In recent years, a number of countries in the Middle East, such as Saudi Arabia, Kuwait and UAE, have become the world’s top donors according to the Organisation for Economic Co-operation and Development (OECD). Countries, such as the UAE in 2017, ranked number one in the world on the ODA against the GNI by contributing 1.2% of their GNI in excess of the more famous western donor countries such as Sweden, the UK, the USA and many more.
Due to this and many other factors, including but not limited to, the deep rooting of charitable giving in Arab societies, and the economic boom in the recent decades, the region has attracted a lot of attention from INGOs who want to try their luck and experience the fundraising market!
I’m from the region and have over 10 years of fundraising experience. Along with my legal background, this will allow me to give you clear guidelines on how you can fundraise legally in the region. Since the Middle East is quite a large region, I will be focusing on the UAE today. The UAE has a similar legislative system to the rest of the countries in the region that are considered to be interesting from an INGO’s perspective.
So, how do you fundraise legally in the UAE?
Before I start talking about this, I want to answer the top 5 frequently asked questions from people outside the region who want to fundraise in the UAE! Let me know if you have any more questions!
1- Can I fundraise without having to register a branch in the UAE?
Yes, you can, but you need to work with a local charity partner.
2- Do I need to spend the money I raise in the UAE on local causes/projects?
No, you can spend the funds raised in any country you are operating in.
3- Can I receive the funds raised in the UAE directly to my charity’s bank account?
If you are not registered, the banking of the funds raised should be facilitated by your local partner. However, if you are registered, it should be banked first in your local bank account and then later transferred to your overseas bank account.
4- If I’m registered as a local charity, can I fundraise freely in the UAE?
Yes, but you always need permission to run a fundraising campaign.
5- Do I need to have a local Emirati board to register a charity in the UAE or open a branch?
You can have a branch at International Humanitarian City (IHC) without the need to have a local board. You can also register a non-profit entity at the Community Development Authority in Dubai.
You will need a local board if you want to register at the Ministry of Community Development.
The law says you can fundraise in the UAE if you are a registered charity, or a society in the Ministry of Community Development (a federal ministry). Alternatively, if you are based in Dubai or your primary fundraising market is Dubai, then you need to be registered with the Islamic Affairs and Charitable Activities Department. So, these two governmental entities are the only regulators for fundraising activities in the UAE.
However, there are several ways that you can obtain fundraising permission without being registered with the above-mentioned governmental entities and still undertake fundraising operations in the UAE, here are a few examples:
Partnering with a local registered charity.
This is quite easy and straightforward, you can partner with a registered charity that is allowed to fundraise. They will handle all the paperwork for obtaining the permission from the relevant government departments (depending on whether you are doing it in Dubai or another Emirate). Usually, you have to pay a percentage (10%) of the money raised to the local charity that facilitates this for you. Most of the time though, if you have a strong partnership with the local charity partner, this percentage could be recognised as a donation from them.
The rationale behind the idea of charging a percentage is to make sure that the local causes/charities always have their own share of the proceeds when it comes to local giving.
Register at the International Humanitarian City (IHC) – Dubai.
IHC is the world’s largest humanitarian logistical hub. It was designed for INGOs who want to benefit from the strategic location of Dubai as the connection between Asia, Africa and the Middle East and to take advantage of the great network of Emirates Airline.
It is an amazing place to be as an INGO; where you will be in the same place as the majority of UN agencies and some of the world’s most famous NGOs.
The registration at IHC is a simple process. In addition to a number of benefits of being a member of IHC, you can use your license to fundraise in Dubai after you get approval from IHC (which will act as your local partner in this case).
The funds raised via the partnership with IHC are also subject to 10% deduction. However, you can apply for an IHC annual grant which is exclusively for its members, and you might actually receive more than 10X the 10% you give to IHC!
Community Development Authority (CDA) in Dubai.
If your organisation is intending to engage in local activities; that is, do more than only be registered to carry out fundraising, then it will make sense for you to register at CDA. This allows you to obtain permission to fundraise in Dubai. This option won’t be ideal if you don’t intend to undertake local activities.
Registering at the Ministry of Community Development (MoCD).
While registration with MoCD represents full compliance with the requirements for fundraising permission, it might represent a challenge as the current registration mentions that the local charities registered with the MoCD shouldn’t have branches outside the UAE (unless a special exception is made), they are not allowed to receive funding from overseas and the board members should be 100% local Emirati.
Even if you have the ministerial resolution as a local charity at MoCD, you will always need to request fundraising permission for any fundraising project you might undertake.
I would like to conclude by saying that it is very important to adhere to the local legislation concerning fundraising permission in the UAE. If you fail to comply with the local legislation you will potentially be exposed to a huge fine (minimum AED 50,000) and you could be jailed for 5 years! So, if you want to do fundraising, please make sure you have the appropriate permission to do so before you undertake your operations!