Grassroots NGOs Win Landmark Environmental Public Interest Lawsuit

In this second year of a sustained crackdown on civil society activists and organizations in China, the environmental sector has been one of the few bright spots. On January 1 of this year, the newly revised Environmental Protection Law loosened restrictions on organizations that could sue polluters on behalf of the public interest (so-called environmental public interest lawsuits) to include qualified civil society organizations. Then in late February, Chai Jing, a former CCTV investigative reporter, released her documentary "Under the Dome" about China's smog crisis. That documentary immediately went viral getting hundreds of millions of clicks just a few days after going online.

Now we can add yet another example to this list. About two-and-a-half weeks ago, on October 29, 2015, the Nanping Intermediate People's Court in China's southeastern Fujian province issued a judgement in favor of two grassroots NGO plantiffs: Beijing-based Friends of Nature and Fujian Green Home. These two NGOs filed the lawsuit on the same day the Environmental Protection Law went into effect. The defendant was a quarry company that had engaged in illegal mining and damaged the surrounding forest. The company owners were ordered to pay fines totaling 1.46 million yuan (US$230,000) in compensation for 'loss of environmental benefits' and legal costs, and given five months to restore the forest to its original state or face further fines.

Some may take exception to calling this a landmark case and they would have a point. The term "landmark" can be abused and overused. What constitutes a landmark case? Is this really a landmark case given that the polluter is a merely a local quarry company, not a large state-owned enterprise? Is it a landmark case given that we still are unsure if the court ruling will be enforced by local authorities, and if the polluters will pay the fine and clean up the forest as ordered? Is it a landmark case given that other significant cases have preceded it? As Stanley Lubman points out in his very informative blog, an earlier "groundbreaking" lawsuit was filed last October by an environmental association in Taizhou City in China's eastern Jiangsu province against companies that were dumping waste acid into local rivers. The intermediate court in Taizhou ended up fining the defendants U.S.$26 million — the largest ever in a public interest lawsuit in China and much larger than the fine levied in the Fujian case.

In an excellent article in The Diplomat, Scott Wilson, who has researched citizen participation in environmental governance, writes about the Taizhou case that it should be seen as an example of the Chinese government seeking to control the environmental litigation process. The Taizhou environmental association that filed the lawsuit - the Taizhou Environmental Protection Federation  (TEPF)- had been founded as a government-organized NGO (GONGO) that same year (the name is a dead giveaway as a local affiliate of the All-China Environmental Federation, a GONGO established with the blessing of the Ministry of Environmental Protection). The irony was that TEPF was able to file this lawsuit under a recently-amended Civil Procedure Law which allowed "relevant organizations" to file environmental public lawsuits for the first time. Yet under the newly-revised Environmental Protection Law, which only allows NGOs with five years experience in environmental protection work to file such lawsuits, TEPF would not have qualified. Pushing the irony further, Friends of Nature, a grassroots, independent environmental NGO established 20 years ago, filed a lawsuit in Taizhou against a chemical company involved in the same pollution case, but the local court refused to hear the case, saying Friends of Nature had no standing to initiate the lawsuit even though it had 19 years more experience than TEPF. The Taizhou case highlights the privileged position occupied by GONGOs which are used by the Chinese government to manage social and environmental issues while appearing to be tolerant of NGO-type organizations.

In this context, the Fujian lawsuit is a landmark case because two independent environmental NGOs with no connection to the government managed to win in a country where the Communist Party seeks increasingly to guide civil society along the correct path. It will be a case that other independent environmental NGOs can build on as a model of, and inspiration for, grassroots activism. Friends of Nature, in particular, is known to many as one of the first independent environmental NGOs, founded by Liang Congjie and friends (Liang Xiaoyan, Wang Lixiong, and Yang Dongping) in 1995 and has been involved in many of the major citizen-led actions on behalf of the environment in China over the last two decades. It's a shame that Liang Congjie, who died at the age of 78 in 2010, did not live to see this day. He would have been proud of the organization he helped to start.

Update for January-June 2014: Legislative Progress and Continuation of a Clampdown

Looking back at this update that I wrote for the International Center for Not-for-Profit Law back in 2014, I see that I was on target about the Charity Law although understandably pessimistic that a draft would appear in the next year or so.  I was also right in reading the signals about upcoming regulation for international NGOs but failed to anticipate the Xi Jinping administration’s embrace of national security priorities in 2014, and what that embrace would mean for international NGOs in the form of the Overseas NGO Management Law that came out in draft form in early 2015.

January-March 2014

In March of 2014, the annual “two meetings” (lianghui) – the second session of the 12^th National People’s Congress (NPC) and the Consultative People’s Political Conference (CPPCC) – were held in Beijing. The NPC session’s focus was on introducing a legislative agenda to carry out the broad policy pronouncements issued by the Third Plenum of the 18^th Central Committee which met earlier last November.  According to various sources, that agenda includes working on the revision of the registration and management regulations for social organizations, the Charity Law which has been in limbo for almost 10 years, and various other policies on tax exemptions to encourage charitable donations, government procurement of services, strengthening trust in charitable organizations through third-party evaluations, improving transparency of foundations and nonprofits, and promoting religious charitable activity.

1) Formulating a Charity Promotion Law  (cishan shiye cujin fa, 慈善事业促进法) to regulate charitable organizations and undertakings. The Charity Promotion Law has been referred to in other discussions in this Note as the Charity Law. Li Liguo, Minister of Civil Affairs, recently revealed that the Charity Promotion Law was placed on the NPC Standing Council’s agenda for this year, although observers believe it will be several years before the Law will be passed[1].

2) Improving previous proposals to encourage religious groups to establish charitable undertakings such as hospitals.

3) Relaxing and clarifying policies regarding the development of civic charitable undertakings [民间慈善事业], as well as giving tax breaks to promote those undertakings. In January of 2013, the Ministry of Finance and State Administration of Taxation issued more clarification on tax exemptions in the form of a Notice on Management Issues Related to Determining Qualification for Tax-exempt Nonprofit Organizations.

4) Strengthening lack of trust in charitable organizations through third-party evaluations and rating systems.

April-June 2014

The spring months have been a tumultuous period for civil society in China. With the launching of an unprecedented high-level anti-corruption campaign by the new administration under President Xi Jinping, the 25^th anniversary of the June 4, 1989 protests looming, large-scale strikes at the IBM and Yue Yuen shoe factories in Guangdong in March and April, and a number of bombings and attacks in the spring that the Chinese government attributes to Uyghur separatists, the security situation for civil society groups and activists became increasingly tense. During the April-July period, a number of lawyers and other civil society activists were detained or arrested and charged with “gathering to create a public disturbance” and other crimes. The well-known anti-discrimination NGO, Yirenping, had its Zhengzhou office raided in June and again in July. In addition, a number of Christian churches in the eastern province of Zhejiang were demolished. The scope of these detentions and arrests was substantial – some say unprecedented – and included groups and activists who had not experienced repression in the past. 

At the same time, we continue to see some progress on the legislative front such as the newly-revised Environmental Protection Law which allows a broader range of NGOs to file environmental public lawsuits, mention of the Charity Law being placed on the national legislative agenda, and signals about formulating regulations for international NGOs.

On April 24, 2014 the 8th meeting of the Standing Committee of the 12th National People’s Congress approved the revised Environmental Protection Law which will come into force in 2015. This Law went through several drafts. Earlier drafts elicited criticism from civil society organizations because they placed narrow restrictions on NGOs that were qualified to file environmental public interest lawsuits. Thus, in the first two drafts of the law, only NGOs with close government ties such as the All-China Environment Federation (a GONGO established by the Ministry of Environmental Protection) were allowed to file lawsuits. Following debates and suggestions, a third draft was presented in August 2013 according to which new actors could file a lawsuit if they respected the following conditions: being registered with a Civil Affairs Bureau above the city level, being active for at least five years, and have “a good reputation.”  In the final draft, presented in March of 2014, “good reputation” was replaced by “no record of illegal activity,” thereby widening the scope of actors entitled to file public interest environment lawsuits[2].  

Reports also came out about the drafting of the Charity Law which has been placed on the National People’s Congress (NPC) legislative timetable. The NPC Domestic Affairs Legal Committee (全国人民代表大会内务司法委员会）has taken the lead in the drafting of the Charity Law and is expected to submit it for consideration in 2015 if the legislative process proceeds smoothly. Legal scholars such as Jin Jinping, director of Peking University’s Civil Society Research Center, spoke in favor of legislation protecting one’s right to engage in charitable acts. She hoped that legislation should give communities more freedom, and stressed that when considering legislation that has to do with liability, supervision, management, and taxes, it was important to consider whether the Charity Law would promote or “imprison” one’s right to do good[3].

There has also been more high-level signaling that new regulations may be in the works that will make it easier for international NGOs to gain legal status. In May of 2014, the newly-formed National Security Commission headed by President Xi Jinping ordered a review and investigation into the operations of international NGOs working in China, particularly those with projects in rural areas. The text noted that the investigation’s purpose was to “lay the foundation for further strengthening standardized management.” This suggests that the investigation should be seen not so much as a crackdown on international NGOs working in China, but as part of a broader initiative to strengthen regulation over international NGOs which, in the past, have operated largely without much government regulation or oversight. Given the 2013 news of impending new regulations for international NGOs, it may very well be that this investigation will help to shape the content of those new regulations.

These positive legislative initiatives accompanied a wave of optimism following the Third Plenum Decision of November of 2013 and the NPC meeting in March of 2014, both of which signaled greater government support for civil society through the moniker of “social governance.” But true to the Communist Party leadership’s penchant for contradictions, these measures were followed quickly by a more repressive period in which many civil society activists, lawyers and NGOs came under greater scrutiny in the run-up to the 25^th anniversary of the June 4, 1989 protests and a substantial number were detained, investigated, harassed or arrested.

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[1] “Minister of Civil Affairs, Li Liguo: The countdown for our country’s charity legislation has begun”, 民政部部长李立国：我国慈善立法进入倒计时, China Broadcasting, 6 March 2013, available online: http://www.chinadevelopmentbrief.org.cn/newsview.php?id=8734

[2] http://chinadevelopmentbrief.cn/news/caixin-the-npc-law-committee-presents-the-features-of-the-new-environmental-protection-law-concerning-public-interest-lawsuit/

[3] http://chinadevelopmentbrief.cn/news/after-10-years-of-twists-and-turns-chinese-charity-legislation-to-be-considered-next-year/