Home ministry amends FCRA rules; gives more time to declare funds
The new rules – Foreign Contribution (Regulation) Amendment Rules, 2022, were notified by the ministry of home affairs (MHA) through a gazette notification on Friday
The ministry of home affairs (MHA) on Friday amended foreign funding rules giving certain relaxations such as allowing relatives to send more money under the Foreign Contribution Regulation Act (FCRA) and giving more time to the organisations to inform the government about opening of bank accounts for utilization of funds received under ‘registration’ or ‘prior permission’ category.
A provision where an organisation/individual receiving foreign funds had to declare such contributions every quarter on its official website has also been done away with.
The new rules – Foreign Contribution (Regulation) Amendment Rules, 2022, were notified by the ministry of home affairs (MHA) through a gazette notification on Friday.
“In the Foreign Contribution (Regulation) Rules, 2011,in rule 6, — for the words “one lakh rupees”, the words “ten lakh rupees” shall be substituted; and for the words “thirty days”, the words “three months” shall be substituted,” the notification stated.
Rule 6 deals with intimation of receiving foreign funds from relatives. It stated earlier that “any person receiving foreign contribution in excess of one lakh rupees or equivalent thereto in a financial year from any of his relatives shall inform the Central government (details of funds) within 30 days from the receipt of such contribution”.
The amended rule now allows relatives to send ₹10 lakhs without informing the government. If the amount exceeds, the individuals will now have three months to inform the government against 30-days earlier.
Similarly, making changes in rule 9, which deals with application of obtaining ‘registration’ or ‘prior permission’ under the FCRA to receive funds, the amended rules given individuals and organisations 45 days to inform the MHA about bank account (s) that are to be used for utilization of such funds. This time limit was 30-days earlier.
The Centre has also ‘omitted’ provision ‘b’ in rule 13, which dealt with declaring foreign funds including details of donors, amount received, and date of receipt etc every quarter on its website. Now, anyone receiving foreign funds under the FCRA will have to follow the existing provision of placing the audited statement of accounts on receipts and utilisation of the foreign contribution, including income and expenditure statement, receipt and payment account and balance sheet for every financial year beginning on the first day of April, within nine months of the closure of the financial year, on its official website or on the website as specified by the Centre.
In case of change of bank account, name, address, aims or key members of the organisation (s) receiving foreign funds, the MHA has now allowed 45 days time to inform it, instead of previous 15-day deadline.
The MHA had made the FCRA rules stricter in November 2020, stating that organisations which may not be directly linked to a political party but engage in political action like bandhs, hartal (strike) or rasta rook (road blockades) will be considered of political nature if they participate in active politics or party politics. The organisations covered under this category include farmers’ organisations, students, workers’ organisations and caste-based organisations.
In the amended FCRA – the law was amended in September 2020 - the government barred public servants from receiving foreign funding and made Aadhar mandatory for every office-bearer of the NGOs. The new law also says that organizations receiving foreign funds won’t be able to use more than 20% of such funds for administrative purposes. This limit was 50% earlier.
The ministry had informed the parliament in March this year it has refused to renew the FCRA of total 466 non-government organisations since 2020 for not fulfilling the eligibility criteria in accordance with the provisions of the law.
There were 100 refusals in 2020, 341 in 2021 and 25 till March this year, MHA said in parliament. A key rejection was that of Oxfam India’s application for renewal of its foreign-funding licence in December 2021, which is yet to be renewed.
As of Saturday, there are 16,790 FCRA registered organisations in the country.