MHA revokes Sonam Wangchuk’s NGO’s FCRA license - What is it and when can it be cancelled?

The Ministry of Home Affairs (MHA) on Thursday (Sep 25) cancelled the FCRA license of climate activist Sonam Wangchuk’s organisation. This decision came a day after four people were killed in police firing during protests in Leh, where protesters are demanding for statehood. The ministry said Wangchuk’s “provocative statements” had triggered the violence. Back in July this year, the CBI had begun a preliminary probe into alleged violations of the Foreign Contribution Regulation Act (FCRA) by Wangchuk’s NGO, the Students Educational and Cultural Movement of Ladakh (SECMOL).

What is the FCRA?

The FCRA was first introduced in 1976, during the Emergency, to stop foreign powers from influencing India’s internal matters by funding different organisations. Concerns about such interference were raised even earlier in Parliament in 1969.

In 2010, the UPA government replaced the old law with a new version to regulate the use of foreign donations and prevent their misuse of these donations against national interests. Later, the BJP government amended it again in 2020, giving the Centre more powers to monitor and control the flow of foreign funds to NGOs.

Under the FCRA, any person or NGO that wants to receive foreign donations must:

• Register under the Act
• Open a bank account at the State Bank of India in Delhi for these funds
• Use the money only for the stated purpose and as per the rules of the Act
• They must also file annual reports and cannot transfer these funds to another NGO

In 2022, the rules were further updated by the government. The list of compoundable offences (those that can be settled with penalties) was expanded from 7 to 12. Families receiving contributions under Rs 10 lakh from relatives abroad no longer need to inform the government.

Another change allowed individuals and organisations usually barred under the FCRA, like political parties or election candidates, to receive money from relatives abroad. They will not face prosecution if they fail to report it within 90 days, but they must pay 5 per cent of the total amount they received.

When can an FCRA license be cancelled?

The government can cancel an NGO’s FCRA license if -

• The registration application contains false information
• The NGO violates any conditions of the certificate
• The NGO has not done meaningful social work for two years in a row
• It becomes inactive or defunct

It can also be cancelled when an audit finds irregularities in the finances of an NGO in terms of misuse of foreign funds.