It has been enacted by the Parliament to consolidate the law to regulate the acceptance and utilization of foreign contribution or foreign hospitality by certain individuals or associations or companies and to prohibit acceptance and utilization of foreign contribution or foreign hospitality for any activities detrimental to national interest and for matters connected therewith or incidental thereto.

By on 14-11-2018

FCRA REGISTRATION.

PURPOSE OF FCRA, 2010

 FCRA, 2010 has been enacted by the Parliament to consolidate the law to regulate the acceptance and utilization of foreign contribution or foreign hospitality by certain individuals or associations or companies and to prohibit acceptance and utilization of foreign contribution or foreign hospitality for any activities detrimental to national interest and for matters connected therewith or incidental thereto.

 ACTS/RULES/GUIDELINES WHICH REGULATE THE FLOW OF FOREIGN CONTRIBUTION TO INDIA

 The flow of foreign contribution to India is regulated under Foreign Contribution (Regulation) Act, 2010, Foreign Contribution (Regulation) Rules, 2011 and other notification / orders etc., issued thereunder from time to time. These are available at the website fcra.online.nic.in.

 FCRA, 2010 applicability

As per Section 1(2) of FCRA, 2010, the provisions of the act shall apply to:

• i. Whole of India
• ii. Citizens of India outside India; and
• iii. Associate Branches or subsidiaries, outside India, of companies or bodies corporate, registered or incorporated in India

 OBTAINING PERMISSION TO ACCEPT FOREIGN CONTRIBUTION

 There are two modes of obtaining permission to accept foreign contribution according to FCRA, 2010:

• i. Registration
• ii. Prior Permission

 Eligibility

ELIGIBILITY CRITERIA FOR GRANT OF REGISTRATION

For grant of registration under FCRA, 2010, the association should:
• (i) be registered under an existing statute like the Societies Registration Act, 1860 or the Indian Trusts Act, 1882 or section 25 of the Companies Act, 1956 (Now Section 8 of Companies Act, 2013) etc;
• (ii) Normally be in existence for at least three years and has undertaken reasonable activity in its chosen field for the benefit of the society for which the foreign contribution is proposed to be utilised. For this purpose, the association should have spent at least Rs.10,00,000/- over the last three years on its aims and objects, excluding administrative expenditure. 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 ELIGIBILITY CRITERIA FOR GRANT OF PRIOR PERMISSION

An organization in formative stage is not eligible for registration. Such organization may apply for grant of prior permission under FCRA, 2010.Prior permission is granted for receipt of a specific amount from a specific donor for carrying out specific activities/projects. For this purpose, the association should meet following criteria:

• (i) be registered under an existing statute like the Societies Registration Act, 1860 or the Indian Trusts Act, 1882 or section 25 of the Companies Act, 1956 etc;
• (ii) submit a specific commitment letter from the donor indicating the amount of foreign contribution and the purpose for which it is proposed to be given; and
•  (iii)For Indian recipient organizations and foreign donor organizations having common members, FCRA Prior Permission shall be granted to the Indian recipient organizations subject to its satisfying the following:
•  i) The Chief Functionary of the recipient Indian organization should not be a part of the donor organization.
•  ii) At least 51% of the office-bearers/ members of the Governing body of the Indian recipient organization should not be members/employees of the foreign donor organization.
•  iii) In case of foreign donor organization being a single person/individual that person should not be the Chief Functionary of the recipient Indian organization.
•  iv) In case of a single foreign donor, at least 51% office bearers/members of the governing body of the recipient organization should not be the family members and close relatives of the donor

CONDITIONS TO BE MET FOR THE GRANT OF REGISTRATION AND PRIOR PERMISSION

In terms of Sec.12 (4) of FCRA, 2010, the following shall be the conditions for the grant of registration and prior permission:

(a) The 'person' making an application for registration or grant of prior permission-
• i. is not fictitious or benami;
• ii. has not been prosecuted or convicted for indulging in activities aimed at conversion through inducement or force, either directly or indirectly, from one religious faith to another;
• iii. has not been prosecuted or convicted for creating communal tension or disharmony in any specified district or any other part of the country;
• iv. has not been found guilty of diversion or mis-utilisation of its funds;
• v. is not engaged or likely to engage in propagation of sedition or advocate violent methods to achieve its ends;
• vi. is not likely to use the foreign contribution for personal gains or divert it for undesirable purposes;
• vii. has not contravened any of the provisions of this Act;
• viii. has not been prohibited from accepting foreign contribution;
• ix. the person being an individual, such individual has neither been convicted under any law for the time being in force nor any prosecution for any offence is pending against him.
• x. the person being other than an individual, any of its directors or office bearers has neither been convicted under any law for the time being in force nor any prosecution for any offence is pending against him.

(b) the acceptance of foreign contribution by the association/ person is not likely to affect prejudicially –
• i. the sovereignty and integrity of India;
• ii. the security, strategic, scientific or economic interest of the State;
• iii. the public interest;
• iv. freedom or fairness of election to any Legislature;
• v. friendly relation with any foreign State;
• vi. harmony between religious, racial, social, linguistic, regional groups, castes or communities.

(c) the acceptance of foreign contribution-
• i. shall not lead to incitement of an offence;
• ii. shall not endanger the life or physical safety of any person.