Foreign Contribution Regulation Act: An Overview
The Foreign Contribution Regulation Act (FCRA) is one of the most difficult laws for a new business person to understand and comply with. The fact is, complying with this law can be complex and challenging for even seasoned executives. That’s why we have information on how to register your company under the act in India available here at Zolvit.
Foreign Contribution Regulation Act: Objective
The Foreign Contribution Regulation Act of 2010 was passed in order to:
- Regulate the acceptance and use of foreign contributions or foreign hospitality by specific individuals or organisations.
- Forbid the use of foreign hospitality or foreign contributions for acts that are detrimental to national interests, as well as matters linked to or incidental to those activities.
Eligibility for Registration under the Foreign Contribution Regulation Act
|If a newly registered entity wishes to receive foreign donations, the Ministry of Home Affairs can grant approval for a specific activity, purpose, and source using the Prior Permission (PP) mechanism.|
Those seeking foreign contributions for cultural, social, economic, educational, or religious programmes may register with the FCRA or receive foreign contributions under the prior approval route. Registration is quite easy, but there are some requirements, which are as follows:
- An FCRA applicant should preferably be a Trust, Society, or Section 8 Company.
- The not-for-profit entity must also have been in operation for at least three years before filing the FCRA application.
- It must not have accepted any foreign contributions prior to that without the approval of the government.
- Furthermore, the entity seeking registration must have spent at least Rs.10,000/- on its aims and objectives in the previous three years, excluding administrative expenses.
- Statements of Income and Expenditure for the last three years, thoroughly audited by a Chartered Accountant, must be submitted to demonstrate that it fulfils the financial requirements.
Procedure for Online Registration under the FCRA
The following are the steps to apply for FCRA registration:
- The first step entails choosing whether Form FC – 3A (Application for FCRA Registration) or Form FC – 3B (Application for FCRA Prior Permission) must be selected.
|The professionals at Zolvit can help you determine which of the registration forms is most apt for you. All you need to do is get in touch with our experts for a free consultation!|
- The webpage will then provide the visitor with the option to apply online.
- After selecting Apply Online, the next step is to create a username and password by clicking Sign Up.
- The applicant may log in to the account after creating a username and password
- Once logged in, the I am applying for section will display a dropdown list from which FCRA Registration must be selected. Following that, Apply Online must be chosen, followed by Proceed Registration.
- To begin the new registration procedure, click on the FC-3 menu in the title bar.
- This leads to the association form, which requires the appropriate information as well as the following documents:
- Darpan ID (not mandatory)
- Association Address
- Registration Number
- Registration Date
- Nature of the Association
- Main object of the Association
- The Executive Committee option must then be selected and filled out from the menu bar before clicking the Save button.
- Then Bank information must be provided.
- Following which all essential documents must be submitted in PDF format.
- The location and date must be input next, followed by the final submission button.
- The last step is to make an online payment.
Pre-Requisites for Registration under the FCRA
The ‘person’ or ‘entity’ who submits an application for registration or prior permission-
- Is not fictitious or benami
- And has not been tried or convicted for engaging in actions aimed at converting people from one religious faith to another through persuasion or force, either directly or indirectly;
- Has not been charged or convicted of inciting communal strife or disharmony in any designated district or elsewhere in the country;
- Has not been found guilty of diverting or squandering funds;
- Is not engaged in or likely to engage in the promotion of sedition or the use of violent measures to attain its goals;
- Is unlikely to use or redirect the foreign donation for personal advantage;
- Has not violated any of the Act’s provisions;
- Has not been barred from taking foreign contributions; The person, being an individual, has not been convicted under any legislation currently in force, nor is any prosecution for any offence pending against him.
- Other than an individual, none of its directors or office bearers has been convicted under any law currently in existence, nor is any prosecution for any offence underway against him.