For acquiring contributions or grants from foreign sources, the FCRA registration is inevitably essential. Every sovereign country recommends FCRA registration with the concerned governmental department or authority, to facilitate the receipt of foreign funds and contributions by private societies, trusts, institutions, associations, and NGOs established in any part of the country. The main and ultimate objectives of the FCRA registration are to legalize the receiving of foreign funds by any domestic agency or entity, and to ensure that the received funds are being utilized properly and strictly for the specified purposes. In India, FCRA registration is made under the Foreign Contribution (Regulation) Act, 1976. The FCRA registration in India is provided for two main categories of necessities — for receiving one-time grant from any one specified foreign source, and the other is, for obtaining frequent contributions or funds from many different foreign sources.

We help you register the Non-Governmental and Non Profitable organization under section 6 of Foreign Contribution Regulation Act in India.

Documents Required for FCRA Registration

• Copy of PAN of the Society/Trust
• Audited Balance Sheet, Profit& Loss Account or Income& Expenditure Account for the latest year and all preceding years
• Copies Annual Report specifying activities of the association or institution during since its inception.
• Certified copy of formation documents like trust deed, rules & regulation, memorandum of association etc. and registration certificate, if any
• Copy of resolution of Governing Body of the organization, authorizing the registration under FCRA.
• If the association has received any foreign contribution with or without the prior approval of the Central Government, then the detail should be given.
• If the association or institution is notified under section10(23)(C) or is approved for the purposes of section 80Gthe particulars of such approval granted
• Bank Details (Bank Name, Account No. and Bank Address)
• List of governing body (Name, Father’s Name, Occupation, Designation and Address)
• Name of the Chief functionary and his Mobile Number
• Telephone Number of the office
• If the association is having any parent or sister or subsidiary organization, which is registered under the FCRA then the registration number along with Ministry of Home Affairs file number should be mentioned.
• If the association has submitted any application earlier then its reference number should be mentioned.
• Copy of any Journal or other publication of the organization.
• Undertaking letter from the chief functionary of organization.
• Such other information as the association or institution may like to place
• Additional documents required for Prior Permission Registration Under FCRA
• Details of the beneficiaries and details of the project for which foreign contribution is expected. The detail should include narrative as well as financial details.
• Letter of commitment from the foreign donor agreeing in principle to provide funds.

How we can help you

We help your FCRA Registration and maintain FCRA Act regulation compliance including the following

• Verify whether the associations are eligible to receive foreign contribution
• Guide the applicant organization in submission of application for registration / prior permission
• Guide the applicant organization in submission of application for renewal of registration
• Assist in the proper maintenance of prescribed books of accounts in accordance with the provisions of FCRA, 2010 and FCRR, 2011
• Ensure that the returns of an association have been prepared in accordance with the provisions of FC(R) Act, 2010 and FCRR, 2011.

POINTS TO NOTE

Requirements for Registration under FCRA

Under Section 6 of Foreign Contribution Regulation Act, it is provided that any organization having a definite cultural / social/ educational/ religious/ economic object shall only accept foreign contribution after obtaining Foreign Contribution Regulation Act Registration

What is foreign contribution?

Foreign contribution has been defined in Section 2(1)(h) of FCRA, 2010. However, foreign contribution excludes earnings from foreign client(s) by an association in lieu of goods sold or services rendered by it as this is a transaction of commercial nature.

Types of FCRA registration

Two ways of registration under FCRA

Regular registration (Apply inform F.C 3)

• Under this registration, there is no restriction (either the total amount or from specific donor) for receiving Foreign Contribution.
• Regular registration certificate for 5 years under this registration, there is no restriction either on the total amount or from specific donor for receiving foreign contribution.
• After five years, FCRA certificate must be renewed. This rule will be implemented from the year 2015. However, in both the cases it is compulsory to file annual return.

Prior permission registration (Apply in Form F.C 4) – Registration

• Under this registration, the permission is granted for a specific amount from a specific donor. A letter of intent from the donor to donate the amount must be enclosed along with the application form (Form F.C 1A).
• Prior permission certificate which is possible after one year under this registration, the permission is granted for a specific amount from a specific donor. A letter of intent from the donor to donate the amount must been closed along with the application form.

Conditions for grant of registration

The association should:

• be registered under the Societies Registration Act, 1860 or the Indian Trusts Act, 1882 or section 25 of the Companies Act, 1956;
• normally be in existence for at least three years and has undertaken reasonable activity in its chosen field for the benefit of the society for which the foreign contribution is proposed to be utilized. For this purpose, the association should have spent at least Rs. 6,00,000 over last three years on its activities, excluding administrative expenditure. Statement of Income & Expenditure duly audited by Chartered Accountant for last three years may be enclosed to substantiate that it meets the financial parameter.
• The person making an application for registration or grant of prior permission under subsection(1),Sec. 12 (4) (a)(1) is not fictitious or benami;
• has not been prosecuted or convicted for indulging in activities aimed at conversion through inducement or force, either directly or indirectly, from one religious faith to another;
• has not been prosecuted or convicted for creating communal tension or disharmony in any specified district or any other part of the country;
• has not been found guilty of diversion or mis-utilisation of its funds;
• is not engaged or likely to engage in propagation of sedition or advocate violent methods to achieve its ends;
• is not likely to use the foreign contribution for personal gains or divert it for undesirable purposes;
• has not contravened any of the provisions of this Act;
• has not been prohibited from accepting foreign contribution; (9) the person and/or any of its directors or office bearers has neither been convicted under any law for the time being in force nor any prosecution for any offence is pending against him.
• the acceptance of foreign contribution by the association/ person is not likely to affect pre judicially –
• the sovereignty and integrity of India; or
• the security, strategic, scientific or economic interest of the State; or
• the public interest; or
• freedom or fairness of election to any Legislature; or
• friendly relation with any foreign State; or
• harmony between religious, racial, social, linguistic, regional groups, castes or communities.
• the acceptance of foreign contribution
• shall not lead to incitement of an offence;
• shall not endanger the life or physical safety of any person.

Who cannot accept foreign contribution

As defined in Section 3(1) of FCRA, 2010, foreign contribution cannot be accepted by any

• a candidate for election;
• Correspondent, columnist, cartoonist, editor, owner, printer or publisher of a registered newspaper;
• Judge, government servant or employee of any Corporation or any other body controlled on owned by the Government;
• Member of any legislature;
• Political party or office bearer thereof;
• Organization of a political nature as may be specified under Section 5(1) by the Central Government.
• Association or company engaged in the production or broadcast of audio news or audio visuals or current affairs programs through any electronic mode, or any other electronic form as defined in clause (r) of subsection (i) of Section 2 of the Information Technology Act, 2000 or any other mode of mass communication;
• Correspondent or communist, cartoonist, editor, owner of the association or company referred to in clause (g).
• Individuals or associations who have been prohibited from receiving foreign contribution.

Prior permission is required when

• The organization does not have permanent FCRA registration number Or FCRA registration number has been cancelled by the Government.
• The association is instructed by the Central Government to take prior permission under the provisions of Section 10 where powers have been provided to prohibit any organization from receiving foreign funds.
• The FCRA number is suspended due to violation of the provisions and conditions specified under the FCRA.
• The organization is of political nature, not being a political party.
• Any person residing in India or any citizen of India residing outside India, receiving foreign funds on behalf of an organization of political nature.

Eligibility criteria for grant of prior permission

An Organization in formative stage is not eligible for registration. Such Organization may apply for grant of prior permission under the law. Prior permission is granted for receipt of specific amount from specific donor for carrying out specific activities/projects. For this purpose, the association should:

• be registered under the Societies Registration Act, 1860 or the Indian Trusts Act, 1882 or section 25 of the Companies Act, 1956;
• Submit a specific commitment letter from the donor; and
• Submit copy of a reasonable project for the benefit of the society for which the foreign contribution is proposed to be utilised.
• Should meet all the conditions for the grant of registration.

Accounting method for foreign contribution received in kind

As per rule 8(1)(a), account has to be maintained for foreign contribution received in kind. Form FC-6 provides the format for recording the receipt as well as the utilisation of contributions received in kind. The entries made in FC-6 should correspond with entries made in Form FC-3.

Can foreign contribution be mixed with local receipts?

No. Foreign contribution cannot be deposited or utilized from the bank account being used for domestic funds.

If an application for registration or prior permission is submitted online by an association, does it need to submit that application in physical form also?

Yes. When an application is filed online, a printout of the same may be taken after submission and thereafter, it should be submitted, duly signed, along with the requisite documents to the Ministry of Home Affairs. The prescribed forms for submission of application for grant of Registration and Prior Permission are FC3 and FC4 respectively.