FCRA amendment bill


The Narendra Modi government introduced the Foreign Contribution (Regulation) Amendment Bill, 2020, within the Lok Sabha Sunday, seeking to form significant changes to the Foreign Contribution (Regulation) Act (FCRA). The bill, introduced within the Lok Sabha by Minister of State for Home Affairs Nityanand Rai, faced objections from leader of the opposition Adhir Ranjan Chowdhury, his Congress colleague Manish Tewari, and Trinamool Congress’ Saugata Roy, who termed it a way to “crush dissent” and “concentrate powers within the hands of the government.

Key Points of the Amendments

  1. The government on Sunday sought to form provisions of the Foreign Contribution Regulation Act (FCRA), 2011 more stringent through a bill that proposes to incorporate “public servants” within the prohibited category, decrease administrative expenses through foreign funds by an organisation to 20% from 50% earlier, make Aadhaar mandatory for registration and provides government powers to prevent utilisation of foreign funds by an organisation through a “summary enquiry.
  2.  The Foreign Contribution (Regulation) Amendment Bill, 2020, to be introduced in Lok Sabha by Home Minister Amit Shah at 3 pm, says the necessity to strengthen the Act has arisen thanks to several organisation “misutilising or misappropriating” the funds resulting in the govt cancelling 19,000 such registrations within the past few years. 
  3. The annual inflow of foreign contribution has almost doubled between the years 2010 and 2019, but many recipients of foreign contribution haven’t utilised an equivalent for the aim that they were registered or granted prior permission under the said Act. 
  4. Many of them were also found wanting in ensuring basic statutory compliances like submission of annual returns and maintenance of proper accounts. This has led to a situation where the Central Government had to cancel certificates of registration of quite 19,000 recipient organisations, including non-Governmental organisations, during the amount between 2011 and 2019. 
  5. The criminal investigations also had to be initiated against dozens of such non-Governmental organisations which indulged in outright misappropriation or mis-utilisation of foreign contribution,” the Bill’s statement of objects and reasons says. 
  6. The government has said there’s a requirement to streamline the provisions of the said Act by “strengthening the compliance mechanism, enhancing transparency and accountability within the receipt and utilisation of foreign contribution worth thousands of crores of rupees per annum and facilitating genuine non-Governmental organisations or associations who are working for the welfare of the society. Seeking to amend clause (c) of sub-section (1) of section 3 of the Act, the govt has proposed to incorporate “public servant” also within its ambit, to supply that no foreign contribution shall be accepted by them. 
  7. Earlier, it had been restricted to legislators, election candidates, journalists, print and broadcast media, judges, government servants or employees of any corporation or the other body controlled or owned by the govt .It has also sought to ban any transfer of foreign contribution to the other association or person. Amendment of section 17 of the ACT has sought to supply that each one that has been granted certificate or prior permission under section 12 shall receive foreign contribution only in an account designated as ‘‘FCRA Account’’ which shall be opened by him in such branch of the depository financial institution of India at New Delhi, because the Central Government may, by notification, specify. 
  8. It has, however, allowed the organisation to transfer these funds to a different account for utilisation.
  9. The government has also sought to offer itself considerable powers choose which organisation, if it’s obtained prior permission from the govt for foreign contribution, shall cease to utilise its funds. 
  10. The amendment sought to Section 11 of the Act gives government powers to prevent utilisation of received but unutilised funds following a “summary enquiry”. Earlier it had been alleged to be done only after the person or association has been “found guilty” of violation of the Act. 
  11.  Provided that the Central Government, on the idea of any information or report, and after holding a summary inquiry, has reason to believe that an individual who has been granted prior permission has contravened any of the provisions of this Act, it may, pending any longer inquiry, direct that such person shall not utilise the unutilised foreign contribution or receive the remaining portion of foreign contribution which has not been received or, because the case could also be , any additional foreign contribution, without prior approval of the Central Government,” the amendment sought to Section 11 says within the Bill. 
  12. Regarding suspension of registration under the Act, the amendment to Section 13 has sought to offer the govt the facility to make a decision on the amount of suspension beyond 180 days.
  13. In section 13 of the principal Act, in sub-section (1), for the words ‘for such period not exceeding 100 and eighty days as could also be specified’, the words ‘for a period of 1 hundred and eighty days, or such further period, not exceeding 100 and eighty days, as could also be specified’ shall be substituted, the Bill has said.

– Vandana Uttrani