In depth

The following are the most relevant aspects of the Law.

1. Procedure for the incorporation of the Organizations: Persons or entities who wish to incorporate any of the Organizations must present before the competent Public Registry Office, regulated by the Autonomous Service of Registries and Notaries (SAREN), the Articles of Incorporation/Bylaws of the Organization, in accordance with the requirements of the Law, accompanied by their identity cards and Tax Information Registry certificates (RIF), for the approval of incorporation.
   The competent Public Registry Office must issue a response to the request for incorporation within 30 business days following receipt of the request and, in the event that the persons or entities who wish to incorporate an Organization fail to comply with any requirement established in the Law, they will have a period of five business days to remedy the non-compliance.
2. National Registry of Non-Governmental Organizations and Non-Profit Social Organizations: The Law creates the National Registry of Non-Governmental Organizations and Non-Profit Social Organizations ("Registry"), which shall contain information on the incorporation, operation, financing and modification of the Organizations. The Ministry with competence in matters of justice will dictate the regulation on the operation of the Registry.
   Organizations must register with the Registry, they must also obtain a RIF certificate and comply with the provisions established in special laws.
3. Organizations domiciled abroad: Organizations domiciled outside the country that carry out activities in Venezuela must be registered with the Register of Non-Domiciled Organizations ("Non-Domiciled Registry"), regulated by the Ministry with competence in foreign affairs. These Organizations will be subject to the supervision and control mechanisms implemented by the National Executive and, in addition, the foreign persons that are members of the Organizations must comply with Venezuelan immigration provisions.
4. Obligations of the Organizations: The Law establishes duties of notification to the competent body regarding financing and/or donations received by the Organizations. Additionally, it establishes a series of acts that are subject to registration before the competent Public Registry, either by ordinary or extraordinary Meeting minutes (i.e., modification of bylaws, general powers of attorney, appointment of officers, opening and closing of offices, among others).
   The National Executive is responsible for monitoring and controlling compliance with the obligations of the Organizations, for which it is empowered by law to issue regulations and develop verification and compliance mechanisms.
5. Offenses: The Law establishes as formal offenses:
   1. Failure to comply with the obligation to timely register the acts and facts provided for in this Law.
   2. Failure to notify the competent agency of the financing or donations to be received, in order to ensure the legality of the funds and compliance with the provisions of this Law.
   3. Failure to keep the Organization's books that it is required to keep and maintain.
   4. Failure to comply with the obligation to assist and cooperate with the State in its control and inspection activities.
   5. Failure to comply with the obligations set forth in the transitory provisions of this Law.
6. Sanctions: Organizations incurring in the formal offenses shall be:
   1. Fined for the equivalent amount between 100 and 1,000 times the official exchange rate of the highest value currency published by the Central Bank of Venezuela and, in case of repeated offenses, the fine will be between 500 and 10,000 times the official exchange rate of the highest value currency published by the Central Bank of Venezuela.
   2. Fined for the amount equivalent to twice the amount received in case of failure to report donations received, without prejudice to applicable civil and criminal actions in accordance with the legislation on money laundering and terrorist financing.
   3. In the case of Organizations domiciled outside the country, they will be sanctioned with the cancellation of the registration granted by the Ministry with competence in foreign affairs. Additionally, foreign persons who are members of the Organizations may be subject to expulsion measures according to Venezuelan immigration regulations.

Fines must be paid within 30 days after the decision becomes final at any bank receiving national public funds. If the fine is not paid, the Organization may be declared in dissolution process after a judicial decision.

In the event that there are sufficient grounds to consider that any of the conducts prohibited by the Law are being committed, the Ministry with competence in matters of justice may impose a preventive measure of suspension of the operation of the Organization, prior declaration of the competent jurisdictional body, and the Organization shall be subject to the judicial process of dissolution.

7. Relevant transitory and final provisions:
   1. The Law establishes that within 90 days after the entry into force of the Law (i.e., as of 13 February 2025), the already incorporated Organizations must submit to the Public Registry Office corresponding to their domicile, the Meeting minutes with the obligations mentioned in item 4 above.
   2. The Organizations already incorporated, whose Articles of Incorporation/Bylaws do not comply with the provisions of the Law, must modify them within 180 days after the entry into force of the Law (i.e., as of 14 May 2025). The registration of the minutes is exempt from the payment of fees, and non-compliance will result in the nullity of the registration of the Organizations.
   3. SAREN will issue the respective guidelines for the migration of the Organizations incorporated in the Main Registries to the Public Registries according to the jurisdiction of their domicile.

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1 Published in Official Gazette No. 6,855 of 15 November 2024.

2 Organizations are defined as "any group of persons, regardless of its name, of a private nature, constituted for charitable, social, altruistic, humanitarian, artistic, community, cultural, educational, sports, environmental or similar purposes, whose purpose is not oriented to obtain an economic project, nor for partisan purposes".