New Fundraising Law to curb irregular fundraising practices, illicit financial activities

The National Center for Non-Profit Sector (NCNPS) announced that the Fundraising Law, approved by the Saudi Cabinet on Tuesday, is designed to govern fundraising activities for non-profit organizations and the campaigns they undertake. The law aims to guarantee that donations are used for their designated purposes, and thus safeguarding non-profit organizations and donors from irregular fundraising practices and illicit financial activities.

The law comprises 23 articles that focus on governing fundraising processes and ensuring that funds are disbursed in accordance with donor specifications, it was clarified by the NCNPS. Through the regulation of fundraising activities, the law aims to protect the rights of donors and beneficiaries, as well as to maximize the desired social and economic impact of the process, the center stated.

Furthermore, the law aims to enhance transparency in fundraising activities by regulating the way funds are collected from authorized entities and the channels through which these entities solicit donations. It also ensures the recording of donations received by these entities and mandates them to prepare annual budgets supported by documentation that details the fundraising proceeds.

The newly approved law annuls the regulation governing fundraising for charitable purposes outlined in Cabinet Resolution No. 547 of 1396 AH, along with any conflicting provisions. The law is scheduled to take effect 180 days after its publication in the official Gazette.

The Cabinet’s endorsement of this law underscores the significance of fundraising activities and the developmental impact of donations within the non-profit sector. It emphasizes the importance of optimizing the use of these donations for social and economic development, ensuring they reach their intended beneficiaries, and contributing to targeted developmental initiatives.