(New York) – Egypt’s state security prosecutor should immediately close “treason” investigations into Egyptian nongovernmental organizations (NGOs) accused of receiving foreign funding, Human Rights Watch said today.

The Egyptian cabinet announced on September 14, 2011, that a Justice Ministry report had identified more than 30 NGOs that are receiving foreign funding and are not registered with the Social Solidarity Ministry as required by the Associations Law and that it had submitted this information to the prosecutor. The offense is punishable with imprisonment under Egypt’s Associations Law. Restricting foreign funding can effectively deny civil society groups the ability to operate since under former President Hosni Mubarak, local funding sources shied away from funding controversial groups, Human Rights Watch said.

“It sends alarming signals about the transitional government’s commitment to human rights that Egyptian authorities have started a criminal investigation with the same methods Hosni Mubarak used to strangle civil society,” said Joe Stork, deputy Middle East and North Africa director at Human Rights Watch. “Egypt should reform the Associations Law to protect civil society’s independence and freedom instead of tightening the screws further and threatening criminal prosecution.”

Under the Law of Associations, the Social Solidarity Ministry has the right to block funding for a variety of reasons including if it decides the purpose of the funding falls outside the organization’s stated mandate. That has led routinely to the arbitrary blocking of funds to projects and organizations dealing with crucial and sensitive human rights violations, such as torture.

On September 22, the Egyptian daily Al-Fagr published a leaked copy of the Justice Ministry’s fact-finding committee report, listing 39 groups not registered under the Associations Law. The list includes some of Egypt’s most reputable human rights organizations. The newspaper named several groups that are accused of receiving foreign funds without prior authorization. The government has long denied registration to groups it considers controversial, including many independent human rights organizations.

The investigation, about which few details have been officially announced, is being conducted under provisions of the highly restrictive 2002 Associations Law, which criminalizes “NGO activities” by organizations not registered under the law and any receipt of foreign funds without prior official approval. Executives and employees of the organizations face imprisonment and a fine if convicted.

The state security prosecutor announced on August 7 that he had started a “broad investigation” into complaints received by the public prosecutor from “state agencies” (gihat siyadiya). He accused organizations that “illegally [receive] funding from foreign sources” of “grand treason, conspiracy against Egypt and carrying out foreign agendas to harm Egyptian national security,” but did not name any of the groups in question. The state security prosecutor usually investigates cases of suspected armed groups or international organized crime and refers cases to the Emergency State Security Court, which was set up under the Emergency Law that has been in effect in Egypt for decades. The court operates outside the regular court system, with no right to appeal.

On July 12, International Cooperation Minister Faiza Abul Naga, a long-serving minister under Mubarak, announced that she had requested creation of the fact-finding committee at the Justice Ministry to investigate the “direct foreign funding of unlicensed Egyptian and foreign NGOs operating in Egypt.” Earlier the same week, Social Solidarity Minister Gouda Abdel Khalek said in a news release that he had “decided to form a committee to review civil institutions and NGOs and consider tightening legal controls on foreign funding.” The Associations Law already provides excessive control of nongovernmental organizations’ financing by requiring prior authorization for every individual grant or fund, Human Rights Watch said.

Minutes of a July 27 cabinet meeting stated that the cabinet “fully rejects all forms of foreign intervention in internal affairs including direct foreign funding of all forms that is given to Egyptian and international organizations and civil society groups that operate in Egypt without authorization and in violation of Egyptian laws.” In early August, the Central Bank ordered all 39 banks operating in Egypt, domestic and foreign, to inform it and the Social Solidarity Ministry about any transactions on the accounts of the organizations that are not registered with the ministry and to check to determine whether the groups received authorization from the ministry to receive the funds. Over the past three weeks, private banks such as HSBC and Commercial International Bank have contacted at least four well-known independent human rights organizations that bank with them to inquire about incoming transfers of funding from foreign sources.

On August 22, a group of 40 Egyptian NGOs submitted a complaint to the UN Special Rapporteur on the rights to freedom of peaceful assembly and of association, the Special Rapporteur on the rights to freedom of expression, and the Special Rapporteur on the situation of human rights defenders, saying that these investigations constitute serious threats to Egyptian civil society.

“The fact that the organizations targeted have been criticizing the military for torture and military trials makes this investigation particularly suspect,” Stork said. “Many of the unregistered organizations are exactly the ones that will play a crucial role in observing Egypt’s upcoming elections, and any interference with their freedom to operate will have a negative impact on the pre-elections environment.”

The UN Declaration on Human Rights Defenders, adopted by consensus in the General Assembly in 1998, provides in article 13 that states must ensure “the right, individually and in association with others, to solicit, receive, and utilize resources for the express purpose of promoting and protecting human rights and fundamental freedoms.”

Egyptian authorities should immediately start a process to amend Law 84 on Associations to bring it into compliance with international human rights standards by introducing a regime of registration by notification, restricting executive interference in nongovernmental organizations’ operations, and protecting the financial independence of the groups while requiring financial transparency, Human Rights Watch said. Egyptian judges should apply the international standards of freedom of association, as set out also in the March 30 Constitutional Declaration, to strike down laws and rules such as Law 84, which authorizes arbitrary and disproportionate restrictions on freedom of association.

“A government has no right to ban foreign funding of civil society groups,” Stork said. “Advance permission for foreign funding is an unnecessarily restrictive measure since there are other ways to regulate proper financing.”

The Associations Law

The Mubarak government used a complex set of interlocking laws, decrees, and emergency powers to stifle the exercise of freedom of association. Under Law 84 on Associations, the authorities prevented human rights groups and other organizations critical of government policies from receiving grants from foreign governments and foundations. The Interior Ministry’s State Security Investigations (SSI) division frequently prevented the registration of independent human rights groups under the law, including many of the unregistered groups in question. Because of constant SSI surveillance, with many activists receiving regular phone calls from their SSI “desk officers,” potential Egyptian donors shied away from funding groups critical of the government for fear of reprisals. Many groups that the SSI prevented from registering as nongovernmental organizations, as well as some groups that were unwilling to do so, registered as law firms or non-profit companies.

Since Mubarak was ousted in February, Egypt’s new rulers, the Supreme Council of the Armed Forces (SCAF), liberalized the Political Parties Law to facilitate the establishment of new political parties, and is amending the Trade Unions Law, but there have been no moves to amend the Associations Law. Justice Minister Abdelaziz al-Guindy confirmed to Human Rights Watch in a June 7 meeting that this was not among his legislative priorities.

The Investigations and Targeting of Nongovernmental Organizations

The investigations by ministries and the prosecutor have lacked any transparency, and officials have yet to reveal which groups are being investigated. The minutes of the July 27 cabinet meeting stated that, “the fact-finding committee headed by the minister of justice will present its report on illegal foreign funding in the next days so that the matter can be put to Egyptian public opinion.” The Justice Ministry has yet to make such a report public, though. A ministry official confirmed to Human Rights Watch that the investigation was ongoing, but said that its scope and the identities of the groups involved were not public information.

According to the leaked copy of the Ministry of Justice fact-finding committee’s report published in Al-Fagron September 22, at least 39 nongovernmental organizations that are not registered with the Social Solidarity Ministry under Law No. 84 but operate legally as private companies or law firms are being investigated.

In its 2005 report “Margins of Repression,” Human Rights Watch documented how the SSI routinely reviewed and rejected registration applications from human rights groups, despite the fact that the SSI had no legally mandated role in the registration process, and that SSI scrutinized leaders of rights groups, as well as activities and funding, without any legal authority. Despite public assurances from officials, including direct assurances to Human Rights Watch from Assistant Minister of Interior Marwan Mostafa on June 5 that the ministry would no longer have a role in monitoring civil society organizations, representatives of groups seeking to register told Human Rights Watch that government officials have informed them that “security permission” is still part of the registration process.

On July 27 the Social Solidarity Ministry’s first secretary, Fatma Abdel Fattah, told the independent daily Al-Shorouk that the ministry “does not object to any organization or association receiving funding from foreign governments except in cases where there are security concerns about the donor because they are an enemy country or an illegitimate donor.” She added that there are two circumstances in which security agencies may interfere with the work of civil society organizations. The first is at the point of registration, when security agencies make inquires about the background of those establishing the association to ensure that they are have no record of criminal or other activities of concern. The second is when a group receives foreign funding, at which point security agencies investigate the foreign donors.

In June 2011 the ministry refused to allow the Cairo-based New Woman Foundation to accept the Nelson Mandela Graca Machel Award, awarded by CIVICUS, an international group that promotes civic participation, for its campaign on freedom of association. The ministry said that the campaign’s goals included preparing a draft law to regulate nongovernmental organizations and that “issuance of laws does not fall within the civil societies’ competencies or activities, but falls within the competencies of the legislative authority.” The ministry statement went on to concede that “the association may debate the law and submit an opinion and proposals as part of the consultations conducted on this matter,” but nevertheless banned the award.

Negad El Borei, a lawyer who runs the legal aid organization United Group, told Human Rights Watch, “We are legally registered as a law firm with the lawyers’ syndicate, yet last week our bank CIB contacted us to ask us to provide them with a report on our sources of funding.”

Bassem Samir, director of the Egyptian Democracy Academy, told Human Rights Watch that his organization, which is registered as a civil company, was contacted by its bank to inquire about a transfer from the Dutch embassy.

“The branch manager of HSBC contacted me to ask why my organization had received a transfer from the Dutch embassy,” he said. “I explained it was for training and he asked me to explain what kind of training.”

Government Statements on Intervention

Egyptian nongovernmental organizations are taking the state security prosecutor’s investigation seriously because of an escalation in public rhetoric from the cabinet and the military over the past month that appears designed to de-legitimize organizations that receive foreign funding. On July 23, the SCAF General Hassan Ruweiny told Al Jazeera Mubashir (Al Jazeera Live) that the April 6 Youth Movement had received foreign funding and that it aimed to provoke a “conflict between the military and the Egyptian people.”

During a visit to Washington DC on July 25, Deputy Defense Minister Maj. Gen. Mohamed al-‘Assar told an audience at the United States Institute for Peace that foreign funding for non-registered organizations “represents a danger, in light of the recent incidents where many police weapons were lost, and about 20,000 prisoners escaped from the prisons of Egypt following the events experienced by the country.” On July 28, Field Marshall Hussein Tantawi, the head of the SCAF, said that, “There are foreign players who feed and set up specific projects that some individuals carry out domestically… it is possible that there is lack of understanding, that foreign players are pushing the people into inappropriate directions" and “do not want stability for Egypt.”

Echoing the views of cabinet ministers Abul Naga and Abdel Khalek, Abdelaziz Hegazy, head of the General Federation for Civic Associations, a government-funded body, told Al Masry al-Youm on August 16 that he had asked the US embassy to provide funding to Egyptian civil society groups in accordance with “Egypt’s priorities,” saying that the International Cooperation Ministry should determine recipients of any foreign funding to nongovernmental organizations to “ensure that the funding goes to the deserving parties.”

“It is inconceivable that $40 million US dollars should go toward human rights when we have much bigger problems than this,” he added, referring to the amount the US embassy earlier announced it had earmarked for democracy and human rights groups in Egypt. More than a year earlier, in March 2010, Hegazy had prepared a new draft associations law that would have increased government control over nongovernmental groups and made their membership in the Federation mandatory, but it was not enacted.

Freedom of Association under Egyptian and International Law

As party to the International Covenant on Civil and Political Rights (ICCPR) and the African Charter on Human and Peoples' Rights, Egypt is obliged to respect and ensure the right to freedom of association, set out in article 22 and article 10 respectively, and may only limit this right through regulations “prescribed by law and which are necessary in a democratic society.” Any limitation should respond to a pressing public need and reflect basic democratic values of pluralism and tolerance. “Necessary” restrictions must also be proportionate – that is, carefully balanced against the specific reason for imposing the restriction and not discriminate, including on the grounds of political belief.

The existing Law No. 84 on Associations of 2002 does not meet these requirements and therefore violates article 22 of the ICCPR. It authorizes the government to interfere with the registration, governance and operation of nongovernmental organizations and impedes the right of Egyptians to form and operate independent associations. Article 42 of the law gives the social solidarity minister unacceptably wide grounds to dissolve groups and even to order the imprisonment of nongovernmental organization members for otherwise legitimate activities, including receiving foreign funds or affiliating with foreign organizations without prior permission, conducting what the authorities might consider to be political or trade union activities, and violating “public order or morals.” The law also requires, in article 76, that all non-profit groups of 10 members or more working in social development activities register with the Social Solidarity Ministry or face criminal penalties, including up to a year in prison.

Article 17 of the law states that “no association shall collect funds from abroad … except with the permission of the Minister of Social Solidarity” and failure to abide by this provision is considered grounds for dissolution of the association under Article 42. Egypt’s highest administrative court, the Council of State, has, in 2008, found articles 17 and 42 unconstitutional because they give excessive powers to the executive that undermine the right to freedom of association. In one case, the Association of Human Rights Legal Aid v. the governor of Cairo and the Minister of Social Solidarity, the Council of State ruled on October 26, 2008 that:

Article 17 of the Associations Law includes a requirement for prior approval to receive funding or donations from abroad, and this system reflects a policy of constraining individual liberties, because… the individual cannot enjoy the freedom except after permission from the executive, and in this way the individual is deprived of the enjoyment of this right … whereas a system of notification allows for the individual to enjoy the right and only be held responsible for the potential harm this may cause to others, which reflects a free democratic system, and therefore the aforementioned Article 17 has adopted a non-democratic system of the exercise of constitutional rights.

The ruling struck down the administrative decision to close the Association of Human Rights Legal Aid but the court’s finding on the unconstitutionality of the law was not binding beyond this one case.

In theory, the Law on Associations allows organizations to work in more than one field of activity, though in practice officials require them to seek prior permission from the Social Solidarity Ministry and the scope of permissible activities remains severely limited. Article 11 of Law 84 gives the executive authorities overly broad discretion to forbid groups from any goals that authorities might consider to be "threatening national unity" or "violating public order or morals,” vague terminology that lays the law open to abuse and has served as a basis for the denial of registration.

Under Mubarak, the Interior Ministry’s SSI division blocked the registration of a number of independent human rights organizations because of unspecified “security concerns,” including the Egyptian Center for Housing Rights, the Egyptian Initiative for Personal Rights, the Egyptian Association against Torture, the Civil Observatory for Human Rights, and the World Center for Human Rights. In every case, the organization petitioned the administrative court to reverse the ministry’s rulings, but the security services and the ministry did not respond to the court’s request to give the reasons for their vetting decisions.

In its 2002 review of Egypt’s human rights report, the Human Rights Committee, in its Concluding Comment, expressed concern regarding

the restrictions placed by Egyptian legislation and practice on the foundation of non-governmental organizations and the activities of such organizations such as efforts to secure foreign funding, which require prior approval from the authorities on pain of criminal penalties (article 22 of the Covenant),

and recommended that Egypt: