Branch Office in India
A branch office setup is most appropriate for person resident outside India who wants to extend their head office business in India also or wants to setup a temporary business in India. Most of the foreign companies use this type of business organisation to discover Indian market without having any long-term commitment.
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Eligibility
A person resident outside India can setup a branch office in India subject to the conditions of profit track record during the immediately preceding five financial years in the home country with net worth of not less than USD 100,000 or its equivalent.
Provided that a person resident outside India who is not financially sound and are subsidiaries of other companies may file a Letter of Comfort from their holding company but the holding company satisfies the prescribed criteria of net worth and profit.
Permissible activities
A person resident outside India permitted by the RBI to establish a branch office in India may undertake or carry on any below specified activity:
- Rendering professional or consultancy services.
- Rendering services in Information Technology and development of software in India.
- Rendering technical support to the products supplied by parent/group companies.
- Export/import of goods.
- Promoting technical or financial collaborations between Indian companies and parent or overseas group company.
- Carrying out research work in which the parent company is engaged.
- Representing the parent company in India and acting as buying/ selling agent in India.
- Representing a foreign airline/shipping company.
Not Permissible activities
- Retail trading activities of any item is not allowed for a Branch Office in India.
- A Branch Office is not allowed to carry out manufacturing or processing activities in India.
List of Documents Required
- Copy of the Certificate of Incorporation; Memorandum of Association (MOA) and Articles of Association (AOA) attested by the Notary Public in the country of registration. [If the Certificate is in a language other than in English, the same must be translated into English and notarized as above and cross verified/attested by the Indian Embassy/ Consulate in the home country]
- Certified copy of the financials for last five years. [If the applicants’ home country laws do mandate auditing of accounts, an Account Statement certified by a CPA or any Registered Accounts Practitioner, disclosing the net worth may be submitted]
- Certified copy of Certificate of net worth & Profits for last 5 (five) five years
- Bankers' Report from the applicant’s bank in the host country showing the number of years since when the applicant has had banking relations with that bank.
- Board Resolution of parent company for approval of opening of Branch office in India
- Notarised copy of Board Resolution in favour of Mr/Ms/Miss, local Representative to sign & execute all the documents required for this purpose
- Notarised Identity & Address proofs of the person signing documents on behalf of parent company;
- Notarised Identity & Address proofs of the Authorised Representative;
- Notarised Identity & Address proofs of Directors of the parent company;
Process
- 1
A person resident outside India wants to setup a branch office shall submit an application in Form FNC to an Authorised Dealer Category-I bank.
- 2
Every foreign company shall, within 30 days of establishment of its branch office in India submit the Form-FC-1 to ROC.
Deliverable
- RBI approval letter
- Certificate of incorporation
- Company PAN card
- Company TAN number
India Entry Services
| Particulars | Company/LLP | Branch Office | Project Office | Liaison Office |
|---|---|---|---|---|
| Eligibility | No Criteria | Profit track record of 5 FY and net worth of USD 100,000 or more | No Criteria | Profit track record of 3 FY and net worth of USD 50,000 or more |
| Approval | ROC | RBI and ROC | RBI and ROC | RBI and ROC |
| Purpose/Activities | Commercial, trading, or industrial activities in India | Commercial, trading, or industrial activities in India except retail trading & manufacturing | To Execute a particular project in India | Representing, Promotion and communication |
| Sources of Funds | Capital and Profits | Head office and internally generated funds | Head office and internally generated funds | 100% from head office |
| Tax Rate | 15%-30% | 40% | 40% | Not Applicable |
| Minimum No. of Director/AR | 2 | 1 | 1 | 1 |
| Minimum No. of Director resident in India | 1 | 1 | 1 | 1 |
| Timelines | 7-10 Days | 3-4 Months | 3-4 Months | 3-4 Months |
| Know More | Know More | Know More | Know More |
