Parliament is set to discuss a decree‑law that aims to strengthen controls on public fundraising and protect Bahrain from money‑laundering and terrorism‑financing risks, ahead of an international review.
The services committee has recommended passing Decree-Law No 39 of 2025, which amends provisions of Decree-Law No 21 of 2013 regulating fundraising.
Committee rapporteur MP Lulwa Al Romaihi said the changes are ‘structural safeguards’ aligned with international standards issued by the Financial Action Task Force (FATF).
“Bahrain is approaching a critical FATF review. Any delay in closing legislative gaps could expose the kingdom to grey-listing risks that affect banks, investment and the wider economy,” she said.
“This decree-law strengthens transparency without undermining genuine charitable work.”
The amendments redefine who is considered a ‘licensee’, restrict fundraising by legal entities to prior ministerial approval, and limit fundraising by individuals to religious purposes only.
A key change requires anyone who receives a donation for public purposes without a licence to notify the Ministry within seven working days. The ministry must reply within 30 days – and silence will now count as rejection, not approval.
Licensees must submit detailed financial reports within 30 days of completing a campaign, with annual reporting if the campaign exceeds a year.
The decree-law also introduces a new risk-based supervision article, empowering the Social Development Ministry to assess each association’s exposure to terrorism-financing risks and apply proportionate oversight measures, updated in line with the National Risk Assessment.
Another new article allows the ministry to impose administrative fines of up to BD10,000 for violations, with penalties calibrated to the seriousness of the breach.
A key amendment is to Article 14, which mandates court-ordered confiscation of funds collected without a licence – or an equivalent amount from the offender if the funds have already been spent – with the money redirected to charitable causes designated by the ministry.
Several societies told MPs this could discourage volunteers and board members acting in good faith. However, the committee concluded the provision is necessary to deter abuse.
“The law clearly distinguishes between administrative mistakes and intentional exploitation,” Ms Al Romaihi said. “But public money collected in the name of charity must remain protected under all circumstances.”
The decree-law was issued under Article 38 of the Constitution due to the urgency of aligning with FATF standards on non-profit organisations, risk-based supervision and deterrent penalties.
“This is about protecting Bahrain’s reputation as much as protecting donations,” Ms Al Romaihi said. “Strong governance builds trust in the charitable sector.”
Social Development Minister Osama Al Alawi told the committee the ministry already applies a risk matrix for associations, supported by data from the Financial Intelligence National Centre and security databases, including UN sanctions lists.
“Licences are not granted blindly,” Mr Al Alawi said. “We assess background data, monitor performance, and maintain a risk report for every association.”
He added that the funds collected by associations are treated as public funds that cannot be spent without prior authorisation.
Statistics provided to MPs show 215 fundraising licences were issued in 2023, 211 in 2024 and 184 up to September 2025. A total of 193 licences were also granted to individuals for religious fundraising during the same period.
The ministry requires associations to open dedicated bank accounts for each campaign with banks licensed by the Central Bank of Bahrain (CBB), ensuring full traceability of funds.
It has been noted that no violations were recorded by the ministry in the activities of licensed associations during the current minister’s tenure, with prior five cases found in 2025, three in 2024 and two in 2023.
Charitable groups, including Sanabel Association for Orphan Care, Sitra Charitable Society and Isa Town Charitable Social Society, supported stronger governance, but urged proportional penalties, clearer definitions of ‘transfer of funds abroad’, and reliance on annual audited reports instead of repeated filings.
The Bahrain Bar Society raised no objections. Mr Al Alawi said executive regulations will clarify procedures and ensure that ‘oversight does not become an administrative burden on sincere charitable work’.
The services committee unanimously recommended approval, saying the amendments strike a balance between safeguarding public funds and sustaining Bahrain’s vibrant culture of volunteerism and charity.
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