Foreign Contribution Regulation Act (FCRA)

Description

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Context: The Union Home Ministry has asked the Central Bureau of Investigation (CBI) to investigate Oxfam India for suspected violation of FCRA.

Details

According to the source, Oxfam continued to transfer foreign funds to different other businesses even after the Foreign Contribution (Regulation) Amendment Act of 2020, which bars such transfers, went into effect.
Oxfam India has filed a case in the Delhi High Court challenging the Ministry's decision not to renew its FCRA registration. According to Oxfam, it is entirely compliant with Indian legislation and has submitted all statutory compliances, including FCRA filings, on time from its establishment.

Must Read Articles:

Foreign Contribution Regulation Act (FCRA): https://iasgyan.in/daily-current-affairs/foreign-contribution-regulation-act-fcra-4

Oxfam India report “Survival of the Richest: The India story”: https://www.iasgyan.in/daily-current-affairs/oxfam-report-on-rich-poor-divide

PRACTICE QUESTION

Q. Consider the following Statement about the Foreign Contribution Regulation Act (FCRA);

1. The FCRA was enacted as part of the New Economic Policy (1991).

2. The FCRA regulates foreign contributions by individuals only.

3. A person who receives a foreign contribution must not use more than 50% of the contribution for meeting administrative expenses.

Which of the following Statement is/are incorrect?

(A) 1 and 2 only

(B) 2 and 3 only

(D) 1, 2 and 3

Answer: D

Explanation:

Statement 1 is incorrect: The FCRA was enacted in 1976 to regulate foreign money into the country through independent organizations.

Statement 2 is incorrect: The Foreign Contribution Regulation Act was amended by the Indian Parliament in 2010. To effectively regulate the foreign contribution by individuals or associations or companies.

Statement 3 is incorrect: A person who receives a foreign contribution must use it only for the purpose for which the contribution is received. They must not use more than 20% of the contribution for meeting administrative expenses (earlier it was 50%).