Claim: Law that regulates funding of political parties was made by the Congress & we have not altered even a ‘comma or a full stop’ in that.
Fact: False. The very way in which a foreign company is defined was changed in The Finance Act, 2016 amendment.
Explanation: The Foreign Contribution Regulation Act, 2010 (FCRA) defines a foreign company in the following way: Basically, a company that is a multi-national or has subsidiaries in other countries will be considered as a foreign company. These companies were not allowed to make donations to political parties.
The Finance Act, 2016 had an amendment to FCRA. It changes the very definition of what will be considered as a ‘foreign company’. According to this, a company which has less than 50% share capital with a foreign entity will not be considered as a foreign source anymore.