Foreign Contribution (Regulation) Bill was introduced in Lok Sabha on 20 September and passed on 21 September, 2020. The Bill was also passed by Rajya Sabha on 23 September, 2020. The Bill amends the Foreign Contribution (Regulation) Act, 2010.
About FCRA
The FCRA regulates foreign donations and ensures that such contributions don't adversely affect internal security. In 1976, it was first enacted and was amended in 2010. That time a few measures were adopted to manage foreign donations.
On what FCRA is applicable?
It is applicable to all or any associations, groups, and NGOs which intend to receive foreign donations. It's mandatory for all such NGOs to register themselves under the FCRA. Initially, the registration is valid for five years and it is often renewed subsequently.
What are the provisions of the Bill?
1. Prohibition to accept foreign contribution
Under this Act, certain persons are prohibited to simply accept any foreign contribution including election candidates, editor or publisher of a newspaper, judges, government servants, members of anyu legislature, and political parties, among others to the present list, the bill adds public servants.
Public servants include any person who is in service or pay of the government or remunerated by the government for the performance of any public duty.
2. Transfer of foreign contribution
Under this Act, foreign contributions can't be transferred to any other person unless such person is additionally registered to simply accept foreign contributions. The Bill also amended to prohibit the transfer of foreign contributions to the other person. Under the Act, the term 'person' includes an individual, an association, or a registered company.
3. Aadhar for registration `
Any person seeking permission, registration, or renewal of registration must provide the Aadhaar number of all its office bearers.
In the case of a foreigner, they ought to provide a copy of the passport or the Overseas Citizen of India card for identification.
4. FCRA Account
Under the Act, a registered person must accept foreign contribution only during a single branch of a scheduled bank specified by them. For the utilization of the contribution, they'll open more accounts in other banks.
The amendment of the bill states that the foreign contribution must be received only in an account designated by the bank as "FCRA account" in such a branch of the State Bank of India, New Delhi, as notified by the central government.
In this account, no funds other than the foreign contribution should be received or deposited.
The person can also open another FCRA Account in any scheduled bank of their choice for keeping or utilizing the received contribution.
5. Administrative expenses
For administrative expenses, the bill reduces the utilisation of funds from 50% to 20%.
6. Renewal of License
Any person, under this Act, got the certificate of registration must renew it within six months of expiration.
Also, before renewing the certificate, the bill provides that the government may conduct an inquiry to ensure that the person generating the application:
- is not fictitious or Benami
- has not been prosecuted or convicted for creating communal tension or indulging in activities aimed at religious conversion
- has not found guilty of diversion or misutilisation of funds, among other conditions.
7. Surrender of certificate
There is a provision added within the bill that permits the central government to allow an individual to surrender their registration certificate.
The government may do so if, post an inquiry, it's satisfied that such person has not contravened any provisions of the Act, and therefore the management of its foreign contribution (and related assets) has been vested in an authority prescribed by the government.
8. Suspension of Registration
Under the Act, the government may suspend the registration of an individual for a period not exceeding 180 days.
The Bill also adds that such suspension could also be extended up to an additional 180 days.
Concerns raised and Issues involved are:
NCP MP Supriya Sule's raised the question that why did the government want to limit the administrative expenses to 20%. Over the government's proposal, the Opposition also raised concerns about to make Aadhar a mandatory identification document for all office-bearers. Also, the Supreme Court said that Aadhar Card is not compulsory then why should you make Aadhar card compulsory?
It is also said that FCRA Amendment 2020 will undermine the work of the Civil Society.
It will 'undermine the work of civil society'.
The bill would impact the livelihoods of workers that are associated with the small Non-Government Organisation (NGOs). It may lead to the killing of the whole social sector as administrative expenses would make it impossible for even the larger NGOs to perform.
It also can impact the collaborative research. With international law, it's also incompatible.
Therefore we can say that the bill "brings in transparency" and also stop the misuse of foreign contributions by people but the proposed amendments will increase the cost of doing business for India's non-profits and should make them further susceptible to harassment.
We also can't ignore that at the grassroots level, the NGOs are helpful in implementing government schemes. They fill the gaps where the government fails to do their jobs.
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