Foreign contribution regulation Act 1976 or FCRA is a law of government of India which:-
Regulates acceptance and utilization of foreign contribution by certain individuals or associations to NGOs and others inside India.
Prohibits acceptance and utilization of foreign contribution for any activities counterproductive to the national interest.
Can NGOs use the foreign contributions for investments in mutual funds or other investments?
No, the donation received can be used only for the purpose for which it was received.
Can multiple bank accounts be maintained for foreign contributions received?
One or more bank accounts shall be opened for utilizing FC provided that the funds other than foreign contribution cannot be deposited in such bank accounts exclusively maintained for the purpose of FC.
Who does it apply to?
It extends to whole of India;
And citizens of India outside India
Associate branches or subsidiaries of companies (registered/incorporated in India) outside India.
Who cannot receive Foreign Contributions?
An election candidate.
Correspondent, columnist, cartoonist, editor, owner, printer or publisher of a registered newspaper.
Judge, government servant or employee of any Corporation or any other body controlled on owned by the Government
Member of any legislature
Political party or office bearer thereof
Organization of a political nature as may be specified by the Central Government.
Association or company engaged in the production or broadcast of audio news or audio visual news or current affairs programmes through any electronic mode, or any other electronic form as defined in the Information Technology Act, 2000 or any other mode of mass communication.
Correspondent or columnist, cartoonist, editor, owner of the association or the company.
What are the types of registrations?
There are basically two types of registrations:-
Prior permission certificate
Permanent certificate for 5 years.
What are eligibility criteria for grant of registration?
For grant of registration under FCRA, 2010, the association should:
(i) be registered under the Societies Registration Act, 1860 or the Indian Trusts Act, 1882 or section 25 of the Companies Act, 1956 etc;
(ii) For the purpose of utilization of foreign contribution the association should have spent at least Rs.10,00,000/- over the last three years on its activities, excluding administrative expenditure.
(iii) Statements of Income & Expenditure, duly audited by Chartered Accountant, for last three years are to be submitted to substantiate that it meets the financial parameter.
What are the documents required for the purpose of FCRA registration?
Copy of registration certificate of the trust
Copies of the audited financial statements.
Copies of annual report for the last three years.
Bank details.
Copy of PAN of the trust.
List of governing body.
Who can certify documents?
The Chief Functionary of the organization shall certify the required documents. Basically it amounts to self-certification. Practically speaking, a letter from the bank manager of the bank where the account for FC is maintained, is submitted.
How long does it take for an NGO/trust to register under FCRA?
Ideally it should take 4 months. But it may take longer depending on the number of branches held by such NGO’s.
The process is as follows:-
- Online filing with Ministry of Home Affairs.
- A report shall be furnished and sent by the Intelligence Bureau after a month of online filing.
- After which, the hard copy submission to the ministry is made.
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