Lok Sabha passes The Foreign Contribution (Regulation) Amendment Bill, 2020. A Bill to amend the Foreign Contribution (Regulation) Act, 2010, proposes to include “public servants” and “corporations owned or controlled by the government” among the list of entities who are not eligible to receive funds from abroad.

The Act regulates the acceptance and utilisation of foreign contribution by individuals, associations and companies. Foreign contribution is the donation or transfer of any currency, security or article (of beyond a specified value) by a foreign source.

Under the Act, certain persons are prohibited to accept any foreign contribution.  These include: election candidates, editor or publisher of a newspaper, judges, government servants, members of any legislature, and political parties, among others.  The Bill adds public servants (as defined under the Indian Penal Code) to this list.  Public servant includes any person who is in service or pay of the government or remunerated by the government for the performance of any public duty.


This means any person who makes an application for prior permission, seeks registration under the FCRA, or wants to renew their FCRA licence, would first have to mandatorily furnish the Aadhar numbers of all office bearers, directors or other key functionaries.

The Foreign Contribution Regulation (Amendment) Bill 2020, which was introduced in the Lok Sabha during Sunday’s session, also proposes to enable the Centre to allow an NGO or association to surrender its FCRA certificate. Besides this, the draft bill proposes to decrease administrative expenses through foreign funds by an organization to 20% from the current 50%.

The bill, if passed, will empower the government to ask a violator to not use the funds by holding a “summary inquiry”. Earlier, it was done only after the person or association has been “found guilty” of violation of the Act. Amendment of Section 17 of the Act has sought to provide that every person who 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 in such branch of the of the SBI at New Delhi, as the Central Government may, by notification, specify.

The Act states that a person may accept foreign contribution if they have: (i) obtained a certificate of registration from central government, or (ii) not registered, but obtained prior permission from the government to accept foreign contribution. Any person seeking registration (or renewal of such registration) or prior permission for receiving foreign contribution must make an application to the central government in the prescribed manner. The Bill adds that any person seeking prior permission, registration or renewal of registration must provide the Aadhaar number of all its office bearers, directors or key functionaries, as an identification document. In case of a foreigner, they must provide a copy of the passport or the Overseas Citizen of India card for identification.




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