangements on a monthly basis, the bill will force us to publicly disclose our internal planning procedures and research in advance. One consequence of this demand will be that our advocacy with state institutions will be less effective.”

Ziv explained that the tactic of proposing drastic changes through legislation and then moderating them is regularly used by Israeli lawmakers, especially against Palestinians.

“In this tactic,” she said, “Israeli policymakers propose a very drastic measure, which leads to loud public outcry and campaigning by NGOs. The measure is then moderated, removing about 90 percent of the changes originally proposed, but leaving one change for the worse, which is much harder to attack. This change leaves the opponents of the bill with a false sense of victory and at the same time leads to an erosion of the power, independence and legitimacy of civil society.”

Eilat Maoz, director of Israeli peace group Coalition of Women for Peace, said that “the aim of this bill, like that of others proposed by the Knesset over the past months, is transparent: to silence all those who dare to oppose Israeli government policies.”

The bill, sponsored by MK Ze’ev Elkin (Likud), will reportedly be passed on in its new version to the Knesset for continued legislation shortly. It is not yet known whether this will happen before the Knesset breaks for its summer recess at the end of July.

Eighteenth Knesset: Bill on disclosure requirements for recipients of support from a foreign political entity - 2010 (Unofficial English Translation)

1. Definitions:
In this law –
• “Amutot Law” – Amutot Law (Law of Associations-ed) – 1981;
• “Foreign Political Entity” – as defined by 36a (a) of the Amutot Law;
• “Recipient”, “Recipient of Support” – an association or charitable corporation that receives monetary support from a foreign political entity;
• “Monetary support from a foreign political entity” – support that has been transferred directly or indirectly according to a directive of the foreign political entity or someone acting on its behalf, or support that is received by a corporation whereby at least a third of its funding originates from foreign political entities.
• “Registrar” – Registrar of Associations, or Registrar of Bequests, as relevant.

2. Duty of immediate reporting
A recipient of monetary support from a foreign political entity must report receipt of such support to the Registrar of Associations or the Registrar of Bequests, as relevant, within 30 days of receipt of support (hereafter, “the immediate report”);

3. Content of the report
The immediate report shall include:
(1) The identity of the provider of support
(2) The sum of monetary support
(3) The purpose or designation of the support
(4) Undertakings made to the foreign political entity by the recipient of support, orally or in writing, directly or indirectly, if such were made.

4. Existing obligations
Submission of an immediate report shall not derogate from reporting obligations applicable to the recipient under any other law.

5. Publication by the registrar
The registrar shall publicize and update monthly the list of recipients who submitted immediate reports on the Ministry of Justice website. The information as detailed in Par. (3) shall be published on the website of the Ministry of Justice and in any other form he deems fit.

6. Publication by the recipient
(1) If the recipient of support or entity acting on its behalf has a website, the recipient must publicize prominently the information as laid out in Par. (3);
(2) If the recipient of support received monetary support from a foreign political entity for purposes of funding a specific publicity campaign, the recipient shall publicize receipt of this support as a part of the campaign.

7. Obligation to ascertain sources of funding
Associations or charitable corporations shall to the best of their ability ascertain whether monetary support received by them is from a foreign political entity.

8. Personal responsibility
If an association or charitable corporation violates a directive of this law, both the Executive Director and the Chair of the Committee and the Head of the Board of Directors shall be charged with the offense, unless they demonstrate that the offense was committed without their knowledge and that they undertook all reasonable measures to ensure the preservation of the law.

9. Penalty
Non-submission of an immediate report as described in Par. (2) shall be considered a violation of Section 38 of the Law of Associations and shall be subject to the instructions under Section 64(a) of the Law of Associations accordingly.

10. Regulations
The Minister of Justice is authorized to enact regulations to implement this law.

Explanatory notes

The purpose of this law is to increase transparency and repair loopholes in legislation in relation to the financing of political activity in Israel by foreign political entities.

The proposed law will demand immediate reporting on receipt of support that will enable an increase of transparency regarding support received and its use.

This law effectively balances the rights of political organizations in a democratic state to operate freely, with the right of the Israeli public to know who is funding their activities.

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