What changed
RBI issued a circular on January 5, 2005, referencing a Ministry of Home Affairs order of December 30, 2004, exempting associations from Section 6(1-A) of the FCRA, 1976, for tsunami relief. Previously, prior government permission was mandatory for receiving foreign contributions. Now, associations can accept such funds without prior approval, subject to specific conditions.
What it means for you
UCBs must facilitate opening of dedicated 'Tsunami Relief Accounts' for associations receiving foreign contributions for tsunami relief. Banks need to verify compliance with conditions like timely submission of Form FC-IA and FC-3/FC-6. This is a temporary relaxation to expedite relief, but banks remain responsible for ensuring proper documentation and reporting.
What you must do
- Instruct branches to allow associations to open 'Tsunami Relief Accounts' for foreign contributions without prior FCRA approval.
- Ensure associations submit Form FC-IA to MHA within one week of account opening.
- Monitor that associations maintain separate accounts and records for tsunami relief funds.
- Advise branches to acknowledge receipt of this circular to the concerned RBI Regional Office.
Who it affects
Primary (Urban) Co-operative Banks, Associations with cultural, economic, educational, religious, or social programmes (excluding political parties), Branches handling foreign contribution accounts
What is the deadline for this FCRA exemption?
The exemption is effective immediately from the date of the MHA order (December 30, 2004) and remains valid until March 31, 2005.