Foreign poll-funding won't be scrutinized as Lok Sabha passes bill
The Lok Sabha has passed a bill that exempts political parties from scrutiny of foreign funds they have received from abroad since 1976. Amid chaotic protests last Wednesday, the government managed to pass 21 amendments to the Finance Bill, 2018 without debate. One of this amendments pertained to the Foreign Contribution (Regulation) Act, 2010, that bans overseas corporations from funding political parties. Here's more.
What is the FCRA, 2010?
Representation of People's Act bars political parties from accepting foreign funds. Notably, FCRA, enacted in 1976, defined a company registered abroad or with subsidiaries abroad as a foreign firm. In 2016, BJP changed this definition saying a company with less than 50% of share capital held by a foreign entity will not be considered a foreign source. This came into effect retrospectively from September'10.
Why is the latest amendment significant?
Earlier, foreign funds received before 2010 were open to scrutiny. With the amendment now, no foreign funding since 1976 will be scrutinized. Interestingly, this retrospective amendment will benefit both BJP and Congress to escape the consequences of the 2014 Delhi HC judgment holding them guilty of violating the FCRA.
