De-registration of NPOs in South Africa – What You Need to Know

Wednesday, January 23, 2013 - 11:19

In the past few weeks many NGOs have discovered that their “NPO registration status” with the NPO Directorate has changed to 'de-registered' or 'non-compliant' 

According to well-known consultant to the sector, Ann Bown, 36 513 organisations have been de-registered, 35 217 are on a warning (non-compliant) while only 29 019 are in good standing (registered), out of the approximately 85 000 registered on the NPO Directorate database.  

Whatever the reasons for these changes - non-compliance by NPOs or administrative incompetence by the NPO Directorate - NPOs need to understand the implications of these changes and take the necessary steps to rectify this situation.  

# Why is it important to be registered by the NPO Directorate  

Registration in terms of the Nonprofit Organisations Act of 1997 (the NPO Act) is voluntary. However, for some organisations it has become practically compulsory. For example, those setting up a voluntary association must be registered in terms of the NPO Act if they have any hope of opening a bank account. Banks are now insisting on the NPO certificate for voluntary associations.

Government departments and some donors (e.g. National Development Agency and the National Lottery Distribution Trust Fund) also require registration in terms of the NPO Act as a condition for funding, while others believe it contributes to increased NPO transparency and credibility.  

# How to check your status

If your organisation is registered with the NPO Directorate and has been issued an NPO number, refer to www.npo.gov.za to check your status.

The status will reflect - Registered, De-Registered or Non-compliant.  

# Reasons for de-registration  

If your organisation has been de-registered, it is important to establish the reason/s for the change in your status. The NPO Directorate’s website would usually indicate the reason, and it should be reflected in the notice of non-compliance that the Director for NPOs issued to your organisation before de-registration.

De-registration is usually linked to the failure by NPOs to submit financial and narrative reports as required in terms of the Act.

The Director for NPOs can de-register NPOs that are registered in terms of the Act if such NPOs have not complied with:

  • a material provision of its founding document;
  • a condition or term of any benefit or allowance conferred on it by the Minister of Social Development in terms of the Act; or
  • its obligations in terms of sections 17, 18 and 19 and any other provision of the Act.
# Requirements before de-registration  

It is important to understand that Section 20(1)(a) of the Act requires that the Director for NPOs must send a compliance notice in the prescribed form to a registered NPO if the organisation has not complied with its obligations in terms of sections 17, 18 and 19 and any other provision of the Act.

This notice must, first, be in writing, second, notify the NPO of the compliance steps required and, third, inform the NPO that it has one month from the date of the notice to comply.  

# Is re-registration possible?  

Section 22 of the NPO Act allows a de-registered NPO to dispute its de-registration by referring the matter for arbitration to an Arbitration Tribunal. This Tribunal must within three months, after having received an appeal, consider the arbitration. Unfortunately, the Tribunal has not been appointed as required in terms of the Act.  

It seems that an organisation will be re-registered if it submits its outstanding narrative and financial reports - if it has been de-registered for failing to submit those reports. The NPO Directorate’s system is now automated and you can submit your financial and narrative reports online.  

Otherwise, if your deregistration or non-compliant status is due to an administrative mistake by the NPO Directorate, then submit proof to the NPO Directorate that your reports were submitted on time.  

# Other steps to be taken  

As expected, the change in “registration” status has upset many NPOs because they claim their information is up-to-date. Others feel this is part of a sinister move by government to regulate the work of the sector as it cannot be the case that so many organisations have not fulfilled their responsibilities in terms of the NPO Act.

CAF Southern Africa is collecting information about organisations that have been de-registered due to administrative error on the part of the NPO Directorate.  

Click here for more information.

NPOs should visit the NPO Database to establish their current status or contact the NPO Directorate at npoenquiry@dsd.gov.za for questions in this regard. 

Also comment on this blog by sharing information about your experiences with the NPO Directorate, the NPO registration process or efforts required in restoring your registration status.  

(I would like to thank Ricardo Wyngaard for the inputs provided in support of this blog. He has prepared A Basic Guide to the NPO Act which provides detailed information in support of many of the issues highlighted above. He has also produced a training DVD on compliance with the NPO Act, which includes an interview with the NPO Directorate. The training took place in September 2012. A limited number of DVDs is available free of charge from Ricardo Wyngaard Attorneys.)


Related article:

Joint media statement by Minister Bathabile Dlamini and the Ministerial Task Team on Non-Profit Organisations (NPOs) (31 January 2013)

Comments

Hi NPO Directorate, I am a founder and a director of Khul'ugqame Creche and Pre-schools Association in Greater Pietermaritzburg and surroundings, I have 120 Creches under this Association, please help us as grassroots level organisations/Community Based Organisations give us more time to give narritive reports please I beg you, Community Development is a long proccess it does not happens overnight we need more time due to lake of knowledge + finance in order to pay Auditors that will be acceptable by funders. Most of the Creches including the Association our financial books are still with Auditors where by auditors need payment before giving out statement. PLease give us another year, I promice we are giving a really good work helping Orphans and Vulnerable children those who losse their parents through HIV and AIDS. We are also trying to fight porverty through establishing home vegetable gardens at creches sourounding community home. Hope my comments will reach your favourable consideration. Thank you F.Buthelezi Social Auxiliary Worker (as a Volunteer not paid). Registration Number with the councel.(50-01223 Ms D.F.Buthelezi)
Hi, can anyone please direct us to the correct person or office where we must register to work with children and elderly persons? The one director at DSD just mentioned that we need to register for this but gave no further information. We are already registered as an NPO. Thanks!
the minitser publish fall information about six months de registerd npos has to compli nothing has hepend this organisation has not submite their must stop playing with people
Due to the fact the minister and her task team publich an atitle on sanews.gov.za saying that all de registerd npos will be giving six months to submite reports.and their did not six months is finish nothing has hepend to this organisations.they publish things wish it not true.they must stop playing with people .
We just found out that our organisation is de-registered. Can you give us information how to re-register again Regards Carmen
I am not surprised our Masiphile Project, in cala has been seriously de-organized by the very Social Workesr from Social Department to a point where they have even embarked on separating the villlage. DSD is an error on its self not to mention ineeficiency of its officers. We have been trying since 2009 to register an NPO with all, I mean all documents being sent but missing in the hands of the NPO office in Pretoria. We went three times in person and with documents nad being informed after two weeks you shall receive certificate it is almost 4 years now. The minister is to de -register her inefficient, reckless and negligent officers in these departments instead of running after service providers who work hard to implement activities her department had dismally failed to do as shown by this de registration. Think of it, according to npo act DSD is suipposed to guide, support and mentor these entities. Where are they when they are non complying? I hear nothing mentioned of what she is doing on her staff but is exploiting overwhelmed hard workers. I just fail to understanding this thinking. Some NPO have no financial statements because the Ministers departments funds and manage the finnances and disrepects any Constitutional Laws approved by the same NPO office and misappropriate funds and reporting even at Provincial level is non acknowledged and mInister had those reports what did she do about them? Nothing. She saves her reckless employees and Provincial Ministers by running after hard working and neglected or abused NPOs by her officers. We hear nothing coming after DSD offices supposed to have supported and guided those de registered NPOs why? This is a down ward approach and a sign of disrespect of NPOs at a higher level in DSD. I do not support the Minister's reaction yes if it was a two way process. What has she done to her own officers?
this thing of NPO directorate re registering de registerd organisation that have not compile with the act submiting all out statding reports and return the original certificate and apeal later is nonsense.their are been giving 6 moths to fix their document .it not in the goverment gazert .it just nonsense.the npos who sumited their reports must complain its not fair its nonsense.
Dear NGO Pulse Childline SA National Office found that they were listed as non-compliant on the NPO website - for 'failing to provide' documents for which we have acknowledgement of receipt. We checked our provincial offices and found that a number of them were also listed as non-compliant for documents that they were able to prove had not only been sent - but received. I have also checked with a number of child welfare societies - same story. This is a serious issue - as it is clear that admin at the NPO directorate is clearly not working. However this is a very serious matter for NGO's as donors check one's status on the site. Does the NPO directorate realise that their carelessness with our documentation can have a severe impact on our funding? Furthermore - we sent the Directorate a change of address 5 years ago - our post from them is still using the incorrect details. We have reminded them annually that they have our contact details incorrect - no response.
After reading about the high number of NPOs who have recently been deregistered, I too rushed to the database to check our status. Our organisation was listed as non-compliant and a non-compliance flag was displayed against the last three years. What surprises me - but no longer shocks me - is that we are shown as non-compliant despite that our annual reports are sent well in advance each year, it is sent by registered mail and we have never received any communication stating that we are non-compliant or requesting that we re-submit the reports.
The recent newspaper articles and news reports of the Department of Social Development declaring 36 000 non-profit organisations as non-compliant; thereby prejudicing their chances of getting funding; was met with major concern given the lack of competence of some of our Government departments. Knowing full well that our organisation have religiously submitted the required reports annually to DSD, I nonetheless decided to check our status on their website; especially given past administrative problems we have had with DSD. To my horror, I found our organisation listed as non-compliant. I immediately tried to contact the DSD telephonically but, unsurprisingly, the telephone does not get answered. I have now resorted to sending them an e-mail and contacting them via their website in an effort to get our status amended. The purpose of this letter is to advise all potential funders of non-profit organisations not to be guided by what they may see on the DSD website, but rather to contact the NPO concerned and clarify whether they are compliant by personally viewing their audited financial statements and narrative reports.