The general purpose is to provide a policy framework on regulating nonprofit organization. The aim is to enhance the existing enabling environment for the nonprofit organisation to flourish and protect the sector from abuse as well as minise undue disruptions to many of it positive contributions.

This policy framework provides for the basis to review and enhance the legal framework on nonprofit organisations based on the principles reflected in the South African Constitution and the provisions of the existing statutes affecting the nonprofit sector. This legal framework reform will involve an overall review of the NPO Act with due considerations given to existing statutes and common law associated with the establishment of the relevant entities within the NPO sector.

The scope of this policy framework is to identify the fundamental rules governing the procedures on the formation of nonprofit organisations, governance, reporting requirements and the enforcement mechanisms on the regulatory framework. The scope will also include a review that will consider the relationship between the existing NPO Act and other statutory law measures for the protection of the interests of beneficiaries, the donor community, employees, and other stakeholders.

There us a need to balance civil, administrative and criminal sanctions particularly when considering administrative and enforcement mechanisms within the regulatory framework. This is important given that the existing NPO Act invokes criminal penalties only, when civil or administrative remedies could be more appropriate in some instances. The review will also address the institutional requirements to ensure simplicity; effectiveness and consistent enforcement by clarifying the roles and responsibilities of different agencies and other role-players within the legal framework for nonprofit organisations.

It will be imperative for the voluntary associations, nonprofit companies and nonprofits trusts to be subjected to the same rules regarding formation governance and reporting requirements in order to circumvent any legal loopholes that will undermine the principles of the public beneficiation and disclosure. This will further create greater equality within the nonprofit sector and will also promote public confidence in the sector.

This review will be broadly consultative to allay fears on the part if the nonprofit sector of unnecessary reforms that would create uncertainties within the sector. Careful consideration will be given to developments within the nonprofit sector and other international best practices with the possibilities of adapting these to the South African context.