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Chinese national flags flutter at Tiananmen Square ahead of the opening session of the National People's Congress (NPC) in Beijing, China, March 5, 2016. REUTERS/Kim Kyung-hoon/File Photo

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By Megha Rajagopalan and Michael Martina

BEIJING (Reuters) - Western governments and rights groups lambasted a new Chinese law governing non-governmental organisations (NGOs) on Friday, saying it treats the groups as a criminal threat and would effectively force many out of the country.

The law, which was passed by parliament on Thursday despite months of intense criticism and lobbying by the West, brings NGOs under the Ministry of Public Security, giving police broad authority over their finances and work.

"I think this definitely gives the government the legitimate channels and the excuse to kick out civil society organizations if they want," said Shen Tingting, a China-based advocacy director for Asia Catalyst, a group that trains domestic NGOs.

Shen said a pervasive atmosphere of sensitivity for NGOs had already driven the group to move many of its training sessions for local charities to Bangkok instead of holding them in China, particularly after one of its partner organisations faced questioning by police.

The law could only make the situation worse, she said.

Chinese officials defended the law, saying only a small number of law-breaking NGOs would be punished and that there was no reason to fear the police.

But rights groups say language in the law banning activities that threaten national security interests or endanger social stability is too ambiguous and could push out groups the ruling Communist Party does not like.

The law comes amid a broad crackdown by President Xi Jinping on civil society, including rights lawyers and the press, which critics say is meant to quash dissent.

The American Chamber of Commerce in China expressed disappointment with the law, saying it would have a detrimental impact on a "huge number of NGOs" as well as the companies they collaborate with.

"Treating foreign NGOs as primarily a security threat undermines not just the ability of those organizations to benefit China, but also the ability of companies to do business here," said James Zimmerman, the chamber's chairman.

China's state-backed Global Times defended the law, calling criticism by the Western press extreme and adding that some NGOs should be restrained by the government.

"Specific foreign NGOs actually have harmed China's national security situation," the commentary said.

"From now on, foreign NGOs may become part of the Chinese Ministry of Public Security's 'difficult to manage' work, because they will promote, to a great extent, their own rights when conflicts occur," the newspaper said.

Western governments, which lobbied Chinese authorities for months to relax restrictions outlined in drafts of the law, said they were disappointed that such changes were minor. U.S. Secretary of State John Kerry expressed "deep concern" that the law would harm ties between the U.S. and China.

"The final version of the new law contains certain improvements from the original draft," he said in a statement. "It also creates a highly uncertain and potentially hostile environment for foreign non-profit, non-governmental organizations and their Chinese partners that will no doubt discourage activities and initiatives."

(Reporting by Megha Rajagopalan and Michael Martina; Editing by Nick Macfie)

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