Why in News?
The Foreign Contribution (Regulation) Amendment Bill, 2026 has been referred to a 31-member Joint Parliamentary Committee (JPC) for detailed examination. The move came amid strong Opposition protests and concerns over the Bill's possible impact on NGOs, charitable organisations and other entities receiving foreign contributions.
Background
- The Foreign Contribution (Regulation) Act, 2010 (FCRA) regulates the receipt and use of foreign contributions by individuals, associations and organisations in India. Entities seeking to receive foreign contributions are required to obtain an FCRA registration certificate or prior permission from the Central Government.
- The FCRA framework is intended to regulate foreign funding and prevent its use for activities considered detrimental to the national interest.
- The FCRA Amendment Bill, 2026 was introduced in the Lok Sabha on March 25, 2026. It mainly seeks to create a framework for the management, supervision and disposal of foreign contributions and assets when an organisation's FCRA registration ceases.
Key Provisions of the Bill
- Creation of a Designated Authority: The Bill proposes the creation of a Designated Authority appointed by the Central Government. The Authority would take over, supervise and manage foreign contributions and assets of an organisation whose FCRA certificate has ceased. The certificate may cease if it is cancelled, surrendered, not renewed before expiry, or if renewal is denied.
- Vesting of Assets: Under the proposed framework, foreign contributions and assets created from such contributions would vest with the Designated Authority when an organisation's FCRA certificate ceases. The Bill also covers assets created partly through foreign contributions.
- Temporary and Permanent Vesting: The vesting of assets would initially be provisional. If the organisation obtains a fresh certificate, renews or restores its registration, the unutilised foreign contribution and eligible assets would be returned. If the organisation fails to obtain or restore its FCRA registration within the prescribed period, the vesting may become permanent.
- Use of Permanently Vested Assets: Assets permanently vested with the Designated Authority would be used for public purposes. They may be transferred to Central or State Government ministries, departments or agencies.
- Protection of Religious Character: If a permanently vested asset is wholly or partly a place of worship, the Designated Authority would have to ensure that its religious character is maintained while making arrangements for its management.
- Conditions for Prior Permission: Organisations that do not hold FCRA registration must obtain prior permission from the Central Government before receiving foreign contributions. The Bill proposes that such contributions must be received and utilised within the prescribed period.
- Key Functionaries: The Bill introduces the concept of “key functionaries” who may be held responsible for violations committed by an organisation. These may include directors of companies, partners of firms, trustees, office bearers and members of governing or managing bodies, among others. A key functionary would be presumed responsible for an offence unless they establish that the offence occurred without their knowledge or despite due diligence.
- Reduction in Maximum Imprisonment: The Bill proposes to reduce the maximum imprisonment for violation of the FCRA from five years to one year. It also proposes that prior approval of the Central Government would be required before initiating an investigation for an offence under the Act.
Key Concerns and Issues
- Non-Renewal Could Lead to Asset Vesting: One of the major concerns is that an organisation could lose assets created through foreign contributions if its FCRA certificate is not renewed.
- Difficulty in Exiting the FCRA Framework: The proposed provisions could make it difficult for organisations to completely exit the FCRA framework while retaining assets created through foreign contributions. An organisation that no longer depends on foreign funding may still need to maintain its FCRA registration to retain such assets.
- Assets Created Through Mixed Funding: The Bill provides that an asset created partly through foreign contribution could also come under the vesting provisions.
- Lack of Appeal Mechanism: The Bill has also raised concerns regarding the absence of a specific appeal mechanism against non-renewal of an FCRA certificate. While the existing framework provides avenues of appeal in certain cases involving cancellation of registration, the Bill does not provide a similar mechanism when renewal is denied.
Concerns Raised by the Opposition
- Opposition parties have criticised the proposed amendments and expressed concerns about their possible impact on NGOs, minority organisations and charitable institutions.
- The government has rejected these allegations and argued that referring the Bill to a JPC would allow all provisions to be examined in detail and provide an opportunity for stakeholders to raise their concerns.
FCRA in Numbers
- 14,449 - Active FCRA registrations as of July 15, 2026.
- 22,498 - Registrations cancelled.
- 15,212 - Registrations that had expired.
- ₹55,741 crore - Foreign contributions received by FCRA-registered organisations between 2019 and 2022, according to the Ministry of Home Affairs.
