The government has introduced several new provisions, including suspension and cancellation of registration of NGOs for rule violations, in the Foreign Contribution Regulation Act (FCRA), 2010.

The new provisions came into effect from last month.

Under the new provisions, no person who receives foreign contribution as per provisions of this Act, shall transfer the same to another person unless that person is also authorised to receive foreign contribution as per rules made by the central government.

The foreign contribution shall be utilised for the purpose for which it has been received, and such contribution can be used for administrative expenses up to 50 per cent of such contribution received in a financial year.

However, administrative expenses exceeding fifty per cent of the contribution have to be defrayed with the prior approval of the central government.

Suspension as well as cancellation of registration of NGOs for violation of the provisions of the Act, is among the new guidelines.

Another new provision relates to the management of foreign contribution and assets created out of such contribution of persons whose certificates have been cancelled.

While the provisions of the repealed FCRA, 1976 have generally been retained, the FCRA, 2010 is an improvement over the repealed Act, as more stringent provisions have been made in order to prevent misutilisation of the foreign contribution received by the associations.