Bhutan transitioned to a democratic constitutional monarchy in 2008, and an important precursor to the transition was the passing of the Civil Society Organisations Act 2007 which is the umbrella legal framework for the formation, registration, and operation of CSOs. Since then, there has been positive developments in the numbers of CSOs that have emerged and the diversity of engagement areas.

Public awareness of the work of CSOs has increased and there are growing frequencies of consultations with CSOs by the State during policy development processes. The role of CSOs in the country, however, is limited by a still evolving democratic culture and a highly cautious approach towards civil society development.

Other challenges facing CSOs include a lack of access to sustainable resource avenues and high dependence on international donors and foundations, and inadequate platforms for collective voice which was further curtailed by the dissolution of a national network of CSOs in 2023. In the same year, the State prescribed endowment funds and operational reserves to be mandatorily maintained by CSOs.

These are significant amounts to be raised and held as reserves, especially for smaller CSOs. As on August 2024, a time extension has been granted to accumulate these funds over a period of three and four years for different categories of CSOs.

Civic freedoms are protected by the Constitution. However, defamation and libel are criminal offences under the Penal Code and carries a punishment of fines and a maximum of three years of imprisonment.

There are positive examples of media-CSOs engagement for awareness and advocacy. The media in general suffers from financial sustainability issues, challenges in accessing information, and self-censorship.