Lok Sabha passes Foreign Contribution (Amendment) Bill

Lok Sabha on Monday passed a bill to amend the Foreign Contribution (Regulation) Act to make furnishing of Aadhaar numbers of office-bearers of any NGO mandatory for registration and also affect other changes, with the government asserting that the proposed legislation is not against any religion.

Once the bill is cleared by the Rajya Sabha and gets assent from President Ram Nath Kovind, public servants will be barred from receiving funding from abroad.

Amid concerns raised by various Opposition members about The Foreign Contribution (Regulation) Amendment Bill, 2020, Minister of State for Home Nityanand Rai asserted that the bill is not against any religion or NGO.

The Bill proposes that not more than 20% of the total foreign funds received could be spent on administrative expenses. Presently, the limit is 50%.

Under the Act, certain persons are prohibited to accept any foreign contribution.  These include election candidates, editor or publisher of a newspaper, judges, government servants, members of any legislature, and political parties, among others. 

The Bill adds public servants (as defined under the Indian Penal Code) to this list.  Public servant includes any person who is in service or pay of the government or remunerated by the government for the performance of any public duty.

Under the Act, foreign contribution cannot be transferred to any other person unless such person is also registered to accept foreign contribution (or has obtained prior permission under the Act to obtain foreign contribution). 

The Bill amends this to prohibit the transfer of foreign contribution to any other person.  The term ‘person’ under the Act includes an individual, an association, or a registered company.

Under the Act, a registered person must accept foreign contribution only in a single branch of a scheduled bank specified by them.  However, they may open more accounts in other banks for the utilization of the contribution. 

The Bill amends this to state that foreign contribution must be received only in an account designated by the bank as “FCRA account” in such a branch of the State Bank of India, New Delhi, as notified by the central government. 

No funds other than the foreign contribution should be received or deposited in this account.  The person may open another FCRA account in any scheduled bank of their choice for keeping or utilizing the received contribution.