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Foreign Contribution (Regulation) Act (FCRA)

Foreign Contribution (Regulation) Act (FCRA):

The Union Ministry of Home Affairs (MHA) has cancelled the Foreign Contribution (Regulation) Act (FCRA), 2010 registration of various non-governmental organisations (NGOs).

  • Suspension of FCRA licence means that the NGO can no longer receive fresh foreign funds from donors pending a probe by the Home Ministry. The FCRA is mandatory for associations and NGOs to receive foreign funds.
  • The FCRA registration of Vadodara-based NGO is cancelled because it was accused of illegally converting members of the Hindu community, funding the anti-CAA protests and for criminal activities to strengthen Islam.
  • The FCRA registration of two other Christian NGOs — the New Hope Foundation, based in Tamil Nadu, and Holy Spirit Ministries from Karnataka were also cancelled.
  • The FCRA registration of AFMI Charitable Trust was cancelled by the MHA for violating the provisions of the Act.

Prior Reference Category:

  • THe MHA had put 10 Australian, American and European donors on its watchlist.
  • Following which the Reserve Bank of India wrote to all banks that any funds sent by the foreign donors should be brought to the notice of the Ministry and not cleared without its permission.
  • All the donors that were placed on the watchlist or “prior reference category” work in the field of climate change, environment and child rights.
  • Foreign Contribution (Regulation) Act (FCRA), 2010: Foreign funding of persons in India is regulated under FCRA act and is implemented by the Ministry of Home Affairs.
  • Individuals are permitted to accept foreign contributions without permission of MHA.
  • However, the monetary limit for acceptance of such foreign contributions shall be less than Rs. 25,000.
  • The Act ensures that the recipients of foreign contributions adhere to the stated purpose for which such contribution has been obtained.
  • Under the Act, organisations are required to register themselves every five years.

Foreign Contribution (Regulation) Amendment Act, 2020:

  • Prohibition to accept foreign contribution: The Act bars public servants from receiving foreign contributions.
  • Public servant includes any person who is in service or paid by the government, or remunerated by the government for the performance of any public duty.
  • Transfer of foreign contribution: The Act prohibits the transfer of foreign contribution to any other person not registered to accept foreign contributions.
  • Aadhaar for registration: The Act makes Aadhaar number mandatory for all office bearers, directors or key functionaries of a person receiving foreign contribution, as an identification document.
  • FCRA account: The Act states that foreign contributions must be received only in an account designated by the bank as FCRA account in such branches of the State Bank of India, New Delhi.
  • Reduction in use of foreign contribution for administrative purposes: The Act proposes that not more than 20% of the total foreign funds received could be defrayed for administrative expenses. In FCRA 2010 the limit was 50%.
  • Surrender of certificate: The Act allows the central government to permit a person to surrender their registration certificate.

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