FCRA Rules 2020

Along with the other substantiative changes in FCRA regulations, the government has also announced revised FCRA rules in the year 2020. Key changes in the rules are detailed below for your perusal.

  • Registration rules amended to ensure that an entity seeking registration must have at least :
    • 3 years of existence
    • a minimum of Rs 15 lakhs spent on core activities
    • Existing capital investment if included in computation of spending, will not be allowed to be used for any other purpose till the time the registration is valid
  • Persons seeking prior permission must have the following documents and compliances in order before they can be granted permission:
    • A letter from donor indicating amount of foreign contribution and purpose
  • In case of common members between donor and recipient :
    • chief functionary of the recipeint entity cannot be part of the donor body
    • further, a minimum of 75% of office bearers/members of the recipient cannot be individuals who are also members of the donor body
    • If the donor is an individual
    • he/she cannot be also a functionary or an office bearer of the recipeint
    • further, at least 75% of members /officials of recipeint shall have to be individuals who are not family members or close relatives of the donor
  • If prior permission is received for funds exceeding 1crore rupees, the government may permit receipt in installments, this is with the caveat that additional installments may be allowed only after 75% of the earlier installment have been expended. This may be subject to regulatory review and clearance.
  • Applications for renewal of existing registrations can be made only after new FCRA account has been opened
  • No utilization of existing FCRA funds lying with the entity until the renewal is completed