Shrinking civic space in the Netherlands: a growing trend

In the first of our new Spotlight on Civic Space series, which explores the trend and impact of shrinking civic space around Europe, and the not-for-profit sector’s response, Goede Doelen Nederland’s public affairs advisor Ross Verde shares insights into the current situation in the Netherlands.

In the Netherlands, nonprofit organizations play an essential role in upholding European values and addressing societal challenges. These organizations emerge from the commitment of citizens who are concerned about the wellbeing of vulnerable individuals, animals, nature, the environment, and culture. They channel the concerns, frustrations, aspirations, and needs of millions of people, thereby giving them a voice in matters that are important to them. However, recent government policies are placing increasing pressure on the ability of nonprofit organizations to operate effectively.

At Goede Doelen Nederland, we are committed to ensuring an environment where nonprofits can work independently. Nonetheless, recent developments indicate a trend of shrinking civic space in our country.

There is growing pressure on both the revenue sources for nonprofit organizations (such as tax deductions for donations, subsidies, and lottery contributions) and their ability to access the courts and exercise the right to protest.

Coalition agreement

On July 2, 2024, the newly formed Cabinet-Schoof, supported by coalition parties BBB, NSC, VVD, and PVV, announced budget cuts for the charitable donation tax deduction. Due to societal pressure to maintain this deduction, the budget cut for individual donations was reversed, but businesses contribute to society too, and this cut must also be withdrawn.

Further complicating matters is that the coalition’s governing agenda, “Hope, Courage, and Pride,” includes proposals with negative effects for nonprofits. Key among these is the plan to investigate imposing stricter requirements on nonprofit organizations involved in legal actions to hold the government accountable to uphold treaties and legislation.

According to the Dutch Bar Association (Nederlandse Orde van Advocaten), this proposal poses significant risks. Their recent report, Rechtsstatelijke Toets Regeerprogramma 2024 (“Constitutional Review of the 2024 Coalition Agreement”) highlights shared concerns about potential impacts on the rule of law.

Currently, nonprofits are legally empowered to bring cases to court to address governmental misconduct, such as unlawful regulations and illegal actions, thereby enhancing the effectiveness of the rule of law. The coalition’s proposal could, however, limit access to the courts in critical cases, thereby weakening the current legal system’s efficacy. This may conflict with Article 13 of the European Convention on Human Rights (ECHR), which guarantees the right to an effective remedy, and, particularly for environmental organizations, with Article 9 of the Aarhus Convention. Vigilance is essential to safeguard these fundamental rights.

The continuation of a new proposed legislation

The proposed legislation aims to enforce greater transparency within civil society, particularly concerning the size and origins of donations. Additionally, a cease-and-desist order is being introduced for organizations that may pose a potential threat to the rule of law or public authority.

While intended to increase accountability, these measures risk curbing the independence and effectiveness of nonprofits. Furthermore, the coalition has proposed revisions to existing laws that could further limit civic freedoms, specifically the rights to protest.

Increasing regulatory pressures

Nonprofits now face a tangled web of regulatory requirements that challenge their operational capacity. European regulations on privacy, consumer protection, and transparency, though intended to enhance accountability, have placed a heavy administrative burden on charitable organizations. This regulatory overload diverts valuable resources away from mission-driven work, making it harder for nonprofits to respond swiftly to urgent social needs.

Financial and legal barriers

A growing trend of “de-risking” by banks is adding significant challenges. Dutch banks, adhering to strict government regulations aimed at minimizing the risk of money laundering and terrorism financing, often deny accounts to nonprofits.

The negative impact of this de-risking on nonprofit organizations is concerning. Opening new accounts has become increasingly difficult, existing accounts are being terminated, and transferring funds – whether to high- or low-risk regions – is subject to long delays. This practice complicates financial management and jeopardizes the stability of funding.

The situation in the Netherlands reflects a broader global trend of shrinking civic space. As regulations tighten and funding becomes less accessible, nonprofits worldwide face challenges in fulfilling their missions. It is crucial for international actors to recognize these challenges, as the implications of a weakened nonprofit sector extend far beyond national borders.

Picture by Lidia Nemiroff on Unsplash