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The Tax Publishers FCRA--Amendment Act, 2020 FCRA Amendment Act, 2020: An Endeavor to Reinforce Foreign Contribution Provisions OR a Hurdle for NGOs CA. Hridayesh Vyas Foreign Contribution Regulation Amendment Act, 2020 (FCRA Amendment Act, 2020) received Presidents assent on September 28, 2020 and is effective from September 29, 2020. The main object of the FCRA Amendment Act, 2020, is to prohibit utilisation of foreign contribution in activities which are against national interest. Far sweeping changes have been made by this Amendment Act, some of which are discussed in this write up. Foreign contribution in India is regulated and monitored by Indian Government under provisions of the Foreign Contribution Regulation Act, 2010 (FCRA, 2010). This act provides the manner in which foreign contribution or foreign hospitality are permitted to be accepted and utilised by individuals, associations and companies in India. In order to prevent misuse of funds, strengthen national security and enhance transparency and accountability in hands of recipient of the foreign contribution, Government found it necessary to amend FCRA Act 2010. Thereafter, Government of India, introduced Foreign Contribution (Regulation) Amendment Bill, 2020 that ('FCRA Bill') which received assent of the Rajya Sabha on September 21, 2020 and of the Lok Sabha on September 23, 2020 raising concerns amongst the non-government organisations (NGOs) receiving foreign contribution in India. This FCRA Bill thereafter received the assent of the Presidents on September 28, 2020 notifying the effectiveness of the Foreign Contribution Regulation Amendment Act, 2020 (FCRA Amendment Act, 2020) from September 29, 2020. The main object of the FCRA Bill, 2020, is to prohibit utilisation of foreign contribution towards activities against national interest. Radical changes have been made pursuant to the FCRA Amendment Act, 2020, which are mentioned below -- 1. Provisions related to restriction on public servants to accept foreign contribution: Under FCRA ACT, 2010 As per section 3(1)(c) of FCRA Act, 2010, there is restriction on acceptance of foreign contribution from following persons, (a) Judge (b) Government servant or employee of any corporation or any other body controlled or owned by the Government. *Amended provisions as per FCRA Amendment Act, 2020* FCRA Amendment Act, 2020 is amended to include public servants (as defined under Section 21 of the Indian Penal Code) in exclusion list for acceptance of foreign contribution. Therefore, by virtue of the amendment to Section 3(1)(c), public servants have also been prohibited from accepting foreign contribution 2. Provisions related to restriction on transfer of foreign contributions: *Under FCRA ACT, 2010* SUBSCRIBE FOR FULL CONTENT

The Tax Publishers

FCRA--Amendment Act, 2020

FCRA Amendment Act, 2020: An Endeavor to Reinforce Foreign Contribution Provisions OR a Hurdle for NGOs

CA. Hridayesh Vyas

Foreign Contribution Regulation Amendment Act, 2020 (FCRA Amendment Act, 2020) received Presidents assent on September 28, 2020 and is effective from September 29, 2020. The main object of the FCRA Amendment Act, 2020, is to prohibit utilisation of foreign contribution in activities which are against national interest. Far sweeping changes have been made by this Amendment Act, some of which are discussed in this write up.

Foreign contribution in India is regulated and monitored by Indian Government under provisions of the Foreign Contribution Regulation Act, 2010 (FCRA, 2010). This act provides the manner in which foreign contribution or foreign hospitality are permitted to be accepted and utilised by individuals, associations and companies in India. In order to prevent misuse of funds, strengthen national security and enhance transparency and accountability in hands of recipient of the foreign contribution, Government found it necessary to amend FCRA Act 2010.

Thereafter, Government of India, introduced Foreign Contribution (Regulation) Amendment Bill, 2020 that ('FCRA Bill') which received assent of the Rajya Sabha on September 21, 2020 and of the Lok Sabha on September 23, 2020 raising concerns amongst the non-government organisations (NGOs) receiving foreign contribution in India. This FCRA Bill thereafter received the assent of the Presidents on September 28, 2020 notifying the effectiveness of the Foreign Contribution Regulation Amendment Act, 2020 (FCRA Amendment Act, 2020) from September 29, 2020. The main object of the FCRA Bill, 2020, is to prohibit utilisation of foreign contribution towards activities against national interest.

Radical changes have been made pursuant to the FCRA Amendment Act, 2020, which are mentioned below --

1. Provisions related to restriction on public servants to accept foreign contribution:

Under FCRA ACT, 2010

As per section 3(1)(c) of FCRA Act, 2010, there is restriction on acceptance of foreign contribution from following persons,

(a) Judge

(b) Government servant or employee of any corporation or any other body controlled or owned by the Government.

Amended provisions as per FCRA Amendment Act, 2020

FCRA Amendment Act, 2020 is amended to include public servants (as defined under Section 21 of the Indian Penal Code) in exclusion list for acceptance of foreign contribution. Therefore, by virtue of the amendment to Section 3(1)(c), public servants have also been prohibited from accepting foreign contribution

2. Provisions related to restriction on transfer of foreign contributions:

Under FCRA ACT, 2010