The Foreign Contribution (Regulation) Act (FCRA) is an Act of the Indian Parliament that regulates the acceptance and utilisation of foreign contributions and foreign hospitality by individuals, associations, and companies. Its primary objective is to ensure that foreign funds do not adversely affect India's sovereignty, democratic institutions, or public interest.
The Act traces its origin to the Foreign Contribution (Regulation) Act, 1976, which was enacted during the emergency period due to concerns about foreign meddling in India's domestic affairs. The 1976 Act was repealed and replaced by the comprehensive Foreign Contribution (Regulation) Act, 2010, to consolidate the law and impose stronger controls.
The mechanism requires any person with a definite cultural, economic, educational, religious, or social programme to obtain a Certificate of Registration or Prior Permission from the Central Government (Ministry of Home Affairs) before accepting foreign contributions. Section 3 of the Act explicitly prohibits certain individuals, such as election candidates, public servants, and members of the legislature, from accepting foreign contributions.
The FCRA, 2010, was significantly amended by the Foreign Contribution (Regulation) Amendment Act, 2020. The 2020 Amendment introduced major changes, including a prohibition on the transfer of foreign contributions from one registered organisation to another, effectively ending sub-granting. It also mandated that foreign contributions must be received only in a designated "FCRA account" at the State Bank of India, New Delhi Main Branch. Furthermore, the limit on using foreign contribution for administrative expenses was reduced from 50% to 20%. The core requirement of registration and the objective of safeguarding national interest remained the same.