 "FCRA")
The Foreign Contribution (Regulation) Act, 2010 (FCRA) is making headlines again due to the cancellation of licences of several non-governmental organisations (NGOs). Among the affected are notable entities such as the CNI Synodical Board of Social Service, Voluntary Health Association of India, Indo-Global Social Service Society, Church Auxiliary for Social Action, and Evangelical Fellowship of India. This isn't a singular event; over the last two years, more than 100 NGOs, including prominent names like the Centre for Policy Research, Rajiv Gandhi Foundation, Rajiv Gandhi Charitable Trust, and Oxfam India, have seen their FCRA licences revoked on allegations of misusing foreign grants.
What necessitates an FCRA licence?
Harish Kumar, a partner at Luthra and Luthra Law Offices India, clarifies, "To accept foreign contribution/donation from a ‘foreign source’, obtaining prior permission or an FCRA registration licence from the Ministry of Home Affairs (MHA) is mandatory. Without this registration or prior permission, it's illegal to accept foreign contributions."
"It may be noted that an organisation can apply for prior permission- if it does not have FCRA registration but has commitment from a foreign source. The prior permission is for receipt of a specific amount from a specific donor for carrying out specific activities/projects and is valid for a period as mentioned in the prior permission. However, FCRA registration can be applied without having any commitment from a foreign source and is generally valid for a period of five years," he says.
Sanjay Jain, a senior advocate and former Assistant Solicitor General (ASG), elaborates on the purpose of FCRA licences, stating they are "granted to NGOs, societies, or charitable trusts that receive foreign funds as donations." The Act aims to regulate foreign contributions or donations and hospitality, preventing contributions that could harm the national interest. It creates a licensed regime to regulate and prohibit the acceptance and utilisation of foreign contributions or hospitality by various entities for activities deemed detrimental to the national interest.
But what leads to the cancellation of an FCRA licence?
Several reasons can trigger the cancellation of an FCRA licence, including non-compliance with the FCRA Act or its rules, misuse of foreign contributions, failure to submit required reports to the MHA, and involvement in activities against the national interest or security of India. An organisation may also lose its licence if it has not been operational for two consecutive years or has become defunct.
Lalit Kumar, a partner at JSA, says, "The government reserves the right to cancel registration if the foreign contribution is received in violation of the FCRA." He outlines various grounds for cancellation, including obtaining registration through false statements, violating certificate conditions, or misusing foreign contributions.
Sanjay Jain recalls the suspension of the Centre for Policy Research's licence in 2023, highlighting misuse of foreign contributions as a prime example of what leads to such drastic measures.
When does the FCRA approval get withdrawn?
The FCRA registration holds a validity of five years. Following this period, renewal is obligatory; failing to renew results in the withdrawal of approval. Additionally, FCRA registration can be suspended or cancelled under certain conditions previously mentioned.
How many FCRA licences have been issued and revoked in recent years?
"As of April 3, 2024, there are 16,242 NGOs operating with active FCRA licences. Conversely, the licences of 14,396 NGOs are deemed expired, and a further 20,701 NGOs have had their licences cancelled for a variety of reasons since 1976 (the year the Act was enacted)," says Sanjay Jain.
