Deregistered NPOs can appeal, says Social Development Dept

JOHANNESBURG - The Social Development Department says deregistered non-profit organisations (NPOs) can appeal their cancellation. 

The department said the process is underway, to comply with the provisions of the NPO Act and the country’s NPO Terrorist Financing Risk Assessment. 

The Financial Action Task Force (FATF) identified that NPOs [non-profit organisations] can be used for terrorist financing and money laundering, and recommended that South Africa develop a risk assessment.

South Africa was greylisted in February 2023 by the global financial watchdog, for not complying with international standards around the prevention of money laundering and terrorist financing.

The department’s Bathembu Futshane said as of October, 167, 103 NPOs were found to be non-compliant.

“The risk of not deregistering/cancelling non-compliant NPOs is the likelihood of those NPOs being used by criminals for money laundering and terrorist financing.

“The department has a responsibility to ensure NPOs that are not complying with provisions of the NPO Act are removed from the NPO register as required in terms of Section 21 (1) of the NPO Act deregistration or cancellation of NPOs is primarily about NPOs that fail to submit annual reports as required in terms of section 18 (1) of the NPO Act.”

Futshane said some organisations failed to abide by their mission statements.

“Other instances that might lead to cancellation of registration status is when an organisation does not comply with the provisions of its own founding document.

“The objective of the deregistration/cancellation is to identify NPOs that have failed to submit annual reports.  Issue them with notices of compliance and subsequently remove them from the NPO register kept in terms of Section 24 of the NPO Act.”