NGO bureau abused its power in closing rights group - Lawyers

Chapter Four was incorporated at the Uganda Registration Services Bureau (URSB) as a company limited by guarantee in April 2013 and given an NGO permit by the bureau on November 25, 2016, valid for five years. 

In December 2020, the bureau wrote to the organisation to show cause why their permit should not be revoked for failure to file annual returns, audited books of accounts, sources of funding and other documents about its operations for more than four years.

On January 6 this year, Chapter Four wrote back to report that it had made good and filed the missing returns and audited books of accounts for the past years. 

However, on August 18, the bureau announced it was suspending indefinitely the permits of 54 NGOs, including Chapter Four, for non-compliance with the NGO Act.

The bureau ordered Chapter Four to cease all operations, including any virtual or digital work so that it could carry out a comprehensive investigation into its activities. 

The letter was copied to various government agencies, including the Ministry of Internal Affairs, which oversees the bureau’s work, and the police.

The letter was also copied to Kampala Capital City Authority, the Financial Intelligence Authority, all Resident District Commissioners, District Internal Security Officers, and Chief Administrative Officers with a request for them to help enforce the directive. 

It was also copied to Chapter Four’s bankers, who were directed to halt all transactions with the organisation.
In the days that followed, Chapter Four wrote to the Bureau in an effort to have the indefinite suspension lifted, without success.

On September 2, Chapter Four attempted to file its returns for 2020 and lodge an application to renew its NGO permit, which was due to expire the following month, but the bureau “arbitrarily declined to receive” the documents, according to court filings seen by this reporter.

Chapter Four also argues that the freezing of its bank accounts in response to the directive from the NGO bureau has forced it to breach contracts with suppliers and contractors, and potentially exposed it to litigation.

“The [bureau’s] impugned decision has also exposed the applicant to the risk of having its donor contracts terminated and donor funding recalled on grounds of failure to implement projects and comply with donor requirements within the agreed timelines,” the NGO notes in its application. 

“The [bureau’s] impugned decision has also prevented the respondent from providing legal representation to its clients in ongoing cases and to honouring its commitments to provide training and capacity building for other organisations in areas such as legal compliance,” it adds.

Chapter Four argues that it was not given a fair hearing before the bureau took the punitive action of indefinitely suspending its permit. 

It has asked court to rule that the directives by the bureau in its August 18 letter “were high handed, arbitrary, irrational, procedurally improper, unreasonable, ultra vires the law, illegal, unlawful, and void”.

Illegality
It argues that the NGO Act 2016 does not give the bureau the power to suspend an NGO’s “permit indefinitely” or to do so “pending investigations.” 

It also argues that the law gives the bureau power to suspend or revoke a permit but only after the affected organisation has been given an opportunity to be heard.

They also argue that the bureau can investigate the operations of the NGO without first shutting it down, and that it has not shown that Chapter Four would interfere in any inquiries.

In its defence filed in court, the NGO bureau says the application for judicial review should focus not on the decision, but on the process by which it was arrived at.

 “It is the respondent’s submission that this court should not look at the decision made by the NGO bureau but rather the decision-making process that led to the decision while subjecting that process to establishing whether decision or act complained of is tainted with illegality, irrationality or procedural impropriety,” it said in court filings.

In a sworn affidavit now before court, Mr Stephen Okello, the head of the NGO bureau, said his organisation acted fairly and within its legal mandate.

Chapter Four is represented by AF Mpanga Advocates and ALP Advocates while the bureau is defended by the Attorney General’s chambers. The matter is before Justice Musa Ssekaana.

The case is being watched closely by the 53 other NGOs affected by the August 18 directive as well as the wider civil society, which has been put on a short leash by the Executive through tighter controls by the NGO bureau.

The closure of the NGOs stunned civil society already reeling from the effects of the suspension of the Democratic Governance Facility, the biggest pool of donor funding to the sector in January. 

Despite making concessions to the government on composition of its governance structures and control of its funding, DGF is yet to resume operations.

The Executive has increasingly become hostile towards civil society organisations, some of which it accuses of supporting opposition politicians locally. 

No evidence has been made public to support the allegations, which have been made repeatedly by senior officials at the highest levels of government.

In December 2020, in the heat of the election campaigns, Mr Nicholas Opiyo, the head of Chapter Four, was arrested and detained on allegations of money-laundering. 

He was released on bail and the charges against him were dropped in September without the matter going to trial or any evidence being tabled to support the charges against him. 

That matter is not part of the ongoing case between Chapter Four and the bureau.
The case is also expected to provide clarity on whether non-compliance with an aspect of the NGO Act is sufficient to force the closure of an entity registered and incorporated under another law, the Company Act, and another institution, URSB.

In a separate case – constitutional petition No. 7 of 2020 – Chapter Four is challenging the constitutionality of parts of the NGO Act 2016.