FCRA Registration, Eligibility and Modes of Permission to accept Foreign Contribution [CS Vinit Nagar]



With the increasing global awareness, people are nowadays making contributions around the world for addressing various social, economic and environmental issues  for upliftment of the society and communities, especially in the developing and underdeveloped countries. Such contributions are not limited to one’s region or city  or state or country. Organizations like Bill & Melinda Gates Foundation, Clinton Health Access Initiative, Care International, FHI 360 are taking active part in society upliftment by donating funds to various Trusts, Section 8 Companies in various countries, including India. Considering the funds coming in such huge sums, it becomes very difficult to track its inward and outflows and to keep an eye on its utilizations. This gap is filled by the Foreign Contribution (Regulation) Act, 2010 and rules frames thereunder.

Purpose of FCRA:

The FCRA was enacted to regulate the acceptance and utilization of foreign contribution or foreign hospitality by certain trusts or associations or companies and to prohibit acceptance and application of such contribution towards any activities detrimental and inimical to national interest and for matters allied therewith or incidental thereto.

Eligibility for receiving Foreign Contribution:

Any Person (i.e., an individual, HUF, an association, Trusts or a Section 8 Company) can receive foreign contribution subject to the following conditions:

  • It must have a definite cultural, economic, educational, religious or social programme.

  • It must obtain the FCRA registration/prior permission from the Central Government

  • It must not be prohibited under Section 3 of FCRA,2010.

  • *FCRA Account to be opened with State Bank of India (SBI) New Delhi, Main Branch.

*The SBI have clarified with their notice dated June 11, 2021 that, the entities are not required to visit Delhi and instead they can visit any branch of their choice near to them for opening of FCRA account.

Modes of permission to accept Foreign Contribution:

Normal Registration: For making application under Normal Registration:
  1. Entity must be registered under an existing statue such as Registration Act, 1860 or the Indian Trusts Act, 1882 or section 8 of the Companies Act, 2013.

  2. Must have spent atleast Rs. 15,00,000/- over the period of last 3 financial years towards main objective.

  3. Should be in existence for atleast 3

Validity of FCRA Normal Registration shall be for 5 years from the date of approval.

Prior Permission: The newly registered entities can apply for registration under the Prior Permission:
  1. Entity must be registered under an existing statue such as Registration Act, 1860 or the Indian Trusts Act, 1882 or section 8 of the Companies Act, 2013.

  2. Prior permission is granted for receipt of a specific amount from specific donor/donors for carrying out specific activities/projects.

Validity of FCRA Prior Permission shall be for 5 years from the date of approval.

Payment of Fee:

For Normal registration, the entities are required to pay Rs. 10,000/- and for prior permission fees is Rs. 5,000/-. For renewal, the Fee is Rs. 5,000/- only.

Time Period for approval:

Time period for approval is 3 months from the date of application.

Lex comply

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