The Central Government has tightened rules under the Foreign Contribution (Regulation) Act, 2010, requiring NGOs receiving foreign funds to make wider disclosures about their social media accounts, operational areas, activities, key functionaries and use of foreign contributions. The changes, notified by the Ministry of Home Affairs, are aimed at strengthening scrutiny over foreign funding and its utilisation.
Wider Disclosures for Registration and Renewal
Under the revised framework, organisations seeking FCRA registration must specify the purposes for which they intend to receive foreign contributions and identify the states or Union Territories where they plan to operate. Applicants will have to choose their objectives from a predefined government list covering religious, social, educational, economic and cultural activities.
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NGOs applying for registration or renewal will also be required to provide details of their social media accounts. In addition, organisations must submit a detailed activity report along with their annual returns, expanding the reporting requirement beyond financial statements.
The amended rules also broaden the definition of “key functionary” to include company directors, partners in firms, trustees, the karta of a Hindu Undivided Family and any person exercising control over the management of an organisation.
Foreign Nationals and Religious Activities Under Lens
The government has introduced stricter norms for organisations with foreign nationals in leadership positions. Associations where foreign nationals, except persons of Indian origin, are key functionaries will ordinarily not be considered for FCRA registration or prior permission to receive foreign contributions. Exceptions may be granted by the government through separate orders.
New provisions have also been introduced for organisations engaged in religious activities. Activities such as religious education, preservation of faith traditions and documentation of indigenous or tribal belief systems remain permissible.
However, the revised rules explicitly exclude proselytisation from several categories eligible for registration under the Act. The changes place greater emphasis on the declared nature and scope of activities carried out with foreign contributions.
Spending Thresholds and Penalties Revised
The amended framework also tightens compliance norms for organisations that remain inactive despite holding FCRA registration. NGOs must have spent at least ₹10 lakh of foreign contributions on declared activities during the previous two financial years to qualify for renewal or continuation of registration.
For organisations receiving funds through the prior permission route, subsequent instalments will depend on the utilisation of at least 75 per cent of the previous instalment. Authorities may conduct field inquiries to verify fund use before allowing further disbursements.
The rules also require disclosure of the ultimate source of funds when contributions are routed through intermediary remittance mechanisms or donor-advised funds. Penalties have been revised for violations such as spending beyond administrative expense limits, speculative investment of funds or use of contributions for purposes other than those approved. Such violations may attract penalties of ₹1 lakh or a prescribed percentage of the amount involved, whichever is higher.
