Primarily targeting foreign NGOs accused by the Zimbabwean Government of bankrolling opposition parties, the new law will also make it a criminal offence for local organisations to receive funding from abroad for projects involving the promotion of human rights and governance issues.
Amnesty International's Africa programme director, Kolawole Olaniyan, said: "The Act is a disaster. We have grave fears that organisations that have done most to raise awareness of the human rights situation in Zimbabwe will now be targeted for closure."
Amnesty is calling for the immediate repeal of the Act, arguing that the law will be used to repress NGOs in the same way as Zimbabwe's Access to Information and Protection of Privacy Act 2002 has already been used to stifle independent media.
Overseas aid charities operating in the country, including Cafod and Oxfam, will also be hit by the law. But none of them are willing to comment on their predicament as they fear for the security of staff. They will be required to submit a three-year plan identifying their funding sources to a Government-controlled council that will grant them certificates.
These can be revoked at any time and the council may dissolve the organisation and take over its property.
Neil O'Keefe, Southern Africa programme officer at Trocaire, another overseas aid charity with projects in Zimbabwe, said the council would give the Government absolute control over agencies' work, and the council "will be eventually used to ban NGOs that do not demonstrate their political loyalty".