In April 2012 a law was implemented that states when donors give money to non-governmental organizations (NGOs) in Kosovo it is legal for NGOs to ‘transform’ the money in stocks or shares of personal private persons. According to the Law on Freedom of Association in NGOs, the capital microfinance NGOs that are in case of dissolution or closure should be distributed to other NGOs operating with similar objectives. As a result, the constitutional court has decided to prohibit microfinance institutions registered as NGOs to turn capital gain as NGOs in investment capital for commercial purposes.
The decision of the constitutional court to abolish this law brought a lot of consent to the Civil Society. Driton Selmanaj, Kosovo Democratic Institute (KDI) says that this law had violated three articles of the Constitution of Kosovo: Article 44 (the freedom of association), Article 46 (freedom of property) and Article 10 (economy).
Korab Sejdiu, a lawyer representing microfinance NGOs, says that this law has been misinterpreted because the objectives of these NGOs were not the way they were deduced. “We had a very strong case where we set our main objectives, but the court did not even take them into consideration,” said Sejdiu.
This law was voted and approved by the Assembly, and the reasoning of Naser Osmani, MP (Democratic League of Kosovo), was that according to him it was a better law than the previous one. However, he adds: “Civil Society has done a good job into being vigilant towards this issue and that they sent their complaints to Ombudsperson. The abolishment of this law is a good sign because it shows that institutions are collaborating and are supervising the work [potential flaws] of each other. The Parliament is not infallible.”
The attempts to create this kind of law have started since 2004, and the transparency has been low. Lulzim Rafuna, minister of Finance, reasons this by saying: “this problem was inherited by UNMIK times. In year 1999 and 2004, these organizations were regulated by UNMIK rules and these rules were abolished in year 2008.” According to him, the purpose of this law was to only touch one category of microfinance NGOs and it does not oblige these institutions to become corporations. However, Selmanaj add that this law has destroyed the main purpose of NGOs which is that they are non-profitable and the money they accumulate should be used in benefit of the society, not private benefits.
In conclusion, the law that allowed microfinance institutions registered as NGOs to turn capital gain as NGOs in investment capital for commercial purposes was abolished. There is still a debate taking place towards this issue, and “Life in Kosovo” will follow the proceedings.