Modified FCRA rules: NGOs to give details of assets created from foreign funds

The MHA also extended the validity of FCRA licence of those entities, whose licences were expiring on September 30 and renewal was pending, till March 31, 2024.

The Union ministry of home affairs (MHA) on Monday modified rules pertaining to filing of annual returns by non-government organisations (NGOS) registered under the Foreign Contribution Regulation Act (FCRA), asking them to provide details of moveable and immovable assets created by them using foreign funds every year.

FCRA licences of over 6,600 NGOs have been cancelled in the last five years for violation of the law (HT Archive)

The ministry made the change in the foreign contribution regulation rules, 2011, by inserting two clauses - (ba) details of movable assets created out of foreign contribution (as on March 31 of financial year) and (bb) details of immovable assets created out of foreign contribution (as on March 31 of financial year) - in the Form FC-4.

Form FC-4 is filled by NGOs/associations granted FCRA licences for filing their annual returns.

The ministry, on Monday, also decided to extend the validity of FCRA licence of those entities, whose licences were expiring on September 30 and renewal was pending, till March 31, 2024.

According to data seen by HT, MHA carried out inspections or audits of 335 NGOs and associations registered or granted prior permission under FCRA between 2019 and 2022 to see if foreign funding rules were being followed by them. The government has tightened FCRA compliance by making NGOs accountable for receiving and using foreign funds. MHA data shows that NGOs have received foreign funding amounting to ₹55,449 crore in last three years.

There were 16,301 NGOs in the country with a valid FCRA licence as on July 17 this year and FCRA licences of over 6,600 NGOs have been cancelled in the last five years for violation of the law. Overall, FCRA licences of 20,693 NGOs have been cancelled till date.

The FCRA Act, which was amended in September 2020, barred public servants from receiving foreign funding and made Aadhaar mandatory for every office-bearer of the NGOs. The new law also says that organisations receiving foreign funds will not be able to use more than 20% of such funds for administrative purposes. This limit was hitherto 50%.

Organisations which may not be directly linked to a political party but engage in political action such as a bandhs, hartal (strike) or rasta roko (road blockade) will be considered to be of political nature, according to new FCRA rules. The organisations covered under this category include farmers’ organisations, students or workers’ organisations and caste-based organisations.