Govt Tightens Rules for NGOs Intending to Receive Funds from Abroad

The NGOs that intend to receive foreign funding will now face tougher rules with the Union Home Ministry making it clear that such organisations must have existed for at least three years and spent Rs 15 lakh in voluntary activities to be eligible to receive money from abroad. In a notification, the home ministry also said office bearers of the NGOs seeking registration under the Foreign Contribution (Regulation) Act must 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.

The FCRA rules were issued about two months after the central government had amended the law under which providing Aadhaar numbers of the office bearers of the NGOs was made mandatory, office expenses were brought down to 20 percent of such amount and election candidates, government servants, members of any legislature and political parties were prohibited from accepting foreign funding. A person seeking registration under clause (b) of sub-section (4) of section 12 of the Act shall meet the following conditions, namely: (i) it shall be in existence for three years and have spent a minimum amount of rupees fifteen lakh on its core activities for the benefit of society during the last three financial years, the notification said.

According to the rules, any NGO or person making an application for obtaining prior permission to receive foreign funds shall have an FCRA Account. The home ministry said “a person seeking prior permission for receipt of a specific amount from a specific donor for carrying out specific activities or projects shall meet certain criteria that include submission of a specific commitment letter from the donor indicating the amount of foreign contribution and the purpose for which it is proposed to be given”.

For the Indian recipient persons and foreign donor organisations having common members, prior permission shall be granted to the Indian person/entity if it satisfies the conditions that the chief functionary of the recipient shall not be a part of the donor organisation, and 75 per cent of the office-bearers or members of the governing body of the recipient shall not be members or employees of the foreign donor organisation. In case of foreign donor organisation being a single individual, that individual shall not be the chief functionary or office bearer of the recipient group and in case of a single foreign donor, 75 per cent of the office bearers or members of the governing body of the recipient shall not be the family members or close relatives of the donor, the home ministry said.

Over Rs 58,000 crore foreign funds were received by NGOs registered under the FCRA between 2016-17 and 2018-19. There are around 22,400 NGOs in the country.

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