FCRA Norms Revised: Enhanced Financial Compliance, News Content Barred

The Ministry of Home Affairs (MHA) issued the Foreign Contribution (Regulation) Amendment Rules, 2025, on May 26, 2025, amending the Foreign Contribution (Regulation) Rules, 2011. Changes have been introduced to Forms FC-3A, FC-3B, FC-3C, FC-4, FC-6A, FC-6B, FC-6C, FC-6D, FC-6E, and pro forma ‘AA’ to include the submission of additional documents or information while seeking registration, prior permission, or renewal. Detailed financial statements and audit reports, adherence to FATF guidelines, a ‘not a newspaper’ certificate, commitment letters from donors, etc., are the major changes introduced.

Here are the highlights of the amendment rules:

• Entities seeking registration are additionally required to submit:
  • Financial statements and audit reports for the preceding three financial years. If the statements do not contain activity-wise expenditure, a chartered accountant’s statement in a specified format may be provided.
  • Year-wise activity report and affidavit in pro forma AA for each stated person.
  • For entities engaged in publication-related activities, an undertaking would be required from the chief functionary regarding compliance with the relevant FCRA norms.
  • Entities’ publications registered with the Registrar of Newspaper for India (RNI) are required to obtain a “Not a Newspaper” certificate.
  • Previously registered associations must submit an affidavit regarding receipt and utilisation of foreign contributions after expiry or cancellation of the registration certificate and the connected bank account statement, duly certified.
  • If the expenditure on aims and objects is less than 15 lakhs in the last three financial years, an affidavit regarding the inclusion of capital investments shall also be submitted.
• Applicants seeking prior permission are additionally required to submit:
  • Commitment letter from the donor with matching amount.
  • Project report including a detailed breakup of proposed expenses and a declaration that administrative expenses shall not exceed 20%. The percentage of administrative expenses was reduced from 50% to 20% in 2020. A declaration has now been mandated.
  • Letter from the chief functionary providing point-wise details in respect of the prior permission guidelines.
  • Undertaking to adhere to the Good Practice Guidelines of the Financial Action Task Force (FATF)
• Applicants seeking renewal are additionally required to submit:
  • Affidavit in pro forma AA for each stated person.
  • Affidavit regarding receipt and utilisation of foreign contribution after expiry or cancellation of registration certificate and the connected bank account statement, duly certified.
• For intimating name, objectives, or bank-related changes, copies of approval from the relevant authority or a letter from the bank along with the resolution of the governing body must be submitted.

The MHA has been actively pursuing the issue of foreign interference in internal affairs through the regulation of foreign tie-ups and funding. The current amendments follow another significant notice issued last month in April, when the validity period for receiving foreign funding with prior permission was curtailed to three years from the date of approval and the utilization period was set at four years. Similarly, a notification in January reiterated that foreign contributions must be used solely for their intended purpose. Some administrative changes were also made through amendments in December 2024.