D.9. Grants to Foreign Organizations

(1) If the grant is to a foreign organization, the written grant agreement must impose

restrictions which are substantially equivalent to the limitations placed on domestic private foundations by Section 4945(d). Such restrictions may be phrased in appropriate terms under foreign law or custom and ordinarily will be considered sufficient if an affidavit or opinion of counsel (of the grantor or grantee) is obtained stating that, under foreign law or custom, the agreement imposes restrictions on the use of the grant substantially equivalent to the restrictions imposed on a domestic private foundation. See Treas. Reg. 53.49455(b)(5).

(2) With respect to activities in foreign countries, the failure of a foreign private

foundation that is described in Section 4948(b) to comply with the requirements in Treas. Reg. 53.4945-5(b)(3) and (4) to set forth certain terms in written grant agreements is not a prohibited transaction under Section 4948(c). See Treas. Reg. 53.4945-5(b)(6).