MHA Amends Foreign Contribution Rules & Forms: NGOs Must Disclose Assets

In a significant development, the Ministry of Home Affairs (MHA) has introduced amendments to the Foreign Contribution (Regulation) Rules. These amendments, effective from the date of their publication in the Official Gazette, require Non-Governmental Organizations (NGOs) to provide detailed information about the movable and immovable assets generated from foreign contributions as of March 31st of each financial year.

1. Short Title and Commencement: The amended rules are titled the “Foreign Contribution (Regulation) Amendment Rules, 2023” and are in force from the date of their publication in the Official Gazette.

2. Amendments to Form FC-4: Form FC-4, used for reporting foreign contributions, has been updated to include two critical sections:

(ba) Details of Movable Assets Created out of Foreign Contribution:

• This section requires NGOs to provide details of movable assets, including a description of the assets, their value at the beginning of the financial year, the value of assets acquired during the financial year, the value of assets disposed of during the financial year, and the value as per the balance sheet at the end of the financial year.

(bb) Details of Immovable Properties Acquired out of Foreign Contribution:

• This section mandates the disclosure of information regarding immovable assets, such as land and buildings. NGOs are required to provide details of the asset, its size, complete address (location), and its value as per the balance sheet.

These amendments aim to enhance transparency and accountability in the utilization of foreign contributions by NGOs.

Conclusion: The Ministry of Home Affairs’ amendments to the Foreign Contribution (Regulation) Rules mark a significant step towards greater transparency and accountability in the utilization of foreign contributions by NGOs. By requiring NGOs to disclose details of movable and immovable assets created from foreign contributions, the government aims to ensure that such contributions are used for their intended purposes and in compliance with the law.

NGOs operating in India must be diligent in adhering to these amended rules, ensuring accurate and timely reporting of asset details. Failure to comply with these regulations may result in legal consequences. These amendments reinforce the government’s commitment to maintaining oversight over foreign contributions and ensuring they benefit the intended beneficiaries and projects.

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MINISTRY OF HOME AFFAIRS
NOTIFICATION
New Delhi, the 22nd September, 2023

G.S.R. 683(E).—In exercise of the powers conferred by section 48 of the Foreign Contribution (Regulation) Act, 2010 (42 of 2010), the Central Government hereby makes the following rules further to amend the Foreign Contribution (Regulation) Rules, 2011, namely:-

1. Short title and commencement. — (1) These rules may be called the Foreign Contribution (Regulation) Amendment Rules, 2023.

(2) They shall come into force on the date of their publication in the Official Gazette.

2. In the Foreign Contribution (Regulation) Rules, 2011, in Form FC-4, in serial number 3, after clause (b), the following shall be inserted, namely:—

“(ba) Details of movable assets created out of foreign Contribution (as on 31st March of Financial Year):

(bb) Details of immovable properties acquired out of foreign contribution (as on 31st March of Financial Year):

[F. No. II/21022/23(12)/2020-FCRA-III]

K. SANJAYAN, Director (FCRA)

Note: The principal rules were published in the Gazette of India, Extraordinary, Part II, Section 3, Sub-section (i), vide notification number G.S.R. 349(E), dated the 29^th April, 2011 and subsequently amended, vide G.S.R. 292 (E), dated the 12th April, 2012, G.S.R. 966 (E), dated the 14th December, 2015, G.S.R. 199 (E), dated the 7th March, 2019, G.S.R. 659 (E), dated the 16th September, 2019, G.S.R. 695(E), dated the 10th November, 2020 and a Corrigendum vide G.S.R. 17(E), dated the 11^th January, 2021, and G.S.R. 506(E), dated the 1st July, 2022.