Establishment of Liaison/Branch/Project Offices in India by Foreign Entities
The Reserve Bank of India (RBI) has outlined the guidelines for foreign entities to establish liaison, branch, or project offices in India.
General Criteria: Foreign entities can establish offices in India through either the Reserve Bank route or the Government route, depending on the nature of their business. A good track record is essential for approval.
Liaison Office: A liaison office can undertake only liaison activities, such as representing the parent company, promoting exports, and providing technical support.
Branch Office: A branch office can engage in commercial activities, such as manufacturing, trading, or providing services.
Additional Activities/Branch/Liaison Offices: Foreign entities must apply to the RBI for undertaking additional activities or opening additional offices.
Reporting Requirements: Branch and liaison offices must submit regular reports to the RBI, including annual audited accounts and a certificate from a chartered accountant.
Closure of Offices: Foreign entities must obtain RBI approval before closing their offices in India.
Project Office: A project office can be established for a specific project, and it must submit regular reports to the RBI. It can also open a foreign currency account.
Other Conditions: Foreign entities must comply with various other conditions, including obtaining necessary registrations, filing tax returns, and maintaining proper accounts.
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Download: Master Circular on Establishment of Liaison / Branch / Project Offices in India by Foreign Entities