The cabinet recently approved a bill to amend FCRA 2010. As of 26 March 2026, the Foreign Contribution (Regulation) Amendment Bill, 2026 is shown as introduced in Lok Sabha on 25 March 2026 and pending. It is not yet operative law; the Bill itself says it will come into force only from the date the Central Government appoints by notification, and different dates may be notified for different provisions.

The following are the major implications of the proposed amendment for the NGO sector:

  1. Renewal failure becomes far more dangerous. The Bill introduces “cessation” of certificate where renewal is not applied for, is refused, or is not completed before expiry. Once the certificate has ceased, the organisation cannot receive or utilise foreign contribution unless renewal happens.
  2. Cessation is treated almost on par with cancellation/surrender for asset-control purposes. The Bill proposes that foreign contribution and assets created out of foreign contribution will provisionally vest in a Designated authority not only on cancellation or surrender, but also on cessation.
  3. Mixed-funded assets are a major danger zone. Even where an asset was created partly from foreign contribution and partly from other sources, the asset will vest wholly in the Designated authority, though the organisation may apply for return of a distinct and ascertainable non-FCRA portion.
  4. If registration is not restored in time, permanent vesting follows. If the organisation does not obtain a fresh certificate, renewal, or restoration within the prescribed period, the foreign contribution and assets created out of it will stand permanently vested in the Designated authority.
  5. After permanent vesting, assets may be transferred or sold. The Designated authority may transfer such assets to government bodies or dispose of them, and sale proceeds together with unutilised foreign contribution may be credited to the Consolidated Fund of India. The original entity and its key functionaries are barred from directly or indirectly acquiring an interest in such assets.
  6. Limited protection for places of worship. Where a permanently vested asset is a place of worship, the Designated authority must entrust its management/operation in the prescribed manner and ensure that its religious character is maintained. That is protection of religious character, not automatic restoration to the same body.
  7. Older vested assets and defunct entities are also covered. The Bill says even assets already vested under the old section 15 framework will be deemed provisionally vested in the Designated authority under the new regime, and where an entity ceases to exist or becomes inoperative/defunct, its FCRA funds and FCRA-created assets will stand permanently vested.
  8. Suspension stage itself becomes tighter. During suspension, the organisation cannot alienate, encumber, or otherwise deal with any asset created out of foreign contribution except with prior approval of the Central Government.
  9. Trustees, governing body members, directors, office bearers and similar persons are explicitly brought under the “key functionary” net. The Bill also makes offences by entities directly attach to key functionaries, subject to the usual defence of lack of knowledge or due diligence.
  10. The Designated authority gets broad operational powers. Persons whose funds/assets are vested must provide access to books, records, premises, keys, bank accounts, lockers and safe deposits, and must comply with supervision directions.
  11. Penalty/investigation mechanics are being recast. The substituted section 35 provides imprisonment up to one year or fine or both for contravention involving acceptance/utilisation/assistance, and no investigation for an offence under the Act may be initiated without prior approval of the Central Government.
  12. Many operational details are still left to future rules. The Bill expressly leaves several crucial matters to rules: time for receipt/utilisation under prior permission, manner of vesting, restoration timelines, disposal process, reporting, exemptions, appeal limits, and entrustment of places of worship.